Document:

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                                                                    Exhibit 10.1

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                          AGREEMENT AND PLAN OF MERGER

                                  BY AND AMONG

                                    TEKELEC,

                             LUKE ACQUISITION CORP.,

                  CERTAIN STOCKHOLDERS OF SANTERA SYSTEMS INC.,

                            SANTERA SYSTEMS INC. AND

                 AUSTIN VENTURES VI, L.P., AS THE REPRESENTATIVE

                              DATED APRIL 30, 2003

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                                TABLE OF CONTENTS
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ARTICLE I DEFINITIONS.....................................................................................     2

ARTICLE II MERGER; CLOSING................................................................................    10
    2.1     Merger and Effect of Merger...................................................................    10
    2.2     Method of Effecting Merger; Closing...........................................................    10
    2.3     Tekelec Contributions to Merger Sub; Conversion of Merger Sub Capital Stock...................    11
    2.4     Contributions to Santera; Conversion of Santera Capital Stock.................................    13
    2.5     Dissenters' Rights............................................................................    14
    2.6     Treatment of Options and Warrants.............................................................    14
    2.7     Deliveries....................................................................................    15
    2.8     Certificate of Incorporation and Bylaws.......................................................    17
    2.9     Directors and Officers of the Surviving Corporation...........................................    17

ARTICLE III REPRESENTATIONS AND WARRANTIES OF TEKELEC.....................................................    17
    3.1     Corporate Existence and Power; Consents, Etc..................................................    17
    3.2     Valid and Enforceable Agreement; Authorization................................................    18
    3.3     Absence of Certain Developments with Respect to the Business..................................    18
    3.4     Undisclosed Liabilities.......................................................................    19
    3.5     Taxes.........................................................................................    19
    3.6     Accounts Receivable; Inventory................................................................    20
    3.7     No Breach of Law or Governing Document........................................................    21
    3.8     Litigation....................................................................................    21
    3.9     Assets........................................................................................    21
    3.10    Necessary Property and Transfer of Contributed Assets.........................................    22
    3.11    Use and Condition of Property.................................................................    22
    3.12    Licenses and Permits..........................................................................    22
    3.13    Contracts.....................................................................................    22
    3.14    Tekelec Business Intellectual Property........................................................    23
    3.15    Employees and Consultants.....................................................................    25
    3.16    Transactions with Related Persons.............................................................    25
    3.17    Labor Matters.................................................................................    25
    3.18    Employee Benefit Matters......................................................................    26
    3.19    Discrimination and Occupational Safety and Health.............................................    26
    3.20    Product and Service Warranties................................................................    27
    3.21    Product and Service Liability Claims..........................................................    27
    3.22    Foreign Assets and Operations.................................................................    27
    3.23    Brokers, Finders..............................................................................    28
    3.24    Environmental Matters.........................................................................    28
    3.25    Investment Representations....................................................................    28
    3.26    Customers.....................................................................................    28
    3.27    Tekelec SEC Reports...........................................................................    29
    3.28    Absence of Certain Changes with Respect to Tekelec Generally..................................    29
    3.29    Complete Disclosure...........................................................................    29

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SANTERA......................................................    29
    4.1     Corporate Existence and Power.................................................................    29
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    4.2     Valid and Enforceable Agreement; Authorization................................................    31
    4.3     Financial Statements..........................................................................    32
    4.4     Absence of Certain Developments...............................................................    32
    4.5     Undisclosed Liabilities.......................................................................    32
    4.6     Taxes.........................................................................................    33
    4.7     Accounts Receivable; Inventory................................................................    35
    4.8     No Breach of Law or Governing Document........................................................    35
    4.9     Litigation....................................................................................    35
    4.10    Assets........................................................................................    35
    4.11    Real and Personal Property Leased.............................................................    36
    4.12    Necessary Property............................................................................    36
    4.13    Use and Condition of Property.................................................................    36
    4.14    Licenses and Permits..........................................................................    36
    4.15    Contracts.....................................................................................    37
    4.16    Santera Business Intellectual Property........................................................    37
    4.17    Insurance.....................................................................................    39
    4.18    Employees and Consultants.....................................................................    39
    4.19    Transactions with Related Persons.............................................................    39
    4.20    Labor Matters.................................................................................    39
    4.21    Employee Benefit Matters......................................................................    40
    4.22    Discrimination and Occupational Safety and Health.............................................    41
    4.23    Product and Service Warranties................................................................    41
    4.24    Product and Service Liability Claims..........................................................    41
    4.25    Customers.....................................................................................    42
    4.26    Foreign Assets and Operations.................................................................    42
    4.27    Rights, Options, Warrants and Similar Agreements..............................................    42
    4.28    Stockholders and Related Matters..............................................................    43
    4.29    Environmental Matters.........................................................................    44
    4.30    Management Rights.............................................................................    44
    4.31    Investment Representations....................................................................    44
    4.32    Brokers, Finders..............................................................................    44
    4.33    Representations and Warranties under the Note and Preferred Stock Purchase Agreement..........    45
    4.34    Complete Disclosure...........................................................................    45

ARTICLE V REPRESENTATIONS AND WARRANTIES OF LEGACY SANTERA STOCKHOLDERS...................................    45
    5.1     General.......................................................................................    45
    5.2     Brokers, Finders..............................................................................    46
    5.3     Litigation....................................................................................    46
    5.4     Investment Representations....................................................................    46
    5.5     Consultation..................................................................................    47

ARTICLE VI ACTIONS PRIOR TO CLOSING DATE..................................................................    47
    6.1     Consents of Certain Third Parties; Governmental Approvals.....................................    48
    6.2     Approval of Merger and Other Matters..........................................................    48
    6.3     Operations of Tekelec Prior to the Closing Date...............................................    49
    6.4     Operations of Santera Prior to the Closing Date...............................................    50
    6.5     Access to Records.............................................................................    52
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    6.6     Governmental Filings..........................................................................    52
    6.7     Notification of Certain Matters...............................................................    52
    6.8     No Solicitation...............................................................................    53
    6.9     All Necessary Action..........................................................................    53

ARTICLE VII ADDITIONAL AGREEMENTS.........................................................................    53
    7.1     Public Announcements..........................................................................    54
    7.2     Tax Matters...................................................................................    54
    7.3     Employee Matters..............................................................................    55
    7.4     Further Assurances............................................................................    55
    7.5     Access to Records.............................................................................    56
    7.6     Audited Financial Statements..................................................................    56

ARTICLE VIII CONDITIONS TO THE OBLIGATIONS OF ALL OF THE PARTIES..........................................    56
    8.1     HSR and Necessary Governmental Approvals......................................................    56
    8.2     No Adverse Proceeding.........................................................................    56
    8.3     Stockholder Approval..........................................................................    56

ARTICLE IX CONDITIONS TO THE OBLIGATIONS OF TEKELEC.......................................................    57
    9.1     Performance of Obligations; Representations and Warranties....................................    57
    9.2     Material Adverse Change.......................................................................    57
    9.3     Necessary Consents and Notices................................................................    57
    9.4     Employment Matters............................................................................    57
    9.5     Effectiveness of Certain Documents............................................................    57
    9.6     Deliveries....................................................................................    58
    9.7     No Pending Lawsuits...........................................................................    58
    9.8     Certain Tax Effects...........................................................................    59

ARTICLE X CONDITIONS TO THE OBLIGATIONS OF THE LEGACY SANTERA STOCKHOLDERS AND SANTERA....................    59
    10.1    Performance of Obligations; Representations and Warranties....................................    59
    10.2    Material Adverse Change.......................................................................    59
    10.3    Necessary Consents and Notices................................................................    59
    10.4    Deliveries....................................................................................    60
    10.5    Effectiveness of Certain Documents............................................................    60

ARTICLE XI INDEMNIFICATION; ESCROW........................................................................    60
    11.1    Indemnification by Tekelec....................................................................    60
    11.2    Indemnification by the Surviving Corporation..................................................    61
    11.3    Notice of Claim...............................................................................    63
    11.4    Right to Contest Claims of Third Persons......................................................    64
    11.5    Survival of Representations, Warranties and Covenants.........................................    66
    11.6    Limitations on Indemnity......................................................................    67
    11.7    Setoff........................................................................................    68
    11.8    Exclusive Remedy..............................................................................    68
    11.9    Escrow........................................................................................    69
ARTICLE XII MISCELLANEOUS PROVISIONS......................................................................    69
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    12.1    Termination...................................................................................    69
    12.2    Notice of Termination; Effect of Termination..................................................    70
    12.3    Bulk Transfer Law.............................................................................    70
    12.4    Notices.......................................................................................    71
    12.5    Expenses......................................................................................    72
    12.6    Confidentiality Agreement.....................................................................    72
    12.7    Entire Agreement..............................................................................    72
    12.8    Amendment.....................................................................................    73
    12.9    Waiver........................................................................................    73
    12.10   Assignment....................................................................................    73
    12.11   Severability..................................................................................    73
    12.12   Counterparts..................................................................................    74
    12.13   Enforcement of this Agreement.................................................................    74
    12.14   Governing Law.................................................................................    74
    12.15   Interpretation; Negotiated Transaction........................................................    74
    12.16   Remedies Cumulative...........................................................................    74
    12.17   Submission to Jurisdiction; Waivers...........................................................    74
    12.18   Tekelec Sub...................................................................................    75
    12.19   Limitation on Claims Against the Legacy Santera Stockholders..................................    75
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                          AGREEMENT AND PLAN OF MERGER

          This Agreement and Plan of Merger (this "Agreement") is entered into
as of the 30th day of April, 2003, by and among Tekelec, a California
corporation ("Tekelec"), Luke Acquisition Corp., a Delaware corporation ("Merger
Sub"), Santera Systems Inc., a Delaware corporation ("Santera"), those
stockholders of Santera who execute this Agreement (together with such
additional parties that may become parties hereto as Legacy Santera Stockholders
after the date hereof, the "Legacy Santera Stockholders") and Austin Ventures
VI, L.P., a Delaware limited partnership, as the Representative, as defined
below.

                                    RECITALS

         A.       Tekelec, Merger Sub, Santera and the Legacy Santera
Stockholders desire to combine the operations of Tekelec's packet telephony
business unit ("PTBU") with the business operations of Santera, together with
additional cash infusions.

         B.       Prior to or at closing, certain Legacy Santera Stockholders
will contribute an aggregate of Twelve Million Dollars ($12,000,000) in cash to
Santera in exchange for a combination of convertible notes and Series D
Preferred Stock of Santera.

         C.       Prior to or at closing, Tekelec will, and will cause Tekelec
Sub to, contribute the PTBU (including specified liabilities) and Twenty-Eight
Million Dollars ($28,000,000) in cash to Merger Sub in exchange for an aggregate
of one hundred (100) shares of common stock of Merger Sub.

         D.       At closing, the parties will cause Merger Sub to merge with
and into Santera, with Santera being the surviving corporation of such merger
(the "Merger"), and, in connection with such merger and in exchange for one
hundred one (101) shares of common stock of Merger Sub, Tekelec and Tekelec Sub
will receive an aggregate of twenty-eight thousand (28,000) shares of Series B
Preferred Stock, $0.001 per share (the "Series B Preferred Stock"), of Santera,
thirty-eight thousand (38,000) shares of Series A Preferred Stock, $0.001 per
share (the "Series A Preferred Stock"), of Santera and one (1) share of Common
Stock, $0.001 per share (the "Common Stock"), of Santera, all on the terms and
subject to the conditions set forth herein.

         E.       In connection with the merger of Merger Sub with and into
Santera and in exchange for shares of Series A-2 Preferred Stock, Series B-2
Preferred Stock, Series C-2 Preferred Stock and Series D Preferred Stock of
Santera then outstanding, certain stockholders of Santera existing immediately
prior to the Merger will receive an aggregate of sixty-two thousand (62,000)
shares of Series A Preferred Stock of Santera, all on the terms and subject to
the conditions set forth herein.

         F.       As of the Closing Date, Tekelec will own thirty-eight percent
(38%) of the issued and outstanding shares of Series A Preferred Stock and all
of the issued and outstanding shares of Common Stock and Series B Preferred
Stock of Santera, and certain Santera stockholders will collectively own
sixty-two percent (62%) of the issued and outstanding shares of Series A
Preferred Stock.

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                                   AGREEMENTS

          Now, therefore, in consideration of the mutual promises and agreements
herein contained, Tekelec, Merger Sub, Santera, the Legacy Santera Stockholders
and the Representative agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

          The following words shall have the meaning given them in this Article
I:

          "Action" has the meaning set forth in Section 3.8.

          "Affiliate" means a person or entity that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, the person or entity referred to. In this definition,
"control" means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a person or entity,
whether through ownership of securities, by contract, or otherwise.

          "Agreement" has the meaning set forth in the first paragraph hereof.

          "Aggregate Santera Cash Contributions" means the aggregate amount of
cash contributed by Legacy Santera Stockholders to Santera pursuant to the Note
and Preferred Stock Purchase Agreement in exchange for a combination of
convertible promissory notes and shares of Series D Preferred Stock of Santera.

           "Ancillary Agreements" means the Bill of Sale, the Assignment and
Assumption Agreement, the Stockholders' Agreement, the License Agreement, the
Services Agreement, the Employment Agreements, the Escrow Agreement, the Note
and Preferred Stock Purchase Agreement, the Registration Rights Agreement, the
Powers of Attorney, the Exchange Agreement and such other assignment and
conveyance documents that are entered into in connection with the transactions
contemplated hereby.

          "Assignment and Assumption Agreement" means the Assignment and
Assumption Agreement between Merger Sub and Tekelec in substantially the form
attached hereto as Exhibit A.

          "Assumed Contracts" means only those Contracts of Tekelec listed on
Schedule 1.1A attached hereto and those other Contracts which are entered into
by Tekelec in the Ordinary Course between the date hereof and the Closing Date
and which are directly and exclusively related to the Business.

          "Assumed Liabilities" means only (i) those liabilities of Tekelec
described in Schedule 1.1B attached hereto that exist on the date hereof (to the
extent the same continue to exist on the Closing Date) and those liabilities of
Tekelec that arise between the date of Schedule 1.1B and the Closing Date in the
Ordinary Course (and which are not, except as specifically set forth on Schedule
1.1B (Special), materially greater than the historical amounts incurred for such
types of expenses as shown on Schedule 1.1B) and are of the same type as those
otherwise described on Schedule 1.1B and (ii) those obligations of Tekelec under
the Assumed Contracts (other than any liability or obligation for breaches
thereof prior to Closing) and (iii) those transaction expenses specified in
Section 12.5.

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          "Bill of Sale" means the Bill of Sale to be executed by Tekelec in
substantially the form attached hereto as Exhibit B.

          "Business" means the business of packet telephony, as such business is
conducted by Tekelec and its Affiliates from the date hereof through the Closing
Date.

          "Business Day" means any day of the week other than Saturday, Sunday
or any nationally observed United States holiday.

          "Bylaws" has the meaning set forth in Section 2.8.

          "Certificate of Amendment" means the Certificate of Amendment of
Santera, in substantially the form attached hereto as Exhibit C.

          "Certificate of Merger" means a Certificate of Merger in substantially
the form attached hereto as Exhibit D.

          "Closing" has the meaning set forth in Section 2.2(b).

          "Closing Date" has the meaning set forth in Section 2.2(b).

          "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended.

          "Code" means the Internal Revenue Code of 1986, as amended, and the
rules and regulations thereunder.

          "Contract" means any contract, agreement, lease, license, indenture,
mortgage, deed of trust, evidence of indebtedness, binding commitment or
instrument, open purchase order, written or oral, express or implied.

          "Contributed Assets" means all assets and property and associated
rights of Tekelec as of the Closing Date that are directly and exclusively used
by Tekelec in the Business, other than any Excluded Asset, and consisting solely
of the following to the extent used by Tekelec directly and exclusively in the
Business (except to the extent the same constitutes an Excluded Asset):

                  (a)      all of those assets that are specifically listed and
described on Schedule 1.1C;

                  (b)      all assets acquired by Tekelec between the date
hereof and the Closing Date but not disposed of;

                  (c)      all Tekelec Accounts Receivable;

                  (d)      all inventories of the Business owned by Tekelec,
including, but not limited to all raw materials, finished goods, component parts
and work in process existing on the Closing Date, and all inventory of the
Business which has been written down or written off as of the Closing Date;

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                  (e)      all rights, benefits and claims of Tekelec under the
Assumed Contracts;

                  (f)      all machinery, equipment, supplies and tools of
Tekelec;

                  (g)      all vehicles owned by Tekelec;

                  (h)      all Tekelec Business Intellectual Property set forth
on Schedule 1.1C (which schedule shall not include any of the Licensed Assets)
and documentation thereof and the right and power to assert, defend and recover
title thereto and the right to sue for and recover for past, present and future
infringement, misuse, misappropriation and other violation thereof, both in the
same manner and to the same extent as Tekelec could or could cause to be done if
the transactions contemplated hereby did not occur;

                  (i)      all permits, approvals, licenses and certifications
issued to Tekelec by a Governmental authority or by a private testing or
certifying authority that have been obtained by Tekelec for the direct and
exclusive benefit of the Business, to the extent assignable under the terms
thereof and applicable Law;

                  (j)      all records of Tekelec, including business, computer,
engineering and other records, and all associated documents, discs, tapes and
other storage and recordkeeping media related directly and exclusively to such
records, including but not limited to all sales data, customer lists, accounts,
bids, contracts, supplier records, personnel files and payroll records,
excluding, however, the tax records, litigation files and any records
exclusively related to Excluded Assets or Excluded Liabilities; and

                  (k)      all claims against others, rights, and choses in
action, liquidated or unliquidated, of Tekelec, including those arising under
insurance policies, but excluding, in any event, any such claims, rights or
choses in action to the extent that the same relate to Excluded Liabilities or
Excluded Assets.

         "Delaware Law" means the General Corporation Law of the State of
Delaware, as in effect on the Closing Date.

         "Department of Labor" means the United States Department of Labor.

         "Effective Time" has the meaning set forth in Section 2.2(a).

         "Employment Agreements" mean the Employment Agreements dated as of the
date hereof between Santera and the persons listed on Exhibit E attached hereto.

         "Environmental Law" means any Law relating to the protection of health
or the environment, including without limitation: the Clean Air Act, the Federal
Water Pollution Control Act, the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response, Compensation and Liability Act, the Toxic
Substance Control Act, any comparable state or foreign law, and the common law,
including the law of nuisance and strict liability.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.

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         "Escrow Agent" means JP Morgan Trust Company, National Association.

         "Escrow Agreement" means the Escrow Agreement dated as of the date
hereof among Tekelec, Santera, the Representative, the Legacy Santera
Stockholders, certain of the other stockholders of Santera and Escrow Agent,
which agreement is attached hereto as Exhibit F.

         "Exchange Agreement" means the Exchange Agreement dated as of the date
hereof among Santera and certain Santera stockholders, which agreement is
attached hereto as Exhibit G.

         "Excluded Assets" means (i) any cash or cash equivalents held by
Tekelec, (ii) all assets or property or property rights of Tekelec that are not
used directly and exclusively in the Business, including, without limitation,
the Licensed Assets and those other assets listed on Schedule 1.1D (Part 1),
(iii) all of those assets or property or property rights of Tekelec that are
used directly and exclusively in the Business and listed and described on
Schedule 1.1D (Part 2) and (iv) any confidential disclosures of Tekelec to its
attorneys, insurers, accountants or financial advisors in connection with the
transactions contemplated by this Agreement or the Ancillary Agreements.

         "Excluded Liabilities" has the meaning set forth in Section 2.3(a)(v).

         "Financial Statements" means the (a) audited balance sheets of Santera
as of December 31, 2001 and December 31, 2000, and the related audited
statements of earnings, stockholders' equity and cash flows for the years then
ended; (b) the unaudited balance sheet of Santera as of December 31, 2002 and
the related unaudited statements of earnings, stockholders' equity and cash
flows for the twelve months then ended; (c) the unaudited balance sheet of
Santera as of March 31, 2003 (the "Most Recent Balance Sheet") and the related
unaudited statements of earnings, stockholders' equity and cash flows for the
three months then ended; and (d) together, as to all the foregoing, with any
notes or schedules thereto.

         "Government" means the United States of America, any other nation or
state, the European Economic Community, the European Union, any federal,
bilateral or multilateral governmental authority, any state, any possession, any
territory, any local, county, district, city or other governmental unit or
subdivision, and any branch, entity, agency, or judicial body of any of the
foregoing.

         "HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.

         "Indemnified Losses" has the meaning set forth in Section 11.1.

         "Intellectual Property" means patents and patent applications
(including, but not limited to, continuations, continuations-in-part,
provisionals, divisionals, reexaminations, reissues, foreign counterparts, and
the like); trademarks, service marks, trade names, brand names, logos and
corporate names, registrations thereof and applications therefor; copyrights and
registrations thereof and applications therefor, and works of authorship,
including derivative works, within the meaning of the United States Copyright
Act, 17 U.S.C. Sections 101 et seq.; trade secrets and know-how; shop rights;
inventions, discoveries, domain names, ideas, developments, concepts,
information, data, processes, techniques, methods, formulae, designs, software,
firmware, programs, databases, algorithms, mask works, prospect lists, customer
lists, projections analyses, and market studies; and any other intellectual
property rights anywhere in the world; all modifications, renewals, extensions

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and reissues of any thereof,  all common law,  statutory,  treaty and convention
rights with respect to any thereof; all property rights, moral rights, ownership
and other proprietary rights in any thereof;  and all worldwide forms of
protection and rights in, to and under all of the foregoing.

         "IRS" means the United States Internal Revenue Service.

         "Knowledge" means the current, actual knowledge of a particular fact,
after reasonable inquiry. A reference to "Tekelec's Knowledge" or "to the
Knowledge of Tekelec" (or words of similar import) shall be limited to the
current, actual knowledge of the following individuals, after reasonable
inquiry: Frederick M. Lax, Paul Miller, Paul J. Pucino, Ronald W. Buckly and
Danny Parker. A reference to "Santera's Knowledge" or "to the Knowledge of
Santera" (or words of similar import) shall be limited to the current, actual
knowledge of the following individuals, after reasonable inquiry: David Heard,
James Orlando, Scott Weidenfeller, Greg Greco and Dave Peters.

         "Law" means any statute, law, ordinance, decree, order, injunction,
rule, directive, or regulation of any Government or quasi-governmental
authority, and includes rules and regulations of any regulatory or
self-regulatory authority compliance with which is required by Law.

         "Legacy Santera Stockholders" has the meaning set forth in the
introduction hereto.

         "Liabilities" means liabilities and/or obligations, whether or not
required to be reflected on the financial statements of a company.

         "License Agreement" means a License Agreement between the Surviving
Corporation and Tekelec pursuant to which Tekelec will grant the Surviving
Corporation a license to use the Licensed Assets on the terms set forth therein,
which License Agreement is in the form attached hereto as Exhibit H.

         "Licensed Assets" means all of the Intellectual Property that will be
licensed to Santera pursuant to the License Agreement.

         "Lien" means any lien, security interest, mortgage, indenture, deed of
trust, pledge, charge, adverse claim, restriction or other encumbrance.

         "Losses" has the meaning set forth in Section 11.1.

         "Material Adverse Change" and "Material Adverse Effect" means any
change, event or effect that is or could reasonably be expected to be materially
adverse to the business, operations, assets, liabilities, employee
relationships, earnings or results of operations, or the business prospects or
condition (financial or otherwise), of Santera or the Business, as the case may
be, but shall not be deemed to include any adverse change, event or effect to
the extent resulting from (i) general economic conditions, (ii) war or terrorist
activities, (iii) changes in foreign currency exchange rates, (iv) regulatory
events, (v) matters (including economic matters) that affect the industry in
which Santera or the Business, as the case may be, operates generally, (vi) the
fact that Santera's cash reserves are continuing to be depleted in connection
with the financing of the operations of Santera in the Ordinary Course or (vii)
the announcement or pendency of the transactions contemplated by this Agreement.

         "Material Santera Contract" has the meaning set forth in Section
4.15(a).

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         "Material Tekelec Contract" has the meaning set forth in Section
3.13(a).

         "Merger" has the meaning set forth in the recitals hereto.

         "Merger Sub" has the meaning set forth in the introduction hereto.

         "Most Recent Balance Sheet" has the meaning set forth in the definition
of "Financial Statements" above.

         "Note and Preferred Stock Purchase Agreement" means the Note and
Preferred Stock Purchase Agreement dated as of the date hereof among Santera and
certain Santera stockholders, which agreement is attached hereto as Exhibit I.

         "Order" means an order, writ, injunction, or decree of any court or
Government.

         "Ordinary Course" means, with respect to the Business or Santera, only
the ordinary course of commercial operations customarily engaged in by Tekelec
with respect to such Business or by Santera, as the case may be, and
specifically does not include (a) any activity (i) involving the purchase or
sale of the Business or Santera, as the case may be, or of any product line or
business unit of such Business or Santera, (ii) involving modification or
adoption of any Plan that affects the employees of Santera or the employees of
Tekelec's Business who are to be offered employment by Santera, as the case may
be, (iii) which requires approval or is approved by the board of directors or
shareholders of Tekelec or Santera, as the case may be, or (b) the incurrence of
any liability for any tort or any breach or violation of or default under any
Contract or Law.

         "Party" means any of Tekelec, Tekelec Sub, Merger Sub, Santera or the
Legacy Santera Stockholders, and "Parties" means all of them.

         "PBGC" means the Pension Benefit Guaranty Corporation.

         "Permitted Liens" means (a) Liens for Taxes not yet due and payable or
that are being contested in good faith by appropriate proceedings, (b) Liens in
favor of vendors, carriers, landlords, warehousemen, repairmen, mechanics,
workmen and materialmen and construction or similar Liens arising by operation
of law in the Ordinary Course in respect of obligations that are not yet due or
that are being contested in good faith by appropriate proceedings, (c) Liens
that, individually and in the aggregate, do not materially interfere with the
use of any property as currently used, but excluding any Liens for borrowed
money and (d) with respect to the Business, those Liens disclosed on Schedule
1.1E (Part 1) and, with respect to Santera, those Liens disclosed on Schedule
1.1E (Part 2).

         "Plan" means any agreement, arrangement, plan, or policy, whether or
not legally binding and whether or not written, that involves (a) any pension,
retirement, profit sharing, deferred compensation, bonus, stock option, stock
purchase, phantom stock, health, welfare, or incentive plan; or (b) welfare or
"fringe" benefits, including without limitation vacation, severance, disability,
medical, hospitalization, dental, life and other insurance, tuition, company
car, club dues, sick leave, maternity, paternity or family leave, or other
benefits; or (c) any employment, consulting, engagement, retainer or
compensation agreement or similar arrangement.

                                       7
<PAGE>

         "Powers of Attorney" means the Agreement and Irrevocable Powers of
Attorney executed by certain stockholders of Santera, which Agreement and
Irrevocable Powers of Attorney are in substantially the form attached hereto as
Exhibit J.

         "Recapitalization" means the approval by the requisite stockholders of
Santera of, and the filing with the Delaware Secretary of State and
effectiveness of, the Certificate of Amendment and the reclassification of
shares of capital stock of Santera pursuant thereto.

         "Registration Rights Agreement" means a Registration Rights Agreement
by and among Tekelec, Santera, certain stockholders of Santera and the
Representative, which agreement is in substantially the form attached hereto as
Exhibit K.

         "Releases" mean the Releases executed by certain stockholders of
Santera, which Releases are in substantially the form attached hereto as Exhibit
L.

         "Representative" means Austin Ventures VI, L.P., which has been
appointed the representative of the Legacy Santera Stockholders hereunder and
under all of the applicable Ancillary Agreements, pursuant to the terms of the
Escrow Agreement, or any successor appointed pursuant to the terms of the Escrow
Agreement.

         "Santera Accounts Receivable" has the meaning set forth in Section
4.7(a).

         "Santera Business Intellectual Property" means all Intellectual
Property that is used or held by Santera and all goodwill associated therewith.

         "Santera Business Intellectual Property Licenses" means all agreements
to which Santera is a party and that include a license of any Santera Business
Intellectual Property.

         "Santera Indemnified Persons" has the meaning set forth in Section
11.1.

         "Santera Indemnifying Person" has the meaning set forth in Section
11.4(a).

         "Second Amended and Restated Certificate of Incorporation" means the
Amended and Restated Certificate of Incorporation of Santera, in the form of
Exhibit M, which Amended and Restated Certificate of Incorporation shall be
attached as Annex A to the Certificate of Merger and shall become effective upon
the consummation of the Merger, as the same may be amended from time to time.

         "Series A-2 Conversion Factor" equals (i) one thousand, four hundred
fifty (1,450) divided by (ii) the aggregate number of shares of Series A-2
Preferred Stock of Santera issued and outstanding immediately prior to the
Effective Time.

         "Series B-2 Conversion Factor" equals (i) seven thousand three hundred
(7,300) divided by (ii) the aggregate number of shares of Series B-2 Preferred
Stock of Santera issued and outstanding immediately prior to the Effective Time.

         "Series C-2 Conversion Factor" equals (i) forty-one thousand, two
hundred fifty (41,250) divided by (ii) the aggregate number of shares of Series
C-2 Preferred Stock of Santera issued and outstanding immediately prior to the
Effective Time.

                                       8
<PAGE>

         "Series D Conversion Factor" equals (i) the Series D Share Number
divided by (ii) the aggregate number of shares of Series D Preferred Stock of
Santera issued and outstanding immediately prior to the Effective Time.

         "Series D Share Number" equals (i) the Aggregate Santera Cash
Contributions (in any event not greater than twelve million dollars
($12,000,000)) divided by (ii) one thousand dollars ($1,000.00).

         "Services Agreement" means a Services Agreement between the Surviving
Corporation and Tekelec in substantially the form attached hereto as Exhibit N;
prior to the Closing, the Services Agreement and schedules thereto shall have
been completed and shall be reasonably acceptable to Santera, Tekelec and the
Legacy Santera Stockholders..

         "Stockholders' Agreement" means that certain Stockholders' Agreement
dated as of the date hereof among Tekelec, Santera, the Legacy Santera
Stockholders and certain of the other stockholders of Santera, which agreement
is attached hereto as Exhibit O.

         "Stockholders' Consent" means the written consent of the stockholders
of Santera approving the Merger and the other transactions contemplated hereby
effective as of the date hereof.

         "Straddle Period" has the meaning set forth in Section 7.2(d).

         "Surviving Corporation" has the meaning set forth in Section 2.1(b).

         "Tax" or "Taxes" means all taxes, charges, fees, levies, or other like
assessments, including without limitation, all federal, possession, state, city,
county and foreign (or governmental unit, agency, or political subdivision of
any of the foregoing) income, profits, employment (including Social Security,
unemployment insurance and employee income tax withholding), franchise, gross
receipts, sales, use, transfer, stamp, occupation, property, capital, severance,
premium, windfall profits, customs, duties, ad valorem, value-added and excise
taxes; PBGC premiums and any other governmental charges of the same or similar
nature; and all penalties, additions to tax and interest relating to any such
amounts. Any one of the foregoing Taxes shall be referred to sometimes as a
"Tax."

         "Tax Returns" means all reports, estimates, information statements and
returns relating to or required by Law to be filed by a Party in connection with
any Taxes, including any attachment thereto, and including any amendment thereof
and all information returns (e.g., Form W 2, Form 1099) and reports relating to
Taxes and Taxes payable by, pursuant to or in connection with employee benefit
plans of such Party. Any one of the foregoing Tax Returns shall be referred to
sometimes as a "Tax Return."

         "Tekelec" means Tekelec, a California corporation and, to the extent of
the Contributed Assets held by Tekelec Sub, unless the context requires
otherwise, Tekelec Sub.

         "Tekelec Accounts Receivable" has the meaning set forth in Section
3.6(a).

         "Tekelec Business Intellectual Property" means (i) all Intellectual
Property of Tekelec set forth on Schedule 1.1C, which is the Intellectual
Property which is used directly and exclusively by

                                       9
<PAGE>

Tekelec in, or held by Tekelec for use directly and exclusively in, the
operation of the Business and (ii) all the Intellectual Property included in the
Licensed Assets.

         "Tekelec Business Intellectual Property Licenses" means all agreements
to which Tekelec is a party and that include a license of only Tekelec Business
Intellectual Property.

         "Tekelec Indemnified Person" has the meaning set forth in Section 11.2.

         "Tekelec Sub" means IEX Corporation, a Nevada corporation and direct
and wholly-owned subsidiary of Tekelec, which holds a portion of the Contributed
Assets.

         "Tekelec Transferred Employee" has the meaning set forth in Section
7.3(b).

         "Third Person" has the meaning set forth in Section 11.4.

         "Third Person Claim" has the meaning set forth in Section 11.4.

         "VEBA" means voluntary employees' beneficiary association.

                                   ARTICLE II
                                 MERGER; CLOSING

                  2.1      Merger and Effect of Merger.

                           (a)      The constituent corporations of the Merger
are Santera and Merger Sub.

                           (b)      Upon the terms and subject to the conditions
of this Agreement and in accordance with the Delaware Law, at the Effective
Time, Merger Sub shall be merged into Santera and the separate corporate
existence of Merger Sub thereupon shall cease. Santera shall be the surviving
corporation in the Merger (the "Surviving Corporation"), and the separate
corporate existence of Santera, with all its rights, privileges, powers and
franchises, shall continue unaffected and unimpaired by the Merger.

                           (c)      At and after the Effective Time, the
Surviving Corporation shall possess all of the rights, privileges, powers and
franchises and be subject to all the restrictions, disabilities and duties of
both Merger Sub and Santera, as provided more particularly in the Delaware Law.

                  2.2      Method of Effecting Merger; Closing. The Merger shall
be effected as follows:

                           (a)      Santera shall execute the Certificate of
Merger and shall cause the Certificate of Merger to be filed and recorded on the
Closing Date with the Secretary of State of Delaware in accordance with the
applicable provisions of the Delaware Law. The Merger shall thereupon become
effective and be consummated immediately upon such filing in accordance with the
Delaware Law (the "Effective Time").

                                       10
<PAGE>

                           (b)      The closing of the Merger and the
transactions contemplated hereby (the "Closing") shall take place at Bryan Cave
LLP, One Metropolitan Square, 211 North Broadway, Suite 3600, St. Louis,
Missouri 63102 at 9:00 a.m., local time, on June 6, 2003 or, if the conditions
to the obligations of the parties hereto are not then satisfied, as promptly as
practicable after the satisfaction or waiver of the conditions set forth in
Article VIII, Article IX and Article X, but in any event within four (4)
Business Days thereafter. The date on which the Closing occurs is referred to
herein as the "Closing Date." The Closing may take place and be effective on
such other date or at such other time or place as Tekelec, Santera and the
Representative may agree upon.

                  2.3      Tekelec Contributions to Merger Sub; Conversion of
Merger Sub Capital Stock.

                           (a)      Tekelec Contribution of Assets.

                                    (i)      Tekelec Assets. Immediately prior
         to the Effective Time, Tekelec will, and will cause Tekelec Sub to,
         contribute, convey, transfer, and assign all of Tekelec's or Tekelec
         Sub's right, title and interest in and to the Contributed Assets to
         Merger Sub.

                                    (ii)     Issuance of Merger Sub Capital
         Stock. In consideration of the contribution, conveyance, transfer and
         assignment of the Contributed Assets to Merger Sub immediately prior to
         the Effective Time, Merger Sub, in full payment for the Contributed
         Assets and the other rights of Merger Sub hereunder, agrees to assume
         the Assumed Liabilities and to issue to Tekelec (and/or to the extent
         directed by Tekelec, Tekelec Sub) fifty-eight (58) shares of common
         stock of Merger Sub.

                                    (iii)    Assumed Liabilities. Immediately
         prior to the Effective Time, Tekelec will assign and transfer to Merger
         Sub, and Merger Sub shall assume, only the Assumed Liabilities.

                                    (iv)     Consents. Notwithstanding Sections
         2.3(a)(i) and 2.3(a)(iii), if the assignment and transfer of any of the
         Contributed Assets and/or Assumed Liabilities, including without
         limitation the Assumed Contracts, would cause a breach thereof and if
         any required consent to such assignment and transfer has not been
         obtained from the third parties involved, then, without limiting the
         effect of any representations and warranties hereunder, such
         Contributed Assets, Assumed Liabilities and/or Assumed Contracts, shall
         not be assigned and transferred, but, instead, Tekelec shall continue
         to hold its interests in such Contributed Assets, Assumed Liabilities
         and/or Assumed Contracts in trust for the benefit of Merger Sub and
         Santera, shall receive in trust and remit as promptly as possible to
         Santera any money paid thereunder to Tekelec and shall cooperate in any
         reasonable arrangement or action requested by Santera to secure for
         Santera all benefits under such Contributed Assets, Assumed Liabilities
         and/or Assumed Contracts, provided, that Santera shall undertake to pay
         or satisfy the corresponding liabilities for the enjoyment of such
         benefits to the extent that Merger Sub or Santera would have been
         responsible therefor hereunder if such consent or approval had been
         obtained. In the event any such consent or approval is not obtained
         prior to the Closing Date, Tekelec shall use commercially reasonable
         efforts to obtain any such consent or approval after the Closing Date
         until such time as such consent or approval has been obtained or
         Santera otherwise agrees that Tekelec

                                       11
<PAGE>

         need not continue to attempt to receive such consent or approval. The
         Parties hereto agree that at and effective as of such time as any such
         required consent with respect to such Contributed Assets, Assumed
         Liabilities and/or Assumed Contracts shall be obtained, such
         Contributed Assets, Assumed Liabilities and/or Assumed Contracts shall
         forthwith be transferred and assigned to Santera, and all related
         obligations and liabilities of Tekelec and shall be simultaneously
         assumed by Santera hereunder, with each such assignment and assumption
         transaction subsequent to the Closing Date to be effected by the
         execution and delivery by Tekelec and Santera of an assignment and
         assumption agreement substantially in the form of the Assignment and
         Assumption Agreement.

                                    (v)      Excluded Liabilities. Except for
         Assumed Liabilities as expressly provided in Section 2.3(a)(iii) and as
         provided in Section 2.3(a)(iv), neither Merger Sub nor Santera shall
         assume or become liable for and neither Merger Sub nor Santera shall be
         obligated to pay or satisfy any obligation, debt or liability
         whatsoever, contingent or otherwise, of Tekelec with respect to its
         business or operations. The obligations and liabilities of Tekelec
         which are not Assumed Liabilities are hereinafter referred to as the
         "Excluded Liabilities." No statement in or provision of this Agreement
         or Ancillary Agreements, and no statement, written or oral, action, or
         failure to act, includes or constitutes an assumption of any Excluded
         Liability by, or an agreement to assume any Excluded Liability by,
         Merger Sub or Santera, and any statement to the contrary by any person
         is unauthorized and hereby disclaimed. Without limiting the generality
         of any the foregoing, in no event shall Santera assume or become liable
         for, and Excluded Liabilities shall include but not be limited to, (i)
         any claim, liability or obligation of Tekelec to its shareholders, (ii)
         any claim, liability or obligation of Tekelec to its directors,
         officers, employees or agent with respect to indemnification or
         contribution, (iii) any claim, liability or obligation related to
         violations of Law, including violations or alleged violations of
         Federal and state securities laws, or violations or alleged violations
         of Environmental Law (whether as a result of the handling, storage or
         disposal of hazardous materials or otherwise), or (iv) except to the
         extent paid by insurance policies included in the Contributed Assets,
         any liability for product liability, product defects or as a result of
         the provision of any services (professional or otherwise) provided by
         Tekelec to any other Person.

                           (b)      Tekelec Cash Contribution.

                                    (i)      Cash Contribution to Merger Sub by
         Tekelec. Immediately prior to the Effective Time, Tekelec will
         contribute to Merger Sub Twenty-Eight Million Dollars ($28,000,000) in
         cash.

                                    (iii)    Issuance of Merger Sub Capital
Stock. In consideration of the cash contribution to be made by Tekelec to Merger
Sub immediately prior to the Effective Time, and in reliance upon the
representations, warranties and covenants made herein by Tekelec, Merger Sub, in
full payment for such cash contribution and the other rights of Merger Sub
hereunder, agrees to issue to Tekelec forty-two (42) shares of common stock of
Merger Sub.

                           (c)      Conversion of Merger Sub Capital Stock. At
the Effective Time, by virtue of the Merger and without any action on the part
of any holder thereof, the issued and outstanding shares of common stock of
Merger Sub shall be converted into thirty-eight thousand (38,000) shares of
Series A Preferred Stock, twenty-eight thousand (28,000) shares of Series B

                                       12
<PAGE>

Preferred Stock and one (1) share of Common Stock of the Surviving Corporation
and, upon surrender of the certificate or certificates representing such shares
of Merger Sub common stock, the Surviving Corporation shall promptly issue to
Tekelec and/or Tekelec Sub certificates representing such shares of Series A
Preferred Stock, Series B Preferred Stock and Common Stock of the Surviving
Corporation into which such shares of Merger Sub common stock have been
converted.

                  2.4      Contributions to Santera; Conversion of Santera
Capital Stock.

                           (a)      Prior to or at the Closing and pursuant to
the Note and Preferred Stock Purchase Agreement, each Legacy Santera Stockholder
shall contribute to Santera in cash the amount set forth next to such Legacy
Santera Stockholder's name on Schedule 2.4 under the column entitled "Cash
Contributions to Santera" in exchange for a combination of convertible notes and
shares of Series D Preferred Stock of Santera in an aggregate amount equal to
each such Legacy Santera Stockholder's required cash contribution. Prior to the
consummation of the Merger, all of the convertible promissory notes shall have
been converted into shares of Series D Preferred Stock in accordance with the
terms of such convertible promissory notes and the Note and Preferred Stock
Purchase Agreement.

                           (b)      Prior to the Closing, each of the Legacy
Santera Stockholders (including those Legacy Santera Stockholders who own less
than 175,000 shares of preferred stock of Santera) shall exercise their
respective rights to exchange all of the shares of Series A-1 Preferred Stock,
Series B-1 Preferred Stock and/or Series C-1 Preferred Stock of Santera then
owned by such Santera stockholders for shares of Series A-2 Preferred Stock,
Series B-2 Preferred Stock and/or Series C-2 Preferred Stock, respectively, in
accordance with the terms of the Note and Preferred Stock Purchase Agreement and
the Exchange Agreement.

                           (c)      At the Effective Time, by virtue of the
Merger and without any action on the part of any holder thereof, all shares of
capital stock of Santera held in its treasury shall be cancelled and no
consideration of any kind shall be delivered in exchange therefor and the
outstanding capital stock of Santera shall be treated as follows:

                                    (i)      Each share of common stock, Series
         A-1 Preferred Stock, Series B-1 Preferred Stock and Series C-1
         Preferred Stock of Santera issued and outstanding at the Effective Time
         shall cease to be outstanding, shall be canceled and no consideration
         of any kind shall be delivered in exchange therefor;

                                    (ii)     Each share of Series A-2 Preferred
         Stock of Santera issued and outstanding at the Effective Time shall
         cease to be outstanding and shall be converted into the right to
         receive a number of shares of Series A Preferred Stock of the Surviving
         Corporation that is equal to the Series A-2 Conversion Factor;

                                    (iii)    Each share of Series B-2 Preferred
         Stock of Santera issued and outstanding at the Effective Time shall
         cease to be outstanding and shall be converted into the right to
         receive a number of shares of Series A Preferred Stock of the Surviving
         Corporation that is equal to the Series B-2 Conversion Factor;

                                       13
<PAGE>

                                    (iv)     Each share of Series C-2 Preferred
         Stock of Santera issued and outstanding at the Effective Time shall
         cease to be outstanding and shall be converted into the right to
         receive a number of shares of Series A Preferred Stock of the Surviving
         Corporation that is equal to the Series C-2 Conversion Factor; and

                                    (v)      Each share of Series D Preferred
         Stock of Santera issued and outstanding at the Effective Time shall
         cease to be outstanding and shall be converted into the right to
         receive a number of shares of Series A Preferred Stock of the Surviving
         Corporation that is equal to the Series D Conversion Factor.

         (it being understood that in no event shall the aggregate number of
shares of Series A Preferred Stock issued by the Surviving Corporation in
respect of the Series A-2 Preferred Stock, the Series B-2 Preferred Stock, the
Series C-2 Preferred Stock and the Series D Preferred Stock be in an amount in
excess of 62,000 shares).

                           (d)      After the Effective Time, upon surrender to
the Surviving Corporation of a certificate or certificates which represented
issued and outstanding shares of Series A-2 Preferred Stock, Series B-2
Preferred Stock, Series C-2 Preferred Stock or Series D Preferred Stock of
Santera immediately prior to the Effective Time by a Legacy Santera Stockholder
thereof, together with such other documents as may be reasonably required by the
Surviving Corporation, the Surviving Corporation shall promptly deliver to the
holder of such certificate or certificates, in exchange therefor, or, if such
holder has otherwise directed the Surviving Corporation in the Escrow Agreement
to deliver such certificates to the Escrow Agent, then the Surviving Corporation
shall deliver such certificate or certificates issued in the name of the
Representative (for the benefit of such Legacy Santera Stockholder) to the
Escrow Agent, the consideration that such Legacy Santera Stockholder has the
right to receive in respect of the shares of capital stock formerly represented
by the certificate or certificates surrendered by such holder (after taking into
account all of the shares of capital stock and any fractional shares with
respect thereto held by such Legacy Santera Stockholder as of the Effective
Time). The Surviving Corporation shall not be obligated to deliver the
applicable consideration to which any Legacy Santera Stockholder is entitled as
a result of the Merger until such holder surrenders such holder's certificate or
certificates as provided in this Section 2.4(d).

                  2.5      Dissenters' Rights. Notwithstanding anything in this
Agreement to the contrary, shares of capital stock of Santera which are held by
stockholders who have properly and timely perfected appraisal rights under
Section 262 of the Delaware Law shall not be converted into or be exchangeable
for the right to receive the consideration described in Section 2.4(c) (unless
and until such holder shall have effectively withdrawn or lost his, her or its
right to appraisal and payment under the Delaware Law) but shall be converted
into the right to receive such cash consideration as may be properly determined
and payable to such holder as provided in the Delaware Law.

                  2.6      Treatment of Options and Warrants.

                           (a)      At the Effective Time, by virtue of the
cancellation of each outstanding share of common stock of Santera pursuant to
the Merger and the failure of the Surviving Corporation to assume such options
as provided in the plan under which such options were issued, each then
outstanding and unexercised option exercisable for shares of capital stock of

                                       14
<PAGE>

Santera shall be canceled and no consideration of any kind shall be delivered in
exchange therefor under this Agreement.

                           (b)      At the Effective Time, by virtue of the
cancellation of each outstanding share of Series A-1 Preferred Stock, Series B-1
Preferred Stock and Series C-1 Preferred Stock of Santera pursuant to the
Merger, the failure of the Surviving Corporation to assume such warrants or
otherwise pursuant to the terms of such warrants, each then outstanding and
unexercised warrant exercisable for shares of capital stock of Santera shall be
canceled and no consideration of any kind shall be delivered in exchange
therefor under this Agreement.

                  2.7      Deliveries.

                           (a)      Subject to the fulfillment or waiver of the
conditions set forth in Article VIII and Article IX, at the Closing, Tekelec
shall deliver:

                                    (i)      to Merger Sub and Santera, the
         Assignment and Assumption Agreement, duly executed by Tekelec and
         Merger Sub;

                                    (ii)     to Merger Sub and Santera, the Bill
         of Sale in favor of Merger Sub, duly executed by Tekelec, together with
         such other assignment and conveyance documents that Santera reasonably
         requests to effectuate the transactions contemplated hereby;

                                    (iii)    to Santera, the License Agreement,
         duly executed by Tekelec;

                                    (iv)     to Santera, the Services Agreement,
         duly executed by Tekelec;

                                    (v)      to Santera, the Registration Rights
         Agreement, duly executed by Tekelec;

                                    (vi)     to Santera, an opinion of Bryan
         Cave LLP, counsel to Tekelec, Tekelec Sub and Merger Sub, in
         substantially the form attached hereto as Exhibit P;

                                    (vii)    to Santera, all consents, waivers
         or approvals obtained by Tekelec with respect to the consummation of
         the transactions contemplated by this Agreement;

                                    (viii)   to Santera, the certificates
         contemplated as being executed by Tekelec by Sections 10.1 and 10.2,
         duly executed by an authorized officer of Tekelec and, to the Legacy
         Santera Stockholders, copies of such certificates; and

                                    (ix)     to Santera, the stock certificates
         representing all of the issued and outstanding shares of capital stock
         of Merger Sub immediately prior to the Effective Time.

                           (b)      Subject to the fulfillment or waiver of the
conditions set forth in Article VIII and Article X, at the Closing, Santera
shall deliver:

                                    (i)      to Tekelec, the License Agreement,
         duly executed by Santera;

                                       15
<PAGE>

                                    (ii)     to Tekelec, the Services Agreement,
         duly executed by Santera;

                                    (iii)    to Tekelec, the Registration Rights
         Agreement, duly executed by Santera;

                                    (iv)     to Tekelec, a duly executed stock
         certificate evidencing the shares of Series A Preferred Stock to be
         issued to Tekelec as contemplated by Section 2.3(c);

                                    (v)      to Tekelec, a duly executed stock

         certificate evidencing the shares of Series B Preferred Stock to be
         issued to Tekelec as contemplated by Section 2.3(c);

                                    (vi)     to Tekelec, a duly executed stock
         certificate evidencing the share of Common Stock to be issued to
         Tekelec as contemplated by Section 2.3(c);

                                    (vii)    to the Escrow Agent, a duly
         executed stock certificate(s), evidencing the shares of Series A
         Preferred Stock to be issued to the Legacy Santera Stockholders as
         contemplated by Section 2.4, which stock certificate(s) shall be held
         by the Escrow Agent in accordance with the Escrow Agreement;

                                    (viii)   to Tekelec, an opinion of Munsch
         Hardt Kopf & Harr P.C., counsel to Santera, in substantially the form
         attached hereto as Exhibit Q, and an opinion of Prickett, Jones &
         Elliott, P.A., special Delaware counsel to Santera, in substantially
         the form attached hereto as Exhibit R;

                                    (ix)     to Tekelec, the Certificate of
         Merger, duly executed by Santera;

                                    (x)      to Tekelec, the certificates
         contemplated by Sections 9.1 and 9.2, duly executed by an authorized
         officer of Santera and, to the Legacy Santera Stockholders, copies of
         such certificates; and

                                    (xi)     to Tekelec, a "blue sky" memorandum
         relating to the issuance of the shares of capital stock and convertible
         promissory notes of Santera contemplated as being issued by Santera
         pursuant to this Agreement and the Ancillary Agreements.

                           (c)      Subject to the fulfillment or waiver of the
conditions set forth in Article IX and Article X, at the Closing, each Legacy
Santera Stockholder shall deliver:

                                    (i)      to Santera, stock certificates
         representing in the aggregate all of the shares of capital stock of
         Santera owned by such Legacy Santera Stockholders immediately prior to
         the Effective Time;

                                    (ii)     to Santera, the Registration Rights
         Agreement, duly executed by such Legacy Santera Stockholder;

                                    (iii)    to Tekelec, the certificate
         contemplated by Section 9.1, duly executed by such Legacy Santera
         Stockholder; and

                                       16
<PAGE>

                                    (iv)     to Santera, the certificate
         contemplated by Section 10.1, duly executed by such Legacy Santera
         Stockholder.

                  2.8      Certificate of Incorporation and Bylaws. At the
Effective Time, the certificate of incorporation of Santera as in effect
immediately prior to the Effective Date shall be amended and restated to read in
its entirety as set forth in Exhibit M, and, as so amended and restated, shall
be the certificate of incorporation of the Surviving Corporation. At the
Effective Time, the bylaws of Santera, as the Surviving Corporation, shall be
amended and restated to read in their entirety as set forth in Exhibit S, and,
as so amended and restated, shall be the bylaws of the Surviving Corporation
(the "Bylaws").

                  2.9      Directors and Officers of the Surviving Corporation.
The directors and officers set forth on Schedule 2.9 shall be the directors and
officers of the Surviving Corporation, effective as of the Closing Date, until
their successors shall have been duly elected and qualified or until their
earlier death, resignation or removal.

                                  ARTICLE III
                    REPRESENTATIONS AND WARRANTIES OF TEKELEC

          Tekelec hereby makes the following representations and warranties to
Santera, each of which is true and correct on the date hereof and shall survive
the Closing Date and the transactions contemplated hereby to the extent set
forth herein.

                  3.1      Corporate Existence and Power; Consents, Etc.

                           (a)      Tekelec is a corporation duly organized,
validly existing and in good standing under the laws of the State of California.
Merger Sub is a corporation, duly organized, validly existing and in good
standing under the laws of the State of Delaware. The entire authorized capital
stock of Merger Sub consists solely of thirty thousand (30,000) shares of common
stock, par value $0.01 per share. As of the date hereof, Tekelec owns one (1)
share of common stock of Merger Sub, which is the only share of capital stock of
Merger Sub outstanding on the date hereof. At the Closing, one hundred one (101)
shares of common stock of Merger Sub will be issued and outstanding and will be
owned by Tekelec and Tekelec Sub.

                           (b)      Tekelec is duly licensed or qualified to do
business as a foreign corporation and is in good standing in each jurisdiction
in which such license or qualification is required for the operation of the
Business by Tekelec, other than those jurisdictions where the failure by any
such entity to be so licensed or qualified will not result in a Material Adverse
Effect.

                           (c)      Each of Tekelec and Merger Sub has the
corporate power and authority to enter into this Agreement and each of the
Ancillary Agreements to which it is a party, to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated hereby
and thereby. The approval of the transactions contemplated hereby and by the
Ancillary Agreements by the Board of Directors of Tekelec does not violate any
fiduciary duty or other obligation of the directors of Tekelec either
individually or collectively.

                           (d)      Except as set forth on Schedule 3.1(d) and
except for the consents and approvals required to be obtained in connection
with, or filings or registrations required to be made pursuant to, the HSR Act,
no waiver or consent of any third person or Governmental or

                                       17
<PAGE>

regulatory authority is required for the execution, delivery and performance by
Tekelec or Merger Sub of this Agreement or any of the Ancillary Agreements to
which Tekelec or Merger Sub is a party or the consummation of the transactions
contemplated hereby or thereby. Neither Tekelec nor Merger Sub is a party to,
subject to or bound by any note, bond, mortgage, indenture, lien, instrument or
Contract or any statute, Law, rule, regulation, judgment, Order or decree of any
court, administrative or regulatory body, governmental agency, arbitrator,
mediator or similar body, franchise or license which would (i) be breached or
violated or the obligations thereunder accelerated or increased (whether or not
with notice or lapse of time or both) by the execution, delivery or performance
by Tekelec or Merger Sub, as the case may be, of this Agreement or any of the
Ancillary Agreements or the consummation of the transactions contemplated hereby
or thereby or (ii) prevent the carrying out of the transactions contemplated
hereby or by the Ancillary Agreements.

                  3.2      Valid and Enforceable Agreement; Authorization. Each
of this Agreement and each of the Ancillary Agreements to which Tekelec or
Merger Sub is a party constitutes or when executed by Tekelec or Merger Sub will
constitute a legal, valid and binding obligation of such party, enforceable
against such party in accordance with its respective terms, except that, in each
case, such enforcement may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally and (ii) the availability of specific
performance, injunctive relief and other equitable remedies. The execution and
delivery of this Agreement and each of the Ancillary Agreements to which Tekelec
or Merger Sub is a party and the consummation of the transactions contemplated
hereby and thereby have been duly authorized, approved and ratified by all
necessary resolutions, authorizations, consents, approvals and/or ratifications
on the part of Tekelec. No resolution, authorization, consent, approval and/or
ratification of the stockholders of Tekelec is necessary in order to enter into
and deliver this Agreement or any of the Ancillary Agreements to which Tekelec
is a party or to perform its obligations hereunder or thereunder or to
consummate the transactions contemplated hereby or thereby. Certified copies of
all required resolutions, authorizations, consents, approvals and/or
ratifications of (x) the Board of Directors of Tekelec and (y) the Board of
Directors and shareholders of Merger Sub are attached as Schedule 3.2 and no
such resolution, authorization, consent or approval has been altered, amended,
rescinded, repealed or revoked. Pursuant to such resolutions, authorizations,
consents, approvals and/or ratifications, each of Tekelec and Merger Sub has
full corporate authority to enter into and deliver this Agreement and each of
the Ancillary Agreements to which Tekelec or Merger Sub is a party, to perform
its respective obligations hereunder and thereunder, and to consummate the
transactions contemplated hereby and thereby.

                  3.3      Absence of Certain Developments with Respect to the
Business. Since December 31, 2002, except as set forth on Schedule 3.3, there
has been no: (a) Material Adverse Effect; (b) loss or, to Tekelec's Knowledge,
threatened loss of any material customer accounts of the Business, or any
decrease by any such material customers, or, to Tekelec's Knowledge, threatened
decrease by such customer, in the rate of buying materials, products or services
of the Business; (c) increase in or commitment to increase compensation,
benefits or other remuneration to or for the benefit of any employee of the
Business who may be transferred to Santera, or any benefits granted under any
Plan with or for the benefit of any such employee, except for increases in
compensation, benefits or other remuneration in the Ordinary Course; (d)
transaction entered into or carried out by Tekelec in connection with the
Business other than in the Ordinary Course; (e) change made by Tekelec with
respect to its Tax or financial accounting with respect to the Business or any
Tax election with respect to the Business; (f) transfer of any material assets
used directly and exclusively

                                       18
<PAGE>

in the Business, other than arm's-length sales, leases, or dispositions in the
Ordinary Course; (g) modifications of any material term of, or termination (but
not including the natural expiration) of, any material Contract to which Tekelec
is a party and which relates directly and exclusively to the Business or any
material Government license, permit or other authorization held by Tekelec for
use exclusively in the Business; (h) abandonment or transfer by Tekelec, or
lapse, of any Tekelec Business Intellectual Property; (i) waiver by Tekelec of
any material claims or material rights arising from or in connection with the
Business; (j) disclosure by Tekelec of any confidential or proprietary
information related to the Business to any person or entity other than (i) to
Santera and Santera' representatives, agents, attorneys and accountants, (ii)
the employees, agents, customers or advisors of Tekelec in the Ordinary Course
or (iii) the employees, agents or advisors of Tekelec in connection with the
transaction contemplated by this Agreement; (k) material change in the conduct
of the Business, or any material change in the methods of purchase, sale, lease,
management, marketing, promotion or operation, or any delay or postponement by
Tekelec of the payment of accounts payable or other Liabilities arising from the
Business; (l) any write-down in accounts receivable of the Business other than
in the Ordinary Course; (m) action taken by Tekelec that will or may reasonably
be expected to cause or constitute a breach of any provision of this Agreement;
or (n) commitment or agreement by Tekelec to do any of the foregoing items (c)
through (n).

                  3.4      Undisclosed Liabilities.

                           (a)      Tekelec does not have any Liabilities
whatsoever with respect to the Business, known or unknown, asserted or
unasserted, liquidated or unliquidated, accrued, absolute, contingent, or
otherwise, and there is no reasonable basis for any claim against Tekelec for
any such Liability, except (a) as incurred in the Ordinary Course or as set
forth on Schedule 3.4(a), or (b) to the extent they arise in the Ordinary Course
and are not required to be set forth in a schedule hereto, performance and
payment obligations (but not liabilities for breach or violation) lawfully
incurred under arm's-length contracts for goods or services which individually
or in the aggregate do not have a Material Adverse Effect upon the Business.
Except for the Assumed Liabilities, there are no Liabilities of Tekelec of any
nature, whether absolute, contingent or otherwise, and there is no reasonable
basis for any claim against Tekelec for any such Liabilities, which will become
the responsibility of Santera as a result of the transactions contemplated by
this Agreement or the Ancillary Agreements. All Assumed Liabilities were
generated by, and relate to, the Business.

                           (b)      The value of the accounts payable and
accrued operating expenses of the Business that are included in the Assumed
Liabilities (as calculated in accordance with accounting principles generally
accepted in the United States, consistently applied) does not as of the date of
this Agreement, and shall not as of the Closing Date, exceed $3,000,000.

                           (c)      Merger Sub does not have, and at the Closing
will not have, any operations other than those operations that are necessary for
the receipt of the Contributed Assets and cash contributions and the assumption
of the Assumed Liabilities from Tekelec and Tekelec Sub, all as contemplated
hereby. As of the Closing Date, Merger Sub will have no Liabilities other than
the Assumed Liabilities.

                  3.5      Taxes.

                           (a)      Tekelec has, in connection with each of the
Contributed Assets and the Business, complied with all Laws relating to the
withholding of Taxes and the payment thereof

                                       19
<PAGE>

(including, without limitation, withholding of Taxes under Sections 1441 and
1442 of the Code, or similar provisions under foreign laws), and has, in
connection with each of the Contributed Assets and the Business, timely and
properly withheld from the appropriate party and paid over to the proper
Government all amounts required to be withheld and be paid over under applicable
Law.

                           (b)      Tekelec has, in connection with each of the
Contributed Assets and the Business, timely filed or caused to be filed with the
appropriate Government entity all Tax Returns and reports required to be filed
by or on behalf of Tekelec, except for those Tax Returns for which the failure
to timely file would not reasonably be expected to have a Material Adverse
Effect. All Tax Returns in connection with each of the Contributed Assets and
the Business, including any amended Tax Returns, are true, correct and complete
in all respects, except where the failure to be true, correct and complete would
not reasonably be expected to have a Material Adverse Effect. Tekelec is not
currently the beneficiary of any extension of time within which to file any Tax
Return in connection with the Contributed Assets or the Business.

                           (c)      Tekelec has, in connection with each of the
Contributed Assets and the Business, timely paid all Taxes with respect to all
periods reflected on Tax Returns except those Taxes the failure of which to
timely pay would not reasonably be expected to have a Material Adverse Effect,
and there are no grounds for the assertion or assessment of any additional Taxes
against Tekelec in connection with the Contributed Assets or the Business with
respect to such periods.

                           (d)      There are no liens for Taxes upon any of the
Contributed Assets, except liens for Taxes not yet due and payable.

                           (e)      None of the Assumed Liabilities is an
obligation to make a payment that will not be deductible under Section 162(m) or
Section 280G of the Code.

                           (f)      Except as set forth on Schedule 3.5(f), none
of the Contributed Assets or Assumed Liabilities will constitute an interest in
a partnership, joint venture or other arrangement or contract that could be
treated as a partnership for federal income tax purposes.

                           (g)      Tekelec is not and since the date of its
incorporation, has not been a member of an "affiliated group" within the meaning
of Section 1504 of the Code (other than a group the common parent of which was
Tekelec).

                           (h)      As of the date hereof, Tekelec is reasonably
satisfied that the contribution by Tekelec and Tekelec Sub of the PTBU and
$28,000,000 cash to Merger Sub in exchange for an aggregate of one hundred (100)
shares of common stock of Merger Sub and the conversion of Merger Sub capital
stock into Series A Preferred Stock, Series B Preferred Stock and Common Stock
of the Surviving Corporation pursuant to Section 2.3(c), when consummated in
accordance with the terms hereof, will constitute a tax-free exchange pursuant
to section 351 of the Code.

                  3.6      Accounts Receivable; Inventory.

                           (a)      Set forth on Schedule 3.6(a) is a list of
all the accounts receivable of the Business as of March 31, 2003, together with
an aging schedule relating thereto. Such accounts receivable, and any accounts
receivable of the Business arising between such date and the Closing

                                       20
<PAGE>

Date (collectively, the "Tekelec Accounts Receivable") are or will be, except as
set forth on Schedule 3.6(a), valid and subsisting, and all such Tekelec
Accounts Receivable arose or will have arisen in the Ordinary Course. Except as
set forth on Schedule 3.6(a), the Tekelec Accounts Receivable are not subject to
any counterclaim, set-off, defense, security interest, claim or other
encumbrance. No agreement for deduction, free goods, discount or other deferred
price or quantity adjustment has been made with respect to any Tekelec Account
Receivable.

                           (b)      Except as set forth on Schedule 3.6(b), all
inventories included in the Contributed Assets consist of a quantity and quality
usable and salable in the Ordinary Course, and are not physically damaged,
previously used, obsolete (i.e., no longer offered for sale by Tekelec),
discontinued or excess.

                  3.7      No Breach of Law or Governing Document. Except as set
forth on Schedule 3.7, Tekelec is not in default under or in breach or violation
of any Law in connection with the operation of the Business, except to the
extent that any such default, breach or violation would not result in a Material
Adverse Effect. Tekelec is not in default under or in breach or violation of any
provision of its Articles of Incorporation or its Bylaws, in either case, as
currently in effect. Except as set forth on Schedule 3.7, Tekelec has not
received any written notice alleging any default, breach or violation of its
Articles of Incorporation or Bylaws or of any Law (in connection with its
operations of the Business), and the execution and delivery of this Agreement
and the Ancillary Agreements to which Tekelec is a party and the consummation of
the transactions contemplated hereby and thereby do not or will not constitute
or result in any such default, breach or violation.

                  3.8      Litigation. Except as set forth on Schedule 3.8, (a)
there is no, and for the previous three (3) years there has not been any, suit,
litigation, proceeding (administrative, judicial, or in arbitration, mediation
or alternative dispute resolution), Government or grand jury investigation, or
other action (any of the foregoing, "Action") pending or, to Tekelec's
Knowledge, threatened against Tekelec related to or otherwise involving the
operation of the Business, including without limitation any Action challenging,
enjoining, or preventing this Agreement or the Ancillary Agreements, or the
consummation of the transactions contemplated hereby and thereby; (b) Tekelec is
not and has not been subject to any Order in connection with its operations of
the Business other than Orders of general applicability and the consummation of
the transactions contemplated hereby and by any of the Ancillary Agreements will
not violate or result in a default by Tekelec under any Order applicable to or
by which Tekelec is bound in connection with its operations of the Business; and
(c) Tekelec has not been subject to or, to Tekelec's Knowledge, been threatened
to be subject to, and there are no grounds for, any Action or Order relating to
personal injury, death, or property or economic damage arising from products or
services sold or provided by Tekelec in connection with the operations of the
Business.

                  3.9      Assets.

                           (a)      Except as set forth on Schedule 3.9 and
except for leased assets or assets which Tekelec has a license to use, Tekelec
has good, valid and legal title to and is the sole and exclusive owner of all
right, title and interest in and to each of the Contributed Assets, free and
clear of all Liens, other than Permitted Liens, and there exists no restriction
on the use or transfer of such Contributed Assets. Except as set forth on
Schedule 3.9, none of the Contributed Assets is in the possession of persons or
entities other than Tekelec or its Affiliates. Tekelec does not own any real
property which is used primarily in the Business.

                                       21
<PAGE>

                           (b)      As of the Closing Date, none of the
Contributed Assets will be encumbered by any Liens in favor of Union Bank of
California and no such Lien will arise as a result of the consummation of the
transactions contemplated hereby or by any of the Ancillary Agreements.

                  3.10     Necessary Property and Transfer of Contributed
Assets. The Contributed Assets, the Licensed Assets, the Excluded Assets listed
on Schedule 1.1D (Part 1) and Schedule 1.1D (Part 2) and the rights of Santera
under the Services Agreement constitute all of the property and property rights
necessary for the conduct of the Business, other than the licenses and permits
listed on Schedule 3.12. Except as set forth on Schedule 3.10, no consent or
permit from any third party is necessary to transfer the Contributed Assets or
the Assumed Liabilities, and there exists no restriction on the transfer of the
Contributed Assets or Assumed Liabilities or the consummation of the
transactions contemplated hereby. There exists no condition, agreement,
understanding, restriction or reservation affecting the title to or utility of
the Contributed Assets or the Licensed Assets which would prevent Santera from
utilizing such assets, or any part thereof, or which would result in a material
liability to Tekelec or Santera if Santera utilized such assets, or any part
thereof, to the same full extent that Tekelec might continue to do so if the
transactions contemplated hereby did not take place.

                  3.11     Use and Condition of Property. Except as set forth on
Schedule 3.11, all the material tangible Contributed Assets are in good
operating condition and repair, subject to ordinary wear and tear, as reasonably
required for their use as presently conducted or planned by Tekelec. There is no
pending, and to Tekelec's Knowledge, there is no proposed or threatened
condemnation proceeding or similar action affecting the activities of the
Business or the Contributed Assets or with respect to any streets or public
amenities appurtenant thereto which would adversely affect Santera's operation
of the Business after the Closing hereunder.

                  3.12     Licenses and Permits. Set forth on Schedule 3.12 is a
list of each license or permit which Tekelec has and/or is required for the
conduct of the Business, together with the name of the Government authority,
agency or entity issuing such license or permit. All such licenses and permits
are valid and in full force and effect, and all such licenses and permits will
continue to be in full force and effect and held by Tekelec (and not the Merger
Sub or Santera) immediately following the consummation of the transactions
contemplated hereby.

                  3.13     Contracts.

                           (a)      Set forth on Schedule 3.13(a) (Part 1) is a
list of each Contract to which Tekelec is a party or is otherwise bound and
which relates to the Business and which (i) has resulted or is reasonably likely
to result in a loss to the Business, (ii) involves (A) a guaranty, indemnity,
surety, accommodation party or power of attorney, (B) a sharing of payments or
joint venture, (C) a sales agency, representation, distributorship or franchise
arrangement, (D) restrictions on competition by Tekelec or its Affiliates, (E)
collective bargaining, works council, or union representation, or (iii) includes
a license, assignment, restriction on use of, or other obligation to transfer
any Tekelec Business Intellectual Property. Set forth on Schedule 3.13(a) (Part
2) is a list of each Contract to which Tekelec is a party or is otherwise bound
and which relates directly and exclusively to the Business and which (i) is not
in the Ordinary Course, (ii) is not terminable upon thirty (30) days' notice
without liability; or (iii) except for customer Contracts in the Ordinary
Course, involves an obligation (either written or verbal) in excess of $50,000
not otherwise included

                                       22
<PAGE>

on Schedule 3.13(a) (Part 2) (all such Contracts described in this Section
3.11(a), the "Material Tekelec Contracts").

                           (b)      Each of the Material Tekelec Contracts is a
valid, binding and enforceable obligation of Tekelec and, to Tekelec's
Knowledge, the other parties thereto, except that such enforcement may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting or relating to enforcement of creditors' rights
generally; and (ii) general equitable principles. Except as indicated on
Schedule 3.13(b), Tekelec is not, and to the extent it would create a current or
future liability of Santera and/or Tekelec, Tekelec has not been, and to
Tekelec's Knowledge, no other party to a Material Tekelec Contract, is in breach
or violation of or default under any such Material Tekelec Contract, and no
event has occurred that, through the passage of time or the giving of notice, or
both, would constitute, and the execution of this Agreement and/or the Ancillary
Agreements, and/or the Closing hereunder or thereunder do not and will not
constitute or result in, such a breach, violation or default on the part of any
party thereto, cause the acceleration of any obligation of Tekelec, any other
party thereto or the creation of a Lien upon the Contributed Assets, or require
any consent thereunder. Tekelec has made available to Santera or its advisors a
true, complete and accurate copy of each Material Tekelec Contract and each
Assumed Contract. To the Knowledge of Tekelec, Tekelec is not a party to any
Contract or understanding that is not an Assumed Contract but which restrict or
could, following the consummation of the transactions contemplated hereby or by
the Ancillary Agreements, restrict, in either case, in any material respect the
operations of Santera.

                  3.14     Tekelec Business Intellectual Property.

                           (a)      Schedule 3.14(a)(i) contains a true,
complete and accurate list of each of the following items of Tekelec Business
Intellectual Property: patents, patent applications and invention disclosures;
trademarks, service marks, trade names, corporate names, and registrations and
applications for registration of the foregoing; copyright registrations and
applications for registration; and domain names. Schedule 3.14(a)(ii) contains a
list of each Tekelec Business Intellectual Property License. Schedule 3.14(a)(i)
accurately summarizes, where applicable, the following for each agreement or
item of Tekelec Business Intellectual Property: patent number, application
number, registration number, filing date, date of issuance, registration or
grant, applicant, classification of goods or services covered (for trademarks
and service marks), agreement title, mark or name, owner, licensee, licensor,
license date, country of origin and subject matter.

                           (b)      Except with respect to Intellectual Property
licensed to Tekelec under a Tekelec Business Intellectual Property License set
forth in Schedule 3.14(a)(ii), and except as described on Schedule 3.14(b),
Tekelec has good, valid and legal title to, and is the sole and exclusive owner
of all right, title and interest in and to each item of Tekelec Business
Intellectual Property, free and clear of all Liens, other than Permitted Liens.

                           (c)      Except as set forth in Schedules 3.14(c)(i)
through (ix), (i) there are no obligations (including royalty obligations),
covenants or restrictions from third parties or Orders affecting either the use,
disclosure, enforcement, transfer or licensing of the Tekelec Business
Intellectual Property; (ii) each item of Tekelec Business Intellectual Property
is valid and enforceable and encompasses all proprietary rights necessary for
the conduct of the Business as presently conducted or proposed by Tekelec to be
conducted (as evidenced by a written business plan or product development plan
on the date hereof); (iii) no entity other than Tekelec possesses any

                                       23
<PAGE>

current or contingent rights to any of the Tekelec Business Intellectual
Property (including, without limitation, through any escrow account); (iv)
Tekelec has secured from all persons who have created or otherwise have any
rights in or to, any item of Tekelec Business Intellectual Property, valid
enforceable written assignments of, or licenses to, any such Tekelec Business
Intellectual Property; (v) Tekelec is the owner of all right, title and interest
in and to, or otherwise possesses all necessary legal rights to, all
Intellectual Property incorporated in, or created in connection with, work
provided to customers of the Business in connection with the Business; (vi)
Tekelec has not transferred, and is not obligated to transfer to any third
party, any Tekelec Business Intellectual Property; (vii) there is no action,
suit, arbitration or other proceeding pending or, to the Knowledge of Tekelec,
threatened, which involves any Tekelec Business Intellectual Property rights;
(viii) Tekelec is not in default under any Tekelec Business Intellectual
Property License or other agreement whereby it has the right to use, sell,
license, maintain enhance, modify or otherwise deal with any Tekelec Business
Intellectual Property; and (ix) Tekelec is not subject to any Order and is not a
party to any Contract, in either case, which restricts or impairs the use of any
Tekelec Business Intellectual Property.

                           (d)      Tekelec has imposed written non-disclosure
obligations on all third parties that have received any confidential information
or trade secrets relating to the Business.

                           (e)      Except as set forth on Schedule 3.14(e),
there is not and has not been any infringement, misappropriation or other
violation of any Intellectual Property of a third party by Tekelec in connection
with the operations of the Business, and there are no facts raising a likelihood
of any such violation. The use of the Tekelec Business Intellectual Property in
connection with the Business does not conflict with any rights of a third party.

                           (f)      To Tekelec's Knowledge, there is not and has
not been any infringement, misappropriation or other violation of any Tekelec
Business Intellectual Property, and to Tekelec's Knowledge there are no facts
raising a likelihood of any such violation. There has been no claim made by
Tekelec of any infringement, misappropriation or other violation of any of the
Tekelec Business Intellectual Property.

                           (g)      Except as set forth on Schedule 3.14(g), the
Tekelec Business Intellectual Property and the products or services of the
Business have not been the subject of a claim of infringement, interference or
unfair competition or other claim. There has been no claim made against Tekelec
asserting the invalidity, misuse or unenforceability of any of the Tekelec
Business Intellectual Property or challenging Tekelec's right to use, transfer,
or ownership of, any of the Tekelec Business Intellectual Property, and there
are no grounds for any such claim or challenge, including without limitation any
such claim or challenge based upon any use or enforcement of, or any failure to
use or enforce, any of the Tekelec Business Intellectual Property.

                           (h)      No loss of any Tekelec Business Intellectual
Property is pending, reasonably foreseeable or threatened. Tekelec has taken all
action necessary to maintain and protect the Tekelec Business Intellectual
Property and, to the Knowledge of Tekelec, the owners of the Tekelec Business
Intellectual Property licensed to Tekelec have taken all action necessary to
maintain and protect such Tekelec Business Intellectual Property.

                           (i)      Except as set forth on Schedule 3.14(i), the
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements will not alter, impair or extinguish any of the Tekelec

                                       24
<PAGE>

Business Intellectual Property or subject Santera's use of the Tekelec Business
Intellectual Property to restrictions or limitations other than those to which
the use by Tekelec thereof would be subject if the transactions contemplated
hereby did not occur.

                           (j)      Tekelec has not given to any third party any
warranty or indemnification related to Tekelec Business Intellectual Property,
except for (i) statutory warranties given in the Ordinary Course in connection
with the sale of goods and services, (ii) warranties given by third party
manufacturers that Tekelec passes through or assigns to its customers in
connection with the sale of goods of the Business and (iii) warranties or
indemnities specifically set forth in writing in the Material Tekelec Contracts.

                  3.15     Employees and Consultants. Set forth on Schedule 3.15
is a list of: (a) all current employees (active or inactive) of Tekelec or its
Affiliates who work primarily in the Business and (b) all current paid
consultants to Tekelec or its Affiliates who are engaged substantially for the
benefit of the Business, together, in the case of (a) and (b), with the current
rate of compensation and benefits (if any) payable to each and paid vacation
time owing to such person and any incentive or bonus payments. Each consultant
who is engaged primarily for the benefit of the Business and listed on Schedule
3.15 has signed the agreement listed on Schedule 3.15; true, correct and
complete copies of such agreements have been made available to Santera. Except
as set forth on Schedule 3.15, neither Tekelec nor any of its Affiliates is
indebted to any director, officer, employee or agent of Tekelec or any of its
Affiliates in connection with the operation of the Business, except for amounts
due as normal salaries and wages and in reimbursement of ordinary expenses on a
current basis.

                  3.16     Transactions with Related Persons. Except as set
forth on Schedule 3.16, neither Tekelec nor any of its Affiliates has any
Liabilities included in the Assumed Liabilities with respect to the Business,
contractual or otherwise, owed to or owing from, directly or indirectly, any
Affiliates of Tekelec. Except as set forth on Schedule 3.16, to Tekelec's
Knowledge (without any inquiry), no director, officer, stockholder or Affiliate
of Tekelec has any material financial interest, direct or indirect, in any
supplier or customer of, or other business which has any material transactions
or other material business relationship with, the Business.

                  3.17     Labor Matters.

                           (a)      Tekelec is not a party to or bound by any
collective bargaining, works council, union representation or similar agreement
or arrangement relating to the Business;

                           (b)      Tekelec is not and has not engaged in any
unfair labor practice with respect to the Business;

                           (c)      There is no labor strike, dispute, slowdown,
or stoppage pending or, to Tekelec's Knowledge, threatened against Tekelec with
respect to the Business;

                           (d)      There is currently no bargaining
representative for the employees of Tekelec who work in the Business; and

                           (e)      No collective bargaining agreement is
currently being negotiated and no organizing effort is currently being made with
respect to the employees of Tekelec who work in the Business.

                                       25
<PAGE>

                  3.18     Employee Benefit Matters.

                           (a)      Except as set forth on Schedule 3.18,
Tekelec is not a party to any Plan relating to employees of the Business. True,
correct and complete copies of all documents creating or evidencing any Plan
listed on Schedule 3.18 have been made available to Santera. There are no
pending or to Tekelec's Knowledge threatened negotiations, demands or proposals
by employees of the Business with respect to the subject matter of the foregoing
Plans other than ordinary claims for benefits under the respective Plans. With
respect to each Plan listed on Schedule 3.18 that Tekelec intends to be
qualified within the meaning of Section 401(a) of the Code, true, correct and
complete copies of the most recent determination letter from the IRS and any
outstanding request for a determination letter from the IRS have been delivered
to Santera.

                           (b)      Each Plan listed on Schedule 3.18 complies
with and has been administered, operated, and maintained substantially in
compliance with, and, except as set forth on Schedule 3.18, Tekelec has no
direct or indirect liability under, the requirements provided by any and all
statutes, orders or governmental rules or regulations currently in effect,
including but not limited to ERISA and the Code, and applicable to such Plans,
and no such Plan is subject to Title IV of ERISA.

                           (c)      Except as set forth on Schedule 3.18,
Tekelec has no liability or obligation to provide life, medical or other welfare
benefits to former or retired employees of the Business, other than under COBRA.

                           (d)      Except as set forth on Schedule 3.18,
Tekelec is not a party to any Plan relating to employees of the Business that is
intended to qualify under Code Section 401(a) and Code Section 501(a) and each
such Plan and its related trust, if any, are qualified under Code Section 401(a)
and Code Section 501(a) and (i) have been determined by the IRS to qualify, and
nothing has since occurred to cause the loss of the Plan's qualification or (ii)
determination letter requests for such Plans have been submitted to the IRS.

                           (e)      Except as set forth on Schedule 3.18, all
contributions with respect to the Plans relating to employees of the Business
for all employment up to the Closing Date (including periods from the first day
of the current plan year to the Closing Date) have been made by Tekelec and all
members of the controlled group in accordance with past practice and the
recommended contribution in the applicable actuarial report, if any.

                           (f)      Except as set forth on Schedule 3.18, there
is no matter pending (other than routine qualification determination filings or
ruling requests) with respect to any Plan before the IRS or the Department of
Labor.

                           (g)      There is no pending or threatened legal
action, proceeding or investigation against or involving any Plan described in
Schedule 3.18 and there is no reasonable basis for any legal action, proceeding
or investigation.

                  3.19     Discrimination and Occupational Safety and Health.
Except as set forth on Schedule 3.19, no person has any claim, or to Tekelec's
Knowledge, has any reasonable basis for any Action against, and no claim is
pending or, to Tekelec's Knowledge, threatened against, Tekelec arising out of
any Law relating to discrimination in employment or employment practices or

                                       26

<PAGE>

occupational safety and health standards as a result of the operation of the
Business;  and since January 1, 1997,  Tekelec has not received any notice from
any person alleging a violation by Tekelec of such Law or occupational safety or
health standards in connection with its operation of the Business.

                  3.20     Product and Service Warranties. The only product or
service warranty or guarantee provided by Tekelec in any Assumed Contract are
those that are specifically set forth in writing in such Assumed Contract or
implied by applicable Law. No oral product or service warranties or guaranties
have been authorized or made by Tekelec with respect to the Assumed Contracts.
Except as set forth on Schedule 3.20, since December 31, 2000, no product or
service warranty or similar claims have been made against Tekelec in connection
with the operations of the Business as to which the losses and expenses in
respect of such claim have exceeded $25,000. The aggregate loss and expense
(including out-of-pocket expenses) attributable to all product warranty and
similar claims now pending or hereafter asserted against Tekelec, in either
case, with respect to products manufactured by Tekelec on or prior to the
Closing Date will not exceed $200,000. No person or entity (including, but not
limited to, Government agencies of any kind) has any valid claim, or valid basis
for any action or proceeding, against Tekelec under any Law relating to unfair
competition, false advertising or other similar claims arising out of product
warranties, guarantees, specifications, manuals or brochures or other
advertising materials used in connection with the operation of the Business.

                  3.21     Product and Service Liability Claims. Except as set
forth on Schedule 3.21, since January 1, 1997, Tekelec has not received notice
or information as to any claim or allegation of personal injury, death, or
property or economic damages, any claim for punitive or exemplary damages, any
claim for contribution or indemnification, or any claim for injunctive relief in
connection with any product manufactured, sold, distributed or otherwise put in
commerce by, or in connection with any service provided by, or based on any
error, omission or negligent act in the performance of services by, Tekelec that
arose out of the operation of the Business. The aggregate loss and expense
attributable to any and all such claims and allegations with respect to products
manufactured, sold, distributed or put in commerce, or services provided during
the period commencing on January 1, 1998 and ending on the Closing Date have not
exceeded, and will not exceed $50,000, exclusive of any recovery or coverage
under any insurance policy.

                  3.22     Foreign Assets and Operations. At all times, Tekelec
(in connection with the operation of the Business) has acted:

                           (a)      pursuant to valid qualifications to do
business in all jurisdictions outside the United States where such qualification
is required by local Law;

                           (b)      in compliance with all applicable foreign
Laws, including without limitation Laws relating to foreign investment, foreign
exchange control, immigration, employment and taxation;

                           (c)      without notice of violation of and in
compliance with all relevant anti-boycott laws, regulations and guidelines,
including without limitation Section 999 of the Code and regulations and
guidelines issued pursuant thereto and the Export Administration Regulations
administered by the U.S. Department of Commerce, as amended from time to time,
including all reporting requirements;

                                       27
<PAGE>

                           (d)      without notice of violation of and in
compliance with all export control or sanctions laws, orders or regulations,
including without limitation the Export Administration Regulation administrated
by the U.S. Department of Commerce and sanctions and embargo executive orders
and regulations administered by the Office of Foreign Assets Control of the U.S.
Treasury Department, as amended from time to time, and without violation and in
compliance with any required export or reexport licenses or authorizations
granted under such laws, regulations or orders, which licenses or authorizations
are described in Schedule 3.22; and

                           (e)      without notice of violation of and in
compliance with the Foreign Corrupt Practices Act of 1977, as amended.

                  3.23     Brokers, Finders. Except for Lehman Brothers, no
finder, broker, agent, or other intermediary, acting on behalf of Tekelec or any
of its stockholders, is entitled to a commission, fee, or other compensation or
obligation in connection with the negotiation or consummation of the
transactions contemplated by this Agreement or the Ancillary Agreements.

                  3.24     Environmental Matters. Tekelec is currently and since
January 1, 1998 has been in compliance with all applicable Environmental Laws in
connection with its operation of the Business. Except as set forth on Schedule
3.24, there is no civil, criminal or administrative action, suit, investigation
or proceeding pending or, to Tekelec's Knowledge, threatened against Tekelec in
connection with its operation of the Business and relating to or arising from
any Environmental Laws.

                  3.25     Investment Representations. Tekelec understands that
the shares of Series A Preferred Stock, Series B Preferred Stock and Common
Stock it is receiving pursuant hereto and any other securities of the Surviving
Corporation received upon conversion thereof, are not, and will not be,
registered under the Securities Act of 1933, as amended, or any applicable state
securities laws and that any sale, transfer or other disposition of such shares
or other securities of the Surviving Corporation by Tekelec must be made only
pursuant to an effective registration under applicable federal and state
securities laws or an available exemption therefrom and otherwise in compliance
with the terms of the Stockholders' Agreement. Tekelec is an "accredited
investor" as defined in Rule 501 of the Securities Act of 1933, as amended.
Tekelec has received all of the information that it considers necessary or
appropriate for deciding whether to consummate the transactions contemplated
hereby. Tekelec has had a satisfactory opportunity to ask questions and receive
answers from Santera regarding the terms and conditions of the Series A
Preferred Stock, Series B Preferred Stock and Common Stock and the business,
properties, prospects and financial condition of Santera and the Surviving
Corporation and to obtain additional information sufficient to satisfy itself
with respect to the foregoing. The shares of Series A Preferred Stock, Series B
Preferred Stock and Common Stock to be received by Tekelec pursuant to this
Agreement, and any securities of the Surviving Corporation received upon
conversion thereof, will be acquired for Tekelec's own account for investment
purposes only and without any plans or intention to resell, transfer or
otherwise dispose of such shares of Series A Preferred Stock, Series B Preferred
Stock, Common Stock or other securities of the Surviving Corporation.

                  3.26     Customers. Schedule 3.26 sets forth a true, complete
and correct list of the top ten (10) largest customers and the top ten (10)
largest suppliers of the Business by volume of sales and purchases for the
fiscal year ended December 31, 2002.

                                       28
<PAGE>

                  3.27     Tekelec SEC Reports. Tekelec has made available to
Santera true and complete copies of each registration statement, report and
proxy or information statement, including, without limitation, its Annual Report
to Shareholders incorporated in material part by reference in certain of such
reports, in the form (including exhibits and any amendments thereto) required to
be filed with the Securities and Exchange Commission since January 1, 2001 to
the date of this Agreement. To Tekelec's Knowledge, none of the reports or proxy
statements of Tekelec filed with the Securities and Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended, since January 1, 2003
contains any untrue statement of material fact or omits a material fact
necessary to make the statements contained therein, taken as a whole, in light
of the circumstances in which they were made, not misleading.

                  3.28     Absence of Certain Changes with Respect to Tekelec
Generally. Since December 31, 2002, there has been no change, event or effect
that is or could reasonably be expected to be materially adverse to the
business, operations, assets, liabilities, employee relationships, earnings or
results of operations, or the business prospects or condition (financial or
otherwise), of Tekelec; provided that a change, event or effect shall not be
deemed to be materially adverse to the extent resulting from (i) general
economic conditions, (ii) war or terrorist activities, (iii) changes in foreign
currency exchange rates, (iv) regulatory events, (v) matters (including economic
matters) that affect the industry in which Tekelec operates generally or (vi)
the announcement or pendency of the transactions contemplated by this Agreement.

                  3.29     Complete Disclosure. To the knowledge of Tekelec,
Tekelec has not omitted any material disclosures necessary in order to make the
representations and warranties made in this Agreement, in light of the
circumstances under which they were made, not misleading.

                                   ARTICLE IV
                    REPRESENTATIONS AND WARRANTIES OF SANTERA

          Santera hereby makes the following representations and warranties to
Tekelec, each of which is true and correct on the date hereof and shall survive
the Closing Date and the transactions contemplated hereby to the extent set
forth herein:

                  4.1      Corporate Existence and Power.

                           (a)      Santera is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Santera has delivered to each of the other Parties hereto true, complete and
correct copies of the Certificate of Incorporation and Bylaws of Santera, as
currently in effect. Santera does not directly or indirectly, (i) own any shares
of capital stock or other securities of, or any proprietary interest in, any
other entity or person except as set forth on Schedule 4.1(a) or (ii) control
all or substantially all of the management policies of any other entity or
person.

                           (b)      Santera is duly licensed or qualified to do
business as a foreign corporation and is in good standing in each jurisdiction
in which such license or qualification is required, other than those
jurisdictions where the failure to be so licensed or qualified will not result
in a Material Adverse Effect.

                                       29
<PAGE>

                           (c)      Santera has the corporate power and
authority to enter into this Agreement and each of the Ancillary Agreements to
which it is a party, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. The approval of the
transactions contemplated hereby and by the Ancillary Agreements by the Board of
Directors of Santera (including, without limitation, the Recapitalization, the
issuance and/or exchange of shares of capital stock of Santera contemplated by
the Note and Preferred Stock Purchase Agreement and the Exchange Agreement and
the Merger) does not violate any fiduciary duty or other obligation of the
directors of Santera either individually or collectively.

                           (d)      Except as set forth on Schedule 4.1(d) and
except for the consents and approvals required to be obtained in connection
with, or filings or registrations required to be made pursuant to, the HSR Act,
no waiver or consent of any third person or Governmental or regulatory authority
is required for the execution, delivery and performance by Santera of this
Agreement or any of the Ancillary Agreements to which Santera is a party or the
consummation of the transactions contemplated hereby or thereby. Santera is not
a party to, subject to or bound by any note, bond, mortgage, indenture, lien,
instrument or Contract or any statute, Law, rule, regulation, judgment, Order or
decree of any court, administrative or regulatory body, governmental agency,
arbitrator, mediator or similar body, franchise or license which would (i) be
breached or violated or the obligations thereunder accelerated or increased
(whether or not with notice or lapse of time or both) by the execution, delivery
or performance by Santera of this Agreement or any of the Ancillary Agreements
or the consummation of the transactions contemplated hereby or thereby or the
consummation of the Recapitalization or the issuance and/or exchange of capital
stock of Santera contemplated by the Note and Preferred Stock Purchase Agreement
and the Exchange Agreement or (ii) prevent the carrying out of the transactions
contemplated hereby or by the Ancillary Agreements or prevent the carrying out
of the Recapitalization. The Recapitalization, the issuance and/or exchange of
capital stock of Santera contemplated by the Note and Preferred Stock Purchase
Agreement and the Exchange Agreement and the Merger will be effectuated by
Santera in accordance with all applicable Laws and in accordance with the terms
of Santera's certificate of incorporation and bylaws then in effect. At the
Effective Time, the Second Amended and Restated Certificate of Incorporation
will become effective and will be in full force and effect, in accordance with
the Delaware Law.

                           (e)      The authorized capital stock of Santera on
the date hereof consists of 86,232,278 shares of common stock, par value $0.0001
per share, and 26,199,085,982 shares of preferred stock, par value $0.0001 per
share, of which 18,840,000 shares are designated Series A-1 Preferred Stock,
9,975,000 shares are designated Series B-1 Preferred Stock, 27,249,730 shares
are designated Series C-1 Preferred Stock, 18,840,000 shares are designated
Series A-2 Preferred Stock, 9,975,000 shares are designated Series B-2 Preferred
Stock, 27,249,730 shares are designated Series C-2 Preferred Stock and
26,086,956,522 shares are designated Series D Preferred Stock. Schedule 4.1(e)
(Part 1) sets forth a true and complete summary of the ownership of all of the
issued and outstanding shares of capital stock of Santera on the date hereof.
Schedule 4.1(e) (Part 2) sets forth a true and complete summary of the ownership
of all of the issued and outstanding capital stock of Santera after taking into
account the Recapitalization. Schedule 4.1(e) (Part 3) sets forth a true and
complete summary of the ownership of all of the issued and outstanding capital
stock of Santera on the Closing Date, after taking into account the
Recapitalization and the closing of the transactions contemplated by the Note
and Preferred Stock Purchase Agreement and the Exchange Agreement. Schedule
4.1(e) (Part 4) sets forth a true and complete summary of the ownership of all
of the issued and outstanding capital stock of Santera on the Closing Date,
after taking into account the Merger.

                                       30
<PAGE>

All of the issued and outstanding shares of capital stock of Santera on the date
hereof have been validly issued and are fully paid and non-assessable. All of
the shares of capital stock of Santera that will be issued between the date
hereof and the Closing Date will be validly issued and fully paid and
non-assessable. On the Closing Date, all of the issued and outstanding shares of
capital stock of Santera (including all shares issued or exchanged in connection
with the Recapitalization and all shares issued or exchanged in connection with
the Note and Preferred Stock Purchase Agreement, the Exchange Agreement and the
transactions contemplated thereby) will have been validly issued and will be,
following such issuance, fully paid and non-assessable. Except as set forth on
Schedule 4.1(e) or Schedule 4.27, and except for the rights provided to Tekelec
in Sections 2.3(a)(ii) and 2.3(b)(iii) or in the Stockholders' Agreement, there
are no outstanding rights or options to subscribe for or purchase from Santera,
or any warrants or other agreements providing for or requiring the issuance by
Santera of, any capital stock or any securities convertible into or exchangeable
for, or exercisable into, its capital stock. All of the issued and outstanding
shares of capital stock of Santera on the date hereof have been issued in
accordance with all applicable Laws, including, without limitation, all Federal
and state securities laws. All of the issued and outstanding shares of capital
stock of Santera issued between the date hereof and the Closing Date or issued
and outstanding on the Closing Date (including all shares issued or exchanged in
connection with the Recapitalization and all shares issued or exchanged in
connection with the Note and Preferred Stock Purchase Agreement, the Exchange
Agreement and the transactions contemplated thereby) will have been issued in
accordance with all applicable Laws, including, without limitation, all Federal
and state securities laws.

                           (f)      The consummation of the various transactions
contemplated by this Agreement and the Ancillary Agreements will not be and will
not be deemed to be a liquidation, dissolution or winding up of Santera under or
pursuant to Section B.2(c)(i) of Article IV or otherwise of the certificate of
incorporation of Santera as in effect at the time any such transaction is
consummated.

                  4.2      Valid and Enforceable Agreement; Authorization. Each
of this Agreement and each of the Ancillary Agreements to which Santera is a
party constitutes or when executed by Santera will constitute a legal, valid and
binding obligation of Santera, in each case, enforceable against Santera in
accordance with its respective terms, except that, in each case, such
enforcement may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors' rights generally and (ii) the availability of specific performance,
injunctive relief and other equitable remedies. Except for the Stockholders'
Consent, the execution and delivery of this Agreement and each of the Ancillary
Agreements to which Santera is a party and the consummation of the transactions
contemplated hereby and thereby have been duly authorized, approved and ratified
by all necessary resolutions, authorizations, consents, approvals and/or
ratifications on the part of Santera and its stockholders. Certified copies of
all such required resolutions, authorizations, consents, approvals and/or
ratifications received through the date hereof are attached as Schedule 4.2 and
no such resolution, authorization, consent or approval has been altered,
amended, rescinded, repealed or revoked. Except for the Stockholders' Consent,
pursuant to such resolutions, authorizations, consents, approvals and/or
ratifications, Santera has full corporate authority to enter into and deliver
this Agreement and each of the Ancillary Agreements to which Santera is a party,
to perform its respective obligations hereunder and thereunder, and to
consummate the transactions contemplated hereby and thereby. Upon receipt of the
Stockholders' Consent on the date hereof, Santera will have full corporate
authority to enter into and deliver this Agreement and each of the Ancillary
Agreements to which Santera is a

                                       31
<PAGE>

party, to perform its respective obligations hereunder and thereunder, and to
consummate the transactions contemplated hereby and thereby.

                  4.3      Financial Statements. Attached as Schedule 4.3(a) are
the Financial Statements. The Financial Statements were derived from the books
and records of Santera and (i) present fairly in all material respects the
financial position and results of operations of Santera at the dates and for the
periods indicated and (ii) except as set forth on Schedule 4.3(b), have been
prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis, except as disclosed in the notes
thereto, and subject to normal year-end audit adjustments (with respect to
interim periods).

                  4.4      Absence of Certain Developments. Since December 31,
2002, except as set forth on Schedule 4.4, there has been no (a) Material
Adverse Effect; (b) loss or, to Santera's Knowledge, threatened loss of any of
Santera's material customer accounts, or any decrease by any such material
customers, or, to Santera's Knowledge, threatened decrease by such customer, in
the rate of buying materials, products or services of Santera; (c) increase in
or commitment to increase compensation, benefits, or other remuneration to or
for the benefit of any employee or agent of Santera, or any benefits granted
under any Plan with or for the benefit of any such employee, shareholder,
director, officer, or agent, except for increases in salary, wages or benefits
in the Ordinary Course; (d) transaction entered into or carried out by Santera
other than in the Ordinary Course; (e) change made with respect to Santera in
its Tax or financial accounting or any Tax election; (f) transfer of any
material assets of Santera, other than arm's-length sales, leases, or
dispositions in the Ordinary Course; (g) modifications of any material term of,
or termination (but not including the natural expiration) of, any material
Contract to which Santera is a party or any material Government license, permit
or other authorization held by Santera; (h) abandonment or transfer by Santera
or lapse of any of Santera's Intellectual Property; (i) waiver by Santera of any
material claims or material rights; (j) disclosure by Santera of any of its
confidential or proprietary information to any person or entity other than (i)
to Tekelec and Tekelec's representatives, agents, attorneys and accountants,
(ii) the respective employees, shareholders, agents, customers, potential
customers or advisors of Santera in the Ordinary Course or (iii) the respective
employees, shareholders, agents or advisors of Santera in connection with the
transaction contemplated by this Agreement; (k) material change in the conduct
of the Santera's business, or any material change in the methods of purchase,
sale, lease, management, marketing, promotion or operation, or any delay or
postponement by Santera of the payment of its accounts payable or other
Liabilities; (l) any write-down in its accounts receivable other than in the
Ordinary Course; (m) action taken by Santera that will or may reasonably be
expected to cause or constitute a breach of any provision of this Agreement; or
(n) commitment or agreement by Santera to do any of the foregoing items (c)
through (n).

                  4.5      Undisclosed Liabilities.

                           (a)      Santera does not have any Liabilities
whatsoever, known or unknown, asserted or unasserted, liquidated or
unliquidated, accrued, absolute, contingent, or otherwise, and there is no
reasonable basis for any claim against Santera for any such Liability, except
(a) as set forth on the Financial Statements or Schedule 4.5, or (b) to the
extent they arise in the Ordinary Course and are not required to be set forth in
a schedule hereto, performance and payment obligations (but not liabilities for
breach or violation) lawfully incurred under arm's-length

                                       32
<PAGE>

contracts for goods or services which individually or in the aggregate will not
have a Material Adverse Effect upon Santera.

                           (b)      The value of the accounts payable and
accrued operating expenses of Santera described on Schedule 11.2 (as calculated
in accordance with accounting principles generally accepted in the United
States, consistently applied) does not as of the date of this Agreement, and
shall not as of the Closing Date, exceed $9,000,000.

                  4.6      Taxes.

                           (a)      Santera has timely filed or caused to be
filed with the appropriate Government entity all Tax Returns and reports
required to be filed by or on behalf of it, except for those Tax Returns for
which the failure to timely file would not reasonably be expected to have a
Material Adverse Effect. All Tax Returns, including any amended Tax Returns, are
true, correct, and complete in all respects, except where the failure to be
true, correct and complete would not reasonably be expected to have a Material
Adverse Effect. Santera is not currently the beneficiary of any extension of
time within which to file any Tax Return.

                           (b)      All Taxes (whether or not reflected in Tax
Returns as filed) payable by Santera with respect to all periods reflected on
Tax Returns have been fully and timely paid, except for those Taxes the failure
of which to fully and timely pay would not reasonably be expected to have a
Material Adverse Effect, and there are no grounds for the assertion or
assessment of any additional Taxes against Santera with respect to such periods.

                           (c)      There are no administrative or judicial Tax
proceedings or federal, state, local or foreign audits of any Tax Returns in
process or, to Santera's Knowledge, pending or threatened. There is no waiver or
tolling of any statute of limitations in effect with respect to any Tax Returns.
Since Santera's inception, no written claim has ever been made by any taxing
authority in a jurisdiction in which Santera does not file a Tax Return that it
is or may be subject to taxation by that jurisdiction.

                           (d)      Santera is not and since the date of its
incorporation has not been a member of an "affiliated group" within the meaning
of Section 1504 of the Code and it does not have any liability for Taxes under
Treas. Reg. Section 1.1502-6 (or any similar provision of state, local or
foreign law).

                           (e)      Santera has complied with all Laws relating
to the withholding of Taxes and the payment thereof (including, without
limitation, withholding of Taxes under Sections 1441 and 1442 of the Code, or
similar provisions under foreign laws), and has timely and properly withheld
from the appropriate party and paid over to the proper Government all amounts
required to be withheld and be paid over under applicable Law.

                           (f)      None of the assets of Santera is property
Santera is required to treat as being a "safe harbor lease" within the meaning
of Section 168(f)(8) of the Code, as in effect prior to amendment by the Tax
Equity and Fiscal Responsibility Act of 1982. None of the assets of Santera has
been financed with or directly or indirectly secures any industrial revenue
bonds or debt the interest on which is tax-exempt under Section 103(a) of the
Code.

                                       33
<PAGE>

                           (g)      None of the property owned by Santera is
tax-exempt use property within the meaning of Section 168(h) of the Code.

                           (h)      Santera is not a party to or bound by any
Tax allocation, Tax sharing, or Tax indemnification agreement or arrangement.

                           (i)      There are no liens for Taxes upon any of the
assets of Santera, except liens for Taxes not yet due and payable.

                           (j)      Except as set forth on Schedule 4.6(j),
Santera is not liable for Taxes to any foreign taxing authority which are due
and unpaid and Santera does not have and has not had a permanent establishment
in any foreign country, as defined in any applicable Tax treaty or convention
between the United States and such foreign country.

                           (k)      Except as set forth on Schedule 4.6(k),
Santera is not a partner in any joint venture, partnership or other arrangement
or contract that could be treated as a partnership for federal income tax
purposes.

                           (l)      Except to the extent the same may arise
pursuant to the Employment Agreements, none of the Liabilities of Santera is an
obligation to make a payment that will not be deductible under Section 162(m) or
Section 280G of the Code.

                           (m)      Santera will not have outstanding at the
Effective Time any warrants, rights with respect to stock, obligations, or
classes of stock (other than as created pursuant to this Agreement or the
Ancillary Agreements) that would prevent Tekelec and those Legacy Santera
Stockholders purchasing Series D Preferred Stock of Santera pursuant to the Note
and Preferred Stock Purchase Agreement from acquiring or retaining control of
the Surviving Corporation as defined in section 368(c) of the Code, provided
that no representation or warranty is made with respect to the items listed on
Schedule 4.6(m).

                           (n)      Schedule 4.6(n) of this Agreement lists (i)
in column 1 the names of certain persons who will purchase for cash Series D
Preferred Stock of Santera pursuant to the Note and Preferred Stock Purchase
Agreement; (ii) in column 2, the minimum amount of cash to be contributed by
each such person immediately prior to the Merger to purchase Series D Preferred
Stock; (iii) in column 3, the minimum number of shares of Series A Preferred
Stock of the Surviving Corporation, as successor to Santera, each person will
own after taking into account the Merger; and (iv) in column 4, the minimum
percentage (rounded to two decimal places) of stock of the Surviving Company, as
a successor to Santera, to be owned by each person, which percentage is stated
as a percentage of the total combined voting power of all classes of stock of
the Surviving Corporation, as successor to Santera, entitled to vote. Assuming
each such person complies with the Note and Preferred Stock Purchase Agreement,
the "Cash Contribution Factor" of each such person will be greater than or equal
to 10%. The "Cash Contribution Factor" is a fraction, (x) the numerator of which
is the actual amount of cash contributed by such person immediately prior to the
Merger to purchase Series D Preferred Stock, and (y) the denominator of which is
the liquidation value of all shares of Series A Preferred Stock received by such
person in the Merger excluding any such shares received on conversion of Series
D Preferred Stock. No person listed on Schedule 4.6(n) has a plan or intention
to sell, exchange or dispose of any stock of the Surviving Corporation, as
successor to Santera, to a person other than Tekelec, Tekelec Sub or another
person listed on Schedule 4.6(n).

                                       34
<PAGE>

                  4.7      Accounts Receivable; Inventory.

                           (a)      Set forth on Schedule 4.7(a) is a list of
all the accounts receivable of Santera as of March 31, 2003, together with an
aging schedule relating thereto. Such accounts receivable, and any accounts
receivable arising between such date and the Closing Date (collectively, the
"Santera Accounts Receivable") are or will be, except as set forth on Schedule
4.7(a), valid and subsisting, and all such Santera Accounts Receivable arose or
will have arisen in the Ordinary Course. Except as set forth on Schedule 4.7(a),
the Santera Accounts Receivable are not subject to any counterclaim, set-off,
defense, security interest, claim or other encumbrance. No agreement for
deduction, free goods, discount or other deferred price or quantity adjustment
has been made with respect to any Santera Account Receivable.

                           (b)      Except as set forth on Schedule 4.7(b), all
inventories held by Santera at any location consist of a quantity and quality
usable and salable in the Ordinary Course, and are not physically damaged,
previously used, obsolete (i.e., no longer offered for sale by Santera),
discontinued or excess.

                  4.8      No Breach of Law or Governing Document. Except as set
forth on Schedule 4.8, Santera is not in default under or in breach or violation
of any Law, except to the extent that any such default, breach or violation
would not result in a Material Adverse Effect. Santera is not in default under
or in breach or violation of any provision of its Certificate of Incorporation
or its Bylaws, in either case, as currently in effect. Except as set forth on
Schedule 4.8, Santera has not received any written notice alleging any default,
breach or violation of its Certificate of Incorporation or Bylaws or of any Law,
and the execution and delivery of this Agreement and the Ancillary Agreements to
which Santera is a party and the consummation of the transactions contemplated
hereby and thereby, including, without limitation, the Recapitalization, do not
or will not constitute or result in any such default, breach or violation.

                  4.9      Litigation. Except as set forth on Schedule 4.9, (a)
there is no, and for the previous three (3) years there has not been any Action
pending or, to Santera's Knowledge, threatened against Santera, including
without limitation any Action challenging, enjoining, or preventing this
Agreement or the Ancillary Agreements, or the consummation of the transactions
contemplated hereby and thereby; (b) Santera is not and has not been subject to
any Order other than Orders of general applicability and the consummation of the
transactions contemplated hereby and by any of the Ancillary Agreements will not
violate or result in a default by Santera under any Order applicable to or by
which Santera is bound; and (c) Santera has not been subject to or, to Santera's
Knowledge, been threatened to be subject to, and there are no grounds for, any
Action or Order relating to personal injury, death, or property or economic
damage arising from products or services sold or provided by Santera.

                  4.10     Assets. Except as set forth on Schedule 4.10 and
except for leased assets or assets which Santera has a license to use, Santera
has good, valid and legal title to and is the sole and exclusive owner of all
right, title and interest in and to all of (i) the assets reflected on the Most
Recent Balance Sheet or (ii) which have been acquired by Santera since the date
of the Most Recent Balance Sheet, in each case, free and clear of all Liens,
other than Permitted Liens. There exists no restriction on the use or transfer
of such assets. Except as set forth on Schedule 4.10, none of such assets are in
the possession of others or held by Santera on consignment. Santera owns no real
property.

                                       35
<PAGE>

                  4.11     Real and Personal Property Leased. Set forth on
Schedule 4.11 is a list of each lease under which Santera is the lessee of any
real property and a list of each lease under which Santera is the lessee of any
personal property and the location of such property. Santera has made available
to the other Parties hereto a true, correct and complete copy of each lease
identified on Schedule 4.11. The premises or property described in said leases
are presently occupied or used by Santera as lessee under the terms of such
leases. Except as set forth on Schedule 4.11, all rentals due under such leases
have been paid and there exists no default by Santera or, to Santera's
Knowledge, by any other party to such leases under the terms of such leases and
no event has occurred which, upon passage of time or the giving of notice, or
both, would result in any event of default by Santera or, to Santera's
Knowledge, by any other party to such leases, or prevent Santera from exercising
and obtaining the benefits of any rights or options contained therein. Except as
set forth on Schedule 4.11, Santera has all right, title and interest of the
lessee under the terms of said leases, free of all Liens, other than Permitted
Liens, on such leasehold right, title and interest, and all such leases are
valid and in full force and effect as against Santera and, to Santera's
Knowledge, the other party or parties thereto.

                  4.12     Necessary Property. The assets, property and property
rights of Santera constitute all of the assets, property and property rights
used, held for use or necessary for the conduct of the business of Santera in
the manner and to the extent presently conducted by Santera. Except as set forth
on Schedule 4.12, there exists no condition, agreement, understanding,
restriction or reservation affecting the title to or utility of the property of
Santera which would prevent Santera from utilizing such assets, or any part
thereof, to the same full extent that Santera might continue to do so if the
transactions contemplated hereby did not take place.

                  4.13     Use and Condition of Property. Except as set forth on
Schedule 4.13, all the material tangible assets of Santera are in good operating
condition and repair, subject to ordinary wear and tear, as reasonably required
for their use as presently conducted or planned by Santera. There is no pending,
and to Santera's Knowledge, there is no proposed or threatened condemnation
proceeding or similar action adversely affecting the activities or the assets of
Santera or with respect to any streets or public amenities appurtenant thereto.

                  4.14     Licenses and Permits. Set forth on Schedule 4.14 is a
list of each license or permit which Santera has and/or is required to maintain,
together with the name of the Government authority, agency or entity issuing
such license or permit. All such licenses and permits are valid and in full
force and effect and, except as set forth on Schedule 4.14, all such licenses
and permits will continue to be in full force and effect immediately following
the consummation of the transactions contemplated hereby.

                                       36
<PAGE>

                  4.15     Contracts.

                           (a)      Set forth on Schedule 4.15(a)(i) - (vii) is
a list of each Contract to which Santera is a party or is otherwise bound,
except for insurance policies set forth on Schedule 4.17, which (i) involves (A)
a guaranty, indemnity, surety, accommodation party or power of attorney, (B) a
sharing of payments or joint venture, (C) a sales agency, representation,
distributorship or franchise arrangement, (D) restrictions on competition by
Santera, (E) collective bargaining, works council, or union representation, (ii)
has resulted or is reasonably likely to result in a loss to Santera, (iii) is
not in the Ordinary Course, (iv) is not terminable upon thirty (30) days' notice
without liability; (v) includes a license, assignment, restriction on use of, or
other obligation to transfer any Intellectual Property or (vi) except for
customer Contracts in the Ordinary Course, involves an obligation (either
written or verbal) in excess of $50,000 not otherwise included on Schedule 4.15
(all such Contracts described in this Section 4.15(a), the "Material Santera
Contracts").

                           (b)      Each of the Material Santera Contracts is a
valid, binding and enforceable obligation of Santera and to Santera's Knowledge,
the other parties thereto, except that such enforcement may be subject to (i)
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting or relating to enforcement of creditors' rights generally; and (ii)
general equitable principles. Except as indicated on Schedule 4.15(b), Santera
is not, and to the extent it would create a current or future liability of
Santera, Santera has not been, and to Santera's Knowledge no other party to a
Material Santera Contract, is in breach or violation of or default under any
such Material Santera Contract, and no event has occurred that, through the
passage of time or the giving of notice, or both, would constitute, and the
execution of this Agreement and/or the Ancillary Agreements, and/or the Closing
hereunder or thereunder do not and will not constitute or result in, such a
breach, violation or default on the part of any party thereto, cause the
acceleration of any obligation of Santera, any other party thereto or the
creation of a Lien upon the assets of Santera, or require any consent
thereunder. Santera has delivered to Tekelec a true, complete and accurate copy
of each Material Santera Contract.

                  4.16     Santera Business Intellectual Property.

                           (a)      Schedule 4.16(a)(i) contains a true,
complete and accurate list of each of the following items of Santera Business
Intellectual Property: patents, patent applications and invention disclosures;
trademarks, service marks, trade names, corporate names, and registrations and
applications for registration of the foregoing; copyright registrations and
applications for registration; and domain names. Schedule 4.16(a)(ii) contains a
list of each Santera Business Intellectual Property License. Schedule 4.16(a)(i)
accurately summarizes, where applicable, the following for each agreement or
item of Santera Business Intellectual Property: patent number, application
number, registration number, filing date, date of issuance, registration or
grant, applicant, classification of goods or services covered (for trademarks
and service marks), agreement title, mark or name, owner, licensee, licensor,
license date, country of origin and subject matter.

                           (b)      Except with respect to Intellectual Property
licensed to Santera under a Santera Business Intellectual Property License set
forth in Schedule 4.16(a)(ii), and except as described on Schedule 4.16(b),
Santera has good, valid and legal title to, and is the sole and exclusive owner
of all right, title and interest in and to all Santera Business Intellectual
Property, free and clear of all Liens, other than Permitted Liens.

                                       37
<PAGE>

                           (c)      Except as set forth in Schedules 4.16(c)(i)
through (ix), (i) there are no obligations (including royalty obligations),
covenants or restrictions from third parties or Orders affecting either the use,
disclosure, enforcement, transfer or licensing of the Santera Business
Intellectual Property; (ii) each item of Santera Business Intellectual Property
is valid and enforceable and encompasses all proprietary rights necessary for
the conduct of the business as presently conducted or proposed by Santera to be
conducted (as evidenced by a written business plan or product development plan
on the date hereof); (iii) no entity other than Santera possesses any current or
contingent rights to any item of Santera Business Intellectual Property
(including, without limitation, through any escrow account); (iv) Santera has
secured from all persons who have created or otherwise have any rights in or to,
any item of Santera Business Intellectual Property, valid enforceable written
assignments of, or licenses to, any such Santera Business Intellectual Property;
(v) Santera is the owner of all right, title and interest in and to, or
otherwise possesses all necessary legal rights to, all Intellectual Property
incorporated in, or created in connection with, work provided to its customers;
(vi) Santera has not transferred, and is not obligated to transfer to any third
party, any Santera Business Intellectual Property; (vii) there is no action,
suit, arbitration or other proceeding pending or, to the Knowledge of Santera,
threatened, which involves any of Santera Business Intellectual Property rights;
(viii) Santera is not in default under any Santera Business Intellectual
Property License or other agreement whereby it has the right to use, sell,
license, maintain enhance, modify or otherwise deal with any Santera Business
Intellectual Property; and (ix) Santera is not subject to any Order and is not
party to any Contract which restricts or impairs the use of any Santera Business
Intellectual Property.

                           (d)      Santera has imposed written non-disclosure
obligations on all third parties that have received any confidential information
or trade secrets relating to Santera.

                           (e)      Except as set forth on Schedule 4.16(e), to
the Knowledge of Santera, there is not and has not been any infringement,
misappropriation or other violation of any Intellectual Property of a third
party by Santera, and there are no facts raising a likelihood of any such
violation. The use of the Santera Business Intellectual Property does not, to
the Knowledge of Santera, conflict with any rights of a third party.

                           (f)      To Santera's Knowledge, there is not and has
not been any infringement, misappropriation or other violation of any Santera
Business Intellectual Property, and to Santera's Knowledge there are no facts
raising a likelihood of any such violation. There has been no claim made by
Santera of any infringement, misappropriation or other violation of any of the
Santera Business Intellectual Property.

                           (g)      Except as set forth on Schedule 4.16(g),
Santera's Intellectual Property and Santera's products or services have not been
the subject of a claim of infringement, interference or unfair competition or
other claim. Except as set forth on Schedule 4.16(g), there has been no claim
made against Santera asserting the invalidity, misuse or unenforceability of any
of the Santera Business Intellectual Property or challenging Santera's right to
use, transfer, or ownership of, any of the Santera Business Intellectual
Property, and, to the Knowledge of Santera, there are no grounds for any such
claim or challenge, including without limitation any such claim or challenge
based upon any use or enforcement of, or any failure to use or enforce, any of
the Santera Business Intellectual Property.

                                       38
<PAGE>

                           (h)      No loss of any Santera Business Intellectual
Property is pending, reasonably foreseeable or threatened. Santera has taken all
action necessary to maintain and protect the Santera Business Intellectual
Property and, to the Knowledge of Santera, the owners of the Santera Business
Intellectual Property licensed to Santera have taken all action necessary to
maintain and protect such Santera Business Intellectual Property.

                           (i)      Except as set forth on Schedule 4.16(i), the
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements will not alter, impair or extinguish any of the Santera
Business Intellectual Property or subject Santera's use of the Santera Business
Intellectual Property to restrictions or limitations other than those to which
Santera's use thereof would be subject if the transactions contemplated hereby
did not occur.

                           (j)      Santera has not given to any third party any
warranty or indemnification related to Santera Business Intellectual Property,
except for (i) statutory warranties given in the Ordinary Course in connection
with the sale of goods and services, (ii) warranties given by third party
manufacturers that Santera passes through or assigns to its customers in
connection with the sale of goods and (iii) warranties or indemnities
specifically set forth in writing in the Material Santera Contracts.

                  4.17     Insurance. Schedule 4.17 sets forth the insurance
maintained by Santera since its inception, together with the amount of coverage
for each policy, the premium due dates, the dates of last payment and whether
such policy is a "claims made" policy or an occurrence based policy.

                  4.18     Employees and Consultants. Set forth on Schedule 4.18
is a list of: (a) all current employees (active or inactive) of Santera, (b) all
current paid consultants to Santera, and (c) all retirees and terminated
employees of Santera for whom Santera has any benefits responsibility or other
continuing or contingent obligation (other than unemployment compensation),
exclusive of any Plan, together, in the case of (a), (b) and (c), with the
current rate of compensation and benefits (if any) payable to each and paid
vacation time owing to such person and any incentive or bonus payments. Each
consultant who is engaged by Santera and listed on Schedule 4.18 has signed an
agreement in the form attached to Schedule 4.18. Except as set forth on Schedule
4.18, Santera is not indebted to any shareholder, director, officer, employee or
agent of Santera, except for amounts due as normal salaries and wages and in
reimbursement of ordinary expenses on a current basis.

                  4.19     Transactions with Related Persons. Except as set
forth on Schedule 4.19, Santera has no Liabilities, contractual or otherwise,
owed to or owing from, directly or indirectly, any shareholders or Affiliates of
Santera. Except as set forth on Schedule 4.19, to the Knowledge (without any
inquiry) of Santera, none of the shareholders of Santera or any director,
officer or Affiliate of Santera has any material financial interest, direct or
indirect, in any supplier or customer of, or other business which has any
material transactions or other material business relationship with Santera.

                  4.20     Labor Matters.

                           (a)      Santera is not a party to or bound by any
collective bargaining, works council, union representation or similar agreement
or arrangement;

                                       39
<PAGE>

                           (b)      Santera is not and has not engaged in any
unfair labor practice;

                           (c)      There is no labor strike, dispute, slowdown,
or stoppage pending or, to Santera's Knowledge, threatened against Santera;

                           (d)      There is currently no bargaining
representative for the employees of Santera;

                           (e)      No collective bargaining agreement is
currently being negotiated and no organizing effort is currently being made with
respect to the employees of Santera; and

                           (f)      Except as set forth on Schedule 4.20(f), no
current or former employee of Santera has any claim against Santera on account
of or for (i) overtime pay, other than overtime pay for the current payroll
period, (ii) wages or salary (excluding current bonus, accruals and amounts
accruing under pension and profit sharing plans) for any period other than the
current payroll period, (iii) vacation, time off or pay in lieu of vacation or
time off, other than that earned in respect of the current fiscal year, or (iv)
any violation of any Law relating to minimum wages or maximum hours of work.

                  4.21     Employee Benefit Matters.

                           (a)      Except as set forth on Schedule 4.21,
Santera is not a party to any Plan relating to its employees. True, correct and
complete copies of all documents creating or evidencing any Plan listed on
Schedule 4.21 have been made available to the other Parties hereto. There are no
pending or to Santera's Knowledge threatened negotiations, demands or proposals
with respect to the subject matter of the foregoing Plans other than ordinary
claims for benefits under the respective plans. With respect to each Plan listed
on Schedule 4.21 that Santera intends to be qualified within the meaning of
Section 401(a) of the Code, true, correct and complete copies of the most recent
determination letter from the IRS and any outstanding request for a
determination letter from the IRS have been delivered to the other Parties
hereto.

                           (b)      Santera has not made any contributions to
any multi-employer plan (as defined in ERISA Section 3(37) or ERISA Section
4001(a)(3)), Santera has never been a member of a controlled group which
contributed to any such plan, and Santera has never been under common control
with an employer which contributed to any such plan.

                           (c)      Each Plan listed on Schedule 4.21 complies
with and has been administered, operated, and maintained substantially in
compliance with, and, except as set forth on Schedule 4.21, Santera has no
direct or indirect liability under, the requirements provided by any and all
statutes, orders or governmental rules or regulations currently in effect,
including but not limited to ERISA and the Code, and applicable to such Plans,
and no such Plan is subject to Title IV of ERISA.

                           (d)      Except as set forth on Schedule 4.21,
Santera has no liability or obligation to provide life, medical or other welfare
benefits to former or retired employees (or other persons), other than under
COBRA.

                           (e)      Except as set forth on Schedule 4.21,
Santera is not a party to any Plan that is intended to qualify under Code
Section 401(a) and Code Section 501(a) and each such

                                       40
<PAGE>

Plan and its related trust, if any, are qualified under Code Section 401(a) and
Code Section 501(a) and (i) have been determined by the IRS to qualify, and
nothing has since occurred to cause the loss of the Plan's qualification or (ii)
determination letter requests for such Plans have been submitted to the IRS.

                           (f)      Except as set forth on Schedule 4.21, all
contributions with respect to the Plans relating to Santera's employees for all
employment up to the Closing Date (including periods from the first day of the
current plan year to the Closing Date) have been made by Santera and all members
of the controlled group in accordance with past practice and the recommended
contribution in the applicable actuarial report, if any.

                           (g)      Except as set forth on Schedule 4.21, there
is no matter pending (other than routine qualification determination filings or
ruling requests) with respect to any Plan before the IRS or the Department of
Labor.

                           (h)      There is no pending or threatened legal
action, proceeding or investigation against or involving any Plan described in
Schedule 4.21 and there is no reasonable basis for any legal action, proceeding
or investigation.

                  4.22     Discrimination and Occupational Safety and Health.
Except as set forth on Schedule 4.22, no person has any claim, or to Santera's
Knowledge, has any reasonable basis for any Action against, and no claim is
pending or, to Santera's Knowledge, threatened against, Santera arising out of
any Law relating to discrimination in employment or employment practices or
occupational safety and health standards as a result of Santera's operations;
and since its inception, Santera has not received any notice from any person
alleging a violation by Santera of such Law or occupational safety or health
standards in connection with its operations.

                  4.23     Product and Service Warranties. The only product or
service warranty or guarantee provided by Santera in any Contract are those that
are specifically set forth in writing in such Contract or implied by applicable
Law. Except as set forth on Schedule 4.23, since September 30, 2000, no product
or service warranty or similar claims have been made against Santera as to which
the losses and expenses in respect of such claim have exceeded $25,000. The
aggregate loss and expense (including out-of-pocket expenses) attributable to
all product warranty and similar claims now pending or hereafter asserted
against Santera or its predecessors, in either case, with respect to products
manufactured by Santera on or prior to the Closing Date will not exceed
$750,000, which amount represents 221% of the estimated reserve on Santera's
balance sheet as of the date hereof for such matters. No person or entity
(including, but not limited to, Government agencies of any kind) has any valid
claim, or valid basis for any action or proceeding, against Santera under any
Law relating to unfair competition, false advertising or other similar claims
arising out of product warranties, guarantees, specifications, manuals or
brochures or other advertising materials.

                  4.24     Product and Service Liability Claims. Except as set
forth on Schedule 4.24, since its inception, Santera has not received notice or
information as to any claim or allegation of personal injury, death, or property
or economic damages, any claim for punitive or exemplary damages, any claim for
contribution or indemnification, or any claim for injunctive relief in
connection with any product manufactured, sold, distributed or otherwise put in
commerce by, or in connection with any service provided by, or based on any
error, omission or negligent act in the performance of services by, Santera. The
aggregate loss and expense attributable to any and all such

                                       41
<PAGE>

claims and allegations with respect to products manufactured, sold, distributed
or put in commerce, or services provided during the period commencing with
Santera's inception and ending on the Closing Date have not exceeded, and will
not exceed, $50,000, exclusive of any recovery or coverage under any insurance
policy.

                  4.25     Customers. Schedule 4.25 sets forth a true, complete
and correct list of the ten (10) largest customers and the ten (10) largest
suppliers of Santera by volume of sales and purchases for the fiscal year ended
December 31, 2002.

                  4.26     Foreign Assets and Operations. Except as set forth on
Schedules 4.26(a)-(b):

                           (a)      Santera has no interest in any real property
or tangible or intangible personal property that is located outside of the
United States, including any stock, securities or investments in, or claims
against, any entities or persons with substantially all their property or
business so located.

                           (b)      At all times, the Santera has acted:

                                    (i)      pursuant to valid qualifications to
         do business in all jurisdictions outside the United States where such
         qualification is required by local Law, except where the failure to be
         so qualified would not have a Material Adverse Effect on Santera;

                                    (ii)     in compliance with all applicable
         foreign Laws, including without limitation Laws relating to foreign
         investment, foreign exchange control, immigration, employment and
         taxation;

                                    (iii)    without notice of violation of and
         in compliance with all relevant anti-boycott laws, regulations and
         guidelines, including without limitation Section 999 of the Code and
         regulations and guidelines issued pursuant thereto and the Export
         Administration Regulations administered by the U.S. Department of
         Commerce, as amended from time to time, including all reporting
         requirements;

                                    (iv)     without notice of violation of and
         in compliance with all export control or sanctions laws, orders or
         regulations, including without limitation the Export Administration
         Regulation administrated by the U.S. Department of Commerce and
         sanctions and embargo executive orders and regulations administered by
         the Office of Foreign Assets Control of the U.S. Treasury Department,
         as amended from time to time, and without violation and in compliance
         with any required export or reexport licenses or authorizations granted
         under such laws, regulations or orders, which licenses or
         authorizations are described in Schedule 3.26; and

                                    (v)      without notice of violation of and
         in compliance with the Foreign Corrupt Practices Act of 1977, as
         amended.

                  4.27     Rights, Options, Warrants and Similar Agreements.
Schedule 4.27 sets forth a true and complete list of all record holders of
options or warrants to acquire shares of capital stock of Santera and, with
respect to each outstanding warrant, (i) the expiration date and (ii) the number
of shares of Series A Preferred Stock for which such warrant will be exercisable
following the

                                       42
<PAGE>

Recapitalization, the consummation of any of the transactions contemplated by
the Note and Preferred Stock Purchase Agreement and/or the Exchange Agreement
and the Merger contemplated hereby and (iii) the exercise price per share of
Series A Preferred Stock at which it will be exercisable following the
consummation of the transactions referenced in (ii) above. Except as shown on
Schedule 4.27, and except for outstanding shares of preferred stock to be
reclassified in the Recapitalization or to be issued in exchange for certain
promissory notes or purchased pursuant to the Note and Preferred Stock Purchase
Agreement, there are no outstanding rights to subscribe for or purchase from
Santera, or to require the issuance by Santera of, capital stock of Santera or
securities convertible into or exchangeable for, or exercisable into, capital
stock of Santera other than the rights contained in this Agreement or the
Stockholders' Agreement. Schedule 4.27 also sets forth the date of each
agreement under which the warrants listed on such Schedule were created and all
amendments to any such agreement, true and complete copies of which have been
provided to Tekelec. Except as specifically noted on Schedule 4.27, each warrant
shown on Schedule 4.27 that is not exercised prior to the Effective Time will,
at the Effective Time, by virtue of the Merger contemplated hereby, the failure
of the Surviving Corporation to assume such warrants pursuant to the terms of
such warrants and without any further action on the part of Santera or the
holder thereof, be cancelled. Each option shown on Schedule 4.27 will, at the
Effective Time, by virtue of the Merger contemplated hereby, the failure of the
Surviving Corporation to assume such options as provided in the plan pursuant to
which such options were issued and without any further action on the part of
Santera or the holder thereof, be cancelled. Neither Santera nor the Surviving
Corporation has any obligation whatsoever to assume any warrants or options
shown on Schedule 4.27 under the terms of such warrants or such options,
pursuant to any plan pursuant to which such warrants or options were issued,
under any applicable law or otherwise. All preemptive rights or rights of first
offer with respect to the sales and/or issuances of promissory notes or shares
of capital stock of Santera contemplated by this Agreement and the various
Ancillary Agreements will, prior to the Closing, have been either satisfied or
effectively and validly waived by the holders thereof in accordance with the
terms of the agreements or instruments creating such rights.

                  4.28     Stockholders and Related Matters.

                           (a)      Schedule 4.28 sets forth a true and complete
list of all holders of record of capital stock and options, warrants or other
rights to acquire shares of capital stock of Santera (other than options and
warrants shown on Schedule 4.27), sorted in descending order according to the
number of shares of capital stock or options, warrants or other rights to
acquire shares of capital stock of Santera owned by each such holder. Santera
does not have, and as of the Closing Date (following the Recapitalization,
consummation of the transactions contemplated by the Note and Preferred Stock
Purchase Agreement and the Exchange Agreement, the Merger and the consummation
of the transactions contemplated hereby) will not have, more than 499 holders of
record of the shares of its capital stock and options, warrants or other rights
to acquire shares of its capital stock, and is not, and at the Closing will not
be, required to register any class of equity securities pursuant to Section
12(g) of the Securities Exchange Act of 1934, as amended.

                           (b)      At the Closing, the provisions of Article
Fourth, Section C(1)(ii) of the Second Amended and Restated Certificate of
Incorporation will become effective under the Delaware Law, enforceable against
the stockholders of Santera in accordance with the terms thereof. The provisions
of Section 3.1 of the Stockholders' Agreement are legal, valid and binding
obligations of each stockholder of Santera which is a signatory thereto,
enforceable against each such stockholder in accordance with the terms thereof.
Each of the Powers of Attorney are legal,

                                       43
<PAGE>

valid and binding obligations of each stockholder of Santera which is a
signatory thereto, enforceable against each such stockholder in accordance with
the terms thereof.

                           (c)      True and complete copies of the accredited
investor questionnaires executed by the Legacy Santera Stockholders in
connection with the Note and Preferred Stock Purchase Agreement have been
delivered to Tekelec on the date hereof.

                  4.29     Environmental Matters. Santera is currently and since
its inception has been in compliance with all applicable Environmental Laws.
Except as set forth on Schedule 4.29, there is no civil, criminal or
administrative action, suit, investigation or proceeding pending or, to
Santera's Knowledge, threatened against Santera relating to or arising from any
Environmental Laws.

                  4.30     Management Rights. Schedule 4.30 sets forth a true
and complete list of all Contracts or agreements between Santera and any of its
stockholders or any other persons or entities pursuant to which Santera has
granted any such stockholder or any such other person or entity, any management,
observation, informational or other similar rights, other than (a) this
Agreement, the Releases or the other Ancillary Agreements and (b) Contracts
between Santera and persons or entities that are not stockholders of Santera,
that are listed on Schedule 11.2 and that contain provisions relating to the
provision of information by Santera to such persons or entities that are
customarily included in agreements of a similar nature. True and complete copies
of all termination agreements or amendments, as indicated on Schedule 4.30, with
respect to the agreements or other management, observation, information or other
similar rights set forth on Schedule 4.30 have, to the extent indicated on
Schedule 4.30, been delivered to Tekelec on the date hereof. On the Closing
Date, all such termination agreements and amendments will continue to be in full
force and effect and shall become effective in accordance with their respective
terms. If Schedule 4.30 states that a Contract listed thereon will terminate in
accordance with its terms, then such Contract will terminate in accordance with
its terms at the Effective Time by virtue of the Merger and without any further
action on the party of Santera or any party to such Contract.

                  4.31     Investment Representations. Santera is an "accredited
investor" as defined in Rule 501 of the Securities Act of 1933, as amended.
Santera has received all of the information that it considers necessary or
appropriate for deciding whether to purchase the Business. Santera has had
satisfactory opportunity to ask questions and received answers from Tekelec
regarding the terms and conditions of the purchase and sale of the Business and
the properties, prospects and financial condition of the Business and to obtain
additional information sufficient to satisfy itself with respect to the
foregoing. The Business will be acquired for Santera's own account for
investment purposes only and without any plans or intention to resell, transfer
or otherwise dispose of the Business.

                  4.32     Brokers, Finders. Except for JP Morgan Chase & Co.,
whose fees and expenses shall not exceed $1,000,000 and whose fees and expenses
shall be paid by Santera, no finder, broker, agent, or other intermediary,
acting on behalf of Santera or any of its Affiliates, is entitled to a
commission, fee, or other compensation or obligation in connection with the
negotiation or consummation of the transactions contemplated by this Agreement
or the Ancillary Agreements. Attached hereto as Exhibit 4.32 are true, correct
and complete copies of all agreements or understandings between Santera and J.P.
Morgan Chase & Co. Upon payment of the above-referenced amounts to J.P. Morgan
Chase & Co., Santera shall have no further obligations whatsoever to J.P. Morgan
Chase & Co.

                                       44
<PAGE>

                  4.33     Representations and Warranties under the Note and
Preferred Stock Purchase Agreement. Each of the representations and warranties
of the Company contained in the Note and Preferred Stock Purchase Agreement is
true and correct.

                  4.34     Complete Disclosure. To the Knowledge of Santera,
Santera has not omitted any material disclosures necessary in order to make the
representations and warranties made in this Agreement, in light of the
circumstances under which they were made, not misleading.

                                    ARTICLE V
                REPRESENTATIONS AND WARRANTIES OF LEGACY SANTERA
                                  STOCKHOLDERS

         Each Legacy Santera Stockholder severally, and not jointly and
severally, hereby makes (with respect to itself only) the following
representations and warranties to each of the other Parties hereto, each of
which is true and correct on the date hereof and shall survive the Closing Date
and the transactions contemplated hereby to the extent set forth herein:

                  5.1      General.

                           (a)      Except as set forth on Schedule 5.1(a), no
permit, consent, waiver, approval or authorization of, or declaration to or
filing or registration with, any Governmental or regulatory authority or third
party is required in connection with the execution, delivery or performance of
this Agreement or the Ancillary Agreements by such Legacy Santera Stockholder or
the consummation by such Legacy Santera Stockholder of the transactions
contemplated hereby and thereby, except for the consents and approvals required
to be obtained in connection with, or filings or registrations required to be
made pursuant to, the HSR Act.

                           (b)      This Agreement has been duly executed and
delivered by such Legacy Santera Stockholder and constitutes a legal, valid and
binding obligation of such Legacy Santera Stockholder, enforceable against such
Legacy Santera Stockholder in accordance with its terms, except to the extent
such enforcement may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors' rights generally and (ii) the availability of specific performance,
injunctive relief and other equitable remedies. Each of the Ancillary Agreements
to which such Legacy Santera Stockholder is a party constitutes a legal, valid
and binding obligation of such Legacy Santera Stockholder, enforceable against
such Legacy Santera Stockholder in accordance with its terms, except to the
extent such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally.

                           (c)      Such Legacy Santera Stockholder owns
beneficially and of record the number of shares of capital stock, or options or
warrants to acquire the same, as are set forth next to such Legacy Santera
Stockholder's name on Schedule 5.1(c) under the column entitled
"Pre-Recapitalization Ownership", free and clear of all Liens, except for Liens
contained in the agreements listed on Schedule 5.1. Following the
Recapitalization, but prior to the consummation of the transactions contemplated
by the Note and Preferred Stock Purchase Agreement, the Exchange Agreement and
the Merger, such Legacy Santera Stockholder will own beneficially and of record
the number of capital stock, or options or warrants to acquire the same, as are
set forth next to such Legacy Santera Stockholder's name on Schedule 5.1(c)
under the column entitled "Post-

                                       45
<PAGE>

Recapitalization Ownership", free and clear of all Liens, except for Liens
contained in the agreements listed on Schedule 5.1. Following the
Recapitalization and the consummation of the transactions contemplated by the
Note and Preferred Stock Purchase Agreement and the Exchange Agreement, but
prior to the Merger, such Legacy Santera Stockholder will own beneficially and
of record the number of capital stock, or options or warrants to acquire the
same, as are set forth next to such Legacy Santera Stockholder's name on
Schedule 5.1(c) under the column entitled "Pre-Merger Ownership", free and clear
of all Liens, except for Liens contained in the agreements listed on Schedule
5.1. Following the Merger, such Legacy Santera Stockholder will own beneficially
and of record the number of capital stock, or options or warrants to acquire the
same, as are set forth next to such Legacy Santera Stockholder's name on
Schedule 5.1(c) under the column entitled "Post-Merger Ownership", free and
clear of all Liens, except for Liens contained in the agreements listed on
Schedule 5.1.

                  5.2      Brokers, Finders. Except for J.P. Morgan Chase & Co.,
whose fees and expenses shall not exceed $1,000,000 and whose fees and expenses
shall be paid by Santera, no finder, broker, agent, or other intermediary,
acting on behalf of such Legacy Santera Stockholder, is entitled to a
commission, fee, or other compensation or obligation in connection with the
negotiation or consummation of the transactions contemplated by this Agreement
or the Ancillary Agreements.

                  5.3      Litigation. There are no actions, suits or
proceedings pending or, to such Legacy Santera Stockholder's knowledge,
threatened against such Legacy Santera Stockholder, at law or in equity, which
if adversely determined would have a material adverse effect on such Legacy
Santera Stockholder's performance under this Agreement or the Ancillary
Agreements or the consummation of the transactions contemplated hereby or
thereby. There are no orders, writs, injunctions, decrees or unsatisfied
judgments outstanding against or related to such Legacy Santera Stockholder
which could interfere with the such Legacy Santera Stockholder's ability to
consummate the transactions contemplated by this Agreement or the Ancillary
Agreements.

                  5.4      Investment Representations. Such Legacy Santera
Stockholder understands that the issuance of (i) shares of Series A-1 Preferred
Stock, Series B-1 Preferred Stock and Series C-1 Preferred Stock it is receiving
in connection with the Recapitalization, (ii) convertible promissory notes it is
receiving pursuant to the Note and Preferred Stock Purchase Agreement, (iii)
shares of Series D Preferred Stock it is receiving pursuant to the Note and
Preferred Stock Purchase Agreement, (iv) shares of Series A-2 Preferred Stock,
Series B-2 Preferred Stock and Series C-2 Preferred Stock it is receiving upon
the exchange of such shares for shares of Series A-1 Preferred Stock, Series B-1
Preferred Stock and Series C-1 Preferred Stock, (v) shares of Series A Preferred
Stock it is receiving pursuant hereto, (vi) any other securities of the
Surviving Corporation received upon conversion thereof, and (vii) any Tekelec
securities received upon the redemption of the Series A Preferred Stock pursuant
to the Second Amended and Restated Certificate of Incorporation or the exercise
of the put or call options contained in the Stockholders' Agreement are not, and
will not be, registered under the Securities Act of 1933, as amended, or any
applicable state securities laws (unless Tekelec elects after the date hereof to
so register such shares) and that any sale, transfer or other disposition of
such shares, promissory notes or other securities of the Surviving Corporation
or Tekelec securities by such Legacy Santera Stockholder must be made only
pursuant to an effective registration under applicable federal and state
securities laws or an available exemption therefrom and otherwise in compliance
with the terms of the Stockholders' Agreement. Such Legacy Santera Stockholder
is an "accredited investor" as defined in Rule 501 of the Securities Act

                                       46
<PAGE>

of 1933, as amended. Such Legacy Santera Stockholder has received all of the
information that it considers necessary or appropriate for deciding whether to
acquire the shares of preferred stock it is receiving in connection with the
Recapitalization, the convertible promissory notes it is receiving pursuant to
the Note and Preferred Stock Purchase Agreement, the shares it is receiving
pursuant to the Note and Preferred Stock Purchase Agreement, the shares of
preferred stock it is receiving upon exchange for other shares of capital stock,
the shares of Series A Preferred Stock it is acquiring pursuant hereto, any
other securities of the Surviving Corporation received upon conversion thereof,
and any Tekelec securities received upon the redemption of the Series A
Preferred Stock pursuant to the Second Amended and Restated Certificate of
Incorporation or the exercise of the put or call options contained in the
Stockholders' Agreement. Such Legacy Santera Stockholder has had a satisfactory
opportunity to ask questions and receive answers from Santera and Tekelec
regarding the terms and conditions of the shares of preferred stock it is
receiving in connection with the Recapitalization, the convertible promissory
notes it is receiving pursuant to the Note and Preferred Stock Purchase
Agreement, the shares it is receiving pursuant to the Note and Preferred Stock
Purchase Agreement, the shares of preferred stock it is receiving upon exchange
for other shares of capital stock, the Series A Preferred Stock it is acquiring
pursuant hereto, any other securities of the Surviving Corporation received upon
conversion thereof, and any Tekelec securities received upon the redemption of
the Series A Preferred Stock pursuant to the Second Amended and Restated
Certificate of Incorporation or the exercise of the put or call options
contained in the Stockholders' Agreement and the business, properties, prospects
and financial condition of Santera and to obtain additional information
sufficient to satisfy itself with respect to the foregoing. The shares of
preferred stock it is receiving in connection with the Recapitalization, the
convertible promissory notes it is receiving pursuant to the Note and Preferred
Stock Purchase Agreement, the shares it is receiving pursuant to the Note and
Preferred Stock Purchase Agreement, the shares of preferred stock it is
receiving upon exchange for other shares of capital stock, the shares of Series
A Preferred Stock to be acquired by such Legacy Santera Stockholder pursuant to
this Agreement, and any securities of the Surviving Corporation received upon
conversion thereof or Tekelec securities received upon the redemption of the
Series A Preferred Stock pursuant to the Second Amended and Restated Certificate
of Incorporation or the exercise of the put or call options contained in the
Stockholders' Agreement, will be acquired for such Legacy Santera Stockholder's
own account for investment purposes only and without any plans or intention to
resell, transfer or otherwise dispose of such shares of Series A Preferred
Stock, other securities of the Surviving Corporation or Tekelec securities.

                  5.5      Consultation. Such Legacy Santera Stockholder has
been advised to consult with an attorney before executing this Agreement and
each Ancillary Agreement to which such Legacy Santera Stockholder is a party,
and such Legacy Santera Stockholder has done so or, after careful reading and
consideration has chosen not to do so of such Legacy Santera Stockholder's own
volition. Such Legacy Santera Stockholder hereby acknowledges that he, she or it
has signed this Agreement knowingly and voluntarily and with the advice of any
counsel retained to advise such Legacy Santera Stockholder with respect to it.

                                   ARTICLE VI
                          ACTIONS PRIOR TO CLOSING DATE

         The Parties hereto covenant and agree to take the following actions
between the date hereof and the Closing Date:

                                       47
<PAGE>

                  6.1      Consents of Certain Third Parties; Governmental
Approvals.

                           (a)      Tekelec will act diligently and reasonably
to secure, before the Closing Date, the consent, approval or waiver, in form and
substance reasonably satisfactory to Santera, from any party to any Assumed
Contract required to be obtained to permit the consummation of the transactions
contemplated by this Agreement; provided that none of Santera or Tekelec shall
have any obligation to offer or pay any consideration in order to obtain any
such consents or approvals. During the period prior to the Closing Date, Santera
shall act diligently and reasonably to cooperate with Tekelec to obtain the
consents, approvals and waivers contemplated by this Section 6.1(a).

                           (b)      During the period prior to the Closing Date,
Tekelec and Santera shall act diligently and reasonably, and each of the Parties
hereto shall cooperate with each other, to secure any consents and approvals of
any Governmental bodies required to be obtained by them in order to assign or
transfer any Contributed Assets to Merger Sub, to permit the consummation of the
transactions contemplated by this Agreement, or to otherwise satisfy the
conditions set forth in Article VIII, Article IX and Article X; provided that
none of the Parties shall be required to divest or hold separate or otherwise
take or commit to take any action that limits its freedom of action with respect
to, or its ability to retain, any of the shares of capital stock of Santera to
be issued hereunder or any of the businesses, product lines or assets of any
such Party.

                  6.2      Approval of Merger and Other Matters.

                           (a)      By 4:00 p.m., Eastern Standard Time, on the
date hereof, Santera and the Legacy Santera Stockholders shall cause (i) the
Recapitalization to be consummated, and Santera shall have obtained confirmation
from the Secretary of State of Delaware that the Certificate of Amendment has
become effective, (ii) the Initial Closing contemplated by the Note and
Preferred Stock Purchase Agreement to be consummated in accordance with the
terms of the Note and Preferred Stock Purchase Agreement and (iii) Santera to
provide Tekelec with evidence, reasonably satisfactory to Tekelec, that each of
the foregoing has been completed.

                           (b)      Santera and each of the Legacy Santera
Stockholders hereby agree to take all actions reasonably necessary to consummate
the transactions contemplated by the Note and Preferred Stock Purchase Agreement
and the Exchange Agreement and to timely fulfill all of their obligations under
such Note and Preferred Stock Purchase Agreement and the Exchange Agreement,
subject to the satisfaction of the conditions set forth therein. Santera and
each of the Legacy Santera Stockholders hereby agree that they shall not,
without the prior written consent of Tekelec, take any action to cause the Note
and Preferred Stock Purchase Agreement, any of the notes issued pursuant
thereto, the Exchange Agreement or any of the terms or conditions of any of the
foregoing to be amended, waived, discharged or terminated. In addition, Santera
and each of the Legacy Santera Stockholders hereby agree not to assign or
otherwise transfer any of their rights or obligations under the Note and
Preferred Stock Purchase Agreement (other than, to the extent applicable,
allocations within groups of affiliates to the extent permitted by the Note and
Preferred Stock Purchase Agreement), any of the notes issued pursuant thereto or
the Exchange Agreement to any person or entity without the prior written consent
of Tekelec.

                           (c)      Santera hereby agrees to use its reasonable
best efforts to obtain as soon as possible after the date hereof and prior to
Closing an executed signature page to (i) this

                                       48
<PAGE>

Agreement, the Note and Preferred Stock Purchase Agreement, the Power of
Attorney, the Escrow Agreement and the Stockholders' Agreement from each of
those stockholders of Santera listed on Schedule 6.2(c) (Part 1), (ii) this
Agreement, the Exchange Agreement, the Stockholders' Agreement, the Power of
Attorney and the Escrow Agreement from each of those stockholders of Santera
listed on Schedule 6.2(c)(Part 2) hereof and (iii) the Release from all of the
stockholders of Santera listed on Schedules 6.2(c) (Part 1) and (Part 2).

                           (d)      Santera hereby agrees that if at any time
prior to the Effective Time hereunder any person or entity commences, or
threatens to commence, any Action against Santera that seeks to challenge,
enjoin, prevent, obtain damages as a result of or otherwise frustrate this
Agreement, any of the Ancillary Agreements or the consummation of any of the
transactions contemplated hereby or thereby, then (i) Santera shall immediately
notify Tekelec thereof and (ii) Santera shall vigorously defend such Action (to
the extent the same has been commenced) and otherwise use its reasonable best
efforts to cause such Action to be dismissed, decided on the merits in favor of
Santera (so that the transactions contemplated hereby and by the Ancillary
Agreement can be consummated on the terms set forth herein or therein as soon as
possible), settled such that the transactions contemplated hereby or by the
Ancillary Agreement can be consummated on the terms set forth herein and therein
as soon as possible or be otherwise extinguished in a manner that would permit
the transactions contemplated by this Agreement and the Ancillary Agreements to
be consummated on the terms and conditions set forth herein and therein as soon
as possible. For the avoidance of doubt, any amounts paid by Santera prior to
the Closing in the defense of any of the foregoing Actions shall be considered
Indemnified Losses for purposes of Section 11.6.

                           (e)      Santera hereby agrees to use its reasonable
best efforts to obtain the consents and/or termination agreements described on
Schedule 6.2(e) as soon as possible after the date hereof.

                           (f)      Without the prior written consent of
Tekelec, none of Santera or any of the Legacy Santera Stockholders shall take
any actions so as to cause the Stockholders' Consent or any of the items set
forth on Schedule 4.2 to be altered, amended, rescinded, repealed or revoked.

                  6.3      Operations of Tekelec Prior to the Closing Date.
Prior to the Closing Date:

                           (a)      Tekelec shall operate and carry on the
Business only in the Ordinary Course. Consistent with the foregoing, Tekelec
shall keep and maintain the Contributed Assets in good operating condition and
repair (normal wear and tear excepted) and shall use its commercially reasonable
efforts consistent with good business practice to maintain the organization of
the Business intact and to preserve the goodwill of the licensees, suppliers,
contractors, licensors, employees, and customers of, and others having business
relations with, the Business. In connection therewith, Tekelec shall not attempt
to persuade any of its employees or agents who work in the Business and who will
be offered employment by the Surviving Corporation to terminate such person's
relationship with the Business.

                           (b)      Except as set forth on Schedule 6.3 or as
expressly provided by this Agreement or except with the express written approval
of Santera, Tekelec shall not at any time prior to the Closing:

                                       49
<PAGE>

                                    (i)      amend or terminate any Assumed
         Contracts other than in the Ordinary Course;

                                    (ii)     violate or fail to perform any
         obligation or duty imposed upon it in connection with the Business by
         any applicable requirements of Laws or by any Assumed Contract;

                                    (iii)    enter into, amend or terminate any
         Contract related to the Business with any customer or supplier of the
         Business which involves or is expected to involve payments of $100,000
         or more during the term thereof, except that Tekelec shall be entitled
         to enter into any Contracts with customers of the Business in the
         Ordinary Course without regard to the foregoing limitation;

                                    (iv)     allow any policies of insurance
         related to the Business to lapse or otherwise be terminated or, outside
         of the Ordinary Course, modified;

                                    (v)      increase the compensation payable
         or to become payable to the employees who will be offered employment by
         the Surviving Corporation (except for increases in the Ordinary Course)
         or grant any severance, change in control or termination pay to any
         such employees, or establish, adopt, enter into, or, except as may be
         required to comply with applicable requirements of Laws, amend in any
         material respects or take action to enhance in any material respect or
         accelerate any rights or benefits under, any labor, collective
         bargaining, bonus, profit sharing, thrift, compensation, stock option,
         restricted stock, pension, retirement, deferred compensation,
         employment, termination, change in control, severance, retention or
         other plan, trust, fund, policy or Contract for the benefit of any such
         employees;

                                    (vi)     sell or dispose of any of the
         Contributed Assets, except on an arms-length basis in the Ordinary
         Course;

                                    (vii)    take any of the actions described
         in Section 3.3, except to the extent of any exceptions set forth on
         Schedule 3.3; or

                                    (viii)   authorize, recommend, propose or
         announce an intention to do any of the foregoing, or enter into any
         understanding or Contract to do any of the foregoing.

                  6.4      Operations of Santera Prior to the Closing Date.
Prior to the Closing Date:

                           (a)      Santera shall operate and carry on its
business only in the Ordinary Course prior to the Closing Date. Consistent with
the foregoing, Santera shall keep and maintain its assets in good operating
condition and repair (normal wear and tear excepted) and shall use its
commercially reasonable efforts consistent with good business practice to
preserve the goodwill of the licensees, suppliers, contractors, licensors,
employees, and customers of, and others having business relations with, Santera.

                           (b)      Except as set forth on Schedule 6.4 or as
expressly provided by this Agreement or except with the express written approval
of Tekelec, Santera shall not at or at any time prior to the Closing:

                                       50
<PAGE>

                                    (i)      (A) declare, set aside or pay any
         dividends on, or make any other actual, constructive or deemed
         distributions in respect of, any of its capital stock, or otherwise
         make any payments to its shareholder in their capacity as such, (B)
         split, combine or reclassify any of its capital stock or issue or
         authorize the issuance of any other securities in respect of, in lieu
         of or in substitution for shares of its capital stock or (C) purchase,
         redeem or otherwise acquire any shares of its capital stock or other
         securities or any rights, warrants or options to acquire any such
         shares or other securities;

                                    (ii)     issue, deliver, sell, pledge,
         dispose of or otherwise encumber any shares of its capital stock, any
         other voting securities or equity equivalent or any securities
         convertible for or exchangeable into, or any rights, warrants or
         options to acquire any such shares, voting securities, equity
         equivalent or convertible securities;

                                    (iii)    create any subsidiary or amend its
         organizational documents or amend or terminate any Contracts of Santera
         other than in the Ordinary Course and which is immaterial to Santera;

                                    (iv)     acquire or agree to acquire by
         merging or consolidating with, or by purchasing a substantial portion
         of the assets of or equity in, or by any other manner, any business or
         any corporation, limited liability company, partnership, association or
         other business organization or division thereof or otherwise acquire or
         agree to acquire any assets other than in the Ordinary Course;

                                    (v)      alter (through merger, liquidation,
         reorganization, restructuring or in any other fashion) the corporate
         structure or ownership of Santera;

                                    (vi)     violate or fail to perform any
         obligation or duty imposed upon it by any applicable requirements of
         Laws or by any Contract to which it is a party or by which it is bound;

                                    (vii)    enter into, amend or terminate any
         Contract with any customer or supplier which involves or is expected to
         involve payments of $100,000 or more during the term thereof; enter
         into, amend or terminate any other Contract material to Santera, except
         that Santera shall be entitled to enter into any Contracts with its
         customers in the Ordinary Course without regard to the foregoing
         limitation;

                                    (viii)   pay, discharge or satisfy any
         claims, Liabilities or obligations (whether or not absolute, accrued,
         asserted, contingent or otherwise), other than the payment, discharge
         or satisfaction in the Ordinary Course;

                                    (ix)     allow any policies of insurance to
         lapse or otherwise be terminated or, outside of the Ordinary Course,
         modified;

                                    (x)      except as expressly contemplated by
         the Employment Agreements, increase the compensation payable or to
         become payable to its directors, officers or employees (except for
         increases in the Ordinary Course) or grant any severance, change in
         control or termination pay to, any director, officer or employee of
         Santera, or establish, adopt, enter into, or, except as may be required
         to comply with applicable requirements of Laws, amend in any material
         respect or take action to enhance in any

                                       51
<PAGE>

         material respect or accelerate any rights or benefits under, any labor,
         collective bargaining, bonus, profit sharing, thrift, compensation,
         stock option, restricted stock, pension, retirement, deferred
         compensation, employment, termination, change in control, severance,
         retention or other plan, trust, fund, policy or Contract for the
         benefit of any director, officer or employee;

                                    (xi)     take any of the actions described
         in Section 4.4, except to the extent of any exceptions set forth on
         Schedule 4.4; or

                                    (xii)    authorize, recommend, propose or
         announce an intention to do any of the foregoing, or enter into any
         understanding or Contract to do any of the foregoing.

                  6.5      Access to Records. Until the Closing, Tekelec and
Santera shall provide full access (including on site access) to such records of
the Business or Santera as Tekelec or Santera, as the case may be, may
reasonably request, and to the personnel, customers and facilities of the
Business or Santera, as the case may be, to the extent mutually agreed by
Santera and Tekelec, subject, in each case, to such procedures and at such times
as Tekelec and Santera shall determine. No such access, and no investigation or
discovery of facts by Tekelec or Santera, shall affect Tekelec's or Santera's
right to recover for any breach of any representation or warranty of Tekelec or
Santera, as the case may be, hereunder.

                  6.6      Governmental Filings. The Parties hereto will
cooperate in making, as soon as practicable following the execution hereof, all
filings required by any Governmental authority in connection with the
transactions contemplated by this Agreement, including, without limitation, any
filings required pursuant to the HSR Act. Any and all filing fees in respect of
such filings shall be borne by the party upon whom such obligations is levied.

                  6.7      Notification of Certain Matters. Between the date of
this Agreement and the Closing, each Party shall give notice promptly upon
obtaining knowledge thereof to each of the other Parties hereto of (i) the
occurrence or failure to occur of any event, which occurrence or failure would
be likely to cause any representation or warranty contained in this Agreement to
be untrue or inaccurate in any material respect any time from the date hereof to
the Closing Date, (ii) any failure of such Party, or any allegation that such
Party has failed, to comply in all material respects with or satisfy in all
material respects any covenant, condition or agreement to be complied with or
satisfied by it hereunder or under any Material Tekelec Contract or Material
Santera Contract, (iii) the loss or threatened loss of any customer of the
Business or of Santera, as the case may be; and (iv) any actual or potential
defects or hazards with respect to any product manufactured or to be
manufactured or sold, distributed or put in commerce by such Party or any
allegation of the same. No such disclosure shall be deemed to cure any breach of
a representation, or warranty or any breach of a covenant or agreement, or to
satisfy any condition or negate any indemnity hereunder; provided that if such
supplemental information relates to an event or circumstance occurring
subsequent to the date hereof (it being understood that the mere discovery of
events or circumstances following the date hereof should not constitute a basis
for any such change to the extent that the event occurred or the circumstance
existed prior to the date hereof) and if any of the other Parties hereto would
have the right to not consummate the transactions contemplated by this Agreement
as a result of the failure of the condition contained in Sections 9.2 and 10.2
on the basis of the information so disclosed and it does not exercise such right
prior to Closing, then such

                                       52
<PAGE>

supplemental information shall constitute an amendment of the representation,
warranty or statement to which it relates for the purpose of Article IX of this
Agreement. For avoidance of doubt, any additions or changes which are identified
by a Party as a Material Adverse Effect or Material Adverse Change shall be
identified as such in the certificate to be delivered to each of the other
Parties hereto pursuant to Section 9.2 and 10.2 and any changes or effects which
are not so identified by such Party as a Material Averse Effect or Material
Adverse Change in such certificate shall not be subject to the foregoing
limitation and shall be subject to the indemnification provisions of Article XI.

                  6.8      No Solicitation.

                           (a)      Except to the extent agreed by Tekelec, from
the date hereof until the Closing Date, neither Santera nor any of the Legacy
Santera Stockholders shall, directly or indirectly through their agents or
representatives or otherwise solicit or cause the solicitation of, or in any way
encourage the making of, any offer, proposal or indication of interest involving
the purchase, sale or transfer of Santera, including a purchase, sale or
transfer of Santera by means of a purchase, sale, transfer, merger or
recapitalization of all or any controlling portion of the securities of Santera,
or negotiate with, respond to any inquiry from (except for "no comment" or a
similar statement), cooperate with or furnish or cause or allow to be furnished
any information to, any third party or its agents or representatives with
respect thereto, it being agreed that Tekelec will be immediately advised by
Santera and the Legacy Santera Stockholders if any such offer, proposal or
indication of interest is received and the terms thereof.

                           (b)      Except to the extent agreed by Santera, from
the date hereof until the Closing Date, Tekelec shall not, directly or
indirectly through its agents or representatives or otherwise solicit or cause
the solicitation of, or in any way encourage the making of, any offer, proposal
or indication of interest involving the purchase, sale or transfer of the
Business, or negotiate with, respond to any inquiry from (except for "no
comment" or a similar statement), cooperate with or furnish or cause or allow to
be furnished any information to, any third party or its agents or
representatives with respect thereto, it being agreed that Santera will be
immediately advised by Tekelec if any such offer, proposal or indication of
interest is received and the terms thereof.

                  6.9      All Necessary Action. Santera and each of the Legacy
Santera Stockholders hereby agree to take all actions that are reasonably
necessary for them to take in order for Santera to fully perform the obligations
of Santera hereunder between the date hereof and the Closing. Tekelec hereby
agrees to take all actions that are reasonably necessary for it to take in order
for Tekelec to fully perform its obligations hereunder between the date hereof
and the Closing.

                  6.10     OEM Agreement. Santera and Tekelec will use their
reasonable best efforts to enter into, as soon as practicable after the date
hereof (including, to the extent practicable, prior to the Closing Date), an OEM
agreement between themselves, which is reasonably acceptable to Santera, Tekelec
and the Legacy Santera Stockholders.

                                   ARTICLE VII
                              ADDITIONAL AGREEMENTS

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                  7.1      Public Announcements. The Parties hereto will not
make any public disclosure of the terms hereof or issue any press release with
respect to the transactions contemplated by this Agreement or otherwise issue
any written public statements with respect to such transactions without the
prior written consent of the other Parties, not to be unreasonably withheld,
delayed or conditioned, except as may be required by applicable requirements of
Laws or by obligations pursuant to any listing agreement with any national
securities exchange or quotation system, in which case the Party making such
disclosure will first provide to the other Parties the text of the proposed
disclosure, the reasons such disclosure is required and the time and manner in
which the disclosure in intended to be made and the other Party shall be
permitted to comment on such proposed disclosure. The Parties agree that the
initial press release and any Securities and Exchange Commission filing to be
made in respect of the transactions contemplated by this Agreement shall be in
the form agreed to by the Parties.

                  7.2      Tax Matters.

                           (a)      The Surviving Corporation shall pay all
applicable sales, use or other similar taxes that are, or become, due or payable
as a result of the sale, conveyance, assignment, transfer or delivery of the
Contributed Assets hereunder, whether levied on Santera, the Surviving
Corporation, Merger Sub, the Contributed Assets or Tekelec. In the event any
such taxes are levied, Tekelec shall prepare, subject to the Surviving
Corporation's reasonable approval, and file any returns required in respect of
such taxes.

                           (b)      Following the Closing, Tekelec agrees to
furnish or cause to be furnished to the Surviving Corporation, upon request, as
promptly as practicable, such information and assistance (including access to
books and records) relating to the Business or the Contributed Assets as is
reasonably necessary for the preparation of any return for taxes, claims for
refund or audit or prosecution or defense of any claim, suit or proceeding
relating to any proposed adjustment of taxes paid.

                           (c)      Tekelec, upon request, shall use its
reasonable efforts to provide or obtain from any taxing authority any
certificate or other document necessary to mitigate, reduce or eliminate any
taxes (including additions thereto or interest and penalties thereon) that
otherwise would be imposed with respect to the transactions contemplated in this
Agreement.

                           (d)      For any personal property, ad valorem and
any other similar local or state Taxes relating solely to the Contributed Assets
or the Business for any taxable year or period commencing prior to the Closing
and ending after the Closing Date (a "Straddle Period"), Tekelec shall pay to
Santera within fifteen (15) days after the date on which Taxes are paid with
respect to such periods an amount that relates to the portion of such taxable
period ending on the Closing Date to the extent such Taxes are not paid by
Tekelec prior to Closing and Santera shall pay such Taxes that relate to the
period commencing on the Closing Date through the end of the Straddle Period.
For purposes of this Section, the portion of such Tax that are allocated to
Tekelec shall be deemed to be the amount of such Tax for the entire taxable
period multiplied by a fraction, the numerator of which is the number of days in
the taxable period ending on the Closing Date, and the denominator of which is
the number of days in the entire taxable period. Any credits relating to a
taxable period that begins before and ends after the Closing Date shall be taken
into account as though the relevant taxable period ended on the Closing Date.
All determinations necessary to give

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<PAGE>

effect to the allocations described in this Section shall be made in a manner
consistent with the prior practice of Tekelec, except for changes required by
changes in Law or fact.

                           (e)      Except as required by applicable Law or as
expressly contemplated by this Agreement or the Ancillary Agreements, the
Parties will not take or cause to be taken any action that would prevent the
transactions contemplated hereby from qualifying as a tax-free transaction under
section 351 of the Code, and the Parties agree that they will report such
transactions consistent therewith and will take no position inconsistent or
contrary thereto.

                  7.3      Employee Matters

                           (a)      Santera Employees. On the date hereof, each
of the employees listed on Exhibit E hereto shall have executed and delivered to
Santera his or her Employment Agreement. The employment relationship of Santera
employees shall not be interrupted or changed due to the consummation of the
transactions contemplated by this Agreement, except as may be provided in an
individual Employment Agreement. All of Santera's Plans shall remain in place
except as set forth herein. Nothing in this Agreement shall constitute a
limitation on Santera's ability to change any such Plan at a later date.

                           (b)      Tekelec Employees. Tekelec shall cause the
employees of Tekelec listed on Schedule 7.3 ("Tekelec Transferred Employees") to
be assigned to the Surviving Corporation immediately following the Closing. Each
Tekelec Transferred Employee shall have his or her wages or salary, Tekelec
employee benefit package, including 401(k) and health and welfare benefits,
continued without interruption through December 31, 2003 unless such employee's
employment with the Surviving Corporation is earlier terminated. Whether wages
and payroll taxes for Tekelec Transferred Employees will be paid directly by the
Surviving Corporation or paid by Tekelec and reimbursed to Tekelec through the
Services Agreement shall be determined by the parties at a later date. Tekelec
shall, however, be reimbursed through the Service Agreement by the Surviving
Corporation for all other employee costs associated with the Tekelec Transferred
Employees relating to services rendered after the Closing Date. Such costs shall
include, but not be limited to, the following with respect to periods after the
Closing Date: vacation accrued for 2003, workmen's compensation costs, FICA,
FUTA, the cost of health and welfare programs, the 401(k) employee matching
contribution under Tekelec's Plan, bonus payments and relocation costs.

                           (c)      2004 and Later. The parties contemplate that
as of January 1, 2004, the employee benefit programs throughout the Surviving
Corporation will be revised so that a uniform program is available to all
employees of the Surviving Corporation to be paid for in all respects directly
by the Surviving Corporation. Santera agrees, on behalf of the Surviving
Corporation, to recognize continuous service of Tekelec Transferred Employees
rendered to Tekelec prior to the Closing Date for purposes of determining
vesting and eligibility for any employee benefit program, including vacation,
under which the benefits may differ based on tenure.

                  7.4      Further Assurances. From time to time after the
Closing Date, each Party shall, at its own expense, execute and deliver, or
cause to be executed and delivered, all such other instruments, including
instruments of conveyance, assignment and transfer and to make all filings with
and to obtain all consents, approvals or authorizations of any Governmental
authority or any other person or entity required to be obtained by such Party in
connection with the transactions contemplated hereby or pursuant to any Assumed
Contracts, permits or Contributed Assets and

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<PAGE>

each such Party shall take all such other actions as such Party may reasonably
be requested to take by another Party to this Agreement, consistent with the
terms of this Agreement, in order to effectuate better the provisions and
purposes of this Agreement and the transactions contemplated by this Agreement.

                  7.5      Access to Records. Tekelec shall, upon request and
during normal business hours, provide the Surviving Corporation reasonable
access to those records of Tekelec which relate to the Business but which are
not otherwise included in Contributed Assets hereunder.

                  7.6      Audited Financial Statements. As soon as practicable,
and in any event no later than thirty (30) days, after the Closing Date, Santera
agrees to furnish or cause to be furnished to Tekelec the audited balance sheet
of Santera as of December 31, 2002, and the related audited statements of
earnings, stockholders' equity and cash flows for the year then ended, together
with any notes or schedules thereto.

                                  ARTICLE VIII
               CONDITIONS TO THE OBLIGATIONS OF ALL OF THE PARTIES

         The obligations of each of the Parties at Closing shall be subject to
the satisfaction at Closing of each of the following conditions, subject to the
right of any such Party to waive any one or more of such conditions (provided
that the Representative shall be entitled to waive any one or more of such
conditions on behalf of all of the Legacy Santera Stockholders):

                  8.1      HSR and Necessary Governmental Approvals. The waiting
period under the HSR Act shall have expired or been terminated and all other
authorizations, consents, orders, declarations, or approvals of, or filings
with, or terminations or expectations of waiting periods imposed by, any
Governmental bodies that are necessary to consummate the transactions
contemplated hereby, which are either specified on Schedule 3.1 or otherwise
required to be obtained, to be made or to occur prior to Closing by applicable
requirements of Laws or which are necessary to prevent a Material Adverse
Change, shall have been obtained, shall have been made or shall have occurred.

                  8.2      No Adverse Proceeding. No injunction or restraining
order shall have been issued by any court of competent jurisdiction and be in
effect which restrains or prohibits any transaction contemplated hereby. No
Governmental body shall have enacted, issued, promulgated, enforced or entered
any statute, rule, regulation, injunction or other order (whether temporary,
preliminary or permanent) which remains in effect, and which has the effect of
making the transactions contemplated hereby illegal or otherwise restraining,
enjoining or prohibiting consummation of the transactions contemplated by this
Agreement, and none of the Parties hereto shall have received written notice
from any Governmental authority that it has determined to institute any suit or
proceeding to restrain or enjoin the consummation of the transactions
contemplated hereby or to nullify or render ineffective this Agreement if
consummated, or to take any other action which would result in the prohibition
or a material change in the terms of the transactions contemplated hereby.

                  8.3      Stockholder Approval. The transactions contemplated
by this Agreement, the Ancillary Agreements and the Recapitalization shall have
been duly authorized, approved and

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<PAGE>

ratified by all necessary resolutions, authorizations, consents, approvals
and/or ratifications on the part of the stockholders of Santera.

                  8.4      Schedules to Services Agreement. The Services
Agreement and schedules thereto shall have been completed and shall be
reasonably acceptable to Santera, Tekelec and the Legacy Santera Stockholders.

                                   ARTICLE IX
                    CONDITIONS TO THE OBLIGATIONS OF TEKELEC

          The obligations of Tekelec at Closing shall be subject to the
satisfaction at Closing of each of the following conditions, subject to the
right of Tekelec alone to waive any one or more of such conditions.

                  9.1      Performance of Obligations; Representations and
Warranties. Each of the Parties hereto other than Tekelec shall have performed
in all material respects each of its agreements contained in this Agreement, the
Voting Agreement, the Escrow Agreement, the Stockholders' Agreement and the Note
and Preferred Stock Purchase Agreement required to be performed on or prior to
the Closing Date; each of the representations and warranties of each of such
other Parties hereto contained in this Agreement that is qualified by
materiality shall be true and correct on and as of the Closing Date as if made
on and as of such date (other than representations and warranties which address
matters only as of a certain date which shall be true and correct as of such
certain date) and each of the representations and warranties that is not so
qualified shall be true and correct in all material respects on and as of the
Closing Date as if made on and as of such date (other than representations and
warranties which address matters only as of a certain date which shall be true
and correct in all material respects as of such certain date), in each case
except as contemplated or permitted by this Agreement, and Tekelec shall have
received certificates, dated the Closing Date, from each of such other Parties
hereto, signed on behalf of each such other Party by a duly authorized officer
of such other Party, to such effect.

                  9.2      Material Adverse Change. Since the date of this
Agreement, there shall have been no Material Adverse Change with respect to
Santera, and Tekelec and the Legacy Santera Stockholders shall have received a
certificate dated the Closing Date, signed on behalf of Santera by the Chief
Executive Officer and Chief Financial Officer of Santera that, to the Knowledge
of such officers, there has been no Material Adverse Change with respect to
Santera.

                  9.3      Necessary Consents and Notices. Santera shall have
received consents to, and/or provided notices of, in form and substance
reasonably satisfactory to Tekelec, the transactions contemplated hereby from or
to the other parties to the contracts which are specified on Schedule 9.3 or are
otherwise necessary to prevent a Material Adverse Change.

                  9.4      Employment Matters. At least ninety percent (90%) of
the employees of Santera who are currently employees of Santera shall continue
to be employees of Santera on the Closing Date. In addition, none of the
Employment Agreements shall have been amended in any respect or terminated by
the employee party thereto.

                  9.5      Effectiveness of Certain Documents.

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<PAGE>

                           (a)      The Releases, the Stockholders' Agreement,
the Escrow Agreement, the Note and Preferred Stock Purchase Agreement and the
termination agreements contemplated by Sections 4.27 and 4.30 executed as of the
date hereof shall continue to be in full force and effect and there shall have
been no breach thereunder by any Party thereto other than Tekelec (it being
understood that if any such agreement is no longer in full force and effect as a
result of a breach thereunder by Tekelec, such agreement shall be deemed to be
in full force and effect for purposes of this condition), and no signatory to
any such Release shall have initiated, or threatened to initiate, any action
against Tekelec, Santera or any of their respective Affiliates challenging the
enforceability of any such Release.

                           (b)      The Recapitalization shall have occurred,
the transactions contemplated by the Note and Preferred Stock Purchase Agreement
shall have been consummated in accordance with the terms thereof, certain of the
Legacy Santera Stockholders shall have contributed an aggregate of Twelve
Million ($12,000,000) in cash to Santera in accordance with the terms of the
Note and Preferred Stock Purchase Agreement, all of the convertible promissory
notes issued pursuant to the Note and Preferred Stock Purchase Agreement shall
have been converted into shares of Series D Preferred Stock of Santera in
accordance with the terms of such notes and those stockholders of Santera who
have purchased convertible promissory notes or Series D Preferred Stock from
Santera pursuant to the Note and Preferred Stock Purchase Agreement and each of
the Legacy Santera Stockholders who own less than 175,000 shares of preferred
stock of Santera shall have exercised their respective rights to exchange all of
the shares of Series A-1 Preferred Stock, Series B-1 Preferred Stock and/or
Series C-1 Preferred Stock of Santera then owned by such stockholders for shares
of Series A-2 Preferred Stock, Series B-2 Preferred Stock and/or Series C-2
Preferred Stock, respectively, pursuant to the Note and Preferred Stock Purchase
Agreement and the Exchange Agreement, all in a manner reasonably satisfactory to
Tekelec in all respects.

                  9.6      Deliveries.

                           (a)      Santera shall have made and tendered, or
caused to be made and tendered, delivery of all of the items required by Section
2.7(b) and such other customary documents, instruments or certificates as shall
be reasonably requested by Tekelec and as shall be consistent with the terms of
this Agreement.

                           (b)      Each Legacy Santera Stockholder shall have
made and tendered, or caused to be made and tendered, the certificates required
by Section 2.7(c)(i) and such other customary documents, instruments or
certificates as shall be reasonably requested by Tekelec and as shall be
consistent with the terms of this Agreement.

                  9.7      No Pending Lawsuits. No Action seeking to challenge,
enjoin, prevent, obtain damages as a result of or otherwise frustrate the
purpose of this Agreement, any of the Ancillary Agreements or the consummation
of any of the transactions contemplated hereby or thereby (including without
limitation the Recapitalization and the other transactions contemplated by the
Note and Preferred Stock Purchase Agreement and Exchange Agreement) shall be
pending, if there is a reasonable likelihood that such Action would result in a
Material Adverse Effect on Santera (which term, for purposes of this Section
9.7, shall be read by ignoring and not giving effect to subsection (vii)
thereof).

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<PAGE>

                  9.8      Certain Tax Effects. Tekelec is reasonably satisfied
that the contribution by Tekelec and Tekelec Sub of the PTBU and $28,000,000
cash to Merger Sub in exchange for an aggregate of one hundred (100) shares of
common stock of Merger Sub and the conversion of Merger Sub capital stock into
Series A Preferred Stock, Series B Preferred Stock and Common Stock of the
Surviving Corporation pursuant to Section 2.3(c), when consummated in accordance
with the terms hereof, will constitute a tax-free exchange pursuant to section
351 of the Code. This condition shall not have any effect unless the failure of
Tekelec to be reasonably satisfied is a result of a change in those facts,
circumstances or events of which Tekelec was aware on the date hereof (it being
understood that for this purpose Tekelec shall not be deemed to have been aware
of any facts, circumstances or events that do not exist as of the date hereof or
that are not expressly set forth in this Agreement, the Ancillary Agreements or
the schedules hereto or thereto, and that Tekelec may rely on the accuracy of
the representations of Santera and the Legacy Santera Stockholders herein).

                                    ARTICLE X
               CONDITIONS TO THE OBLIGATIONS OF THE LEGACY SANTERA
                            STOCKHOLDERS AND SANTERA

         The obligations of Santera at Closing shall be subject to the
satisfaction at Closing of each of the following conditions, subject to the
right of Santera to waive any one or more of such conditions, and the
obligations of the Legacy Santera Stockholders at Closing shall be subject to
the satisfaction at Closing of each of the following conditions, subject to the
right of the Representative to waive any one or more of such conditions on
behalf of the Legacy Santera Stockholders:

                  10.1     Performance of Obligations; Representations and
Warranties. Each of Tekelec and Merger Sub shall have performed in all material
respects each of its agreements contained in this Agreement required to be
performed on or prior to the Closing Date; each of the representations and
warranties of each of Tekelec and Merger Sub contained in this Agreement that is
qualified by materiality shall be true and correct on and as of the Closing Date
as if made on and as of such date (other than representations and warranties
which address matters only as of a certain date which shall be true and correct
as of such certain date) and each of the representations and warranties that is
not so qualified shall be true and correct in all material respects on and as of
the Closing Date as if made on and as of such date (other than representations
and warranties which address matters only as of a certain date which shall be
true and correct in all material respects as of such certain date), in each case
except as contemplated or permitted by this Agreement, and Santera shall have
received certificates, dated the Closing Date, from each of Tekelec and Merger
Sub, signed on behalf of each of Tekelec and Merger Sub by a duly authorized
officer of Tekelec and Merger Sub, to such effect.

                  10.2     Material Adverse Change. Since the date of this
Agreement, there shall have been no Material Adverse Change with respect to the
Business, and Santera and the Legacy Santera Stockholders shall have received a
certificate dated the Closing Date, signed on behalf of Tekelec by a duly
authorized officer of Tekelec that, to the Knowledge of such officer, there has
been no Material Adverse Change with respect to the Business.

                  10.3     Necessary Consents and Notices. Tekelec shall have
received consents to, and/or provided notices of, in form and substance
reasonably satisfactory to Santera, the transactions contemplated hereby from or
to the other parties to all Assumed Contracts which are specified on Schedule
10.3 or are otherwise necessary to prevent a Material Adverse Change.

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<PAGE>

                  10.4     Deliveries. Tekelec shall have made and tendered, or
caused to be made and tendered, delivery of all of the items required by Section
2.7(a) and such other customary documents, instruments or certificates as shall
be reasonably requested by Santera and as shall be consistent with the terms of
this Agreement.

                  10.5     Effectiveness of Certain Documents. The Stockholders'
Agreement and the Escrow Agreement shall continue to be in full force and effect
and there shall have been no breach thereunder by Tekelec or its wholly owned
subsidiaries (it being understood that if any such agreement is no longer in
full force and effect as a result of a breach thereunder by any party thereto
other than Tekelec or its wholly owned subsidiaries, such agreement shall be
deemed to be in full force and effect for purposes of this condition).

                                   ARTICLE XI
                             INDEMNIFICATION; ESCROW

                  11.1     Indemnification by Tekelec. Subject to the
limitations set forth in this Article XI, Tekelec shall hold Santera and,
following the Closing hereunder, the Surviving Corporation and the directors,
officers, successors, assigns, and agents of each of them in their capacities as
such (excluding in any event Tekelec, the "Santera Indemnified Persons"),
harmless and indemnify each of them from and against, any and all claims,
losses, damages, liabilities, expenses or costs ("Losses"), including to the
extent not otherwise included in Losses, reasonable attorneys' fees and expenses
incurred in connection with Losses and/or the enforcement of this Agreement (in
all, "Indemnified Losses"), incurred by any of them to the extent resulting from
or arising out of:

                           (a)      the breach of any agreement, covenant,
representation, warranty, or other obligation of Tekelec under this Agreement
(with, in the case of any such representation or warranty, the existence of any
such breach determined by ignoring and not giving any effect whatsoever to the
scheduling of any exceptions thereto to the extent that such scheduled exception
cross-references or otherwise schedules as an exception any of the items set
forth on Schedule 3.8);

                           (b)      any liability for (A) Taxes attributable to
Tekelec, the Business or the Contributed Assets for any taxable periods or
partial periods through the Closing Date, including any liability, if any, for
Taxes of others (for example, as a successor or transferee, or by application of
Treas. Reg. 1.1502-6 or comparable state law provisions), except to the extent
the same are specifically described on Schedule 1.1B; (B) Taxes resulting from a
breach by Tekelec of any of the covenants set forth in Section 7.2 of this
Agreement; or (C) Taxes for any tax period resulting from a breach of any of the
representations or warranties contained in Section 3.5 (with the existence of
any such breach determined by ignoring and not giving any effect whatsoever to
the presence of any "Knowledge" or "Material Adverse Effect" qualifications
contained therein or the scheduling of any exceptions thereto), including any
Losses sustained in a tax period of Tekelec ending after the Closing Date
arising out of the settlement or other resolution of a proposed tax adjustment
that related to a tax period ending on or before the Closing Date; and

                           (c)      any liability, claim or obligation of
Tekelec other than the Assumed Liabilities, including, without limitation, any
liability, claim or obligation for, or arising out of, the Excluded Liabilities.

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<PAGE>

                  11.2     Indemnification by the Surviving Corporation. Subject
to the limitations set forth in this Article XI, Santera and, following the
Closing hereunder, the Surviving Corporation shall hold Tekelec, Tekelec Sub,
Merger Sub and the directors, officers, successors, assigns, and agents of each
of them in their capacities as such (excluding in any event Santera, the
Surviving Corporation and any stockholders of Santera or the Surviving
Corporation other than Tekelec or Tekelec Sub, the "Tekelec Indemnified
Persons") harmless and indemnify each of them from and against any and all
Indemnified Losses incurred by any of them, to the extent resulting from or
arising out of:

                           (a)      the breach of any agreement, covenant,
representation, warranty, or other obligation of Santera or the Surviving
Corporation under this Agreement (with the existence of any such breach
determined (i) in the case of any such representation or warranty, the existence
of any such breach determined by ignoring and not giving any effect whatsoever
to the scheduling of any exceptions thereto to the extent that such scheduled
exception cross-references or otherwise schedules as an exception any of the
items on Schedule 4.16(c)(vii) or 4.16(c)(viii)) and (ii) in the case of the
representations set forth in Sections 4.16(e) and 4.16(g), by ignoring and not
giving any effect whatsoever to the presence of any "Knowledge" qualification
contained therein and otherwise without reference to Santera's Knowledge, except
that Indemnified Losses arising solely as a result of a breach after the
Effective Time by Santera or the Surviving Corporation of an agreement, covenant
or other obligation of Santera or the Surviving Corporation under this Agreement
shall not be covered by this indemnity, unless such breach is caused in whole or
in part by actions or inactions on the part of the Legacy Santera Stockholders
or the Representative or unless such breach is of the obligations of Santera or
the Surviving Corporation under this Article XI;

                           (b)      any liability for (A) Taxes attributable to
Santera for any taxable periods or partial periods through the Closing Date,
including any liability, if any, for Taxes of others (for example, as a
successor or transferee, or by application of Treas. Reg. 1.1502-6 or comparable
state law provisions), except to the extent the same are described on Schedule
11.2; (B) Taxes resulting from a breach by Santera of any of the covenants set
forth in Section 7.2 of this Agreement; or (C) Taxes for any tax period
resulting from a breach of any of the representations or warranties contained in
Section 4.6 (with the existence of any such breach determined by ignoring and
not giving any effect whatsoever to the presence of any "Knowledge" or "Material
Adverse Effect" qualifications contained therein or the scheduling of any
exceptions thereto), including any Losses sustained in a tax period of Santera
or the Surviving Corporation ending after the Closing Date arising out of the
settlement or other resolution of a proposed tax adjustment that related to a
tax period ending on or before the Closing Date;

                           (c)      any Liability of Santera or the Surviving
Corporation, whether known or unknown, contingent or otherwise, that relates to
or arises out of or with respect to facts, circumstances or events that occur at
or as a result of the Closing (excluding Liabilities of the Business) or
occurred at any time prior to the Closing hereunder, other than (i) the
obligations of Santera or the Surviving Corporation under those Contracts of
Santera listed on Schedule 11.2 (other than any liability, claim or obligation
for breach thereof prior to Closing) or those other Contracts of Santera entered
into by Santera in the Ordinary Course after the date hereof and before the
Closing (other than any liability, claim or obligation for breach thereof prior
to Closing) or (ii) those liabilities of Santera specifically described on
Schedule 11.2 that exist on the date hereof (to the extent the same exist on the
Closing Date) and those liabilities of Santera that arise between the date of
Schedule 11.2 and the Closing Date in the Ordinary Course (and which are not,
except as

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specifically set forth on Schedule 11.2 (Special), materially greater than the
historical amounts incurred for such types of expenses as shown on Schedule
11.2) and are of the same type as those otherwise described on Schedule 11.2.
Without limiting the generality of the foregoing, Schedule 11.2 shall not
include, and the foregoing indemnity shall cover among other things, the
following, to the extent the same relate to or arise out of facts, circumstances
or events that occur at or as a result of the Closing or occurred at any time
prior to the Closing hereunder:

                                    (A)      any liability or obligation of
         Santera or the Surviving Corporation to the stockholders of Santera
         which were stockholders prior to the Merger or any claim by such
         stockholders against Santera or the Surviving Corporation (other than
         for liabilities or obligations of Santera or the Surviving Corporation
         which are specifically contemplated as being incurred or performed by
         the Surviving Corporation after the Closing Date (i) by the terms of
         this Agreement or any of the Ancillary Agreements or by the terms of
         the Second Amended and Restated Certificate of Incorporation or Bylaws
         or (ii) pursuant to the terms of any agreements set forth in Schedule
         11.2 with the following entities: Howin Technologies Co., Ltd.,
         Comdisco, Inc., Comerica Bank - California or any of the warrantholders
         listed on Schedule 4.27 to the extent such warrantholders become
         stockholders of Santera or the Surviving Corporation prior to the
         Closing hereunder by exercise of their respective warrants, it being
         understood however, that liabilities and obligations that result from
         or arise out of any breaches of or defaults under any such agreements
         set forth on Schedule 11.2 that occur prior to the Closing (including
         any such liabilities or obligations that arise after the Closing as a
         result of the continuation of any such pre-Closing breach or default)
         shall be so covered by this indemnity),

                                    (B)      any liability or obligation of
         Santera or the Surviving Corporation to its directors, officers,
         employees or agents or any claim by such directors, officers, employees
         or agents (i) with respect to indemnification or contribution or (ii)
         pursuant to any employment agreement, severance agreement or similar
         arrangement between Santera and any of the employees listed on Exhibit
         E or any former employees, including for any transaction bonuses or
         salary continuation payments, but excluding any such claim, liability
         or obligation that (x) relates to normal salary or benefits for
         services actually performed by such employees prior to the Closing Date
         in the Ordinary Course or (y) arises out of the Employment Agreements,

                                    (C)      any claim, liability or obligation
         related to violations of Law, including violations or alleged
         violations of Federal and state securities laws, or violations or
         alleged violations of Environmental Law (whether as a result of the
         handling, storage or disposal of hazardous materials or otherwise), or

                                    (D)      except to the extent paid by
         insurance policies, any liability for product liability, product
         defects or as a result of the provision of any services (professional
         or otherwise) provided by Santera to any other Person; and

                           (d)      any Action or threatened Action described in
Section 6.2(d) or Section 9.7 (ignoring the Material Adverse Effect
qualification contained therein; it being understood that any such Action shall
be the subject of indemnification regardless of whether there is a reasonable
likelihood that such Action would result in a Material Adverse Effect on
Santera), including, without limitation, the liabilities, damages, costs and
expenses incurred by Santera or

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Tekelec (including attorney's fees) in connection with the defense, settlement
or other resolution thereof; and

                           (e)      the Recapitalization, the consummation of
the transactions pursuant to and contemplated by the Note and Preferred Stock
Purchase Agreement and the Exchange Agreement or the consideration, or lack
thereof, provided in the Merger to the holders of Santera's Common Stock, the
holders of other shares of capital stock of Santera existing immediately prior
to the Effective Time or the holders of options or warrants to acquire any of
the foregoing, including liability in connection with appraisal or dissenters
rights or claims made by stockholders, optionholders or warrantholders of
Santera existing prior to such Merger or as a result of such Merger excluding
any liability for Taxes except as provided for under Section 11.2(b).

                  11.3     Notice of Claim.

                           (a)      In the event that Santera or the Surviving
Corporation or the Representative (on behalf of Santera or the Surviving
Corporation) desires to seek indemnification hereunder, the Representative shall
give reasonably prompt written notice to Tekelec specifying the facts
constituting the basis for such claim and the amount, to the extent known, of
the claim asserted. If Tekelec disputes such claim of indemnification, it shall
notify the Representative within thirty (30) days after receipt of the Notice of
Claim, whereupon Tekelec and the Representative shall meet and attempt in good
faith to resolve their differences with respect to such claim of
indemnification. If the dispute has not been resolved within thirty (30) days
after such Parties first meet to attempt such resolution, any Party may initiate
litigation in accordance with this Agreement. If Tekelec does not dispute the
claim of indemnification, Tekelec shall pay the amount of any such claim to
Santera or the Representative (on behalf of Santera) not more than thirty (30)
days after the Representative provides notice to Tekelec of such amount, and if
Tekelec pays such amounts directly to the Representative, then the
Representative shall promptly pay such amounts to Santera.

                           (b)      In the event that Tekelec seeks
indemnification hereunder on behalf of a Tekelec Indemnified Person, Tekelec
shall give reasonably prompt written notice to Santera, the Representative and
the Escrow Agent specifying the facts constituting the basis for such claim and
the amount, to the extent known, of the claim asserted. If the Representative
disputes such claim of indemnification, the Representative shall notify Tekelec
thereof within thirty (30) days after receipt of the Notice of Claim, whereupon
Tekelec and the Representative shall meet and attempt in good faith to resolve
their differences with respect to such claim of indemnification. If the dispute
has not been resolved within thirty (30) days after such Parties first meet to
attempt such resolution, any Party may initiate litigation in accordance with
this Agreement. If the Representative does not dispute Tekelec's claim of
indemnification, the Escrow Agent shall, to the extent requested by Tekelec,
transfer shares of Series A Preferred Stock to the Surviving Corporation (valued
for all purposes at $1,000 per share, as adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassification or other similar event with respect to the
shares of Series A Preferred Stock) or, to the extent no shares of Series A
Preferred Stock remain in escrow, other property held in escrow under the Escrow
Agreement to the Surviving Corporation in an amount equal to the amount of such
claim, all within not more than thirty (30) days after Tekelec provides notice
to the Representative of such amount and in accordance with the terms of the
Escrow Agreement. If the Escrow Agreement has been terminated at such time or
there were not a sufficient number of shares of Series A Preferred Stock or
other property remaining in the escrow established thereby to fully satisfy any
such claim, the Representative shall

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promptly provide written notice to the Surviving Corporation directing the
Surviving Corporation to pay the unsatisfied portion of any such claim (after
applying any remaining shares of Series A Preferred Stock and such other
property remaining in the escrow) to the appropriate Tekelec Indemnified
Person(s) as soon as possible thereafter. Subject to the rights of Tekelec and
the Surviving Corporation under Section 11.7 or any comparable provision of any
Ancillary Document, Tekelec agrees that for so long as shares of Series A
Preferred Stock or other property are held in escrow under the Escrow Agreement
to satisfy indemnity claims of Tekelec, (1) Tekelec shall first seek to satisfy
all of its claims for indemnification hereunder (on behalf of itself and all
Tekelec Indemnified Persons) by making a claim pursuant to and in accordance
with the terms of the Escrow Agreement, (2) Tekelec will not seek payment for
any claim from the Surviving Corporation as long as shares of Series A Preferred
Stock or other property securing the Surviving Corporation's indemnity
obligations are held in escrow under the Escrow Agreement and (3) the surrender
of shares of Series A Preferred Stock or other property held under the Escrow
Agreement to the Surviving Corporation as provided in this Section 11.3 will
satisfy any such indemnity claim of any Tekelec Indemnified Person to the same
degree as the claim would have been satisfied by payment of cash (with such
shares valued at $1,000 per share for this purpose, as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassification or other similar event with respect to the
shares of Series A Preferred Stock).

                  11.4     Right to Contest Claims of Third Persons.

                           (a)      If a Tekelec Indemnified Person is entitled
to indemnification hereunder because of a claim asserted by any claimant (other
than an indemnified person hereunder) ("Third Person") at a time when shares of
Series A Preferred Stock or other property are held in escrow under the Escrow
Agreement to satisfy such claim, Tekelec shall give the Representative
reasonably prompt notice thereof after such assertion is actually known to
Tekelec; provided, however, that the right of a person to be indemnified
hereunder in respect of claims made by a Third Person shall not be adversely
affected by a failure to give such notice unless, and then only to the extent
that, the Santera Indemnifying Persons are actually damaged thereby. If a
reasonably sufficient number of shares of Series A Preferred Stock or other
property are held in escrow under the Escrow Agreement to satisfy such claim the
Representative, on behalf of Santera and/or the Surviving Corporation and/or the
person or persons beneficially owning shares of Series A Preferred Stock held in
escrow under the Escrow Agreement (in all, the "Santera Indemnifying Persons")
shall have the right, upon written notice to Tekelec, and using counsel
reasonably satisfactory to Tekelec, to investigate, secure, contest, or settle
the claim alleged by such Third Person (a "Third Person Claim"), provided that
the Representative, on behalf of the Santera Indemnifying Persons, has
unconditionally acknowledged to Tekelec in writing (i) the obligation of the
Surviving Corporation to indemnify the persons to be indemnified hereunder with
respect to such Third Person Claim, (ii) that the shares of Series A Preferred
Stock held pursuant to the Escrow Agreement for satisfaction of indemnity claims
are in fact available to satisfy such indemnity obligation and (iii) the
availability of the setoff rights of Tekelec and Santera and/or the Surviving
Corporation contained in Section 11.7 or any comparable provision of any
Ancillary Document to satisfy such indemnity claims; Tekelec may thereafter
participate in (but not control) the defense of any such Third Person Claim with
its own counsel at its own expense, unless separate representation is necessary
to avoid a conflict of interest, in which case such representation shall be at
the expense of the Santera Indemnifying Persons (which obligation shall be
satisfied by setoff contemplated by Section 11.7 or any comparable provision of
any Ancillary Document or by surrender of shares of Series A Preferred Stock or,
to the extent that no Shares of Series A Preferred Stock remain in

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escrow, other property held in escrow under the Escrow Agreement as provided in
Section 11.3(b)). Unless and until the Representative, on behalf of the Santera
Indemnifying Persons, so acknowledges the obligations of Santera and/or the
Surviving Corporation to indemnify and otherwise makes the acknowledgements
described above, Tekelec shall have the right, at its option, to assume and
control defense of the matter and to look to the Santera Indemnifying Persons
for the full amount of the reasonable costs of defense (which obligation shall
be satisfied as provided in the parenthetical at the end of the preceding
sentence). The failure of the Representative to respond in writing to the
aforesaid notice of Tekelec with respect to such Third Person Claim within
twenty (20) days after receipt thereof and to deliver the unconditional
acknowledgement referenced above shall be deemed an election not to defend the
same; provided, however, that at any time during the defense of such claim, the
Representative may assume and control the defense of such matter if the
Representative, on behalf of the Santera Indemnifying Persons, acknowledges the
obligation of Santera and/or the Surviving Corporation to indemnify the Tekelec
Indemnified Persons with respect to such Third Person Claim and otherwise makes
the acknowledgements described above. If the Representative does not so
acknowledge the obligation of Santera and/or the Surviving Corporation to
indemnify and otherwise make such other acknowledgements and have the
Representative assume the defense of any such Third Person Claim, (a) Tekelec
may defend against such claim using counsel of its choice, in such manner as it
may reasonably deem appropriate, except that Tekelec agrees that it shall not
settle such claim without the consent of the Representative thereto, which
consent shall not be unreasonably withheld, and (b) the Representative may
participate in (but not control) the defense of such action, with their own
counsel at its own expense. If the Representative (on behalf of the Santera
Indemnifying Persons or otherwise) thereafter seeks to question the manner in
which Tekelec defended such Third Person Claim, the Representative shall have
the burden to prove by clear and convincing evidence that conduct of Tekelec in
the defense of such Third Person Claim constituted negligence or willful
misconduct. The Parties shall promptly make available to each other all relevant
information in their possession relating to any such Third Person Claim and
shall cooperate in the defense thereof.

                           (b)      If a Santera Indemnified Person is entitled
to indemnification hereunder because of a claim asserted against any such
Santera Indemnified Person by a Third Person at a time when shares of Series A
Preferred Stock or other property remain in escrow under the Escrow Agreement,
the Representative shall or, if no shares of Series A Preferred Stock or other
property remain in escrow, Santera shall give Tekelec reasonably prompt notice
thereof after such assertion is actually known to the Representative or Santera;
provided, however, that the right of a person to be indemnified hereunder in
respect of claims made by a Third Person shall not be adversely affected by a
failure to give such notice unless, and then only to the extent that, Tekelec is
actually damaged thereby. Tekelec shall have the right, upon written notice to
the Representative, and using counsel reasonably satisfactory to the
Representative, to investigate, secure, contest, or settle the Third Person
Claim, provided that Tekelec has unconditionally acknowledged to the
Representative in writing the obligation of Tekelec to indemnify the persons to
be indemnified hereunder with respect to such Third Person Claim; the
Representative may thereafter participate in (but not control) the defense of
any such Third Person Claim with its own counsel at its own expense, unless
separate representation is necessary to avoid a conflict of interest, in which
case such representation shall be at the expense of Tekelec. Unless and until
Tekelec so acknowledges its obligation to indemnify, the Representative shall
have the right, at its option, to assume and control defense of the matter and
to look to Tekelec for the full amount of the reasonable costs of defense. The
failure of Tekelec to respond in writing to the aforesaid notice of the
Representative with respect to such Third Person Claim within twenty (20) days
after receipt thereof and to deliver the

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<PAGE>

unconditional acknowledgement referenced above shall be deemed an election not
to defend the same; provided, however, that at any time during the defense of
such claim, Tekelec may assume and control the defense of such matter if Tekelec
acknowledges its obligation to indemnify the persons to be indemnified hereunder
with respect to such Third Person Claim. If Tekelec does not so acknowledge the
obligation of Tekelec to so indemnify and assume the defense of any such Third
Person Claim, (a) the Representative may defend against such claim using counsel
of its choice, in such manner as it may reasonably deem appropriate, except that
the Representative agrees that it shall not settle such claim without the
consent of Tekelec thereto, which consent shall not be unreasonably withheld,
and (b) Tekelec may participate in (but not control) the defense of such action,
with its own counsel at its own expense. If Tekelec thereafter seeks to question
the manner in which the Representative defended such Third Person Claim, Tekelec
shall have the burden to prove by clear and convincing evidence that conduct of
the Representative in the defense of such Third Person Claim constituted
negligence or willful misconduct. The Parties shall promptly make available to
each other all relevant information in their possession relating to any such
Third Person Claim and shall cooperate in the defense thereof.

                  11.5     Survival of Representations, Warranties and
Covenants. The indemnification provided for in this Article XI and the
representations, warranties and covenants to which an indemnification obligation
under this Article XI may apply, shall survive until the earliest of (A) 11:59
p.m. on the date which is the three (3) year anniversary of the Closing Date,
(B) the closing of a transaction pursuant to which Tekelec acquires all of the
Series A Preferred Stock not owned by Tekelec, its wholly owned subsidiaries or
the Tekelec Designees (as defined in the Stockholders' Agreement), other than
any Disputed Shares (as defined in the Stockholders' Agreement), as a result of
the exercise of the call right or the put right contained in Article III of the
Stockholders' Agreement and (C) the closing of a transaction pursuant to which
the Surviving Corporation redeems all of the Series A Preferred Stock not owned
by Tekelec, its wholly owned subsidiaries or the Tekelec Designees, other than
any Disputed Shares, pursuant to Article Fourth, Section C(1)(ii) of the Second
Amended and Restated Certificate of Incorporation, unless a claim with respect
thereto shall have been made pursuant to Section 11.3 (Notice of Claim) or
Section 11.4 (Right to Contest Claims of Third Persons) prior to such date
against the Party or Parties responsible for indemnification hereunder, in which
case such indemnification (to the extent asserted in such claim) shall survive
until such claim is resolved in accordance with the terms hereof except that:
(i) the representations and warranties, and the indemnification obligations with
respect thereto, under Sections 3.1(c) and (d) (section entitled Corporate
Existence and Power; Consents, Etc.), 3.2 (section entitled Valid and
Enforceable Agreement; Authorization), the first sentence of 3.9 (section
entitled Assets), 3.14(b) (subsection of section entitled Intellectual
Property), 4.1(c), (d) and (e) (section entitled Corporate Existence and Power),
4.2 (section entitled Valid and Enforceable Agreement; Authorization); the first
sentence of 4.10 (section entitled Assets) and 4.16(b) (subsection of section
entitled Intellectual Property) and the indemnification obligations contained in
Section 11.2(c) shall survive until the earlier of (a) the date which is one (1)
year after the date on which Tekelec acquires all of the Series A Preferred
Stock as a result of the consummation of a transaction pursuant to the exercise
of the call right or the put right contained in Article III of the Stockholders'
Agreement, (b) the date which is one (1) year after the date on which the
Surviving Corporation redeems all of the Series A Preferred Stock pursuant to
Article Fourth, Section C(1)(ii) of the Second Amended and Restated Certificate
of Incorporation or (c) if such Series A Preferred Stock is not acquired
pursuant to the exercise of the call right or the put right contained in Article
III of the Stockholders' Agreement or redeemed pursuant to Article Fourth,
Section C(1)(ii) of the Second Amended and Restated Certificate of
Incorporation, then on February 28, 2009; and (ii) the representations and

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warranties, and the indemnification obligations with respect thereto, under
Sections 3.5 (section entitled Taxes), 3.18 (section entitled Employee Benefit
Matters), 4.6 (section entitled Taxes) and 4.21 (section entitled Employee
Benefit Matters), and the indemnity obligations of the parties hereto related to
fraudulent misrepresentations and warranties and willful breaches of covenants
or agreements hereunder shall survive until the expiration of the applicable
statutes of limitation, including any suspensions, tollings or extensions
thereof. The certificates delivered pursuant to Sections 9.1, 9.2, 10.1 and 10.2
shall be deemed to be additional representations and warranties, and shall
expire in the same manner as the respective underlying representations and
warranties in Article III, Article IV and Article V expire and shall otherwise
be subject to the same terms, conditions and limitations (if any) as the
respective underlying representations and warranties in Article III, Article IV
and Article V are subject under this Agreement. All representations and
warranties hereunder shall be deemed to be material and relied upon by the
parties with or to whom the same were made, notwithstanding any investigation or
inspection made by or on behalf of such party or parties.

                  11.6     Limitations on Indemnity.

                           (a)      The Santera Indemnified Persons shall not be
entitled to indemnification for Indemnified Losses under Section 11.1 unless and
until the aggregate amount of Indemnified Losses exceeds Five Hundred Thousand
Dollars ($500,000), and then only to the extent of the Indemnified Losses in
excess of such $500,000 threshold; provided, however, that the foregoing
$500,000 threshold shall not apply in any manner whatsoever to any instances of
fraud or willful breach of any agreement, covenant, representation, warranty or
other obligation of Tekelec made or incurred under or pursuant to this
Agreement.

                           (b)      The Tekelec Indemnified Persons shall not be
entitled to indemnification for Indemnified Losses under Section 11.2 unless the
aggregate amount of Indemnified Losses exceeds Five Hundred Thousand Dollars
($500,000), and then only to the extent of the Indemnified Losses in excess of
such $500,000 threshold; provided, however, that the foregoing $500,000
threshold shall not apply in any manner whatsoever to any instances or fraud or
willful breach of any agreement, covenant, representation, warranty or other
obligation of Santera or the Surviving Corporation made or incurred under or
pursuant to this Agreement.

                           (c)      The Santera Indemnified Persons shall not be
entitled to indemnification for Indemnified Losses under Section 11.1 to the
extent such Indemnified Losses, together with all other Indemnified Losses
recovered by Santera Indemnified Persons under Section 11.1, exceed $38,000,000,
except that such cap shall not apply in any manner whatsoever to any instances
of fraud or willful breach of any agreement, covenant, representation, warranty
or other obligation of Tekelec made or incurred under or pursuant to this
Agreement.

                           (d)      The Tekelec Indemnified Persons shall not be
entitled to indemnification for Indemnified Losses under Section 11.2 to the
extent such Indemnified Losses, together with all other Indemnified Losses
recovered by Tekelec Indemnified Persons under Section 11.2, exceed $50,000,000,
except that such cap shall not apply in any manner whatsoever to any instances
of fraud or willful breach of any agreement, covenant, representation, warranty
or other obligation of Santera or the Surviving Corporation made or incurred
under or pursuant to this Agreement.

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                  11.7     Setoff. Tekelec shall be entitled to setoff, and/or
at any time following the Closing, cause the Surviving Corporation to setoff,
(i) any amount that Tekelec claims Santera or the Surviving Corporation owes it
under this Article XI, including any amounts owed pursuant to that letter
agreement dated April 30, 2003, against (x) any amounts owed by Tekelec to
Santera or the Surviving Corporation (other than amounts owed by Tekelec to
Santera as indemnification payments pursuant to this Article XI or upon exercise
of the Tekelec Option (as defined in the Stockholders' Agreement) pursuant to
the Stockholders' Agreement) or to any of the Legacy Santera Stockholders under
this Agreement or the Stockholders' Agreement or (y) after the Closing, any
amounts owed by the Surviving Corporation to the Legacy Santera Stockholders
upon redemption of shares of Series A Preferred Stock under the Second Amended
and Restated Certificate of Incorporation and/or (ii) any amount Tekelec claims
any Legacy Santera Stockholder owes it, Santera or the Surviving Corporation
under this Agreement against (x) any amounts owed by Tekelec to Santera or the
Surviving Corporation (other than amounts owed by Tekelec to Santera as
indemnification payments pursuant to this Article XI or upon exercise of the
Tekelec Option (as defined in the Stockholders' Agreement) pursuant to the
Stockholders' Agreement) or to any such Legacy Santera Stockholder under this
Agreement or the Stockholders' Agreement or (y) after the Closing, any amounts
owed by Santera to any such Legacy Santera Stockholder upon redemption of shares
of Series A Preferred Stock under the Second Amended and Restated Certificate of
Incorporation; provided, in any such case, that Tekelec informs the
Representative in writing of such proposed setoff in advance of such setoff and
describes the grounds upon which Tekelec claims the right to make such setoff
(or cause Santera to make such setoff) and provides the Representative a
reasonable opportunity to contest such setoff. If the Representative disputes
such setoff, it shall notify Tekelec thereof within thirty (30) days after
receipt of the notice of setoff, whereupon Tekelec and the Representative shall
meet and attempt in good faith to resolve their differences with respect to such
claimed right of setoff. If the dispute has not been resolved within thirty (30)
days after such Parties first meet to attempt such resolution, any Party may
initiate litigation in accordance with this Agreement. This Section 11.7 does
not create any independent obligation of a Party to Tekelec, nor shall this
Section 11.7 circumvent the limitations set forth in Sections 11.5, 11.6, 11.8
and 11.9.

                  11.8     Exclusive Remedy. In the absence of fraud or willful
breach, the indemnification provisions (including the setoff provision contained
in Section 11.7) set forth in this Article XI shall provide the exclusive remedy
for breach of any covenant, agreement, representation or warranty by Santera or
the Surviving Corporation or Tekelec set forth in this Agreement; provided
however, that such limitation shall not impair the rights of any of the Parties
to seek non-monetary equitable relief, including, without limitation, specific
performance or injunctive relief to redress any default or breach of this
Agreement. In connection with the seeking of any non-monetary equitable relief,
each of the Parties acknowledges and agrees that the other Parties hereto would
be damaged irreparably in the event any of the provisions of this Agreement are
not performed in accordance with their specific terms or otherwise are breached.
Notwithstanding anything to the contrary herein, at any time after the closing
of (a) the acquisition by Tekelec of all of the Series A Preferred Stock not
owned by Tekelec, its wholly owned subsidiaries or the Tekelec Designees, other
than Disputed Shares, as a result of the consummation of a transaction pursuant
to the exercise of the call right or the put right contained in Article III of
the Stockholders' Agreement or (b) the redemption by Santera of all of the
Series A Preferred Stock not owned by Tekelec, its wholly owned subsidiaries or
the Tekelec Designees, other than Disputed Shares, pursuant to Article Fourth,
Section C(1)(ii) of the Second Amended and Restated Certificate of
Incorporation, Tekelec shall have no right to satisfy any indemnification claims
it may have against Santera under this

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Agreement by recourse to the Legacy Santera Stockholders (other than with
respect to any Disputed Shares, as such term is defined in the Stockholders
Agreement).

                  11.9     Escrow. Subject to the rights of Tekelec and the
Surviving Corporation under Section 11.7 or under any comparable provision of
any Ancillary Agreements, Santera, the Surviving Corporation, Tekelec and each
of the Legacy Santera Stockholders agree that for so long as shares of Series A
Preferred Stock or other property are held in escrow under the Escrow Agreement
to satisfy indemnity claims of Tekelec, Tekelec shall first seek to satisfy all
of its claims for indemnification hereunder (on behalf of itself and all Tekelec
Indemnified Persons) by making a claim pursuant to and in accordance with the
terms of the Escrow Agreement and will not seek payment in cash for any claim
for indemnification from the Surviving Corporation as long as shares of Series A
Preferred Stock or other property securing Santera's and the Surviving
Corporation's indemnity obligations are held under the Escrow Agreement. All of
the Parties hereto acknowledge and agree that the escrow shall be available to
satisfy, and, so long as property is held thereunder to secure Santera's and the
Surviving Corporation's indemnity obligation, shall be the sole source (subject
to the right of Tekelec and the Surviving Corporation pursuant to Section 11.7
or the comparable provision of any Ancillary Agreements) available to satisfy,
the indemnification claims of the Tekelec Indemnified Persons under this
Agreement. The Parties acknowledge and agree that in determining whether a
Tekelec Indemnified Person has incurred Indemnified Losses with respect to any
particular matter, and in calculating the amount of the Indemnified Losses that
a Tekelec Indemnified Person is entitled to hereunder with respect to any such
matter, all of the Indemnified Losses incurred by Santera and/or the Surviving
Corporation (other than those Indemnified Losses with respect to which Santera
and/or the Surviving Corporation is entitled to indemnification pursuant to
Section 11.1) with respect to such matter shall be deemed to have been incurred
by the Tekelec Indemnified Persons for all purposes hereunder and under the
Escrow Agreement. The Parties acknowledge that no Legacy Santera Stockholder
shall, in the absence of actual fraud or willful breach on the part of such
Legacy Santera Stockholder, have any personal liability with respect to any
agreement, obligation, covenant, representation or warranty or indemnity
obligation of Santera and/or the Surviving Corporation under this Agreement; the
only recourse against any Legacy Santera Stockholder with respect to such
matters being against shares of Series A Preferred Stock or other property held
in escrow to secure the obligations of Santera and/or the Surviving Corporation
under the Escrow Agreement or by exercise of the setoff rights contained in
Section 11.7 or contained in the Escrow Agreement or the Stockholders'
Agreement.

                                  ARTICLE XII
                            MISCELLANEOUS PROVISIONS

                  12.1     Termination. This Agreement may be terminated at any
time prior to the Closing Date:

                           (a)      by mutual consent of the Parties hereto;

                           (b)      by any Party if there shall be any law or
regulation that makes consummation of the transaction contemplated hereby
illegal or otherwise prohibited or if any judgment, injunction, order or decree
enjoining the Parties from consummating the transactions contemplated hereby is
entered and such judgment, injunction, order or decree shall become final and
nonappealable;

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                           (c)      by either Santera, on the one hand, or
Tekelec, on the other hand, if the Closing shall not have occurred on or before
July 1, 2003, or such other date, if any, as Santera and Tekelec shall agree
upon; provided that no Party may terminate this Agreement pursuant to this
clause (c) if such Party's failure to fulfill any of its obligations under this
Agreement shall have directly or indirectly resulted in the failure of the
Closing to occur on or before said date;

                           (d)      by Tekelec if (i) there shall have been a
breach in any material respect (individually or in the aggregate) of any
representation or warranty on the part of Santera set forth in this Agreement,
or (ii) except with respect to the covenants and agreements contained in Section
6.2(a), there shall have been a breach by Santera of any of its covenants or
agreements hereunder materially adversely affecting (or materially delaying) the
consummation of the transactions contemplated hereby, and Santera has not cured
such breach within twenty (20) Business Days after notice by Tekelec thereof,
provided that, with respect to clauses (i) and (ii) above, Tekelec has not
materially breached any of its obligations hereunder and failed to timely cure
such breach;

                           (e)      by Tekelec, at any time prior to 5:00 p.m.
Eastern Standard Time on the date which is two (2) days following the date
hereof, if (i) Santera has not obtained the Stockholders' Consent by 4:00 p.m.,
Eastern Standard Time on the date hereof, (ii) there shall have been a breach by
Santera or any of the Legacy Santera Stockholders of any of their respective
covenants or agreements under Section 6.2(a) or (iii) any of the transactions
contemplated as being consummated by 4:00 p.m., Eastern Standard Time, on the
date hereof have not been so consummated; or

                           (f)      by Santera if (i) there shall have been a
breach in any material respect (individually or in the aggregate) of any
representation or warranty on the part of Tekelec set forth in this Agreement,
or (ii) there shall have been a breach by Tekelec of any of their respective
covenants or agreements hereunder materially adversely affecting (or materially
delaying) the consummation of the transactions contemplated hereby, and Tekelec
has not cured such breach within twenty (20) Business Days after notice by
Santera thereof, provided that, with respect to clauses (i) and (ii) above,
Santera has not materially breached any of its obligations hereunder and failed
to timely cure such breach.

                  12.2     Notice of Termination; Effect of Termination.

                           (a)      Any Party or Parties desiring to terminate
this Agreement pursuant to Section 12.1 shall give written notice of such
termination to the other Parties to this Agreement.

                           (b)      If this Agreement is terminated pursuant to
Section 12.1, all obligations of the Parties hereunder shall terminate (other
than the obligations pursuant to Section 12.5), without liability of any Party
to any other Party, except that nothing in this Section or elsewhere in this
Agreement shall impair or restrict the rights of any party to any and all
remedies at law or in equity in the event of a breach of or default under this
Agreement prior to any such termination by any other Party.

                  12.3     Bulk Transfer Law. The Parties hereto each waive
compliance by Tekelec with the provisions of any applicable State Uniform
Commercial Code or other statutory provisions regulating bulk sales or transfers
which may be applicable to the contribution of the Contributed Assets.

                                       70
<PAGE>

                  12.4     Notices. All notices, consents, approvals, requests
and other communications hereunder shall be in writing and shall be deemed given
when delivered personally, one (1) day after being delivered to an overnight
courier or when telecopied (with a confirmatory copy sent by overnight courier)
to the parties at the following addresses (or at such other address for a party
as shall be specified by like notice):

         If to Santera or the Surviving Corporation, to:

                  Santera Systems Inc
                  3601 East Plano Parkway, #100
                  Plano, Texas 75704
                  Attention: President
                  Facsimile No.: (972) 461-7512

         with copies to:

                  Munsch Hardt Kopf & Harr P.C.
                  1445 Ross Avenue, Suite 4000
                  Dallas, Texas 75202
                  Attention: A. Michael Hainsfurther
                  Facsimile No.: (214) 855-7584

         If to Tekelec, to:

                  Tekelec
                  26580 West Agoura Road
                  Calabasas, California 91302
                  Attention: President
                  Facsimile No.: (818) 880-0176

         with copies to:

                  Ronald W. Buckly
                  Tekelec
                  26850 West Agoura Road
                  Calabasas, California 91302
                  Facsimile: (818) 880-0176

         and

                  Bryan Cave LLP
                  One Metropolitan Square
                  211 North Broadway, Suite 3600
                  St. Louis, Missouri 63102
                  Attention: J. Mark Klamer and Katherine F. Ashton
                  Facsimile: (314) 259-2020

          If to the Legacy Santera Stockholders, to the Representative:

                                       71
<PAGE>

                  Austin Ventures VI, L.P.
                  2435 North Central Expressway, Suite 1600
                  Richardson, Texas 75080
                  Attention: Edward Olkkola
                  Facsimile No.: (972) 892-3701

         with a copy to:

                  Wilson Sonsini Goodrich & Rosati, Professional Corporation
                  8911 Capital of Texas Highway North
                  Westech 360, Suite 3350
                  Austin, Texas 78759
                  Attention: Paul R. Tobias
                  Facsimile: (512) 338-5499

                  12.5     Expenses. Each Party hereto will pay all costs and
expenses incident to its negotiation and preparation of this Agreement and to
its performance and compliance with all agreements and conditions contained
herein on its part to be performed or complied with, including the fees,
expenses and disbursements of its counsel, financial advisors and accountants
except as otherwise provided herein and except that upon Closing, (i) the
Surviving Corporation shall pay all investment banking, legal and accounting
fees and expenses incurred by the Legacy Santera Stockholders with respect to
periods prior to the Closing Date in connection with the negotiation and
preparation of this Agreement and the Ancillary Agreements, and the transactions
contemplated hereby and thereby and (ii) the Surviving Corporation shall assume
all liability for investment banking, legal and accounting fees and expenses
incurred by Tekelec, Tekelec Sub or Merger Sub with respect to periods prior to
the Closing Date in connection with the negotiation and preparation of this
Agreement and the Ancillary Agreements, and the transactions contemplated hereby
and thereby, in an amount not to exceed the total amount of such expenses paid
by Santera or the Surviving Corporation (on behalf of Santera or the Surviving
Corporation and/or their stockholders, other than Tekelec) prior to, in
connection with or following the Closing hereunder. The Surviving Corporation's
assumption of the amount of these expenses that are liabilities of Tekelec at
the Closing shall be treated as an assumption of Tekelec's liabilities pursuant
to Section 357(a) of the Code. The Surviving Corporation shall reimburse Tekelec
for all costs and expenses associated with the reduction in force of 21
employees of the Business in March 2003.

                  12.6     Confidentiality Agreement. The provisions of the Non-
Disclosure Agreement dated September 20, 2002, amended as of September 20, 2002
(the "Confidentiality Agreement"), shall remain in full force and effect
notwithstanding the Closing and shall not be superseded by the terms of this
Agreement.

                  12.7     Entire Agreement. This Agreement, together with the
other documents and instruments executed in connection herewith, is an
integrated document and contains the sole and entire agreement and understanding
between the parties as to the matters contained herein, and except as expressly
provided herein, fully supersedes and merges any and all prior and
contemporaneous agreements, understandings, proposals, negotiations,
arrangements and/or discussions, both written and oral, among the parties with
respect to the subject matter hereof, including, following Closing, the
Confidentiality Agreement. This Agreement, except as otherwise may be expressly
provided herein, is not intended to confer upon any Person other than the
parties

                                       72
<PAGE>

hereto any rights, benefits or remedies hereunder, other than those Persons
entitled to indemnification pursuant to Article XI.

                  12.8     Amendment. No modification or amendment of this
Agreement or of any provision of this Agreement shall be valid or enforceable
unless in writing duly executed by Tekelec, Santera and the Legacy Santera
Stockholders which own a majority in interest of the capital stock of Santera
owned by all Legacy Santera Stockholders, calculated on an as converted basis.

                  12.9     Waiver. At any time prior to the Closing, Tekelec,
Santera and the Legacy Santera Stockholders which own a majority in interest of
the capital stock of Santera owned by all Legacy Santera Stockholders,
calculated on an as converted basis, may (i) extend the time for the performance
of any of the obligations or other acts of the other Parties hereto, (ii) waive
any inaccuracies in the representations and warranties contained herein or in
any document delivered pursuant hereto and (iii) waive compliance with any of
the agreements or conditions contained herein which may legally be waived.
Except as otherwise specifically provided herein, any agreement on the part of
Tekelec, Santera or the Legacy Santera Stockholders to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of Tekelec, Santera or the Legacy Santera Stockholders which own a
majority in interest of the capital stock of Santera owned by all Legacy Santera
Stockholders, calculated on an as converted basis, as the case may be (it being
agreed and understood that any agreement to any such extension or waiver signed
by the Legacy Santera Stockholders which own a majority in interest of the
capital stock of Santera owned by all Legacy Santera Stockholders, calculated on
an as converted basis, shall constitute an agreement to such extension or waiver
by all of the Legacy Santera Stockholders). No failure of any Party to exercise
any power given such Party hereunder or to insist upon strict compliance by any
Party with its obligations hereunder, and no custom or practice of the parties
in variance with the terms hereof, shall constitute a waiver of that Party's
right to demand exact compliance with the terms hereof. Any waiver shall not
obligate that Party to agree to any further or subsequent waiver or affect the
validity of the provision relating to any such waiver.

                  12.10    Assignment. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
Parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other Parties.

                  12.11    Severability. The invalidity or unenforceability of a
particular provision of this Agreement or portion hereof shall not affect the
other provisions or portions hereof, which shall remain fully valid and
enforceable as if such invalid or unenforceable provision or portion was
omitted. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the Parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
Parties as closely as possible in a mutually acceptable manner in order that the
transactions contemplated by this Agreement may be consummated as originally
contemplated to the fullest extent possible. If the Parties fail to so agree
within ten (10) Business Days of such determination that any term or other
provision is invalid, illegal or incapable of being enforced, such holding shall
not affect the validity or enforceability of any other aspect hereof (or of such
provision in another jurisdiction) and the Parties agree and hereby request that
the court or arbitrator(s) make such valid modifications to (or replacement of,
if necessary) the invalid provision as are necessary and reasonable to most
closely approximate the Parties' intent as evidenced hereby as a whole.

                                       73
<PAGE>

                  12.12    Counterparts. This Agreement may be executed in
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more counterparts have been signed by each of
the Parties and delivered to the other Parties.

                  12.13    Enforcement of this Agreement. The parties hereto
agree that irreparable damage would occur in the event that (a) the conditions
to Closing set forth in Article VIII, Article IV, Article IX and Article X have
been satisfied or waived and one of the Parties refuses to consummate the
transactions contemplated to this Agreement, or (b) a party violates one or more
of the provisions of Article VI, and it is accordingly agreed that the Parties
hereto shall be entitled to an injunction or injunctions to prevent such
violations of this Agreement and to enforce specifically the terms and
provisions hereof. Such remedy shall be in addition to any other remedy to which
any Party is entitled at law or in equity.

                  12.14    Governing Law. This Agreement and all rights and
obligations of the parties shall be governed, construed and interpreted under
and pursuant to the laws of the State of Delaware applicable to agreements made
and to be performed entirely within such State.

                  12.15    Interpretation; Negotiated Transaction. The article
and section headings contained in this Agreement are inserted for convenience
only and shall not affect in any way the meaning or interpretation of the
Agreement. Each reference in this Agreement to an Article, Section or Schedule,
unless otherwise indicated, shall mean an Article or a Section of this Agreement
or a Schedule attached to this Agreement, respectively. References herein to
"days", unless otherwise indicated, are to consecutive calendar days. The
provisions of this Agreement were negotiated by the Parties hereto and said
Agreement shall be deemed to have been drafted by all the Parties hereto,
notwithstanding any presumptions at law to the contrary.

                  12.16    Remedies Cumulative. Except as otherwise provided
herein, all rights and remedies of the Parties under this Agreement are
cumulative and without prejudice to any other rights or remedies under Law.

                  12.17    Submission to Jurisdiction; Waivers.

                           (a)      Each of Santera, the Surviving Corporation,
each Legacy Santera Stockholder and the Representative (on behalf of the Legacy
Santera Stockholders) irrevocably agrees that any legal action or proceeding
with respect to this Agreement brought by it against Tekelec shall be brought
and determined in any federal or state court in the district in which Los
Angeles, California is located, and Tekelec irrevocably submits with regard to
any such action or proceeding for itself and in respect to its property,
generally and unconditionally, to the exclusive jurisdiction of the aforesaid
court. Tekelec hereby irrevocably waives, and agrees not to assert, by way of
motion, as a defense, counterclaim, or otherwise, in any action or proceeding
with respect to this Agreement, (a) any claim that it is not personally subject
to the jurisdiction of the above named court for any reason other than the
failure to serve process in accordance with this Section 12.17, (b) that it or
its property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such court (whether through judgment or otherwise),
and (c) to the fullest extent permitted by applicable law that (i) the suit,
action or proceeding in any such court is brought in an inconvenient forum, (ii)
the venue of such suit, action or proceeding is improper and (iii) this
Agreement, or the subject matter hereof, may not be enforced in or by such
court.

                                       74
<PAGE>

                           (b)      Tekelec irrevocably agrees that any legal
action or proceeding with respect to this Agreement brought by it against
Santera, the Surviving Corporation, any of the Legacy Santera Stockholder or the
Representative (on behalf of the Legacy Santera Stockholders) shall be brought
and determined in any federal or state court in the district in which Dallas,
Texas is located, and each of Santera, the Surviving Corporation, each Legacy
Santera Stockholder and the Representative (on behalf of the Legacy Santera
Stockholders) irrevocably submits with regard to any such action or proceeding
for itself and in respect to its property, generally and unconditionally, to the
exclusive jurisdiction of the aforesaid court. Each of Santera, the Surviving
Corporation, each Legacy Santera Stockholder and the Representative (on behalf
of the Legacy Santera Stockholders) hereby irrevocably waives, and agrees not to
assert, by way of motion, as a defense, counterclaim, or otherwise, in any
action or proceeding with respect to this Agreement, (a) any claim that it is
not personally subject to the jurisdiction of the above named court for any
reason other than the failure to serve process in accordance with this Section
12.17, (b) that it or its property is exempt or immune from jurisdiction of any
such court or from any legal process commenced in such court (whether through
judgment or otherwise), and (c) to the fullest extent permitted by applicable
law that (i) the suit, action or proceeding in any such court is brought in an
inconvenient forum, (ii) the venue of such suit, action or proceeding is
improper and (iii) this Agreement, or the subject matter hereof, may not be
enforced in or by such court.

                           (c)      Each Party hereto waives all personal
service of any and all process upon such Party related to this Agreement and
consents that all service of process upon such Party shall be made by hand
delivery, certified mail or confirmed telecopy directed to such Party at the
address specified in Section 12.4; and service made by certified mail shall be
complete seven days after the same shall have been posted

                  12.18    Tekelec Sub.

                           (a)      Certain Contribution Assets are currently
held by Tekelec Sub. Tekelec shall cause Tekelec Sub to contribute the
Contributed Assets held by Tekelec Sub on the Closing Date to be contributed to
Merger Sub, and shall otherwise be wholly liable for all representations,
warranties and covenants relating to the Business contained in this Agreement.
Tekelec Sub shall have no liability under this Agreement.

                           (b)      A portion of the common stock of Merger Sub
to be issued by Merger Sub to Tekelec hereunder will be allocated to Tekelec Sub
in proportion to the fair market value of the Contributed Assets contributed by
Tekelec Sub, as designated by Tekelec by written notice to Santera prior to the
Closing.

                           (c)      Any reference to Tekelec hereunder shall be
deemed also to mean a reference to Tekelec Sub to the extent of the Contributed
Assets held by Tekelec Sub, unless the context requires otherwise.

                  12.19    Limitation on Claims Against the Legacy Santera
Stockholders. No person shall be entitled to recover from any Legacy Santera
Stockholder an amount in excess of the amount of such Legacy Santera
Stockholder's cash contribution set forth next to such Legacy Santera
Stockholder's name on Schedule 2.4 under the column entitled "Cash Contribution
to Santera" (such Legacy Santera Stockholder's cash contribution being a portion
of $12,000,000) as a result of a breach by such Legacy Santera Stockholder of
any representation or warranty of such Legacy

                                       75
<PAGE>

Santera Stockholder under this Agreement, except that such limitation shall not
apply in any manner whatsoever to any instances of fraud or willful breach of
any such representation or warranty.

           [The remainder of this page has been left intentionally.]

                                       76
<PAGE>

          IN WITNESS WHEREOF, the foregoing agreement has been executed and
delivered as of the date first above written.

                              SANTERA SYSTEMS INC.

                              By:  /s/ David Heard
                                 _______________________________________________
                              Name:    David Heard
                                   _____________________________________________
                              Title:   President and CEO
                                    ____________________________________________

                              TEKELEC

                              By:  /s/ Frederick M. Lax
                                 _______________________________________________
                              Name:    Frederick M. Lax
                                   _____________________________________________
                              Title:   President and CEO
                                    ____________________________________________

                              By:  /s/ Paul J. Pucino
                                 _______________________________________________
                              Name:    Paul J. Pucino
                                   _____________________________________________
                              Title:   CFO
                                    ____________________________________________

                              LUKE ACQUISITION CORP.

                              By:  /s/ Ronald W. Buckly
                                 _______________________________________________
                              Name:    Ronald W. Buckly
                                   _____________________________________________
                              Title:   Vice President
                                    ____________________________________________

                              AUSTIN VENTURES VI, L.P., as Representative

                              By: AV Partners VI, L.P., its General Partner

                              By:   /s/ Edward E. Olkkola
                                  ______________________________________________
                                 Edward E. Olkkola, General Partner

                              AUSTIN VENTURES VI, L.P.

                              By: AV Partners VI, L.P., its General Partner

                              By:   /s/ Edward E. Olkkola
                                  ______________________________________________
                                 Edward E. Olkkola, General Partner

                              AUSTIN VENTURES VI AFFILIATES FUND,
                              L.P.

                              By: AV Partners VI, L.P., its General Partner

                              By:   /s/ Edward E. Olkkola
                                  ______________________________________________
                                 Edward E. Olkkola, General Partner

                          AGREEMENT AND PLAN OF MERGER
                                 Signature Page

<PAGE>

                              AUSTIN VENTURES VIII, L.P.

                              By: AV Partners VIII, L.P., its General Partner

                              By:   /s/ Edward E. Olkkola
                                  ______________________________________________
                                 Edward E. Olkkola, General Partner

                              REDPOINT VENTURES II, L.P., by its General
                              Partner, Redpoint Ventures II, LLC

                              By:   /s/ R. Thomas Dyal
                                  ______________________________________________
                              R. Thomas Dyal, Managing Director

                              REDPOINT ASSOCIATES II, LLC, as nominee

                              By:   /s/ R. Thomas Dyal
                                  ______________________________________________
                                 R. Thomas Dyal, Managing Director

                              REDPOINT TECHNOLOGY PARTNERS Q-I,
                              L.P., by its General Partner, Redpoint Ventures I,
                              LLC

                              By:   /s/ R. Thomas Dyal
                                  ______________________________________________
                              Name:     R. Thomas Dyal
                                    ____________________________________________
                              Title:    Managing Director
                                     ___________________________________________

                              REDPOINT TECHNOLOGY PARTNERS A-I,
                              L.P., by its General Partner, Redpoint Ventures I,
                              LLC

                              By:   /s/ R. Thomas Dyal
                                  ______________________________________________
                              Name:     R. Thomas Dyal
                                    ____________________________________________
                              Title:    Managing Director
                                     ___________________________________________

                              MERITECH CAPITAL PARTNERS L.P.

                              By: Meritech Capital Associates L.L.C.
                                 its General Partner

                              By: Meritech Management Associates L.L.C.
                                 a managing member

                              By:   /s/ Mark Stevens
                                  ______________________________________________
                              Name: ____________________________________________
                              Title: ___________________________________________

                          AGREEMENT AND PLAN OF MERGER
                                 Signature Page

<PAGE>

                              MERITECH CAPITAL AFFILIATES L.P.

                              By: Meritech Capital Associates L.L.C.
                                 its General Partner

                              By: Meritech Management Associates L.L.C.
                                 a managing member

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              SEQUOIA CAPITAL FRANCHISE FUND, L.P.

                              By: SCFF Management, LLC
                              A Delaware Limited Liability Company
                              General Partner

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              SEQUOIA CAPITAL FRANCHISE PARTNERS,
                              L.P.

                              By: SCFF Management, LLC
                              A Delaware Limited Liability Company
                              General Partner

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              SEQUOIA CAPITAL VIII, L.P.

                              By: SC VIII Management, LLC
                              A California Limited Liability Company
                              General Partner

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                          AGREEMENT AND PLAN OF MERGER
                                 Signature Page

<PAGE>

                              SEQUOIA INTERNATIONAL TECHNOLOGY
                              PARTNERS VIII, L.P.

                              By: SC VIII Management, LLC
                              A California Limited Liability Company
                              General Partner

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              SEQUOIA INTERNATIONAL TECHNOLOGY
                              PARTNERS VIII (Q), L.P.

                              By: SC VIII Management, LLC
                              A California Limited Liability Company
                              General Partner

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              SEQUOIA 1997

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              CMS PARTNERS LLC

                              By:  /s/ Mark Stevens
                                  ______________________________________________
                              Name: Mark Stevens
                                    ____________________________________________
                              Title: ___________________________________________

                              INSTITUTIONAL VENTURE PARTNERS VIII,
                              L.P., by its General Partner, Institutional
                              Venture Management VIII, LLC

                              By:  /s/ R. Thomas Dyal
                                  ______________________________________________
                                   R. Thomas Dyal, Managing Director

                              IVM INVESTMENT FUND VIII, LLC, by its
                              Manager, Institutional Venture Management VIII,
                              LLC

                              By:  /s/ R. Thomas Dyal
                                  ______________________________________________
                                   R. Thomas Dyal, Managing Director

                          AGREEMENT AND PLAN OF MERGER
                                 Signature Page

<PAGE>

                              BROADBAND FUND, L.P., by its General Partner,
                              BBF Management, LLC, by its Manager,
                              Institutional Venture Management VIII, LLC

                              By:  /s/ R. Thomas Dyal
                                  ______________________________________________
                                       R. Thomas Dyal, Managing Director

                          AGREEMENT AND PLAN OF MERGER
                                 Signature Page

<PAGE>

                         LIST OF EXHIBITS AND SCHEDULES

Exhibit A                  Form of Assignment and Assumption Agreement
Exhibit B                  Form of Bill of Sale
Exhibit C                  Form of Certificate of Amendment
Exhibit D                  Form of Certificate of Merger
Exhibit E                  Persons Executing Employment Agreements
Exhibit F                  Escrow Agreement
Exhibit G                  Exchange Agreement
Exhibit H                  Form of License Agreement
Exhibit I                  Note and Preferred Stock Purchase Agreement
Exhibit J                  Form of Power of Attorney
Exhibit K                  Form of Registration Rights Agreement
Exhibit L                  Form of Releases
Exhibit M                  Form of Second Amended and Restated Certificate of
                           Incorporation
Exhibit N                  Stockholders' Agreement
Exhibit O                  Form of Services Agreement
Exhibit P                  Form of Opinion of Bryan Cave LLP
Exhibit Q                  Form of Opinion of Munsch Hardt Kopf & Harr P.C.
Exhibit R                  Form of Opinion of Prickett, Jones & Elliott, P.A.
Exhibit S                  Form of Amended and Restated Bylaws

Schedule 1.1A              Assumed Contracts
Schedule 1.1B              Assumed Liabilities
Schedule 1.1C              Contributed Assets
Schedule 1.1D (Part 1)     Excluded Assets Not Used in the Business
Schedule 1.1D (Part 2)     Excluded Assets Used in the Business
Schedule 1.1E (Part 1)     Permitted Liens - Business
Schedule 1.1E (Part 2)     Permitted Liens - Santera
Schedule 2.4               Cash Contributions by Legacy Santera Stockholders
Schedule 2.9               Directors and Officers
Schedule 3.1(d)            Consents and Approvals
Schedule 3.2               Resolutions of Tekelec and Merger Sub
Schedule 3.3               Certain Developments with Respect to the Business
Schedule 3.4(a)            Undisclosed Liabilities
Schedule 3.5(f)            Taxes - Joint Ventures, Partnerships
Schedule 3.6(a)            Accounts Receivable
Schedule 3.6(b)            Inventory
Schedule 3.7               Breach of Law
Schedule 3.8               Litigation
Schedule 3.9               Assets
Schedule 3.10              Consents or Permits of Third Parties
Schedule 3.11              Condition of Property
Schedule 3.12              Licenses and Permits
Schedule 3.13(a) (Part 1)  Contracts Relating to the Business
Schedule 3.13(a) (Part 2)  Contracts Relating Exclusively to the Business
Schedule 3.13(b)           Breach or Violation of Material Tekelec Contracts
Schedule 3.14(a)(i)        Tekelec Business Intellectual Property

<PAGE>

Schedule 3.14(a)(ii)       Tekelec Business Intellectual Property Licenses
Schedule 3.14(b)           Exceptions to Title to Tekelec Business Intellectual
                           Property
Schedule 3.14(c)           Restrictions on Tekelec Business Intellectual
                           Property
Schedule 3.14(e)           Third Party Infringement
Schedule 3.14(g)           Infringement Claims - Tekelec
Schedule 3.14(i)           Effect of Transaction on Tekelec Business
                           Intellectual Property
Schedule 3.15              Employees and Consultants
Schedule 3.16              Related Party Transactions
Schedule 3.18              Employee Benefit Matters
Schedule 3.19              Discrimination and Occupational Safety and Health
Schedule 3.20              Product and Service Warranties
Schedule 3.21              Product Liability and Service Claims
Schedule 3.22              Foreign Licenses and Authorizations
Schedule 3.24              Environmental Matters
Schedule 3.26              Customers and Suppliers
Schedule 4.1(a)            Interests in Third Parties
Schedule 4.1(d)            Consents and Approvals
Schedule 4.1(e) (Part 1)   Capitalization
Schedule 4.1(e) (Part 2)   Capitalization after Recapitalization
Schedule 4.1(e) (Part 3)   Capitalization on the Closing Date before the Merger
Schedule 4.1(e) (Part 4)   Capitalization on the Closing Date after the Merger
Schedule 4.2               Authorization
Schedule 4.3(a)            Financial Statements
Schedule 4.3(b)            Exceptions to GAAP
Schedule 4.4               Certain Developments with Respect to Santera
Schedule 4.5               Undisclosed Liabilities
Schedule 4.6(j)            Taxes
Schedule 4.6(k)            Taxes - Joint Ventures, Partnerships
Schedule 4.6(m)            Outstanding Obligations
Schedule 4.6(n)            Persons Who Are Transferring Property
Schedule 4.7(a)            Accounts Receivable
Schedule 4.7(b)            Inventory
Schedule 4.8               Breach of Law
Schedule 4.9               Litigation
Schedule 4.10              Assets
Schedule 4.11              Leased Assets
Schedule 4.12              Exceptions to Title of Property
Schedule 4.13              Condition of Property
Schedule 4.14(a)           Licenses and Permits
Schedule 4.15(a)           Contracts
Schedule 4.15(b)           Breach or Violation of Material Santera Contracts
Schedule 4.16(a)(i)        Santera Business Intellectual Property
Schedule 4.16(a)(ii)       Santera Business Intellectual Property Licenses
Schedule 4.16(b)           Exceptions to Title to Santera Business Intellectual
                           Property
Schedule 4.16(c)           Restrictions on Santera Business Intellectual
                           Property
Schedule 4.16(e)           Third Party Infringement
Schedule 4.16(g)           Infringement Claims - Santera
Schedule 4.16(i)           Effect of Transaction on Santera Business
                           Intellectual Property

<PAGE>

Schedule 4.17              Insurance
Schedule 4.18              Employees and Consultants
Schedule 4.19              Related Party Transactions
Schedule 4.20(f)           Labor Matters
Schedule 4.21              Employee Benefit Matters
Schedule 4.22              Discrimination and Occupational Safety and Health
Schedule 4.23              Product and Service Warranties
Schedule 4.24              Product Liability and Service Claims
Schedule 4.25              Customers and Suppliers
Schedule 4.26              Foreign Licenses and Authorizations
Schedule 4.27              Rights, Options, Warrants and Similar Agreements
Schedule 4.28              Stockholders
Schedule 4.29              Environmental Matters
Schedule 4.30              Management Rights
Schedule 4.32              JP Morgan Chase & Co. letters
Schedule 5.1(a)            Consents and Approvals
Schedule 5.1(c)            Stockholders
Schedule 6.2(c) (Part 1)   Stockholders Executing the Agreement, the Note and
                           Preferred Stock Purchase Agreement, the Power of
                           Attorney, the Escrow Agreement, the Stockholders'
                           Agreement and the Release
Schedule 6.2(c) (Part 2)   Stockholders Executing the Exchange Agreement, the
                           Stockholders' Agreement, the Power of Attorney, the
                           Escrow Agreement and the Release
Schedule 6.2(e)            Certain Consents and/or Termination Agreements
Schedule 6.3               Operations of Tekelec Prior to Closing
Schedule 6.4               Operations of Santera Prior to Closing
Schedule 7.3               Tekelec Transferred Employees
Schedule 9.3               Necessary Consents - Santera
Schedule 10.3              Necessary Consents - Tekelec
Schedule 11.2              Liabilities of Santera

<PAGE>

                                STATE OF DELAWARE
                            CERTIFICATE OF MERGER OF
                              DOMESTIC CORPORATIONS

Pursuant to Title 8, Section 251(c) of the Delaware General Corporation Law, the
undersigned corporation executed the following Certificate of Merger:

FIRST: The name of the surviving corporation is Santera Systems Inc., and the
name of the corporation being merged into this surviving corporation is Luke
Acquisition Corp. Each of the constituent corporations is incorporated in the
State of Delaware.

SECOND: The Merger Agreement has been approved, adopted, certified, executed and
acknowledged by each of the constituent corporations in accordance with the
provisions of Section 251(c) of the Delaware General Corporation Law.

THIRD: The name of the surviving corporation is Santera Systems Inc., a Delaware
corporation.

FOURTH: The Amended and Restated Certificate of Incorporation of the surviving
corporation shall be amended in its entirety and is attached hereto as Exhibit
A.

FIFTH: An executed copy of the Merger Agreement is on file at 3601 East Plano
Parkway, #100, Plano, Texas 75704, the place of business of the surviving
corporation.

SIXTH: A copy of the Merger Agreement will be furnished by the surviving
corporation on request, without cost, to any stockholder of either constituent
corporation.

SEVENTH: The Certificate of Merger herein certified has been duly adopted and
written consent has been given in accordance with the provisions of Section 228
of the General Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, said surviving corporation has caused this certificate to be
signed by an authorized officer, the ____ day of ____________, A.D., 2003.

                                               By:______________________________
                                               Name:  David W. Heard
                                               Title: Chief Executive Officer

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                                     ANNEX A

                              AMENDED AND RESTATED

                          CERTIFICATE OF INCORPORATION

                                       OF

                              SANTERA SYSTEMS INC.

  (Originally incorporated in the State of Delaware on December 31, 1998 under
                      the name of E-Switch Systems, Inc.)

FIRST. The name of the Corporation is Santera Systems Inc. (the "Corporation").

SECOND. The address of the registered office in the State of Delaware is located
at 2711 Centerville Road, Suite 400, Wilmington, Delaware. The name of its
registered agent at such address is The Corporation Service Company.

THIRD. The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of the
State of Delaware ("GCL").

FOURTH:

A.   CLASSES AND NUMBER OF SHARES.

         The aggregate number of shares of capital stock which the Corporation
is authorized to issue is 305,835 shares, consisting of:

         (i)      165,585 shares of common stock, par value $.001 per share
("Common Stock"); and

         (ii)     140,250 shares of preferred stock, par value $.001 per share,
of which (a) 100,250 shares are designated as Series A Preferred Stock ("Series
A Preferred Stock") and (b) 40,000 shares are designated as Series B Preferred
Stock ("Series B Preferred Stock," and, together with the Series A Preferred
Stock, the "Preferred Stock").

B.   PREEMPTIVE RIGHTS.

         Except as may otherwise be provided by written agreement among the
Corporation and stockholders of the Corporation, no stockholder of any class of
stock of the Corporation shall have any preemptive right to acquire any
additional shares of stock of the Corporation of any class or series or any
security convertible into, or exercisable or exchangeable for, such stock.

C.   TERMS OF PREFERRED STOCK.

         1.       SERIES A PREFERRED STOCK AND SERIES B PREFERRED STOCK. The
preferences and relative, participating, optional and other special rights of
Series A Preferred Stock and Series B Preferred Stock, and the qualifications,
limitations and restrictions thereof, are as follows:

                  (i)      DIVIDENDS. The holders of shares of Series A
Preferred Stock and Series B Preferred Stock shall not be entitled to receive
any fixed dividends thereon. No dividends or other

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distributions shall be made with respect to any such series of Preferred Stock
unless equivalent dividends or other distributions are simultaneously made on a
pro rata basis to all holders of each such series.

                  (ii)     SERIES A MANDATORY REDEMPTION.

                           (a)      Redemption. Issued and outstanding shares of
Series A Preferred Stock shall be subject to mandatory redemption as described
in this Section below. The Corporation shall be obligated to make such
redemption as described in this Section below.

                                    (I)      Subject to the provisions of
Article Fourth, Section C.1(ii)(a)(V) below, the Corporation shall, within
twenty-five (25) calendar days after the Redemption Price has been finally
established hereunder, redeem all of the Series A Preferred Stock then issued
and outstanding, other than any Disputed Shares (as defined below) and other
than the Series A Preferred Stock owned by Tekelec, by its wholly owned
subsidiaries or by any Tekelec Designees (as defined below) (the shares to be so
redeemed, the "Redemption Stock"), if the Corporation receives at any time
during the period commencing on July 1, 2005 and ending on December 31, 2007 a
written request from the holders of not less than a majority of the then issued
and outstanding shares of Series B Preferred Stock (the "Series B Holder
Redemption Notice") to do the same. The Corporation shall after a Redemption
Date (as defined below) redeem all of the shares previously considered Disputed
Shares within 15 days after the date that such shares are no longer Disputed
Shares (as specified in a written notice delivered by Tekelec to the
Corporation; it being understood that shares previously considered Disputed
Shares that have been or are required to be transferred to the Corporation in
accordance with the terms of the Escrow Agreement (as defined below) shall not
be considered Disputed Shares to be redeemed), for the per share Redemption
Price (as adjusted for any stock dividends, combinations, reverse stock splits,
stock splits, recapitalizations, reorganizations, reclassifications or other
similar event with respect to such shares) paid on such prior Redemption Date.
From and after delivery of the Series B Holder Redemption Notice, issued shares
of Series A Preferred Stock, other than the Series A Preferred Stock owned by
Tekelec, by its wholly owned subsidiaries or by any Tekelec Designees, shall be
considered shares of Redemption Stock for purposes of this Article Fourth,
Section C.1(ii)(a)(I).

                                    (II)     Subject to the provisions of
Article Fourth, Section C.1(ii)(a)(V) below, the Corporation shall, within
twenty-five (25) calendar days after the Redemption Price has been finally
established hereunder, redeem all of the Redemption Stock if the Corporation
receives at any time during the period commencing January 1, 2006 and ending
February 28, 2008, a written request from the holders of not less than a
majority of the then issued and outstanding shares of Series A Preferred Stock,
excluding, in any event, any such shares owned by Tekelec, by its wholly owned
subsidiaries or by Tekelec Designees (the "Series A Holder Redemption Notice")
to do the same; provided, however, that such holders of the Series A Preferred
Stock shall not be entitled to cause the redemption of the Redemption Stock
described in this Section C.1(ii)(a)(II) unless the Corporation has had positive
Net Income (as defined below) in each of the two most recently ended calendar
quarters prior to the date of the Series A Holder Redemption Notice. The
Corporation shall after a Redemption Date redeem all of the shares previously
considered Disputed Shares within 15 days after the date that such shares are no
longer Disputed Shares (as specified in a written notice delivered by Tekelec to
the Corporation; it being understood that shares previously considered Disputed
Shares that have been or are required to be transferred to the Corporation in
accordance with the terms of the Escrow Agreement shall not be

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considered Disputed Shares to be redeemed), for the per share Redemption Price
(as adjusted for any stock dividends, combinations, reverse stock splits, stock
splits, recapitalizations, reorganizations, reclassifications or other similar
event with respect to such shares) paid on such prior Redemption Date. From and
after delivery of the Series A Holder Redemption Notice, issued shares of Series
A Preferred Stock, other than the Series A Preferred Stock owned by Tekelec, by
its wholly owned subsidiaries or by any Tekelec Designees, shall be considered
shares of Redemption Stock for purposes of this Article Fourth, Section
C.1(ii)(a)(II).

                                    (III)    If, at any time prior to February
28, 2008, Tekelec sells or transfers, or proposes to sell or transfer, all of
the Preferred Stock and Common Stock owned by Tekelec and its wholly owned
subsidiaries to another person or entity (other than an affiliate of Tekelec) (a
"Change of Ownership"), then the Corporation shall redeem all of the Redemption
Stock if the Corporation receives at any time prior to the consummation of, or
within ten (10) calendar days after the consummation of, such Change of
Ownership transaction a written request from the holders of not less than a
majority of the then issued and outstanding shares of Series B Preferred Stock
(the "Change of Ownership Redemption Notice") to do the same. Upon receipt of
the Change of Ownership Redemption Notice, the Corporation shall be obligated to
redeem the Redemption Stock on or within fifteen (15) calendar days following
the date of the Change of Ownership transaction, except that the holders of not
less than a majority of the then issued and outstanding shares of Series B
Preferred Stock may rescind such holders' request for redemption by giving
written notice of such rescission to the Corporation prior to any such
redemption, in which case, the Corporation shall not be obligated to, or
permitted to, redeem such shares. The Corporation shall after a Redemption Date
redeem all of the shares previously considered Disputed Shares within 15 days
after the date that such shares are no longer Disputed Shares (as specified in a
written notice delivered by Tekelec to the Corporation; it being understood that
shares previously considered Disputed Shares that have been or are required to
be transferred to the Corporation in accordance with the terms of the Escrow
Agreement shall not be considered Disputed Shares to be redeemed), for the per
share Redemption Price (as adjusted for any stock dividends, combinations,
reverse stock splits, stock splits, recapitalizations, reorganizations,
reclassifications or other similar event with respect to such shares) paid on
such prior Redemption Date. From and after delivery of each notice, issued
shares of Series A Preferred Stock, other than the Series A Preferred Stock
owned by Tekelec, by its wholly owned subsidiaries or by any Tekelec Designees,
shall be considered shares of Redemption Stock for purposes of this Article
Fourth, Section C.1(ii)(a)(III).

                                    (IV)     The Corporation shall at any time
and from time to time after a Redemption Date or Put Closing Date (as defined in
the Stockholders' Agreement) or Call Closing Date (as defined in the
Stockholders' Agreement) redeem all or any portion of the shares of the Series A
Preferred Stock that are issued by the Corporation after such Redemption Date,
Put Closing Date or Call Closing Date, as applicable, whether the same are
issued pursuant to the exercise of any Special Options (as defined below) or
otherwise, for the per share Redemption Price, Put Price (as defined in the
Stockholders' Agreement) or Call Price (as defined in the Stockholders'
Agreement), as applicable (in each case, as adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares), paid on such prior Redemption Date, Put Closing Date or Call Closing
Date, as applicable, if the Corporation receives at any time after such
Redemption Date a written request from the holders of not less than a majority
of the then issued and outstanding shares of Series B Preferred Stock (or if no
such shares remain issued and outstanding at such time, a majority

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of the then issued and outstanding shares of Common Stock) (the "Options
Redemption Notice") to do the same.

                                    (V)      The Series A Holder Redemption
Notice, the Series B Holder Redemption Notice, the Change of Ownership
Redemption Notice and an Options Redemption Notice shall be delivered to the
Corporation at its principal place of business at the time, to the attention of
the President or Secretary, by (a) first class certified or registered mail,
postage prepaid, (b) nationally recognized overnight courier service, (c)
facsimile or (d) personal delivery, within the applicable time periods specified
in such clause. Upon delivery of the Series A Holder Redemption Notice, the
Series B Holder Redemption Notice, the Change of Ownership Redemption Notice, or
an Options Redemption Notice, the Corporation and the holders of the Redemption
Stock shall be obligated to consummate the purchase and sale of all of the
Redemption Stock on the terms and conditions set forth herein except that the
Corporation shall have no obligation to redeem any shares (a) as a result of the
delivery of a Series A Holder Redemption Notice in the event that the
Corporation has not had positive Net Income in each of the two most recently
ended calendar quarters prior to the date of the Series A Holder Redemption
Notice or (b) as provided in the second sentence of Section C.1(ii)(a)(III), in
which case the Corporation shall notify the holders of the Series A Preferred
Stock. Notwithstanding anything contained herein to the contrary, if at any time
after the delivery of a Series B Holder Redemption Notice or Series A Holder
Redemption Notice hereunder and prior to the Redemption Date in respect thereof,
Tekelec delivers a written notice to the Corporation specifying that Tekelec
desires to treat any such Series B Holder Redemption Notice as a Call Notice
pursuant to the Stockholders' Agreement or that Tekelec desires to treat any
such Series A Holder Redemption Notice as a Put Notice pursuant to the
Stockholders' Agreement, then such Series B Holder Redemption Notice or Series A
Holder Redemption Notice, as the case may be, shall be treated as of the date of
its delivery as a Call Notice or a Put Notice, as the case may be, for all
purposes hereunder and all purposes under the Stockholders' Agreement.

                           (b)      Redemption Price. The Corporation shall pay
a price per share (the "Redemption Price") equal to:

                                    (I)      For each share which is redeemed
under Section C.1(ii)(a)(I), the quotient of (1) the amount derived by
multiplying (x) the Adjustment Factor (as defined below) times (y) the
Redemption Value (as defined below), divided by (2) the number of shares of
Redemption Stock.

                                    (II)     For each share which is redeemed
under Section C.1(ii)(a)(II), the quotient of (1) the amount derived by
multiplying (x) 0.80 times (y) the Adjustment Factor times (z) the Redemption
Value, divided by (2) the number of shares of Redemption Stock.

                                    (III)    For each share which is redeemed
under Section C.1(ii)(a)(III), the quotient of (1) the aggregate number of
shares of Common Stock issued or issuable upon conversion of the shares of
Redemption Stock multiplied by the per share consideration paid or payable with
respect to the shares of Common Stock in such Change of Ownership (calculated on
an as if converted basis), divided by (2) the number of shares of Redemption
Stock.

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                                    (IV)     For each share which is redeemed
under Section C.1(ii)(a)(IV),  the amount of the Redemption Price paid on such
prior Redemption Date (as adjusted for any stock dividends, combinations,
reverse stock splits, stock splits, recapitalizations, reorganizations,
reclassifications or other similar event with respect to such shares).

                                    (V)      The Corporation may, at its option,
increase the number of shares of Redemption Stock used in calculating the
Redemption Price under clauses (I) and (II) above by assuming the issuance of
all securities issuable upon the exercise of Legacy Options which are then
exercisable. If the Corporation so elects to increase the number of shares of
Redemption Stock, then (a) upon the exercise of any such Legacy Options, the
consideration received by the Corporation upon such exercise shall be deemed to
be an increase in the aggregate Redemption Price payable for all shares of
Redemption Stock, (b) upon the expiration of any such Legacy Option without
exercise, the Redemption Price (as adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares) shall be recalculated without assuming the issuance of any securities
issuable upon the exercise of such expired Legacy Option (but, otherwise using
all of the same facts as previously used). Any increase in the Redemption Price
resulting from the preceding sentence will be paid to the parties entitled
thereto in accordance with Section C.1(ii)(c) within 30 days of the event giving
rise to the increase in the Redemption Price, with the payment to be accompanied
by a statement setting forth the calculations and reasonable supporting data
used to determine the increase.

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                           (c)      Procedure for Redemption.

                                    (I)      At least fifteen (15) days prior to
the date on which such redemption is to be made (a "Redemption Date"), written
notice (a "Redemption Notice") shall be sent to the representative (the
"Representative") under the Escrow Agreement dated April 30, 2003 by and among
J.P. Morgan Trust Company, National Association, as escrow agent, Tekelec, a
California corporation ("Tekelec"), and certain stockholders of the Corporation
(the "Escrow Agreement") (which shall serve as notice to all holders of Series A
Preferred Stock who own shares held in escrow thereunder) at the addresses
provided for in the Escrow Agreement and for each other holder of shares of
Redemption Stock, at the notice address of such holder last shown on the records
of the transfer agent of the Series A Preferred Stock (or the records of the
Corporation, if it serves as its own transfer agent), in either case by (A)
first class certified or registered mail, postage prepaid, (B) nationally
recognized overnight courier service, or (C) personal delivery, notifying such
Representative or holder of the Redemption Date and the Redemption Price, and
calling upon such Representative and/or all such holders to surrender or cause
to be surrendered to the Corporation, in the manner and at the place designated,
the respective certificate or certificates representing the Redemption Stock. If
the holders of not less than a majority of the issued and outstanding shares of
Series B Preferred Stock have indicated to the Corporation that such holders may
elect to cause the Corporation to pay all or any portion of the Redemption Price
in shares of common stock, without par value, of Tekelec ("Tekelec Stock"), as
provided in Section C.1(ii)(c)(III) below, then the Corporation shall also
include a letter of transmittal with the Redemption Notice requesting the
Representative (with respect to each holder of Redemption Stock held in escrow
under the Escrow Agreement) and/or each holder to (i) confirm, or cause to be
confirmed, the information regarding such holder set forth in such transmittal
letter or provide or cause to be provided the information with respect to such
holder requested thereby and (ii) execute (to the extent not previously executed
by any such holder) the Stockholders' Agreement dated April 30, 2003 by and
among the Corporation, Tekelec and certain stockholders of the Corporation (the
"Stockholders' Agreement"). Upon delivery of the Redemption Notice, the
Corporation shall be required to redeem all of the Redemption Stock on the terms
and conditions set forth herein and therein and except as provided in the second
sentence of Section C.1(ii)(a)(III); provided, however, that to the extent the
Redemption Price is disputed as provided for below and the Redemption Price is
determined to be different from the Redemption Price set forth in the Redemption
Notice, then the Redemption Price shall be as so determined in accordance with
Section C.1(ii)(c)(VII).

                                    (II)     The Representative (on behalf of
any holder) shall cause to be surrendered, and/or each holder of the Redemption
Stock shall surrender her, his or its, certificates representing the Redemption
Stock to the Corporation (and to the extent applicable, a completed letter of
transmittal and executed copy of the Stockholders' Agreement), in the manner and
at the place designated in the Redemption Notice, and against such surrender the
Redemption Price of such shares shall be paid on the Redemption Date to the
order of the person whose name appears on each such certificate as the owner
thereof. Each surrendered certificate shall be canceled. From and after such
Redemption Date, unless there shall have been a default in payment of the
Redemption Price, all rights of the holders of the Redemption Stock (except the
right to receive the Redemption Price, and any subsequent increase thereof
pursuant to Section C.1(ii)(b)(V), without interest upon surrender of their
certificate or certificates) shall cease with respect to such shares, and such
shares shall not thereafter be transferred on the books of the Corporation or be
deemed to be issued and/or outstanding for any purpose whatsoever.

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                                    (III)    For shares redeemed under Section
C.1(ii)(a)(I) or Section C.1(ii)(a)(II) or Section C.1(ii)(a)(IV), the
Redemption Price payable by the Corporation to the holders of the Redemption
Stock shall be payable, at the option of the holders of a majority of the then
issued and outstanding shares of Series B Preferred Stock in the exercise of its
or their sole and absolute discretion, in cash, shares of Tekelec Stock either
registered upon issuance or registered for resale pursuant to the Securities Act
of 1933, as amended (the "Securities Act") pursuant to a registration statement
effective on the Redemption Date (the "Registration Statement"), or any
combination thereof; provided, however, that the Corporation may deliver Tekelec
Stock which is not registered upon issuance or registered for resale pursuant to
the Securities Act to any holder of the Redemption Stock who has not confirmed
or provided the information regarding such holder set forth or requested by any
transmittal letter that accompanied the Redemption Notice and/or has not
executed or become a party to the Stockholders' Agreement, at least two (2) days
prior to the Redemption Date. Such holders of the Series B Preferred Stock shall
be able to elect to deliver Tekelec Stock (and not all cash) only if (i) no stop
order suspending the effectiveness of the Registration Statement shall then be
in effect, and no proceedings for that purpose shall then be threatened by the
Securities Exchange Commission or shall have been initiated by the Securities
Exchange Commission and not concluded or withdrawn; (ii) all state securities or
blue sky permits or approvals required for resale of such Tekelec Stock shall
have been received; (iii) the shares of Tekelec Stock shall have been duly
approved for listing on the Nasdaq National Market or another national
securities exchange, subject to official notice of issuance; and (iv) Tekelec or
its wholly owned subsidiaries in the aggregate hold a majority of the then
issued and outstanding shares of Series B Preferred Stock. To the extent that
the Corporation is to pay all or any portion of the Redemption Price in the form
of Tekelec Stock, each share of Tekelec Stock shall be valued for such purpose
at the average closing price per share of Tekelec Stock, as published by The
Wall Street Journal, for the ten (10) trading days ending on and including the
second to the last trading day prior to the Redemption Date.

                                    (IV)     For shares redeemed under Section
C.1(ii)(a)(III), the Redemption Price payable by the Corporation to the holders
of the Redemption Stock shall be payable in the form of the consideration
payable or paid with respect to each share of Series A Preferred Stock in such
Change of Ownership; provided that if such consideration is not or was not paid
or payable in cash, the Corporation shall nonetheless pay the Redemption Price
in cash to the extent that the holders of not less than a majority of the issued
and outstanding shares of Series B Preferred Stock provide written instruction
to the Corporation to pay the Redemption Price in cash. If the Redemption Price
under this Section C.1(ii)(c)(IV) is paid or payable in securities or property
other than cash, the value of such consideration shall be valued as provided in
paragraph (e) of Section C.1(iii).

                                    (V)      (A) If, following the Corporation's
receipt of a Series A Holder Redemption Notice, Tekelec disputes the existence
of positive Net Income for the two most recently completed calendar quarters
prior to the date of such Series A Holder Redemption Notice, then Tekelec shall
promptly provide the Corporation and the Representative with written notice to
that effect (a "Net Income Dispute Notice"). Following the delivery of a Series
A Holder Redemption Notice, the Corporation shall permit Tekelec and its
accountants to review promptly upon request all records necessary for Tekelec to
determine the existence or nonexistence of positive Net Income for such periods
and to take copies of the same. The Corporation shall, upon request of the
Representative, promptly provide the Representative and its accountants
reasonable access to those records of the Corporation which are reasonably
necessary in order for the

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Representative to verify the existence or non-existence of positive Net Income
for the relevant calendar quarters, which records shall include any such records
provided to Tekelec that are necessary for Tekelec to confirm the existence or
non-existence of positive Net Income for such periods, and to take copies of any
such records.

                                             (B) Upon delivery of any Net Income
Dispute Notice, Tekelec and the Representative shall each appoint a designated
senior business executive or its equivalent (who for Tekelec shall be Tekelec's
Chief Executive Officer) whose task it will be to meet for the purpose of
endeavoring to resolve any disputes with respect to the existence or
non-existence of positive Net Income for such periods. The designated
representatives shall meet as often as Tekelec and the Representative reasonably
deem necessary in order to gather and furnish to the other all information with
respect to the dispute which Tekelec and the Representative believe to be
appropriate and germane in connection with its resolution. Such representatives
shall discuss the dispute and will negotiate in good faith in an effort to
resolve the dispute. The specific format for such discussions shall be left to
the discretion of the designated representatives and may include the preparation
of agreed upon statements of fact or written statements of position furnished to
the other party.

                                             (C) If the designated
representatives of Tekelec and the Representative are unable to resolve the
dispute as to Net Income within thirty (30) calendar days after the
Representative receives the Net Income Notice of Dispute (the "Net Income
Consultative Period"), Tekelec and the Representative each shall select an
independent arbitrator, expert in the subject matter of such dispute (the
arbitrators so selected shall be referred to herein as "Tekelec's Net Income
Arbitrator" and the "Representative's Net Income Arbitrator", respectively). In
the event that the Representative fails to select an independent arbitrator
within five (5) days from the date of the expiration of the Net Income
Consultative Period, then the matter shall be resolved by Tekelec's Net Income
Arbitrator. In the event that Tekelec fails to select an independent arbitrator
within five (5) days from the date of the expiration of the Net Income
Consultative Period, then the matter shall be resolved by the Representative's
Net Income Arbitrator. Tekelec's Net Income Arbitrator and the Representative's
Net Income Arbitrator shall select a third independent arbitrator, expert in the
subject matter of the dispute (the "Net Income Joint Arbitrator"), and the three
arbitrators so selected shall finally resolve, as soon as practicable, all
points of disagreement with respect to the existence or non-existence of Net
Income for the relevant periods and in any event within thirty (30) calendar
days after all the arbitrators are selected and finalized. Within seven (7) days
after the date of the expiration of the Net Income Consultative Period,
Tekelec's Net Income Arbitrator and the Representative's Net Income Arbitrator
shall each prepare a list of three independent arbitrators. If Tekelec's Net
Income Arbitrator fails to prepare a list of three independent arbitrators
within such seven (7) day period, then Representative's Net Income Arbitrator
shall select the Net Income Joint Arbitrator within ten (10) days after the date
of the expiration of the Net Income Consultative Period. If the Representative's
Net Income Arbitrator fails to prepare a list of three independent arbitrators
within such seven (7) day period, then Tekelec's Net Income Arbitrator shall
select the Net Income Joint Arbitrator within ten (10) after the date of the
expiration of the Net Income Consultative Period. If Tekelec's Net Income
Arbitrator and the Representative's Net Income Arbitrator each prepare a list of
three arbitrators, the Net Income Joint Arbitrator shall be selected jointly by
Tekelec's Net Income Arbitrator and the Representative's Net Income Arbitrator
from the lists of proposed arbitrators within seventeen (17) days after the date
of the expiration of the Consultative Period. If Tekelec's Net Income Arbitrator
and the Representative's Net Income Arbitrator are unable to jointly select the
Net Income Joint

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Arbitrator within seventeen (17) days after the date of the expiration of the
Net Income Consultative Period, then Tekelec's Net Income Arbitrator and the
Representative's Net Income Arbitrator shall each have the opportunity to
designate as objectionable and eliminate one arbitrator from the other
arbitrator's list within twenty (20) days after the date of the expiration of
the Net Income Consultative Period, and the Net Income Joint Arbitrator shall
then be selected by lot from the arbitrators remaining on the lists submitted by
Tekelec's Net Income Arbitrator and the Representative's Net Income Arbitrator.

                                             (D) The final determination of all
points of disagreement with respect to the existence or non-existence of Net
Income for the relevant periods must be agreed upon and signed by the sole
arbitrator or by at least two of the three arbitrators, as the case may be;
provided that if two of the three arbitrators are unable to agree upon all
points of disagreement with respect to the Net Income within thirty (30) days
after all the arbitrators are selected and finalized, as the case may be, the
final determination of all points of disagreement with respect thereto shall be
resolved by the Net Income Joint Arbitrator and the Net Income Joint Arbitrator
shall have signed a statement rendering such determination by such date. For
purposes of such arbitration each of Tekelec and the Representative shall submit
a proposed calculation of the Net Income for such periods. The arbitrator(s)
shall apply the terms of this Certificate of Incorporation (including Article
Fourth hereof), and shall otherwise conduct the arbitration under such
procedures as Tekelec and the Representative may agree or, failing such
agreement, under the then prevailing Commercial Rules of the American
Arbitration Association. The fees and expenses incurred in connection with the
arbitration of the existence or non-existence of Net Income for such relevant
periods (including the fees and expenses of the arbitrator(s) and the other
party's outside counsel and accounting fees) shall be paid by the party who is
not the prevailing party with respect to such matter. All determinations by the
arbitrator(s) shall be final, conclusive and binding with respect to the
existence or non-existence of Net Income for such relevant periods, in the
absence of fraud or manifest error. This Section C.1(ii)(c)(V) shall be the sole
and exclusive dispute resolution mechanism for the Corporation, Tekelec, the
Representative and the holders of the Redemption Stock for any and all claims
and disputes with respect to the existence or non-existence of Net Income.

                                    (VI)     At least sixty (60) days prior to
the end of the Series A Holder Redemption Measurement Period or Series B Holder
Redemption Measurement Period, as applicable, the Corporation shall provide a
written notice (the "Revenue Notice") to the Representative providing it with
the calculations of Revenue on a monthly basis for the first nine (9) months of
the Series A Holder Redemption Measurement Period or Series B Holder Redemption
Measurement Period, as applicable, (as calculated and determined by Tekelec).
The Corporation shall permit Tekelec and its accountants to review promptly upon
request all records necessary for the computation by Tekelec of the Revenue for
such periods and to take copies of the same. Upon delivery of the Revenue
Notice, the Corporation shall, upon request of the Representative, promptly, but
in any event within five (5) days after receipt by the Corporation of any such
request from the Representative, provide the Representative and its accountants
reasonable access to those records of the Corporation which are reasonably
necessary in order for such holders to verify the accuracy of the Revenue for
such periods, which records shall include the records provided to Tekelec that
were necessary for the computation by Tekelec of the Revenue for such periods,
and to take copies of any such records. After delivery of the Revenue Notice,
Tekelec and the Representative shall, upon request of either Tekelec or the
Representative, each appoint a designated senior business executive or its
equivalent (who for Tekelec shall be Tekelec's Chief Executive

                                       9

<PAGE>

Officer) whose task it will be to meet for the purpose of endeavoring to resolve
any actual or anticipated disputes, claims or other matters with respect to the
redemption. The designated representatives shall meet as often as Tekelec and
the Representative reasonably deem necessary in order to gather and furnish to
the other all information with respect to the dispute, claim or other matter
which Tekelec and the Representative believe to be appropriate and germane in
connection with its resolution. Such representatives shall discuss the dispute,
claim or other matter with respect to the redemption and will negotiate in good
faith in an effort to resolve the dispute, claim or other matter. The specific
format for such discussions shall be left to the discretion of the designated
representatives and may include the preparation of agreed upon statements of
fact or written statements of position furnished to the other party. Within ten
(10) days after the end of the Series A Holder Redemption Measurement Period or
Series B Holder Redemption Measurement Period, as applicable, the Corporation
shall provide a written notice (the "Redemption Price Notice") to the
Representative notifying it of the aggregate amount of the Redemption Price (as
calculated and determined by Tekelec), and providing it with a statement
calculating the Redemption Price and showing the calculations of Revenue on a
monthly basis during the Series A Holder Redemption Measurement Period or Series
B Holder Redemption Measurement Period, as applicable. The Corporation shall
permit Tekelec and its accountants to review promptly upon request all records
necessary for the computation by Tekelec of the Redemption Price and to take
copies of the same. Upon delivery of the Redemption Price Notice, the
Corporation shall, upon request of the Representative, promptly, but in any
event within five (5) days after receipt by the Corporation of any such request
from the Representative, provide the Representative and its accountants
reasonable access to those records of the Corporation which are reasonably
necessary in order for such holders to verify the accuracy of the Redemption
Price, which records shall include the records provided to Tekelec that were
necessary for the computation by Tekelec of the Redemption Price, and to take
copies of any such records.

                                    (VII)    If the Representative disputes the
Redemption Price or desires to raise any other claim or matter related to or in
connection with such redemption, including, without limitation, any claim or
matter related to the amount of the Revenue or other variables that are
necessary for the calculation of the Redemption Price or the fulfillment or
non-fullfillment of the legal, fiduciary or other obligations or duties of any
person or entity with respect to such redemption, not more than thirty (30)
calendar days after the date the Representative receives the Redemption Price
Notice, the Representative shall deliver to Tekelec a written notice specifying
in reasonable detail the notice of such dispute, claim or other matter (a
"Notice of Redemption Dispute") signed by the Representative. If no such Notice
of Redemption Dispute signed by the Representative has been delivered during
such thirty (30) day period or if the Representative has delivered to Tekelec a
signed written notice accepting the Redemption Price set forth in the Redemption
Price Notice, then Tekelec's determination of the Redemption Price and all other
matters associated with such redemption shall be final, binding and conclusive
for all purposes. Upon receipt of the Notice of Redemption Dispute, the
designated representatives of Tekelec and the Representative shall promptly
consult with each other with respect to the specified points of disagreement in
an effort to resolve the dispute, claim or other matter. If the designated
representatives of Tekelec and the Representative are unable to resolve the
dispute, claim or other matter, within ten (10) calendar days after Tekelec
receives the Notice of Redemption Dispute (the "Consultative Period"), Tekelec
and the Representative each shall select an independent arbitrator, expert in
the subject matter of such dispute (the arbitrators so selected shall be
referred to herein as "Tekelec's Arbitrator" and the "Representative's
Arbitrator", respectively); provided, however, if, at such time, there has been
an arbitration with respect to Net Income matters, then the dispute, claim

                                       10

<PAGE>

or other matter shall be referred to the arbitrator or arbitrators which
resolved the Net Income matters, and for all purposes of this paragraph, the
term Joint Arbitrator shall be deemed to refer to the Net Income Joint
Arbitrator, the term Tekelec's Arbitrator shall be deemed to refer to Tekelec's
Net Income Arbitrator and the term Representative's Arbitrator shall be deemed
to refer to the Representative's Net Income Arbitrator. If, at such time, there
has been no arbitration with respect to Net Income matters, then the following
process shall apply for purposes of selecting the arbitrators. In the event that
the Representative fails to select an independent arbitrator within five (5)
days from the date of the expiration of the Consultative Period, then the matter
shall be resolved by Tekelec's Arbitrator. In the event that Tekelec fails to
select an independent arbitrator within five (5) days from the date of the
expiration of the Consultative Period, then the matter shall be resolved by the
Representative's Arbitrator. Tekelec's Arbitrator and the Representative's
Arbitrator shall select a third independent arbitrator, expert in the subject
matter of the dispute (the "Joint Arbitrator"), and the three arbitrators so
selected shall finally resolve, as soon as practicable, all points of
disagreement with respect to the Redemption Price or such other claim or matter,
as the case may be and in any event within thirty (30) calendar days after all
the arbitrators are selected and finalized. Within seven (7) days after the date
of the expiration of the Consultative Period, Tekelec's Arbitrator and the
Representative's Arbitrator shall each prepare a list of three independent
arbitrators. If Tekelec's Arbitrator fails to prepare a list of three
independent arbitrators within such seven (7) day period, then Representative's
Arbitrator shall select the Joint Arbitrator within ten (10) days after the date
of the expiration of the Consultative Period. If the Representative's Arbitrator
fails to prepare a list of three independent arbitrators within such seven (7)
day period, then Tekelec's Arbitrator shall select the Joint Arbitrator within
ten (10) after the date of the expiration of the Consultative Period. If
Tekelec's Arbitrator and the Representative's Arbitrator each prepare a list of
three arbitrators, the Joint Arbitrator shall be selected jointly by Tekelec's
Arbitrator and the Representative's Arbitrator from the lists of proposed
arbitrators within seventeen (17) days after the date of the expiration of the
Consultative Period. If Tekelec's Arbitrator and the Representative's Arbitrator
are unable to jointly select the Joint Arbitrator within seventeen (17) days
after the date of the expiration of the Consultative Period, then Tekelec's
Arbitrator and the Representative's Arbitrator shall each have the opportunity
to designate as objectionable and eliminate one arbitrator from the other
arbitrator's list within twenty (20) days after the date of the expiration of
the Consultative Period, and the Joint Arbitrator shall then be selected by lot
from the arbitrators remaining on the lists submitted by Tekelec's Arbitrator
and the Representative's Arbitrator. The final determination of all points of
disagreement with respect to the Redemption Price or such other claim or matter,
as the case may be, must be agreed upon and signed by the sole arbitrator or by
at least two of the three arbitrators, as the case may be; provided that if two
of the three arbitrators are unable to agree upon all points of disagreement
with respect to the Redemption Price or such other claim or matter within thirty
(30) days after all the arbitrators are selected and finalized, as the case may
be, the final determination of all points of disagreement with respect thereto
shall be resolved by the Joint Arbitrator and the Joint Arbitrator shall have
signed a statement rendering such determination by such date. For purposes of
such arbitration each of Tekelec and the Representative shall submit a proposed
calculation of the Redemption Price. The arbitrator(s) shall apply the terms of
this Certificate of Incorporation (including Article Fourth hereof), and shall
otherwise conduct the arbitration under such procedures as Tekelec and the
Representative may agree or, failing such agreement, under the then prevailing
Commercial Rules of the American Arbitration Association. The fees and expenses
incurred in connection with the arbitration of the Redemption Price or such
other claim or matter, as the case may be, (including the fees and expenses of
the arbitrator(s) and the other party's outside counsel and accounting fees)
shall be paid by the party who is not the prevailing party with respect to the
items in dispute with respect

                                       11

<PAGE>

to the Redemption Price or such other claim or matter, as the case may be; it
being understood that the party whose proposed calculation with respect of the
Redemption Price is nearest in terms of dollars to the amount of the Redemption
Price determined by the artibtrator(s) shall be considered the prevailing party
hereunder for purposes of this sentence. All determinations by the arbitrator(s)
shall be final, conclusive and binding with respect to the Redemption Price or
such other claim or matter, as the case may be, and the allocation of
arbitration fees and expenses, in the absence of fraud or manifest error. This
Section C.1(ii)(c)(VII) shall be the sole and exclusive remedy for the
Representative and the holders of the Redemption Stock for any and all claims
and disputes with respect to the Redemption Price and any other matter related
to any such redemption, including, without limitation, any claim or matter
related to the amount of the Revenue or other variables that are necessary for
the calculation of the Redemption Price or the fulfillment or non-fullfillment
of the legal, fiduciary or other obligations or duties of any person or entity
with respect to such redemption.

                           (d)      Definitions. For purposes of the Certificate
of Incorporation, the following definitions apply:

                                    (I)      "Adjustment Factor" shall mean the
aggregate percentage of the capital stock of the Corporation that is Redemption
Stock, calculated on a fully diluted and as if converted basis, as of the end of
the Series A Holder Redemption Measurement Period or Series B Holder Redemption
Measurement Period, as applicable. No Disputed Shares shall be considered
Redemption Stock for this purpose.

                                    (II)     "Arbiter" shall have the meaning
specified in Section C.1(vii) of Article Fourth.

                                    (III)    "Certificate of Incorporation"
shall mean this Amended and Restated Certificate of Incorporation.

                                    (IV)     "Change of Ownership" shall have
the meaning specified in Section C.1(ii)(a)(III) of Article Fourth.

                                    (V)      "Change of Ownership Redemption
Notice" shall have the meaning specified in Section C.1(ii)(a)(III) of Article
Fourth.

                                    (VI)     "Comerica Option" shall have the
meaning specified in Section C.1(iv)(d)(I)(D)(2).

                                    (VII)    "Common Stock" shall have the
meaning specified in Section A.(i) of Article Fourth.

                                    (VIII)   "Conversion Price" shall have the
meaning specified in Section C.1(iv)(a) of Article Fourth.

                                    (IX)     "Corporation" shall mean Santera
Systems Inc.

                                    (X)      "Disputed Shares" shall mean the
number of shares of Series A Preferred Stock specified by Tekelec in a written
notice to the Corporation prior to an applicable Redemption Date as being the
subject of a dispute notice pursuant to the terms of the

                                       12

<PAGE>

Escrow Agreement (it being understood that unless Tekelec delivers such notice
to the Corporation specifying a lower amount, which it may do if it intends to
exercise its set-off rights contained in the Stockholders' Agreement or in the
other Ancillary Agreements (as defined in the Stockholders' Agreement), a number
of shares of Series A Preferred Stock equal to the amounts disputed under the
Escrow Agreement divided by 1,000 shall be considered Disputed Shares).

                                    (XI)     "Escrow Agreement" shall have the
meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XII)    "GAAP" shall mean United States
generally accepted accounting principles.

                                    (XIII)   "Legacy Option" shall mean any
Special Option issued by the Corporation prior to the Effective Time that
remains outstanding after the Effective Time.

                                    (XIV)    "Merger Agreement" shall mean the
Agreement and Plan of Merger dated April 30, 2003 by and among Tekelec, the
Corporation, Luke Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of Tekelec, and certain stockholders of the Corporation.

                                    (XV)     "Net Income" shall mean Revenue
less all operating and other expenses incurred in connection therewith
(including depreciation and amortization, selling, general and administrative
expenses which includes allocations of corporate services provided by Tekelec to
or for the benefit of the Corporation, and interest and tax expense) excluding
losses associated with a write-off resulting from an impairment of intangible
assets under FAS 142 or FAS 144 (only to the extent applicable to impairments of
intangible assets), and excluding any impact of granting or exercising stock
options as a result of this transaction due to a change in GAAP in which the
expensing of stock options is required, all as computed in accordance with GAAP
and Tekelec's accounting practices, as consistently applied by the Corporation.
All allocated expenses will be subject to a Transition Services Agreement dated
as of the Closing Date between the Corporation and Tekelec. The pricing of
allocated services will be subject to periodic review as defined in such
Transition Services Agreement.

                                    (XVI)    "Net Income Consultative Period"
shall have the meaning specified in Section C.1(ii)(c)(V)(C) of Article Fourth.

                                    (XVII)   "Net Income Dispute Notice" shall
have the meaning specified in Section C.1(ii)(c)(V)(A) of Article Fourth.

                                    (XVIII)  "Net Income Joint Arbitrator" shall
have the meaning specified in Section C.1(ii)(c)(V)(C) of Article Fourth.

                                    (XIX)    "Notice of Dispute" shall have the
meaning specified in Section C.1(vii) of Article Fourth.

                                    (XX)     "Notice of Redemption Dispute"
shall have the meaning specified in Section C.1(ii)(c)(VII) of Article Fourth.

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<PAGE>

                                    (XXI)    "Options Redemption Notice" shall
have the meaning specified in Section C.1(ii)(a)(IV) of Article Fourth.

                                    (XXII)   "Preferred Stock" shall have the
meaning specified in Section A.(ii) of Article Fourth.

                                    (XXIII)  "Qualified IPO" shall have the
meaning specified in Section C.1(iv)(b) of Article Fourth.

                                    (XXIV)   "Redemption Date" shall have the
meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XXV)    "Redemption Notice" shall have the
meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XXVI)   "Redemption Price" shall have the
meaning specified in Section C.1(ii)(b) of Article Fourth.

                                    (XXVII)  "Redemption Price Notice" shall
have the meaning specified in Section C.1(ii)(c)(VI) of Article Fourth.

                                    (XXVIII) "Redemption Stock" shall have the
meaning specified in Section C.1(ii)(a)(I) of Article Fourth.

                                    (XXIX)   "Redemption Value" shall mean an
amount equal to two (2) multiplied by the amount of the Corporation's Revenue
during the Series A Holder Redemption Measurement Period or Series B Holder
Redemption Measurement Period, as applicable; provided, that in no event shall
the Redemption Value exceed $350,000,000.

                                    (XXX)    "Registration Statement" shall have
the meaning specified in Section C.1(ii)(c)(III) of Article Fourth.

                                    (XXXI)   "Representative" shall have the
meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XXXII)  "Representative's Arbitrator" shall
have the meaning specified in Section C.1(ii)(c)(VII) of Article Fourth.

                                    (XXXIII) "Representative's Net Income
Arbitrator" shall have the meaning specified in Section C.1(ii)(c)(V)(C) of
Article Fourth.

                                    (XXXIV)  "Revenue" shall mean (a) revenues
earned by the Corporation as a result of the sale of products or the provision
of services, after taking into consideration returned products and allowances
for price reductions, credits, or discounts, computed in accordance with GAAP
and Tekelec's accounting practices, as consistently applied by the Corporation
plus (b) to the extent not otherwise included in (a) above, revenues earned by
Tekelec or its Affiliates (as defined in the Stockholders' Agreement) from the
sale of the Corporation's packet telephony products, after taking into
consideration returned products and allowances for price reductions, credits, or
discounts, computed in accordance with GAAP, as

                                       14

<PAGE>

consistently applied by Tekelec; provided, that in no event shall Revenue
include any revenue earned by Tekelec or its Affiliates (as defined in the
Stockholders' Agreement) as a result of the sale by Tekelec or its Affiliates
(as defined in the Stockholders' Agreement) of packet telephony products other
than the Corporation's packet telephony products, including but not limited to
Tekelec's signaling gateway products, or revenue from any agreements not
assigned or transferred to the Corporation, or the provision of services with
respect thereto. For purposes of this definition, Affiliates shall not include
the Corporation.

                                    (XXXV)   "Securities Act" shall have the
meaning specified in Section C.1(ii)(c)(III) of Article Fourth.

                                    (XXXVI)  "Series A Holder Redemption
Measurement Period" shall mean the one (1) year period beginning on the first
day of the sixth calendar month prior to the date of the Series A Holder
Redemption Notice and ending twelve (12) months thereafter.

                                    (XXXVII) "Series A Holder Redemption Notice"
shall have the meaning specified in Section C.1(ii)(a)(II) of Article Fourth.

                                    (XXXVIII) "Series A Preferred Stock" shall
have the meaning specified in Section A.(ii) of Article Fourth.

                                    (XXXIX)  "Series B Holder Redemption
Measurement Period" shall mean the one (1) year period beginning on the first
day of the sixth calendar month prior to the date of the Series B Redemption
Notice and ending twelve (12) months thereafter.

                                    (XL)     "Series B Holder Redemption Notice"
shall have the meaning specified in Section C.1(ii)(a)(I) of Article Fourth.

                                    (XLI)    "Series B Preferred Stock" shall
have the meaning specified in Section A.(ii) of Article Fourth.

                                    (XLII)   "Special Option" means any
security, right, subscription, warrant, option, call, right, "phantom" stock
right or other contract or arrangement that gives the right to (a) purchase or
otherwise receive or be issued any shares of capital stock of the Corporation or
any security of any kind convertible into or exchangeable or exercisable for any
shares of capital stock of the Corporation or (b) receive or exercise any
benefits or rights similar to any rights enjoyed by or accruing to the holder of
shares of capital stock of the Corporation, including any rights to participate
in the equity or income of the Corporation or to participate in or direct the
election of any directors or officers of the Corporation or the manner in which
any shares of capital stock of the Corporation are voted.

                                    (XLIII)  "Stockholders' Agreement" shall
have the meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XLIV)   "Tekelec" shall have the meaning
specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XLV)    "Tekelec's Arbitrator" shall have
the meaning specified in Section C.1(ii)(c)(VII) of Article Fourth.

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<PAGE>

                                    (XLVI)   "Tekelec's Net Income Arbitrator"
shall have the meaning specified in Section C.1(ii)(c)(V)(C) of Article Fourth.

                                    (XLVII)  "Tekelec Designees" shall mean all
direct or indirect transferees of shares of Preferred Stock or Common Stock
owned by Tekelec or a wholly owned subsidiary of Tekelec, other than a
transferee that is a wholly owned subsidiary of Tekelec.

                                    (XLVIII) "Tekelec Stock" shall have the
meaning specified in Section C.1(ii)(c)(I) of Article Fourth.

                                    (XLIX)   "Termination Date" shall have the
meaning specified in Section C.1(v)(b) of Article Fourth.

                           (e)      The Series B Preferred Stock. The Series B
Preferred Stock shall not be redeemable by the Corporation at any time except
pursuant to the terms of an agreement between the Corporation and the holder or
holders of any of the shares to be redeemed.

                  (iii)    LIQUIDATION RIGHTS.

                           (a)      Series A Preferred Stock. In the event of
any liquidation, dissolution or winding up of the Corporation, whether voluntary
or involuntary, the holders of shares of the Series A Preferred Stock shall be
entitled to receive, after the distribution of the full preferential amount to
holders of Series B Preferred Stock provided for in paragraph (b) of this
Section C.1(iii) but prior and in preference to any distribution of any of the
assets or surplus funds of the Corporation to the holders of the Common Stock,
by reason of their ownership thereof, distributions equal to $1,000.00 per share
then held by such holder (as adjusted for any stock dividends, combinations,
reverse stock splits, stock splits, recapitalizations, reorganizations,
reclassifications or other similar event with respect to such shares). If upon
the occurrence of such an event, following the distribution of the full
preferential amounts to holders of Series B Preferred Stock provided for in
paragraph (b) of this Section C.1(iii), the assets and funds thus distributed
among the holders of Series A Preferred Stock shall be insufficient to permit
the payment to such holders of the full aforesaid preferential amount, then the
remaining assets and funds of the Corporation legally available for distribution
shall be distributed ratably among the holders of the Series A Preferred Stock
in proportion to the full preferential amount each such holder is otherwise
entitled to receive.

                           (b)      Series B Preferred Stock. In the event of
any liquidation, dissolution or winding up of the Corporation, whether voluntary
or involuntary, the holders of shares of the Series B Preferred Stock shall be
entitled to receive, prior and in preference to any distribution of any of the
assets or surplus funds of the Corporation to the holders of the Common Stock or
to the holders of the Series A Preferred Stock, by reason of their ownership
thereof, distributions equal to an amount equal to $2,000 per share then held by
such holder (as adjusted for any stock dividends, combinations, reverse stock
splits, stock splits, recapitalizations, reorganizations, reclassifications or
other similar event with respect to such shares). If upon the occurrence of such
an event, the assets and funds thus distributed among the holders of the Series
B Preferred Stock shall be insufficient to permit the payment to such holders of
the full aforesaid preferential amount, then the entire assets and funds of the
Corporation legally available for distribution shall be distributed ratably
among the holders of Series B Preferred Stock in proportion to the full
preferential amount each such holder is otherwise entitled to receive.

                                       16

<PAGE>

                           (c)      After the payment to the holders of shares
of Series A Preferred Stock and Series B Preferred Stock of the full
preferential amounts provided for in paragraphs (a) and (b) of this Section
C.1(iii), the remaining assets of the Corporation legally available for
distribution to stockholders shall be distributed ratably to the holders of
Common Stock, Series A Preferred Stock and Series B Preferred Stock based on the
number of shares of Common Stock held by each such holder assuming conversion of
all shares of Series A Preferred Stock and Series B Preferred Stock (including
any shares of Preferred Stock that are not yet convertible at that time) at the
then applicable Conversion Price.

                           (d)      Unless otherwise determined by (I) at any
time prior to the Termination Date (as defined below), the holders of at least
60% of the Preferred Stock then issued and outstanding, voting as a single class
and not on an as converted basis, or (II) at any time on or after the
Termination Date, the holders of a majority of the issued and outstanding shares
of Common Stock and Preferred Stock, voting as a single class and on an as
converted basis (including any shares of Preferred Stock that are not yet
convertible at that time), for purposes of this Article Fourth of the
Certificate of Incorporation, (1) the acquisition of the Corporation by another
entity by means of any transaction or series of related transactions (including,
without limitation, any merger, consolidation, reclassification,
recapitalization or other form of transaction in which outstanding shares of the
Corporation are exchanged for securities or other consideration issued, or
caused to be issued, by the acquiring entity or its subsidiary, but excluding
any transaction effected primarily for the purpose of changing the Corporation's
jurisdiction of incorporation) that results in the transfer or acquisition of
all of the Corporation's voting power to a third party that is not an Affiliate
(as defined in the Stockholders' Agreement) of a stockholder of the Corporation,
or (2) any sale or other disposition of all or substantially all of the assets
of the Corporation to a third party that is not an Affiliate (as defined in the
Stockholders' Agreement) of a stockholder of the Corporation, shall be treated
as a liquidation, dissolution or winding up of the Corporation and shall entitle
the holders of Series A Preferred Stock and Series B Preferred Stock to receive
at the closing in cash, securities or other property (valued as provided in
paragraph (e) of this Section C.1(iii)) amounts as specified in paragraphs (a),
(b) and (c) of this Section C.1(iii). Notwithstanding the foregoing, the
exercise of the call option by Tekelec under Section 3.1 of the Stockholders'
Agreement or the put option by the stockholders under Section 3.2 of the
Stockholders' Agreement or a redemption under Section C.1(ii) shall not be
treated as a liquidation, dissolution or winding up of the Corporation.

                           (e)      If any assets of the Corporation distributed
to stockholders in connection with any liquidation, dissolution or winding up of
the Corporation are other than cash, then the value of such assets shall be
their fair market value as determined in good faith by the Board of Directors;
provided, however, any publicly-traded securities shall be valued as follows:

                                    (I)      if the securities are then traded
on a national securities exchange or the Nasdaq Stock Market (or a similar
national quotation system), then the value of the securities shall be deemed to
be to the average of the closing prices of the securities on such exchange or
system over the ten (10) trading day period ending five (5) trading days prior
to the distribution; and

                                    (II)     if the securities are actively
traded over-the-counter, then the value of the securities shall be deemed to be
the average of the closing bid prices of the securities over the ten (10)
trading day period ending five (5) trading days prior to the distribution.

                                       17

<PAGE>

                  (f)      Until the Termination Date, the Corporation shall
give each holder of record of Preferred Stock written notice of a transaction
described in paragraph (d) of this Section C.1(iii) not later than twenty (20)
days prior to the stockholders' meeting called to approve such transaction, or
twenty (20) days prior to the closing of such transaction, whichever is earlier,
and shall also notify such holders in writing of the final approval by the
stockholders, if necessary, of such transaction. The first of such notices shall
describe the material terms and conditions of the impending transaction and the
provisions of paragraph (d) of this Section C.1(iii), and the Corporation shall
thereafter give such holders prompt notice of any material changes. After the
Termination Date, the Corporation shall have no obligation to provide the
notices described in this Section C.1(iii)(f).

         (iv)     CONVERSION. The holders of Series A Preferred Stock and Series
B Preferred Stock shall have conversion rights as follows:

                  (a)      Right to Convert. Each share of Series A Preferred
Stock and Series B Preferred Stock shall be convertible, in whole or in part, at
the option of the holder thereof, (i) with respect to the Series A Preferred
Stock, at any time on or after March 1, 2008 if no Series A Holder Redemption
Notice, Series B Holder Redemption Notice or Change of Ownership Redemption
Notice has been delivered to the Corporation by such date, or if any such notice
has been delivered, the day after the Redemption Date (provided that if a
redemption pursuant to a Change of Ownership Redemption is rescinded after being
provided, then the Series A Preferred Stock shall be convertible on the later of
March 1, 2008 and the day after the day that notice of such rescission is sent
to the holders of the Series A Preferred Stock) and provided further that no
Disputed Shares may be converted unless and until the dispute with respect to
such shares has been resolved in accordance with the terms of the Escrow
Agreement, and (ii) at any time after the date of issuance of such share with
respect to the Series B Preferred Stock, into such number of fully paid and
nonassessable shares of Common Stock as is determined by dividing (x) (i)
$1,000.00, with respect to Series A Preferred Stock and (ii) $1,633.33, with
respect to Series B Preferred Stock (in each case, as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications, or other similar events with respect to such
shares), by (y) the Conversion Price applicable to such share, determined as
hereinafter provided, in effect on the date the certificate is surrendered for
conversion in accordance with paragraph (c) of this Section C.1(iv). The price
at which shares of Common Stock shall be deliverable upon conversion of shares
of the Series A Preferred Stock or Series B Preferred Stock (each, a "Conversion
Price") per share of Common Stock shall initially be (i) $1,000.00 with respect
to Series A Preferred Stock and (ii) $1,000.00 with respect to Series B
Preferred Stock. Such initial Conversion Price shall be adjusted as hereinafter
provided.

                  (b)      Automatic Conversion. Each share of Series A
Preferred Stock and Series B Preferred Stock shall automatically be converted
into shares of Common Stock at the then-effective Conversion Price immediately
prior to the closing of the sale of the Corporation's Common Stock in a firm
commitment, underwritten public offering registered under the Securities Act, in
which the public offering price (prior to underwriter's discounts or commissions
and offering expenses) exceeds $3,000.00 per share of Common Stock (as adjusted
for any stock dividends, combinations, reverse stock splits, stock splits,
recapitalizations, reorganizations, reclassifications or other similar event
with respect to such shares) and the aggregate gross proceeds raised exceeds
$35,000,000 (a "Qualified IPO"), other than a registration relating solely to a

                                       18

<PAGE>

transaction under Rule 145 under the Securities Act (or any successor thereto)
or to an employee benefit plan of the Corporation.

                  (c)      Mechanics of Conversion.

                           (I)      Before any holder of Series A Preferred
Stock or Series B Preferred Stock shall be entitled to convert any of such
shares into shares of Common Stock pursuant to paragraph (a) of this Section
C.1(iv), such holder shall surrender the certificate or certificates evidencing
such shares, duly endorsed, at the office of the Corporation or of any transfer
agent for such stock, and shall give written notice to the Corporation at such
office of the number of shares that such holder elects to so convert and shall
state therein the name or names in which such holder wishes the certificate or
certificates for such shares of Common Stock to be issued. The Corporation
shall, as soon as practicable thereafter (but in any event within 20 business
days thereafter), issue and deliver to such holder of Series A Preferred Stock
or Series B Preferred Stock, as the case may be, a certificate or certificates
for the number of shares of Common Stock to which such holder shall be entitled
as aforesaid and, if applicable, a certificate or certificates representing any
such shares of any such Preferred Stock that are not being so converted (but
were otherwise represented by a certificate that included shares that were being
so converted). Any such conversion shall be deemed to have been made immediately
prior to the close of business on the date of surrender of the certificate or
certificates for the shares of Series A Preferred Stock or Series B Preferred
Stock, as the case may be, to be converted, and the person or persons entitled
to receive the shares of Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder or holders of such shares of
Common Stock on such date; provided, however, that in the event of an automatic
conversion in connection with a Qualified IPO, the outstanding shares of
Preferred Stock shall be converted automatically without any further action by
the holders of such shares and whether or not the certificates representing such
shares are surrendered to the Corporation or its transfer agent.

                           (II)     In the event of an automatic conversion in
connection with a Qualified IPO, the conversion may, at the option of any holder
tendering shares of Series A Preferred Stock or Series B Preferred Stock for
conversion, be conditioned upon the closing with the underwriters of the sale of
securities pursuant to such offering, in which event the person(s) entitled to
receive the Common Stock upon conversion of the Series A Preferred Stock or
Series B Preferred Stock shall not be deemed to have converted such series of
Preferred Stock until immediately prior to the closing of such sale of
securities. No holder of shares of Series A Preferred Stock or Series B
Preferred Stock shall receive certificates for shares of Common Stock upon such
conversion unless and until such holder shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation or of any
transfer agent for such stock and shall give written direction to the
Corporation of the name or names in which such holder wishes the certificate or
certificates for such shares of Common Stock to be issued. Until surrendered as
provided above, each certificate previously representing shares of Preferred
Stock shall be deemed for all corporate purposes to represent the number of
shares of Common Stock resulting from such automatic conversion.

                  (d)      Adjustments to Conversion Price for Certain Diluting
Issues.

                           (I)      Special Definitions. For purposes of
paragraph (d) of this Section C.1(iv), the following definitions apply:

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<PAGE>

                                    (A) "Options" shall mean rights, options and
warrants to subscribe for, purchase or otherwise acquire Common Stock, Preferred
Stock or Convertible Securities (defined below).

                                    (B) "Original Issue Date" shall mean: (A)
for Common Stock, ___________, 2003 and (B) for each series of Preferred Stock,
the first date on which a share of any such series of Preferred Stock was first
issued by the Corporation.

                                    (C) "Convertible Securities" shall mean any
evidences of indebtedness, shares or other securities convertible into or
exchangeable for Common Stock.

                                    (D) "Additional Shares of Common Stock"
shall mean all shares of Common Stock issued (or, pursuant to subparagraph
(d)(III) of this Section C.1(iv), deemed to be issued) by the Corporation after
the applicable Original Issue Date, other than shares of Common Stock issued or
issuable in any of the following transactions:

                                             (1)      upon conversion of shares
of Series A Preferred Stock or Series B Preferred Stock;

                                             (2)      (x) the grant to, or
exercise by, Tekelec of an option to acquire not more than 12,000 shares of
Series B Preferred Stock (as such number is adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to the
Series B Preferred Stock) for a per share purchase price of $1,000.00 (as such
per share price is adjusted for any stock dividends, combinations, reverse stock
splits, stock splits, recapitalizations, reorganizations, reclassifications or
other similar event with respect to the Series B Preferred Stock) pursuant to
Article IV of the Stockholders' Agreement (the "Tekelec Option") or (y) the
grant on the Closing Date (as defined in the Merger Agreement) to, or exercise
by, Comerica Incorporated of an option to acquire not more than 250 shares of
Series A Preferred Stock (as such number is adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to the
Series A Preferred Stock) for a per share purchase price of $1,000.00 (as such
per share price is adjusted for any stock dividends, combinations, reverse stock
splits, stock splits, recapitalizations, reorganizations, reclassifications or
other similar event with respect to the Series A Preferred Stock) (the "Comerica
Option") or (z) the exercise of any Legacy Option;

                                             (3)      as a dividend or
distribution on the Series A Preferred Stock or Series B Preferred Stock;

                                             (4)      in connection with bona
fide acquisitions from time to time approved by the Corporation's Board of
Directors (the "Board of Directors");

                                             (5)      for which adjustment of
the Conversion Price is made pursuant to paragraph (e) or paragraph (g) of this
Section C.1(iv).

                           (II)     No Adjustment of Conversion Price. Any
provision of the Certificate of Incorporation to the contrary notwithstanding,
no adjustment in any Conversion Price shall be made in respect of the issuance
of Additional Shares of Common Stock unless such issuance

                                       20

<PAGE>

is without consideration or the consideration per share (determined pursuant to
subparagraph (d)(V) of this Section C.1(iv)) for an Additional Share of Common
Stock issued or deemed to be issued by the Corporation is less than such
applicable Conversion Price in effect on the date of, and immediately prior to,
such issue.

                           (III)    Deemed Issue of Additional Shares of Common
Stock. In the event the Corporation at any time or from time to time after the
Original Issue Date shall issue any Options or Convertible Securities or shall
fix a record date for the determination of holders of any class of securities
then entitled to receive any such Options or Convertible Securities, then the
maximum number of shares (as set forth in the instrument relating thereto
without regard to any provisions contained therein designed to protect against
dilution) of Common Stock issuable upon the exercise of such Options or, in the
case of Convertible Securities and Options for Convertible Securities, the
conversion or exchange of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time of such issue or, in
case such a record date shall have been fixed, as of the close of business on
such record date, provided that in any such case in which Additional Shares of
Common Stock are deemed to be issued:

                                    (1)      no further adjustments in the
         applicable Conversion Price shall be made upon the subsequent issue of
         such Convertible Securities where an adjustment to the Conversion Price
         had been made on the record date, or shares of Common Stock upon the
         exercise of such Options or conversion or exchange of such Convertible
         Securities, in each case where an adjustment to the Conversion Price
         had been made on the record date or issue date;

                                    (2)      if such Options or Convertible
         Securities by their terms provide, with the passage of time or
         otherwise, for any increase or decrease in the consideration payable to
         the Corporation, or decrease or increase in the number of shares of
         Common Stock issuable, upon the exercise, conversion or exchange
         thereof, the applicable Conversion Price computed upon the original
         issue thereof (or upon the occurrence of a record date with respect
         thereto), and any subsequent adjustments based thereon, shall, upon any
         such increase or decrease becoming effective, be recomputed to reflect
         such increase or decrease insofar as it affects such Options or the
         rights of conversion or exchange under such Convertible Securities
         (provided, however, that no such adjustment of the applicable
         Conversion Price shall affect Common Stock previously issued upon
         conversion of Series A Preferred Stock or Series B Preferred Stock);

                                    (3)      upon the expiration of any such
         Options or any rights of conversion or exchange under such Convertible
         Securities which shall not have been exercised, the applicable
         Conversion Price computed upon the original issuance thereof (or upon
         the occurrence of a record date with respect thereto), and any
         subsequent adjustments based thereon, shall, upon such expiration, be
         recomputed as if:

                                             (A)      in the case of Convertible
                  Securities or Options for Common Stock, the only Additional
                  Shares of Common Stock issued were the shares of Common Stock,
                  if any, actually issued upon the exercise of such Options or
                  the conversion or exchange of such Convertible Securities and
                  the consideration received therefor was the consideration
                  actually received by the Corporation for the issue of all such
                  Options, whether or not exercised, plus the consideration
                  actually received by the Corporation upon such exercise or for
                  the issue of all such Convertible Securities which were
                  actually converted or exchanged,

                                       21

<PAGE>

                  plus the additional consideration, if any, actually received
                  by the Corporation upon such conversion or exchange, and

                                             (B)      in the case of Options for
                  Convertible Securities, only the Convertible Securities, if
                  any, actually issued upon the exercise thereof were issued at
                  the time of issue of such Options, and the consideration
                  received by the Corporation for the Additional Shares of
                  Common Stock deemed to have been then issued was the
                  consideration actually received by the Corporation for the
                  issue of all such Options, whether or not exercised, plus the
                  consideration deemed to have been received by the Corporation
                  (determined pursuant to subparagraph (d)(V) of this Section
                  C.1(iv)) upon the issue of the Convertible Securities with
                  respect to which such Options were actually exercised;

                                             (C)      no readjustment pursuant
                  to clause (2) or (3) above shall have the effect of increasing
                  the applicable Conversion Price to an amount which exceeds the
                  lower of (a) the applicable Conversion Price on the original
                  adjustment date, or (b) the applicable Conversion Price that
                  would have resulted from any issuance of Additional Shares of
                  Common Stock, other than those Additional Shares of Common
                  Stock causing such readjustment, between the original
                  adjustment date and such readjustment date;

                                             (D)      in the case of any Options
                  which expire by their terms not more than 30 days after the
                  date of issue thereof, no adjustment of the applicable
                  Conversion Price shall be made until the expiration or
                  exercise of all such Options, whereupon such adjustment shall
                  be made in the same manner provided in clause (3) above; and

                                             (E)      in the event that any
                  adjustment described in this subparagraph (d)(III) is made,
                  with respect to any Additional Shares of Common Stock that
                  were originally issued (or deemed issued) for a consideration
                  per share equal to or in excess of the applicable Conversion
                  Price then in effect that, had such adjustment been made prior
                  to such original issue date (or deemed original issue date)
                  would have caused such Additional Shares of Common Stock to be
                  issued for a consideration per share less than the applicable
                  Conversion Price then in effect, then such Additional Shares
                  of Common Stock shall be deemed to have been issued as of the
                  date of any such adjustment.

                           (IV)     Adjustment of Conversion Price Upon Issuance
of Additional Shares of Common Stock. In the event the Corporation, at any time
after the Original Issue Date, shall issue Additional Shares of Common Stock
(including Additional Shares of Common Stock deemed to be issued pursuant to
subparagraph (d)(III) of this Section C.1(iv)) without consideration or for a
consideration per share less than the applicable Conversion Price for any series
of Preferred Stock in effect on the date of and immediately prior to such issue,
then and in such event, the applicable Conversion Price for such series shall be
reduced, concurrently with such issue, to a price (calculated to the nearest
cent) determined by multiplying the applicable Conversion Price by a fraction,
the numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such issue plus the number of shares of Common Stock which
the aggregate consideration received by the Corporation for the total number of
Additional Shares of Common Stock so issued would purchase at the applicable
Conversion Price for such series of Preferred Stock in effect immediately prior
to such issuance, and the denominator of which shall be the number of shares of

                                       22

<PAGE>

Common Stock outstanding immediately prior to such issue plus the number of such
Additional Shares of Common Stock so issued. For the purpose of the above
calculation, the number of shares of Common Stock outstanding immediately prior
to such issue shall be calculated on a fully diluted basis, as if all
outstanding shares of Series A Preferred Stock and Series B Preferred Stock and
all Convertible Securities (including any shares of Preferred Stock that are not
yet convertible at that time) had been fully converted into shares of Common
Stock immediately prior to such issuance and all outstanding Options had been
fully exercised immediately prior to such issuance (and the resulting securities
fully converted into shares of Common Stock, if so convertible) as of such date,
but not including in such calculation any additional shares of Common Stock
issuable with respect to outstanding shares of Series A Preferred Stock and
Series B Preferred Stock, Convertible Securities or Options solely as a result
of the adjustment of the respective Conversion Prices (or other conversion
ratios) resulting from the issuance of the Additional Shares of Common Stock
causing the adjustment in question.

                           (V)      Determination of Consideration. For purposes
of paragraph (d) of this Section C.1(iv), the consideration received by the
Corporation for the issue of any Additional Shares of Common Stock shall be
computed as follows:

                                    (1)      Cash and Property. Such
consideration shall:

                                             (A)      insofar as it consists of
                  cash, be computed at the aggregate amount of cash received by
                  the Corporation;

                                             (B)      insofar as it consists of
                  property other than cash, be computed at the fair value
                  thereof at the time of such issue, as determined in good faith
                  by the Board of Directors; and

                                             (C)      in the event Additional
                  Shares of Common Stock are issued together with other shares
                  or securities or other assets of the Corporation for
                  consideration which covers both, be the proportion of such
                  consideration so received, computed as provided in clauses (A)
                  and (B) above, as determined in good faith by the Board of
                  Directors.

                                    (2)      Options and Convertible Securities.
         The consideration per share received by the Corporation for Additional
         Shares of Common Stock deemed to have been issued pursuant to
         subparagraph (d)(III) of this Section C.1(iv), relating to Options and
         Convertible Securities shall be determined by dividing:

                                             (A)      the total amount, if any,
                  received or receivable by the Corporation as consideration for
                  the issue of such Options or Convertible Securities, plus the
                  minimum aggregate amount of additional consideration (as set
                  forth in the instruments relating thereto, without regard to
                  any provision contained therein designed to protect against
                  dilution) payable to the Corporation upon the exercise of such
                  Options or the conversion or exchange of such Convertible
                  Securities, or in the case of Options for Convertible
                  Securities, the exercise of such Options for Convertible
                  Securities and the conversion or exchange of such Convertible
                  Securities by

                                             (B)      the maximum number of
                  shares of Common Stock (as set forth in the instruments
                  relating thereto, without regard to any

                                       23

<PAGE>

                  provision contained therein designed to protect against
                  dilution) issuable upon the exercise of such Options or
                  conversion or exchange of such Convertible Securities.

                           (e)      Adjustments to Conversion Prices for Stock
Dividends and for Combinations or Subdivisions of Common Stock. In the event
that the Corporation at any time or from time to time after the Original Issue
Date shall declare or pay, without consideration, any dividend or other
distribution on the Common Stock payable in shares of Common Stock or in any
right to acquire shares of Common Stock for no consideration, or shall effect a
subdivision of the outstanding shares of Common Stock into a greater number of
shares of Common Stock (by stock split, reclassification or otherwise than by
payment of a dividend in shares of Common Stock or in any right to acquire
shares of Common Stock), or in the event the outstanding shares of Common Stock
shall be combined or consolidated, by reclassification or otherwise, into a
lesser number of shares of Common Stock, then the applicable Conversion Price in
effect immediately prior to such event shall, concurrently with the
effectiveness of such event, be proportionately decreased or increased, as
appropriate. In the event that the Corporation shall declare or pay, without
consideration, any dividend on the Common Stock payable in any right to acquire
shares of Common Stock for no consideration, then the Corporation shall be
deemed to have made a dividend payable in shares of Common Stock in an amount
equal to the maximum number of shares issuable upon exercise of such rights to
acquire Common Stock.

                           (f)      Other Distributions. In the event the
Corporation shall declare a distribution payable to the holders of the Common
Stock in securities of other persons, evidences of indebtedness issued by the
Corporation or other persons, assets (excluding cash dividends) or options or
rights not referred to in subparagraph (e) of this Section C.1(iv), then, in
each such case for the purpose of this subparagraph (f), the holders of
Preferred Stock shall be entitled to a proportionate share of any such
distribution as though they were the holders of the number of shares of Common
Stock of the Corporation into which their respective shares of Preferred Stock
are convertible as of the record date fixed for the determination of the holders
of Common Stock of the Corporation entitled to receive such distribution.

                           (g)      Adjustments for Reclassification and
Reorganization. If the Common Stock issuable upon conversion of the Series A
Preferred Stock or Series B Preferred Stock shall be changed into the same or a
different number of shares of any other class or classes of stock, whether by
capital reorganization, reclassification or otherwise (other than a subdivision
or combination of shares provided for in paragraph (e) of this Section C.1(iv)
above or a merger or other reorganization referred to in paragraph (d) of
Section C.1(iii) above), the applicable Conversion Price then in effect shall,
concurrently with the effectiveness of such reorganization or reclassification,
be proportionately adjusted so that the Series A Preferred Stock and Series B
Preferred Stock shall thereafter be convertible into, in lieu of the number of
shares of Common Stock which the holders would otherwise have been entitled to
receive, a number of shares of such other class or classes of stock equivalent
to the number of shares of Common Stock that would have been received by the
holders upon conversion of the Series A Preferred Stock or Series B Preferred
Stock immediately before that change. In any such case, appropriate adjustment
shall be made in the application of the provisions of this subparagraph (g) with
respect to the rights of the holders of each series of Preferred Stock after the
reclassification or reorganization so that the provisions of this subparagraph
(g) (including adjustment of the Conversion Price then in effect and the number
of shares issuable upon conversion of each series of Preferred Stock) shall be
applicable

                                       24

<PAGE>

to the series of Preferred Stock after such event as nearly equivalent as prior
to such event as may be practicable.

                           (h)      No Impairment. The Corporation will not, by
amendment of the Certificate of Incorporation or through any reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance of performance of any of the terms to be observed or performed
hereunder by the Corporation, but will at all times in good faith assist in the
carrying out of all the provisions of this Section C.1(iv) and in the taking of
all such action as may be necessary or appropriate in order to protect the
Conversion Price against impairment.

                           (i)      Certificates as to Adjustments. Upon the
occurrence of each adjustment or readjustment of the applicable Conversion Price
pursuant to this Section C.1(iv), the Corporation at its expense shall promptly
compute such adjustment or readjustment in accordance with the terms hereof and
prepare and furnish to each holder of Series A Preferred Stock and Series B
Preferred Stock a certificate executed by the Corporation's President or Chief
Financial Officer setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based. The
Corporation shall, upon the written request at any time of any such holder,
furnish or cause to be furnished to such holder a like certificate setting forth
(i) such adjustments and readjustments, (ii) the applicable Conversion Price at
the time in effect, and (iii) the number of shares of Common Stock and the
amount, if any, of other property which at the time would be received upon the
conversion of the Series A Preferred Stock or the Series B Preferred Stock, as
the case may be.

                           (j)      Notices of Record Date. In the event that
the Corporation shall propose at any time prior to the conversion of all
outstanding shares of Series A Preferred Stock and Series B Preferred Stock: (I)
to declare any dividend or distribution upon its Common Stock, whether in cash,
property, stock or other securities, whether or not a regular cash dividend and
whether or not out of earnings or earned surplus; (II) to offer for subscription
pro rata to the holders of any class or series of its stock any additional
shares of stock of any class or series or other rights; (III) to effect any
reclassification or recapitalization of its Common Stock outstanding involving a
change in the Common Stock; (IV) that the holders of Common Stock, as a result
of owning Common Stock, receive any rights, other than those rights provided by
the GCL or set forth in the Certificate of Incorporation, or (V) to merge or
consolidate with or into any other corporation, or sell, lease or convey all or
substantially all of its assets, or to liquidate, dissolve or wind up; then, in
connection with each such event, the Corporation shall send to the holders of
Series A Preferred Stock and Series B Preferred Stock:

                                    (I)      at least twenty (20) days' prior
written notice of the date on which a record shall be taken for the purpose of
determining the holders thereof who are entitled to such dividend, distribution
or subscription rights (and specifying the date on which the holders of Common
Stock shall be entitled thereto) or for determining rights to vote, if any, in
respect of the matters referred to in clauses (III) and (V) above in this
Section C.1(iv)(j); and

                                    (II)     in the case of the matters referred
to in clauses (III) and (V) above in this Section C.1(iv)(j), at least twenty
(20) days' prior written notice of the date when the same shall take place (and
specifying the date on which the holders of Common Stock shall be

                                       25

<PAGE>

entitled to exchange their Common Stock for securities or other property
deliverable upon the occurrence of such event).

                           (k)      Issue Taxes. The Corporation shall pay any
and all issue and other taxes that may be payable in respect of any issue or
delivery of shares of Common Stock on conversion of Series A Preferred Stock or
Series B Preferred Stock pursuant hereto; provided, however, that the
Corporation shall not be obligated to pay any transfer taxes resulting from any
transfer requested by any holder in connection with any such conversion.

                           (l)      Reservation of Stock Issuable Upon
Conversion. The Corporation shall at all times reserve and keep available out of
its authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the shares of Series A Preferred Stock and Series B
Preferred Stock, such number of its shares of Common Stock as shall from time to
time be sufficient to effect the conversion of all outstanding shares of
Preferred Stock; and if at any time the number of authorized but unissued shares
of Common Stock shall not be sufficient to effect the conversion of all then
outstanding shares of each such series of Preferred Stock, the Corporation will
take such corporate action as may, in the opinion of its counsel, be necessary
to increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purpose, including, without limitation,
engaging in best efforts to obtain the requisite stockholder approval of any
necessary amendment to the Certificate of Incorporation.

                           (m)      Fractional Shares. No fractional share shall
be issued upon the conversion of any share or shares of Series A Preferred Stock
or Series B Preferred Stock. All shares of Common Stock (including fractions
thereof) issuable upon conversion of more than one share of Series A Preferred
Stock or Series B Preferred Stock by a holder thereof shall be aggregated for
purposes of determining whether the conversion would result in the issuance of
any fractional share. If, after the aforementioned aggregation, the conversion
would result in the issuance of a fraction of a share of Common Stock, the
Corporation shall, in lieu of issuing any fractional share, pay the holder
otherwise entitled to such fraction a sum in cash equal to the fair market value
of such fraction on the date of conversion (as determined in good faith by the
Board of Directors).

                           (n)      Notices. Any notice required by the
provisions of this Section C.1(iv) to be given to the holders of shares of
Series A Preferred Stock or Series B Preferred Stock shall be deemed given if
deposited in the United States mail, postage prepaid, or if sent by facsimile or
delivered personally by hand or nationally recognized courier and addressed to
each holder of record at such holder's address or facsimile number appearing in
the records of the Corporation.

                                       26

<PAGE>

                  (v)      VOTING.

                           (a)      Voting Rights in General. Except as
otherwise specifically provided in the Certificate of Incorporation, at any
meeting of the stockholders of the Corporation, the shares of Series A Preferred
Stock and Series B Preferred Stock shall be entitled to the number of votes for
each such share held that would equal the number of shares of Common Stock
issuable upon conversion of such shares on the record date for the meeting
(including any shares of Preferred Stock that are not yet convertible at that
time). The shares of the Preferred Stock and the Common Stock shall vote
together as a single class of stock, except where voting separately by class or
series is required by the GCL and except as otherwise specifically provided in
the Certificate of Incorporation.

                           (b)      Other Voting Rights. Until the earliest to
occur of (x) the redemption of all Redemption Stock (other than the Disputed
Shares) on a Redemption Date, (y) if no Call Notice or Put Notice under the
Stockholders' Agreement or no Series A Holder Redemption Notice or Series B
Holder Redemption Notice under the Certificate of Incorporation has been
delivered prior to March 1, 2008, on March 1, 2008 , and (z) the date that
Tekelec and/or its Affiliates (as defined in the Stockholders' Agreement)
acquires all of the Preferred Stock or Common Stock (other than the Disputed
Shares) of the Corporation, other than shares owned by Tekelec, its wholly owned
subsidiaries or Tekelec Designees, pursuant to the exercise of the call option
by Tekelec under Section 3.1 of the Stockholders' Agreement or the put option by
the stockholders under Section 3.2 of the Stockholders' Agreement (the earliest
date on which any such event occurs, the "Termination Date"), the Corporation
shall not, without first obtaining the affirmative vote of at least sixty
percent (60%) of the Preferred Stock then issued and outstanding, voting as a
single class, and not on an as converted basis:

                                    (I)      Alter or change (whether by
amending this Certificate of Incorporation directly or by amending or
terminating it by way of merger, consolidation or otherwise or through a
certificate of designation) the rights, preferences or privileges of the
Preferred Stock or any series thereof (from those rights, preferences or
privileges contained herein) so as to materially or adversely affect such
shares;

                                    (II)     Increase or decrease (other than
decreases as a result of conversions or redemptions or as a result of transfers
of shares pursuant to or as contemplated by the Escrow Agreement) the number of
authorized shares of Common Stock or Preferred Stock or any security or
instrument convertible or exchangeable therefore;

                                    (III)    Authorize or issue (whether by
amending this Certificate of Incorporation directly or by amending or
terminating it by way of merger, consolidation or otherwise or through a
certificate of designation) any new class or series of equity securities or any
security or instrument convertible or exchangeable therefor, or issue any
additional shares of Common Stock, Series A Preferred Stock or Series B
Preferred Stock or any security or instrument convertible or exchangeable
therefor, other than the issuance of (x) up to 12,000 (as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to the
Series B Preferred Stock) shares of Series B Preferred Stock upon the exercise
of the Tekelec Option for $1,000.00 per share (as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares) or (y) up to 250

                                       27

<PAGE>

(as adjusted for any stock dividends, combinations, reverse stock splits, stock
splits, recapitalizations, reorganizations, reclassifications or other similar
event with respect to the Series A Preferred Stock) shares of Series A Preferred
Stock upon the exercise of the Comerica Option or (z) shares of Series A
Preferred Stock upon the exercise of the Legacy Options;

                                    (IV)     Redeem, repurchase or pay or
declare any dividends or other distributions (or pay into or set aside for a
sinking fund for such purpose) with respect to any shares of capital stock of
the Corporation, other than (x) acquisitions for stock by the Corporation
pursuant to an agreement which permits the Corporation to repurchase such shares
upon termination of services to the Corporation or in exercise of the
Corporation's right of first refusal set forth in the Stockholders' Agreement,
(y) redemptions pursuant to Article Fourth, Section C.1(ii) of the Certificate
of Incorporation, and (z) transfers of stock to the Corporation pursuant to or
as contemplated by the Escrow Agreement;

                                    (V)      Amend the Certificate of
Incorporation or By-laws of the Corporation, other than the amendment and
restatement of the Corporation's By-laws as set forth in the form of Exhibit S
to the Merger Agreement;

                                    (VI)     Liquidate, dissolve or wind up the
Corporation;

                                    (VII)    Sell all or substantially all of
its assets, or merge into or consolidate with any other entity, or effect any
transaction or series of related transactions in which at least a majority of
the Corporation's voting power is disposed of (other than in connection with a
Majority Sale (as defined in the Stockholders' Agreement) or in connection with
a redemption contemplated by Section C.1(ii) of Article Fourth of this
Certificate of Incorporation);

                                    (VIII)   Change the range of the number of
authorized directors of the Corporation's Board of Directors from the number set
forth in Article Fifth Section B of the Certificate of Incorporation and set
forth in the Corporation's By-laws; and

                                    (IX)     Permit any subsidiary to issue or
sell, or obligate itself to issue or sell, except to the Corporation or any
wholly owned subsidiary of the Corporation, any stock of such subsidiary.

                  (vi)     REACQUIRED SHARES. In the event any shares of any
series of Preferred Stock are converted pursuant to Section C.1(iv) or redeemed,
the Corporation shall never again issue the shares so converted or redeemed and
all such shares so converted or redeemed shall, upon such conversion or
redemption, cease to be a part of the Corporation's authorized stock.

                  (vii)    ARBITRATION. At any time within thirty (30) calendar
days after the Board of Directors of the Corporation makes a good faith
determination as to the value of the property in accordance with the provisions
of Section C.1(iv)(d)(V)(1)(B), Section C.1(iv)(d)(V)(1)(C) or Section
C.1(iii)(e), then the holders of not less than a majority of the then issued and
outstanding shares of Series A Preferred Stock, excluding in any event any such
shares owned by Tekelec, its wholly owned subsidiaries or Tekelec Designees, may
dispute the good faith determination of the Board of Directors as to the fair
market value of any such property pursuant to any such Section by written notice
delivered to the Corporation specifying in reasonable detail the notice of such
dispute (a "Notice of Dispute"). Upon receipt of the Notice of Dispute, the
Board of Directors and such

                                       28

<PAGE>

holders shall promptly consult with each other with respect to the specified
points of disagreement in an effort to resolve the dispute. If any such dispute
cannot be resolved within 30 calendar days after the Board of Directors receives
the Notice of Dispute, the Board of Directors and such holders shall jointly
refer the dispute to Deloitte & Touche, LLP or, if Deloitte & Touche, LLP is no
longer in existence, to any other reputable accounting firm reasonably
acceptable to Tekelec and the Representative (the "Arbiter"), as an arbitrator
to finally resolve, as soon as practicable, and in any event within 45 calendar
days after such reference, all points of disagreement with respect to the fair
market value of the consideration. The Arbiter shall apply the terms of the
Certificate of Incorporation, and shall otherwise conduct the arbitration under
such procedures as the parties may agree or, failing such agreement, under the
then prevailing Commercial Rules of the American Arbitration Association. The
disputing holders and the Corporation shall each bear its own expenses in
connection with the arbitration. All determinations by the Arbiter shall be
final, conclusive and binding with respect to the fair market value of such
consideration.

         2.       OTHER SERIES OF PREFERRED STOCK. Subject to the provisions of
Article Fourth, Section C.1(v)(b), the terms of the shares of each other series
of Preferred Stock shall be as stated and expressed in the Certificate of
Incorporation or any amendment hereto, or in the resolution or resolutions
providing for the issuance of such series of Preferred Stock adopted by the
Board of Directors. Subject to the requirements of the GCL and the provisions of
the Certificate of Incorporation (including but not limited to Article Fourth,
Section C.1(v)(b)), the Board of Directors is expressly authorized to cause any
number of the authorized and undesignated shares of Preferred Stock to be issued
from time to time in one or more series of Preferred Stock with such voting
powers, full or limited, or no voting powers, and such designations, preferences
and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, if any, as the Board of
Directors may fix by resolution or resolutions, prior to the issuance of any
shares of such series of Preferred Stock, each of which series may differ from
any and all other series, including, without limiting the generality of the
foregoing, the following:

         (i)      The number of shares constituting such series of Preferred
Stock and the designation thereof;

         (ii)     The dividend rate, if any, on the shares of such series of
Preferred Stock, whether and the extent to which any such dividends shall be
cumulative or non-cumulative, the relative rights of priority, if any, of
payments of any dividends, and the times at which, and the terms and conditions
on which, any dividends shall be paid;

         (iii)    The right, if any, of the holders of shares of such series of
Preferred Stock to vote and the manner of voting, except as may otherwise be
provided by the GCL;

         (iv)     The right, if any, of the holders of shares of such series of
Preferred Stock to convert the same into, or the right, if any, of the
Corporation to exchange the same for, another class or series of stock of the
Corporation and the terms and conditions, including any provision for future
adjustment in the conversion or exchange rate, under which said shares may be
converted or exchanged;

         (v)      The redemption or purchase price or prices of the shares of
such series of Preferred Stock, if any, and the times at which, and the terms
and conditions on which, the shares of such series of Preferred Stock may be
redeemed or purchased;

                                       29

<PAGE>

         (vi)     The terms of the sinking fund, if any, to be provided for such
series of Preferred Stock, and the terms and amount of such sinking fund;

         (vii)    The rights of the holders of shares of such series of
Preferred Stock in the event of a voluntary or involuntary liquidation,
dissolution or winding up of the Corporation and the relative rights of
priority, if any, of such holders with respect thereto; and

         (viii)   Any other relative powers, preferences and rights, and any
qualifications, limitations or restrictions, of such series of Preferred Stock.

D. TERMS OF COMMON STOCK.

         The voting powers and relative, participating, optional and other
special rights of the Common Stock, and the qualifications, limitations and
restrictions thereof, are as follows:

         1.       VOTING RIGHTS AND POWERS. Except as provided in the GCL and
except as otherwise specifically provided in the Certificate of Incorporation,
the holders of shares of the Common Stock shall vote together as a single class
(with the holders of all series of Preferred Stock entitled to vote together
with the holders of the shares of Common Stock) on all matters as to which such
holders are entitled to vote.

         2.       ADJUSTMENT IN AUTHORIZED COMMON STOCK. Subject to the
provisions of Article Fourth, Section C.1(v)(b), the number of authorized shares
of Common Stock may be increased or decreased (but not below the number of
shares of Common Stock then outstanding) by an affirmative vote of the holders
of at least 64% of all capital stock of the Corporation entitled to vote (voting
together on an as-converted basis (including any shares of Preferred Stock that
are not yet convertible at that time)) and without a separate class vote of the
Common Stock, irrespective of the provisions of Section 242(b)(2) of the GCL.

         3.       DIVIDEND RIGHTS. No cash dividends may be declared and paid
upon the Common Stock so long as any Series A Preferred Stock or Series B
Preferred Stock or other securities ranking prior to the Common Stock upon
dissolution, liquidation or winding up of the Corporation is outstanding.
Thereafter, cash dividends may be declared and paid upon the Common Stock in
such amounts and at such times as the Board of Directors may determine. Funds
otherwise legally available for the payment of dividends on the Common Stock
shall not be restricted or reduced by reason of there being any excess of the
aggregate preferential amount of any series of Preferred Stock outstanding over
the aggregate par value thereof.

         4.       LIQUIDATION RIGHTS. In the event of any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
the assets and funds of the Corporation legally available for distribution shall
be distributed as set forth in Section C.1(iii) of the Certificate of
Incorporation.

FIFTH.

A. GENERAL. All corporate powers of the Corporation shall be exercised by or
under the direction of the Board of Directors except as otherwise provided
herein or by applicable law. In furtherance and not in limitation of the powers
conferred by law, subject to the provisions of Section C.1(v)(b) of Article
Fourth hereof the Board of Directors is expressly authorized:

                                       30

<PAGE>

         (i)      to adopt, amend or repeal By-laws of the Corporation, subject
to the right of the stockholders of the Corporation entitled to vote with
respect thereto to adopt By-laws and to amend or repeal By-laws made by the
Board of Directors; and

         (ii)     from time to time to determine whether and to what extent, at
what time and place, and under what conditions and regulations the accounts and
books of the Corporation, or any of them, shall be open to the inspection of any
stockholder; and no stockholder shall have any right to inspect any account or
book or document of the Corporation except as provided by applicable law or the
By-laws of the Corporation, as authorized by resolution of the stockholders or
Board of Directors of the Corporation or as set forth in any agreement among the
Corporation and any of its stockholders.

B. ELECTION OF DIRECTORS. The Board of Directors shall consist of 5 or 7
directors. The number of directors constituting the entire Board shall initially
be set at 5 directors.

                  (i)      Until the Termination Date, for so long as the
holders of the Series A Preferred Stock (excluding Tekelec, its wholly owned
subsidiaries and any Tekelec Designees) in the aggregate own at least 31,000
shares of Series A Preferred Stock (as adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares):

                           (a)      the holders of a majority of outstanding
Series A Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and
any Tekelec Designees), voting as a single series, shall be entitled to elect at
each meeting or pursuant to each written consent of the Corporation's
stockholders for the election of directors two (2) directors of the
Corporation's Board of Directors if the Board of Directors consists of 5
directors and three (3) directors of the Corporation's Board of Directors if the
Board of Directors consists of 7 directors; and

                           (b)      the holders of a majority of outstanding
Series B Preferred Stock, voting as a single series, shall be entitled to elect
at each meeting or pursuant to each written consent of the Corporation's
stockholders for the election of directors three (3) directors of the
Corporation's Board of Directors if the Board of Directors consists of 5
directors and four (4) directors of the Corporation's Board of Directors if the
Board of Directors consists of 7 directors.

                  (ii)     Until the Termination Date, for so long as the
holders of the Series A Preferred Stock (excluding Tekelec, its wholly owned
subsidiaries and any Tekelec Designees) in the aggregate own at least 15,000 but
less than 31,000 shares of Series A Preferred Stock (as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares):

                           (a)      the holders of a majority of outstanding
Series A Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and
any Tekelec Designees), voting as a single series, shall be entitled to elect at
each meeting or pursuant to each written consent of the Corporation's
stockholders for the election of directors one (1) director of the Corporation's
Board of Directors if the Board of Directors consists of 5 directors and one (1)
director of the Corporation's Board of Directors if the Board of Directors
consists of 7 directors; and

                                       31

<PAGE>

                           (b)      the holders of a majority of outstanding
Series B Preferred Stock, voting as a single series, shall be entitled to elect
at each meeting or pursuant to each written consent of the Corporation's
stockholders for the election of directors four (4) directors of the
Corporation's Board of Directors if the Board of Directors consists of 5
directors and six (6) directors of the Corporation's Board of Directors if the
Board of Directors consists of 7 directors.

                  (iii)    Until the Termination Date, for so long as the
holders of the Series A Preferred Stock (excluding Tekelec, its wholly owned
subsidiaries and any Tekelec Designees) in the aggregate own less than 15,000
shares of Series A Preferred Stock (as adjusted for any stock dividends,
combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to such
shares), the following individuals shall be elected to the Board of Directors:

                           (a)      the holders of a majority of outstanding
Series A Preferred Stock (including Tekelec, its wholly owned subsidiaries and
any Tekelec Designees), voting as a single series, shall be entitled to elect
one (1) director of the Corporation's Board of Directors if the Board of
Directors consists of 5 directors and one (1) director of the Corporation's
Board of Directors if the Board of Directors consists of 7 directors at each
meeting or pursuant to each written consent of the Corporation's stockholders
for the election of directors; and

                           (b)      the holders of a majority of outstanding
Series B Preferred Stock, voting as a single series, shall be entitled to elect
at each meeting or pursuant to each consent of the Corporation's stockholders
for the election of directors four (4) directors of the Corporation's Board of
Directors if the Board of Directors consists of 5 directors and six (6)
directors of the Corporation's Board of Directors if the Board of Directors
consists of 7 directors.

                  (iv)     After the Termination Date or prior to the
Termination Date if no shares of Series A Preferred Stock remain outstanding,
the shares of the Preferred Stock and the Common Stock shall vote together as a
single class of stock in the election of directors, and the shares of Series A
Preferred Stock and Series B Preferred Stock, if there are any such shares
outstanding, shall be entitled to the number of votes for each such share held
that will equal the number of shares of Common Stock issuable upon conversion of
such shares on the record date for the meeting.

                  (v)      Whenever the holders of any class or classes of stock
or series thereof are entitled to elect one or more directors pursuant to
paragraphs (i), (ii) and (iii) of this Section B, vacancies and newly created
directorships of such class or classes or series shall be filled by the
affirmative vote of the holders of at least a majority of the outstanding shares
of that class or classes or series (including or excluding Tekelec, its wholly
owned subsidiaries and any Tekelec Designees, as set forth in such paragraph).
After the Termination Date, vacancies and newly created directorships may be
filled by at least a majority of the directors then in office, or by a sole
remaining director so elected, or, if there is no sole remaining director then
in office, by the affirmative vote of the holders of at least a majority of the
outstanding shares of stock entitled to vote for the election of directors.

                  (vi)     For so long as the holders of any class or classes of
stock or series thereof are entitled to elect such director pursuant to
paragraphs (i), (ii) or (iii) of this Section B, any director who was elected by
a specified class or classes of stock or series thereof may be removed during
such director's term of office at any time, with or without cause, only by the
affirmative vote of the

                                       32

<PAGE>

holders of at least a majority of the outstanding shares of the class or classes
of stock or series thereof that initially elected such director (including or
excluding Tekelec, its wholly owned subsidiaries and any Tekelec Designees, as
set forth in such paragraph). After the Termination Date, any director may be
removed during such director's term of office at any time, with or without
cause, only by the affirmative vote of the holders of at least a majority of the
outstanding shares of stock entitled to vote for the election of directors.

C. SUPERMAJORITY VOTING FOR CERTAIN CORPORATE ACTIONS.

                  (i)      The affirmative vote of at least a majority of the
directors of the Corporation present at a meeting duly called at which a quorum
is present shall be required to take any action by the Board not specifically
addressed in this Article Fifth C.(ii) below.

                  (ii)     The affirmative vote of at least eighty percent (80%)
of the directors of the Corporation or a unanimous written consent signed by the
directors of the Corporation in lieu of such meeting shall be required for any
of the following corporate actions, to the extent the same are to be taken at
any time from or after the effective time of the Stockholders' Agreement:

                           (a)      Payment of any dividend or distribution with
respect to any shares of capital stock, other than in connection with a
redemption contemplated by Section C.1(ii) of Article Fourth of the Certificate
of Incorporation;

                           (b)      Change the range of the number of authorized
directors of the Corporation's Board of Directors from the number set forth in
Article Fifth Section B of the Certificate of Incorporation and set forth in the
Corporation's By-laws;

                           (c)      Sale of all or substantially all of the
Corporation's assets, or merge into or consolidate with any other entity, or
effect any transaction or series of related transactions in which at least a
majority of the Corporation's voting power is disposed of (other than in
connection with a Majority Sale (as defined in the Stockholders' Agreement) or
in connection with a redemption contemplated by Section C.1(ii) of Article
Fourth of the Certificate of Incorporation); and

                           (d)      Except as otherwise contemplated or provided
for in the Stockholders' Agreement or contemplated by the Certificate of
Incorporation, any transaction between the Corporation and a stockholder or an
affiliate of a stockholder or an employee of a stockholder, unless such
transaction is made on an arm's-length basis in the ordinary course of business.

D.   COMMITTEES. At all times prior to the Termination Date, at least one (1)
member of each committee of the Board of Directors shall be a director
designated pursuant to Article Fifth, Section B.(i)(a), Section B.(ii)(a), or
Section B.(iii)(a), as the case may be. At all times prior to the Termination
Date, no committee of the Board of Directors shall be authorized to take any
action specified in Article Fifth, Section C.(ii) hereof.

SIXTH. No director of the Corporation or any person acting at the direction of
the Board of Directors shall be personally liable to the Corporation or its
stockholders for monetary damages for any breach of fiduciary duty by such
director as a director; provided, however, that the foregoing shall not be
deemed to eliminate or limit the liability of a director to the extent provided
by applicable law (i) for any breach of the director's duty of loyalty to the
Corporation or its

                                       33

<PAGE>

stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the GCL, or (iv) for any transaction from which the director derived an improper
personal benefit. This provision is not intended to eliminate or narrow any
defenses to or protection against liability otherwise available to directors of
the Corporation. No amendment to or repeal of this Article Sixth shall apply to
or have any effect on the liability or alleged liability of any director of the
Corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment. Any person or persons who, pursuant to any
provision of the Certificate of Incorporation, exercises or performs any of the
powers or duties conferred or imposed upon a director of the Corporation shall
be treated as a director for purposes of this Article Sixth and shall be
entitled to the limitation of liability set forth in this Article Sixth.

SEVENTH.

A. Every person who was or is a party or is threatened to be made a party to
or is involved in any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that such person or a person of whom such person is a legal
representative is or was a director or officer of the Corporation or is or was
serving at the request of the Corporation or for its benefit as a director,
officer, employee or agent of any other corporation, or as the representative of
the Corporation in a partnership, joint venture, trust or other entity, shall be
indemnified and held harmless by the Corporation to the fullest extent legally
permissible under the GCL, as amended from time to time, against all expenses,
liabilities and losses (including attorneys' fees, judgments, fines and amounts
paid or to be paid in settlement) reasonably paid or incurred by such person in
connection therewith. Such right of indemnification shall be a contract right
that may be enforced in any manner desired by such person. Such right of
indemnification shall include the right to be paid by the Corporation the
expenses incurred in defending any such action, suit or proceeding in advance of
its final disposition upon receipt of an undertaking by or on behalf of such
person to repay such amount if ultimately it should be determined that such
person is not entitled to be indemnified by the Corporation under the GCL. Such
right of indemnification shall not be exclusive of any other right which such
directors, officers or representatives may have or hereafter acquire and,
without limiting the generality of such statement, they shall be entitled to
their respective rights of indemnification under any By-law, agreement, vote of
stockholders, provision of law or otherwise, as well as their rights under this
Article Seventh.

B. The Board of Directors may adopt By-laws from time to time with respect to
indemnification to provide at all times the fullest indemnification permitted by
the GCL, as amended from time to time, and may cause the Corporation to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation or for its benefit as a director, officer, employee
or agent of any other corporation, or as the representative of the Corporation
in a partnership, joint venture, trust or other entity, against any expense,
liability or loss asserted against or incurred by any such person in any such
capacity or arising out of any such status, whether or not the Corporation would
have the power to indemnify such person against such expense, liability or loss.

EIGHTH. The Corporation reserves the right to amend, alter, change or repeal any
provision contained in the Certificate of Incorporation in the manner now or
hereafter prescribed by statute, and all rights conferred upon stockholders,
directors and officers herein are granted subject to this reservation except for
the following qualifications: (i) prior to the Termination Date, any

                                       34

<PAGE>

amendment, alteration, change, repeal or waiver (directly or indirectly, whether
by amending the Certificate of Incorporation or by way of merger, consolidation
or otherwise or through a certificate of designation) of any provision contained
in the Certificate of Incorporation is subject to the provisions of Section
C.1(v)(b) of Article Fourth hereof; (ii) prior to the later of (a) the
Termination Date and (b) the date on which no Disputed Shares remain
outstanding, any amendment, alteration, change, repeal or waiver (directly or
indirectly, whether by amending the Certificate of Incorporation or by way of
merger, consolidation or otherwise or through a certificate of designation) of
any provision of Section C.1(ii) of Article Fourth shall always require the
approval of the holders of at least (x) a majority of the Series B Preferred
Stock, voting on an as converted basis, and (y) a majority of the Series A
Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and any
Tekelec Designees), voting on an as converted basis, and prior to the later of
(a) the Termination Date and (b) the date on which no Disputed Shares remain
outstanding, any amendment, alteration, change, repeal or waiver (directly or
indirectly, whether by amending the Certificate of Incorporation or by way of
merger, consolidation or otherwise or through a certificate of designation) of
any provision of the Certificate of Incorporation that adversely affects the
rights of the holders of the Redemption Stock under Section C.1(ii) of Article
Fourth shall always require the approval of the holders of at least (x) a
majority of the Series B Preferred Stock, voting on an as converted basis, and
(y) a majority of the Series A Preferred Stock (excluding Tekelec, its wholly
owned subsidiaries and any Tekelec Designees), voting on an as converted basis;
(iii) prior to the Termination Date, any amendment, alteration, change, repeal
or waiver (directly or indirectly, whether by amending the Certificate of
Incorporation or by way of merger, consolidation or otherwise or through a
certificate of designation) to Article Fifth shall require the approval of the
holders of at least (x) a majority of the Series B Preferred Stock, voting on an
as converted basis, and (y) a majority of the Series A Preferred Stock
(excluding Tekelec, its wholly owned subsidiaries and any Tekelec Designees),
voting on an as converted basis, so long as the holders of the Series A
Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and any
Tekelec Designees) in the aggregate own at least 15,000 shares of Series A
Preferred Stock (as adjusted for any stock dividends, combinations, reverse
stock splits, stock splits, recapitalizations, reorganizations,
reclassifications or other similar event with respect to such shares); (iv)
prior to the later of (a) the Termination Date and (b) the date on which no
Disputed Shares remain outstanding, any amendment, alteration, change, repeal or
waiver (directly or indirectly, whether by amending the Certificate of
Incorporation or by way of merger, consolidation or otherwise or through a
certificate of designation) of any provision of this Article Eighth shall always
require the approval of the holders of at least (x) a majority of the Series B
Preferred Stock, voting on an as converted basis, and (y) a majority of the
Series A Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and
any Tekelec Designees), voting on an as converted basis; and (v) prior to the
Termination Date, any amendment, alteration, change, repeal or waiver (directly
or indirectly, whether by amending the Certificate of Incorporation or by way of
merger, consolidation or otherwise or through a certificate of designation) of
any provision of Section C.1(vi) of Article Fourth shall always require the
approval of the holders of at least (x) a majority of the Series B Preferred
Stock, voting on an as converted basis, and (y) a majority of the Series A
Preferred Stock (excluding Tekelec, its wholly owned subsidiaries and any
Tekelec Designees), voting on an as converted basis.

                                       35<PAGE>

                                                                    Exhibit 10.2

--------------------------------------------------------------------------------

                                ESCROW AGREEMENT

                                  BY AND AMONG

                                     TEKELEC

                              SANTERA SYSTEMS INC.,

                  CERTAIN STOCKHOLDERS OF SANTERA SYSTEMS INC.

                AUSTIN VENTURES VI, L.P., AS THE REPRESENTATIVE,

                                       AND

        J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, AS ESCROW AGENT

                           DATED AS OF APRIL 30, 2003

--------------------------------------------------------------------------------

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                             <C>
Article I Definitions......................................................................      2
         1.1    Definitions................................................................      2
         1.2    Usage Generally; Interpretation............................................      5

Article II Representative..................................................................      5
         2.1    Appointment................................................................      5
         2.2    Power and Authority........................................................      5
         2.3    Expenses...................................................................      6
         2.4    Notices....................................................................      6
         2.5    Resignation................................................................      6
         2.6    Indemnification of the Representative......................................      7

Article III Escrow.........................................................................      7
         3.1    Creation of Legacy Preferred Escrow........................................      7
         3.2    Creation of New Preferred Escrow...........................................      8
         3.3    Dividends and Other Distributions..........................................      8
         3.4    Reorganization.............................................................      8
         3.5    Global Certificates; Legends...............................................      8

Article IV Disposition of Escrowed Shares or Funds.........................................      9
         4.1    Dispositions During Escrow Period..........................................      9
         4.2    Setoff.....................................................................     11
         4.3    Distributions Following the Release Date...................................     12

Article V Transfer of Escrowed Shares; Registers...........................................     13
         5.1    Registration...............................................................     13
         5.2    Restrictions...............................................................     13
         5.3    Instrument of Accession....................................................     13

Article VI Escrow Agent....................................................................     13
         6.1    Duties.....................................................................     13
         6.2    Expenses...................................................................     14
         6.3    Resignation................................................................     15
         6.4    Disputes...................................................................     15
         6.5    Indemnification of the Escrow Agent........................................     15

Article VII Indemnification................................................................     15
         7.1    Indemnification by Tekelec.................................................     15
         7.2    Indemnification by the Legacy Santera Stockholders.........................     15

Article VIII Miscellaneous.................................................................     16
         8.1    Notices....................................................................     16
         8.2    Expenses...................................................................     17
         8.3    Binding Effect; Assignment.................................................     17
         8.4    Amendment; Waiver..........................................................     17
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                             <C>
         8.5    Counterparts...............................................................     18
         8.6    Headings...................................................................     18
         8.7    Severability...............................................................     18
         8.8    Governing Law..............................................................     18
         8.9    Further Assurances.........................................................     18
         8.10   Third Party Beneficiary....................................................     18
         8.11   Venue and Jurisdiction.....................................................     18
         8.12   Acknowledgement............................................................     18
</TABLE>

                                       ii

<PAGE>

                                ESCROW AGREEMENT

         This ESCROW AGREEMENT (the "Agreement") is entered into this 30th day
of April, 2003 by and among Tekelec, a California corporation ("Tekelec"),
Santera Systems Inc., a Delaware corporation ("Santera"), those legacy
stockholders of Santera who are listed on the signature pages of this Agreement,
as Legacy Santera Stockholders (together with any subsequent transferees thereof
or any other parties who execute an Instrument of Accession hereto as a Legacy
Santera Stockholder, the "Legacy Santera Stockholders"), Austin Ventures VI,
L.P., a Delaware limited partnership, as the Representative, as defined
hereunder, and J.P. Morgan Trust Company, National Association ("Escrow Agent").

                                    RECITALS

         A.       Concurrently herewith, Tekelec, Merger Sub, Santera and
certain of the Legacy Santera Stockholders are entering into that certain
Agreement and Plan of Merger (the "Merger Agreement"), pursuant to which the
operations of Tekelec's packet telephony business unit (the "PTBU") will be
combined with the business operations of Santera, together with additional cash
infusions.

         B.       On or prior to the Closing Date, as that term is defined in
the Merger Agreement, certain Legacy Santera Stockholders will contribute an
aggregate of Twelve Million Dollars ($12,000,000) in cash to Santera in exchange
for a combination of convertible notes and Series D Preferred Stock of Santera.

         C.       On or prior to the Closing Date, as that term is defined in
the Merger Agreement, Tekelec will, and will cause its subsidiaries to,
contribute the PTBU (including specified liabilities) and Twenty-Eight Million
Dollars ($28,000,000) in cash to Merger Sub in exchange for an aggregate of one
hundred (100) shares of common stock of Merger Sub.

         D.       Upon consummation of the merger contemplated by the Merger
Agreement, Tekelec and its subsidiaries will receive twenty-eight thousand
(28,000) shares of Series B Preferred Stock, $0.001 per share (the "Series B
Preferred Stock"), of Santera, thirty-eight thousand (38,000) shares of Series A
Preferred Stock, $0.001 per share (the "Series A Preferred Stock" and, together
with the Series B Preferred Stock, the "Preferred Stock"), of Santera and one
(1) share of Common Stock, $0.001 per share (the "Common Stock"), of Santera in
exchange for one hundred one (101) shares of common stock of Merger Sub, all
subject to and on the terms and conditions set forth in the Merger Agreement.

         E.       Upon consummation of the merger contemplated by the Merger
Agreement, certain stockholders of Santera existing immediately prior to the
merger will receive an aggregate of sixty-two thousand (62,000) shares of Series
A Preferred Stock of Santera in exchange for shares of Series A-2 Preferred
Stock, Series B-2 Preferred Stock, Series C-2 Preferred Stock and Series D
Preferred Stock of Santera, all subject to and on the terms and conditions set
forth in the Merger Agreement.

         F.       As of the Closing Date, Tekelec will own thirty-eight percent
(38%) of the issued and outstanding Series A Preferred Stock and all of the
issued and outstanding Common Stock and

<PAGE>

Series B Preferred Stock of Santera, and the Legacy Santera Stockholders will
collectively own sixty-two percent (62%) of the issued and outstanding Series A
Preferred Stock of Santera.

         G.       The Legacy Santera Stockholders have agreed to place all of
the shares of Series A Preferred Stock to be owned by them following the Merger
in escrows established hereunder, to be held pursuant to the terms and
conditions set forth in this Agreement and the Merger Agreement.

         NOW, THEREFORE, in consideration of the conditions and provisions
contained herein, the parties hereto hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         1.1      Definitions. The following terms shall, for purposes of this
Agreement, have the following meanings (terms defined in the singular or the
plural shall include the plural or the singular, as the case may be):

                  "Act" shall mean the Securities Act of 1933, as amended.

                  "Affiliate" shall mean a person or entity that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with, the person or entity referred to. In this definition,
"control" means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a person or entity,
whether through ownership of securities, by contract, or otherwise.

                  "Agreement" shall mean this Escrow Agreement, as the same may
be amended from time to time in accordance with the terms hereof.

                  "Amended and Restated Certificate of Incorporation" shall mean
the Amended and Restated Certificate of Incorporation of Santera in
substantially the form of attached as Exhibit K to the Merger Agreement, as the
same may be amended from time to time.

                  "Ancillary Agreements" shall have the meaning set forth in the
Merger Agreement.

                  "Change of Control" shall mean (1) the acquisition of Santera
by another entity by means of any transaction or series of related transactions
(including, without limitation, any merger, consolidation, reclassification,
recapitalization or other form of transaction in which outstanding shares of
Santera are exchanged for securities or other consideration issued, or caused to
be issued, by the acquiring entity or its subsidiary, but excluding any
transaction effected primarily for the purpose of changing Santera's
jurisdiction of incorporation) that results in the transfer or acquisition of
all of Santera's voting power to a third party that is not an Affiliate of a
stockholder of Santera, or (2) any sale or other disposition of all or
substantially all of the assets of Santera to a third party that is not an
Affiliate of a stockholder of Santera. Notwithstanding the foregoing, the
exercise of the call option by Tekelec under Section 3.1 of the Stockholders'
Agreement or the put option by the Legacy Santera Stockholders under Section 3.2
of the Stockholders' Agreement, a redemption under Section C.1(ii) of the
Amended and Restated Certificate of Incorporation or the merger contemplated by
the Merger Agreement shall not be treated as a Change of Control.

                                       2

<PAGE>

                  "Closing Date" shall have the meaning set forth in the Merger
Agreement.

                  "Dispute Notice" shall have the meaning set forth in Section
4.1(b) hereof.

                  "Disputed Amount" shall have the meaning set forth in Section
4.1(c) hereof.

                  "Disputed Shares" shall mean the number of shares of Series A
Preferred Stock, if any, to which the Disputed Amounts relate unless Tekelec
specifies a lower amount in a written notice to Santera.

                  "Distribution Directive" shall have the meaning set forth in
Section 4.1(c) hereof.

                  "Escrow Agent" shall have the meaning set forth in the
introduction hereto.

                  "Escrow Register" shall have the meaning set forth in Section
5.1 hereof.

                  "Indemnified Losses" shall have the meaning set forth in the
Merger Agreement.

                  "Instrument of Accession" shall mean that certain instrument
of accession to this Agreement, in substantially the form attached hereto as
Exhibit A.

                  "Legacy Preferred Account" shall have the meaning set forth in
Section 3.1 hereof.

                  "Legacy Santera Stockholders" shall have the meaning set forth
in the introduction hereto.

                  "Merger" shall mean the merger of Merger Sub with and into
Santera pursuant to the Merger Agreement and the consummation of the
transactions contemplated thereby.

                  "Merger Agreement" shall mean that Agreement and Plan of
Merger dated as of the date hereof among Tekelec, Merger Sub, Santera, certain
of the Legacy Santera Stockholders and the Representative.

                  "Merger Sub" shall mean Merger Sub, a Delaware corporation and
direct and wholly-owned subsidiary of Tekelec.

                  "New Preferred Account" shall have the meaning set forth in
Section 3.2 hereof.

                  "New Preferred Escrow Shares" shall have the meaning set forth
in Section 3.2 hereof.

                  "New Preferred Stock" shall mean those twelve thousand
(12,000) shares of Series A Preferred Stock to be issued to the Legacy Santera
Stockholders on the Closing Date which are attributable to the contributions by
such Legacy Santera Stockholders of an aggregate of Twelve Million Dollars
($12,000,000) in cash to Santera in exchange for an aggregate of Twelve Million
Dollars ($12,000,000) in principal amount of convertible promissory notes and
Series D Preferred Stock of Santera pursuant to the Note and Preferred Stock
Purchase Agreement (as such term is defined in the Merger Agreement).

                                       3

<PAGE>

                  "Option" with respect to any Person means any security, right,
subscription, warrant, option, call, right, "phantom" stock right or other
contract or arrangement that gives the right to (a) purchase or otherwise
receive or be issued any shares of capital stock of such Person or any security
of any kind convertible into or exchangeable or exercisable for any shares of
capital stock of such Person or (b) receive or exercise any benefits or rights
similar to any rights enjoyed by or accruing to the holder of shares of capital
stock of such Person, including any rights to participate in the equity or
income of such Person or to participate in or direct the election of any
directors or officers (or comparable Persons) of such Person or the manner in
which any shares of capital stock of such Person are voted.

                  "Person" shall mean an individual, sole proprietorship,
corporation, partnership, limited partnership, limited liability company, joint
venture, trust, statutory trust, unincorporated organization, mutual company,
joint stock company, estate, union, employee organization, bank, trust company,
land trust or other organization, whether or not a legal entity.

                  "Preferred Escrow Shares" shall have the meaning set forth in
Section 3.1 hereof.

                  "Preferred Stock" shall mean the Series A Preferred Stock and
the Series B Preferred Stock, collectively.

                  "Redemption Notice" shall have the meaning set forth in
Section 4.1(d) hereof.

                  "Release Date" shall mean the earliest of (i) the day after
the date that all shares of capital stock of Santera not owned by Tekelec, its
wholly owned subsidiaries or any Tekelec Designees, other than the Disputed
Shares, are redeemed pursuant to Article Fourth, Section C(1)(ii)(a)(I) or (II)
of the Amended and Restated Certificate of Incorporation, (ii) the day after the
date that Tekelec acquires all shares of capital stock of Santera not owned by
Tekelec, its wholly owned subsidiaries or any Tekelec Designees, other than
Disputed Shares, pursuant to the exercise of the call option by Tekelec or the
put option by the Representative, in each case pursuant to Article III of the
Stockholders' Agreement or (iii) March 1, 2008 provided that no stockholders of
Santera have (1) initiated the redemption of shares of capital stock of Santera
pursuant to Article Fourth Section C(1)(ii)(a)(I) or (II) of the Amended and
Restated Certificate of Incorporation by such date by delivering a Series B
Holder Redemption Notice or a Series A Holder Redemption Notice to Santera or
(2) exercised the put or call options pursuant to Article III of the
Stockholders' Agreement.

                  "Release Notice" shall have the meaning set forth in Section
4.1(a) hereof.

                  "Representative" shall mean Austin Ventures VI, L.P., who has
been appointed the representative of the Legacy Santera Stockholders hereunder
and under the Merger Agreement and all of the applicable Ancillary Agreements
and any successor thereto who may hereafter be appointed, in each case pursuant
to the terms of this Agreement,.

                  "Santera" shall mean Santera Systems Inc., a Delaware
corporation.

                  "Santera Indemnifying Person" shall have the meaning set forth
in the Merger Agreement.

                                       4

<PAGE>

                  "Series A Preferred Stock" shall mean the Series A Convertible
Preferred Stock, par value $0.001 per share, of Santera that is authorized under
the Amended and Restated Certificate of Incorporation.

                  "Series B Preferred Stock" shall mean the Series B Convertible
Preferred Stock, par value $0.001 per share, of Santera that is authorized under
the Amended and Restated Certificate of Incorporation.

                  "Stockholders' Agreement" shall mean that Stockholders'
Agreement dated as of the date hereof among Tekelec, Santera, the Legacy Santera
Stockholders and the Representative.

                  "Tekelec" shall mean Tekelec, a California corporation.

                  "Tekelec Indemnified Person" shall have the meaning set forth
in the Merger Agreement.

         1.2      Usage Generally; Interpretation. Whenever the context may
require, any pronoun includes the corresponding masculine, feminine and neuter
forms. All references herein to articles or sections shall be deemed to be
references to articles or sections of this Agreement unless the context
otherwise requires. Unless otherwise expressly provided herein, any agreement,
instrument or statute defined herein or referred to herein or in any agreement
or instrument that is referred to herein means such agreement, instrument or
statute, as from time to time amended, modified or supplemented, including (in
the case of agreements or instruments) by waiver or consent and (in the case of
statutes) by succession of comparable successor statutes and references to all
attachments thereto and instruments incorporated therein. Unless otherwise
expressly provided herein, all references to "as converted" or "as if converted"
shall mean assuming conversion of all then issued and outstanding shares of
Preferred Stock (including any or such shares that the holder thereof may not
yet have the right to convert into shares of Common Stock).

                                   ARTICLE II
                                 REPRESENTATIVE

         2.1      Appointment. Each Legacy Santera Stockholder hereby
irrevocably appoints (which appointment is coupled with an interest) Austin
Ventures VI, L.P., and Austin Ventures VI, L.P. hereby accepts such appointment,
as the Representative for purposes of this Agreement, the Merger Agreement and
under all of the applicable Ancillary Agreements.

         2.2      Power and Authority. Until the later of the Release Date, the
date on which the Stockholders' Agreement is terminated in accordance with its
terms or the date on which no shares of Series A Preferred Stock or other
property remains held in escrow hereunder, the Representative shall, and shall
have full power and authority to, exclusively act on behalf of each Legacy
Santera Stockholder in connection with all matters relating to this Agreement,
the Merger Agreement and the applicable Ancillary Agreements, including, without
limitation, exercising all of such stockholder's rights and powers in respect of
all shares of Series A Preferred Stock deposited hereunder, including, without
limitation, executing such stock powers or other instruments of transfer as may
be required hereunder, voting and/or determining whether or not to take part in
or consent to any corporate action of any kind whatsoever, receiving and
delivering at any time closing certificates or other documents, negotiating,
determining and settling all matters arising hereunder or

                                       5

<PAGE>

thereunder or related hereto or thereto (including, without limitation, any and
all claims and disputes (including, any allegations of breach of fiduciary duty)
related to the exercise of the redemption rights contained in, or otherwise with
respect to the amount to be paid to the Legacy Santera Stockholders in
connection with any redemption of shares of capital stock of Santera pursuant
to, Article Fourth, Section C(1)(ii)(a)(I) or (II) of the Amended and Restated
Certificate of Incorporation or related to the exercise of the put or call right
contained in, or with respect to the amount to be paid to the Legacy Santera
Shareholders in connection with any such exercise of the put or call options
contained in, Article III of the Stockholders' Agreement and any and all
indemnity matters). The Representative shall also have full power and authority
to give and receive notices by or on behalf of each Legacy Santera Stockholder.

         2.3      Expenses. The Representative shall be entitled to
reimbursement from the Legacy Santera Stockholders of all reasonable expenses
incurred in the performance of its duties as Representative under this
Agreement, the Merger Agreement and each of the Ancillary Agreements. To the
extent that expenses of the Representative remain unreimbursed by the Legacy
Santera Stockholders and shares of Series A Preferred Stock or other property
(in either case, other than any Disputed Shares or Disputed Amounts) remains in
the Legacy Preferred Account or the New Preferred Account on the Release Date,
the reimbursement obligations contained in this Section 2.3 shall be satisfied
by the Legacy Santera Stockholders from the Preferred Escrow Shares and/or the
New Preferred Escrow Shares (less, in either case, any Disputed Shares or
Disputed Amounts), as appropriate to the expenses being reimbursed, pro rata
from each such Legacy Santera Stockholder based on the percentages next to each
such Legacy Santera Stockholders' name on the Escrow Register for the Legacy
Preferred Stockholders under the column entitled "Percentage of Legacy Preferred
Shares" and/or "Percentage of New Preferred Shares," as the case may be, with
each share of Series A Preferred Stock having a value of $1,000.

         2.4      Notices. By giving notice to the Representative in the manner
provided by Section 8.1, a party shall be deemed to have given notice to all of
the Legacy Santera Stockholders and any action taken by the Representative may
be considered by any other party to be the action of each such Legacy Santera
Stockholder for all purposes, including for all purposes of this Agreement, the
Merger Agreement and the applicable Ancillary Agreements. In addition, the
Parties hereto acknowledge and agree that (i) none of the Legacy Santera
Stockholders shall be entitled to individually take any action which the
Representative is authorized hereunder to take on behalf of such Legacy Santera
Stockholders and (ii) the failure of the Representative to take any action it is
permitted or authorized to take hereunder on behalf of the Legacy Santera
Stockholders during the applicable time period in which such action is permitted
to have been taken by the Representative, including, without limitation,
providing any notice of dispute hereunder or under the Merger Agreement or
objecting to or otherwise making a claim with respect to or related to a
redemption of Series A Preferred Stock under the Amended and Restated
Certificate of Incorporation or an exercise of the put or call rights contained
in the Stockholders' Agreement, shall be deemed for all purposes to constitute a
complete waiver and release by each Legacy Santera Stockholder of the right to
individually take any such action.

         2.5      Resignation. In the event a Representative becomes unable or
refuses to serve, the Representative or a Legacy Santera Stockholder will
promptly notify the other parties hereto in writing of the designation by a
majority of the total Preferred Escrow Shares held by such Legacy Santera
Stockholders (by reference to the applicable Escrow Register), of a successor to
act as Representative hereunder and under the Merger Agreement and each of the
Ancillary Agreements.

                                       6

<PAGE>

No Representative shall resign as a Representative hereunder or under the Merger
Agreement or any of the Ancillary Agreements until such time as a successor
Representative has been approved and appointed by the relevant stockholders. In
the event the relevant stockholders fail to approve and appoint a successor
Representative, the Legacy Santera Stockholder possessing the largest percentage
of the total Preferred Escrow Shares (by reference to the applicable Escrow
Register) shall appoint the successor Representative hereunder. Until the Legacy
Santera Stockholder possessing the largest percentage of the total Preferred
Escrow Shares (by reference to the applicable Escrow Register) appoints a
successor Representative hereunder, such Legacy Stockholder so possessing the
largest percentage of the total Preferred Escrow Shares shall act as
Representative hereunder.

         2.6      Indemnification of the Representative. The Representative,
acting in such capacity, shall not incur any responsibility or liability for
reason of any error of law or with respect to anything done or suffered or
omitted, except for such Representative's own willful misconduct or gross
negligence in connection with or arising out of (a) this Agreement, the Merger
Agreement or the Ancillary Agreements or (b) the discharge by such
Representative of the Representative's duties hereunder or under the Merger
Agreement or the Ancillary Agreements. The Legacy Santera Stockholders shall
indemnify and hold harmless the Representative from and against any and all
claims, expenses and liabilities incurred by such Representative or asserted
against such Representative in connection with or arising out of (a) this
Agreement, the Merger Agreement or the Ancillary Agreements or (b) the discharge
by such Representative of the Representative's duties hereunder or under the
Merger Agreement or the Ancillary Agreements, except, in either case, for such
Representative's willful misconduct or gross negligence in such matters. The
Representative shall not be required to give any bond or other security for the
discharge of such Representative's duties hereunder or under the Merger
Agreement or the Ancillary Agreements. To the extent that indemnification
obligations of the Legacy Santera Stockholders to the Representative remain and
shares of Series A Preferred Stock or other property (in either case, other than
any Disputed Shares or Disputed Amounts) remains in the Legacy Preferred Account
or the New Preferred Account on the Release Date, the indemnification
obligations contained in this Section 2.6 shall be satisfied by the Legacy
Santera Stockholders from the Preferred Escrow Shares and/or the New Preferred
Escrow Shares (less, in either case, any Disputed Shares or Disputed Amounts),
as appropriate to the indemnification being paid, pro rata from each such Legacy
Santera Stockholder based on the percentages next to each such Legacy Santera
Stockholders' name on the Escrow Register for the Legacy Preferred Stockholders
under the column entitled "Percentage of Legacy Preferred Shares" and/or
"Percentage of New Preferred Shares," as the case may be, with each share of
Series A Preferred Stock having a value of $1,000.

                                   ARTICLE III
                                     ESCROW

         3.1      Creation of Legacy Preferred Escrow. Each Legacy Santera
Stockholder hereby directs Santera to deposit with the Escrow Agent on the
Closing Date all of the shares of Series A Preferred Stock to which such Legacy
Santera Stockholder is entitled upon consummation of the Merger, other than the
New Preferred Stock (the "Preferred Escrow Shares"), which shares of Series A
Preferred Stock shall be held hereunder in a separate account known as the
"Legacy Preferred Account". All such shares of Series A Preferred Stock to be
deposited with the Escrow Agent hereunder shall be duly endorsed, or accompanied
by such instruments of transfer as to enable the Escrow Agent to cause such
certificates to be transferred into the name of the Representative, as

                                       7

<PAGE>

hereinafter provided. The parties acknowledge that the shares held in escrow
hereunder may be increased or decreased from time to time during the term hereof
pursuant to the terms of this Agreement. Accordingly, the term "Preferred Escrow
Shares" shall refer to the shares of Series A Preferred Stock initially placed
in escrow hereunder by the Legacy Santera Stockholders other than the New
Preferred Stock and to such greater or lesser shares as may be held pursuant
hereto at any point during the term hereof.

         3.2      Creation of New Preferred Escrow. Each Legacy Santera
Stockholder hereby directs Santera to deposit with the Escrow Agent on the
Closing Date all of the New Preferred Stock to be issued to such Legacy Santera
Stockholder upon consummation of the Merger (the "New Preferred Escrow Shares"),
which shares shall be held hereunder in a separate account known as the "New
Preferred Account." All such shares of Series A Preferred Stock to be deposited
with the Escrow Agent hereunder shall be duly endorsed, or accompanied by such
instruments of transfer as to enable the Escrow Agent to cause such certificates
to be transferred into the name of the Representative, as hereinafter provided.
The parties acknowledge that the shares held in escrow hereunder may be
increased or decreased from time to time during the term hereof pursuant to the
terms of this Agreement. Accordingly, the term "New Preferred Escrow Shares"
shall refer to the shares of New Preferred Stock initially placed in escrow
hereunder and to such greater or lesser shares as may be held pursuant hereto at
any point during the term hereof.

         3.3      Dividends and Other Distributions. If, at any time prior to
the release of the Preferred Escrow Shares and/or the New Preferred Escrow
Shares hereunder, any dividend or other distribution (including, without
limitation, any cash or stock dividend or other distribution) in respect of the
Series A Preferred Stock is paid to the holders of the Series A Preferred Stock,
the Representative, as the record holder of such shares of Series A Preferred
Stock, shall receive and deliver to the Escrow Agent any such dividends or
distributions to hold any such cash, stock or other property hereunder. All
cash, stock or other property received by the Escrow Agent (i) with respect to
the Preferred Escrow Shares shall be held in the Legacy Preferred Account and
(ii) with respect to the New Preferred Escrow Shares shall be held in the New
Preferred Account.

         3.4      Reorganization. In the event of a Change of Control prior to
the Release Date, the Representative shall receive and deliver to the Escrow
Agent to hold under this Agreement any property received on account of the
ownership of the Preferred Escrow Shares held hereunder prior to such Change of
Control.

         3.5      Global Certificates; Legends. All certificates of Series A
Preferred Stock transferred and delivered to the Escrow Agent pursuant to this
Agreement shall promptly be surrendered by the Escrow Agent to Santera and
cancelled, and new global certificates, one for each of the Preferred Escrow
Shares and the New Preferred Escrow Shares, shall promptly be issued in the name
of the Representative, as nominee for the Legacy Santera Stockholders. The
Representative shall promptly deliver to the Escrow Agent to be held hereunder,
such new global certificates along with blank stock powers in substantially the
form attached hereto as Exhibit B and other instruments of transfer signed by
such Representative for purposes of enabling the Escrow Agent to transfer the
Preferred Escrow Shares and the New Preferred Escrow Shares in accordance with
the terms hereof. From time to time during the term of this Agreement, the
Representative shall, upon the reasonable request of the Escrow Agent, Tekelec
or Santera, execute such additional blank stock powers or other instruments of
transfer and deliver the same to the Escrow Agent to be held by such Escrow
Agent in order to ensure that such Escrow Agent can promptly and timely take all

                                       8

<PAGE>

actions required by the Escrow Agent to be taken hereunder. Each of such new
global certificates shall include the following legend:

         THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF
         AN ESCROW AGREEMENT DATED APRIL 30, 2003, AS AMENDED FROM TIME TO TIME,
         A COPY OF WHICH IS ON FILE AT THE OFFICE OF SANTERA SYSTEMS INC.

This legend shall be in addition to any other legends which are required by
federal or state laws (including, but not limited to any legend required by the
Act or state "blue sky" laws, or any rule or regulation thereunder), by the
Stockholders' Agreement or as otherwise may be reasonably required by the Escrow
Agent.

                                   ARTICLE IV
                     DISPOSITION OF ESCROWED SHARES OR FUNDS

         4.1      Dispositions During Escrow Period.

                  (a)      If Tekelec claims that a Tekelec Indemnified Person
has suffered Indemnified Losses for which it is entitled to indemnification from
Santera pursuant to Section 7.2 hereof or Section 11.2 of the Merger Agreement
at any time prior to the Release Date when shares of Series A Preferred Stock or
other property remains in the Legacy Preferred Account, Tekelec shall deliver
the written notice required by Section 11.3(b) of the Merger Agreement (any
notice from Tekelec under this Section 4.1 shall be referred to as a "Release
Notice") to the Representative and the Escrow Agent to release from the Legacy
Preferred Account and transfer to Santera shares of Series A Preferred Stock (or
other property held in such escrow if no shares of Series A Preferred Stock then
remain in any such account) in an amount equal to the amount of such claim. The
parties hereto acknowledge and agree that all shares of Series A Preferred Stock
shall be valued for all purposes at $1,000 per share (as adjusted for any stock
dividends, combinations, reverse stock splits, stock splits, recapitalizations,
reorganizations, reclassifications or other similar event with respect to the
Series A Preferred Stock). All other property contained in any escrow hereunder
shall be valued in good faith as mutually agreed by Tekelec and the
Representative, and such parties agree to promptly advise the Escrow Agent of
the value of any such property.

                  (b)      Any notice delivered to the Representative and the
Escrow Agent under this Section 4.1 shall specifically identify the amount of
the claim (to the extent known) and the aggregate number of shares of Series A
Preferred Stock or, if no shares of Series A Preferred Stock then remain in any
such account, the value of other property, in either case, to be transferred by
the Escrow Agent to Santera from the Legacy Preferred Account. If the
Representative does not notify Tekelec and the Escrow Agent that it disputes the
validity or amount of such claim in a writing signed by the Representative
containing a description in reasonable detail of the basis (to the extent the
Representative has knowledge thereof, or to the extent the Representative does
not have such knowledge at the time of the notice, by stating that the
Representative has a good faith basis after a reasonable investigation to
dispute the validity or amount of such claim, as evidenced by a certificate
signed by the Representative to such effect) for the dispute and the amount in
dispute (a "Dispute Notice"), within thirty (30) calendar days after Tekelec has
provided the Representative with its Release Notice, then the Escrow Agent shall
promptly transfer to Santera from the Legacy Preferred Account the aggregate
number of shares of Series A Preferred Stock set forth in the Release Notice

                                       9

<PAGE>

by delivering to Santera the global stock certificate then representing such
Preferred Escrow Shares, together with a stock power and/or such other
instruments of transfer as reasonably requested by Santera or Tekelec, in either
case, as executed by the Representative and held by the Escrow Agent in escrow
hereunder and as completed by the Escrow Agent to represent the number of shares
of Series A Preferred Stock to be so transferred to Santera hereunder, or, if no
such shares of Series A Preferred Stock then remain in any such account but
other property does so remain, such other property having a value equal to the
value of such number of shares of Series A Preferred Stock. Promptly upon its
receipt of such global stock certificate and transfer documentation from the
Escrow Agent, Santera shall prepare and deliver to the Escrow Agent a new global
stock certificate representing the number of shares of Series A Preferred Stock
not transferred to Santera pursuant to such transfer documentation. The parties
acknowledge that there may be multiple Release Notices given by Tekelec during
the term hereof and that any Release Notice may be amended by Tekelec from time
to time on or prior to the Release Date (e.g., to increase or decrease the
claimed amount stated therein), any such amendment being effective as of and
from the date of delivery thereof to the Representative and the Escrow Agent.

                  (c)      In the event that a Dispute Notice signed by the
Representative has been provided to Tekelec and the Escrow Agent within the
required thirty (30) calendar day period, the Escrow Agent shall promptly (i)
deliver to Santera the global stock certificate then representing such Preferred
Escrow Shares, together with a stock power and/or such other instruments of
transfer as reasonably requested by Santera or Tekelec, in either case, as
executed by the Representative and held by the Escrow Agent in escrow hereunder
and as completed by the Escrow Agent to represent that number of shares of
Series A Preferred Stock with a value equal to the undisputed portion (if any)
of the amount set forth in the Release Notice, or if no shares of Series A
Preferred Stock then remain in escrow, such other property having a value equal
to such undisputed portion, and (ii) withhold the shares of Series A Preferred
Stock or such other property in an amount equal to the amount in dispute (the
"Disputed Amount"), which shares of Series A Preferred Stock or other property
shall be distributed in accordance with this Section 4.1(c). Promptly upon its
receipt of such global stock certificate and transfer documentation from the
Escrow Agent, Santera shall prepare and deliver to the Escrow Agent a new global
stock certificate representing the number of shares of Series A Preferred Stock
not transferred to Santera pursuant to such transfer documentation. The Disputed
Amount shall be held by the Escrow Agent in accordance with the terms hereof
until the earlier to occur of the following: (i) the Representative and Tekelec
jointly direct the transfer of shares or other property with a value equal to
the Disputed Amount by delivering written instruction to the Escrow Agent, or
(ii) the Escrow Agent receives a copy of a final judgment or order of a court of
competent jurisdiction (a "Distribution Directive") with respect to the Disputed
Amount (which judgment or order shall also be delivered by Tekelec to the
Representative or by the Representative to Tekelec, as the case may be). Upon
receipt of such instructions, or as promptly as practicable but in no event more
than fifteen (15) calendar days after receipt of such Distribution Directive,
the Escrow Agent shall deliver to Santera the global stock certificate then
representing such Preferred Escrow Shares, together with a stock power and/or
such other instruments of transfer as reasonably requested by Santera or
Tekelec, in either case, as executed by the Representative and held by the
Escrow Agent in escrow hereunder and as contemplated by the Escrow Agent to
represent that number of shares of Series A Preferred Stock (valued at $1,000
per share, as adjusted for any stock dividends, combinations, reverse stock
splits, stock splits, recapitalizations, reorganizations, reclassifications or
other similar event with respect to the Series A Preferred Stock) with an
aggregate value equal to the amount indicated in the Distribution Directive, or
if no shares of Series A Preferred Stock then remain in escrow, such other

                                       10

<PAGE>

property having an aggregate value equal to such amount. If no shares of Series
A Preferred Stock remain, the other property remaining in such account, having a
value equal to the Disputed Amount, shall be distributed to Santera. Promptly
upon its receipt of such global stock certificate and transfer documentation
from the Escrow Agent, Santera shall prepare and deliver to the Escrow Agent a
new global stock certificate representing the number of shares of Series A
Preferred Stock not transferred to Santera pursuant to such transfer
documentation, and Santera shall retire the transferred shares.

                  (d)      If at any time on or prior to the Release Date, the
Escrow Agent shall receive a written notice (i) from Tekelec which states that
Tekelec has exercised its call right under Article III of the Stockholders'
Agreement, (ii) from the Representative that the put right under Article III of
the Stockholders' Agreement has been exercised or (iii) from Santera that it
intends to redeem the shares of Series A Preferred Stock pursuant to the Article
Fourth Section C(1)(ii)(a) of the Amended and Restated Certificate of
Incorporation (each such notice in (i), (ii), or (iii), a "Redemption Notice"),
the Escrow Agent shall continue to hold in escrow the Preferred Escrow Shares
and the New Preferred Escrow Shares until (A) it shall receive further
instructions as to the disposition of such shares in writing signed by Tekelec
and the Representative (and the parties agree that, unless otherwise directed by
Tekelec, the Escrow Agent shall continue to hold a sufficient number of shares
of Series A Preferred Stock held in the Legacy Preferred Account (including any
fractions thereof) to satisfy any Disputed Amounts hereunder, notwithstanding
any redemption or transfer otherwise contemplated by the terms of the Amended
and Restated Certificate of Incorporation or the Stockholders' Agreement) or (B)
it shall be otherwise ordered by a Distribution Directive. Tekelec and the
Representative hereby agree (promptly following the delivery of a Redemption
Notice to the Escrow Agent) to jointly prepare and deliver instructions to the
Escrow Agent that are designed to permit and facilitate the closing of any
purchase and sale or redemption referenced in such Redemption Notice in
accordance with the terms of the Stockholders' Agreement or the Amended and
Restated Certificate of Incorporation, as the case may be; provided, that the
parties agree that, unless otherwise directed by Tekelec, the Escrow Agent shall
continue to hold a sufficient number of shares of Series A Preferred Stock
(including any fractions thereof) to satisfy any Disputed Amounts hereunder,
notwithstanding any redemption or transfer otherwise contemplated by the terms
of the Amended and Restated Certificate of Incorporation or the Stockholders'
Agreement.

         4.2      Setoff. Tekelec shall be entitled to setoff, and/or at any
time following the Closing, cause Santera to setoff, (i) any amount that Tekelec
claims Santera owes it under Article XI of the Merger Agreement, including any
amounts owed pursuant to that letter agreement dated April 30, 2003, against (x)
any amounts owed by Tekelec to Santera (other than amounts owed by Tekelec to
Santera as indemnification payments pursuant to Article XI of the Merger
Agreement or upon exercise of the Tekelec Option (as defined in the
Stockholders' Agreement) pursuant to the Stockholders' Agreement) or to any of
the Legacy Santera Stockholders under this Agreement, the Merger Agreement or
the Stockholders' Agreement or (y) after the Closing, any amounts owed by
Santera to the Legacy Santera Stockholders upon redemption of shares of Series A
Preferred Stock under the Amended and Restated Certificate of Incorporation
and/or (ii) any amount that Tekelec claims a Legacy Santera Stockholder owes it
or Santera under the Merger Agreement against (x) any amounts owed by Tekelec to
Santera (other than amounts owed by Tekelec to Santera as indemnification
payments pursuant to Article XI of the Merger Agreement or upon exercise of the
Tekelec Option (as defined in the Stockholders' Agreement) pursuant to the
Stockholders' Agreement) or to any such Legacy Santera Stockholder under this
Agreement, the Merger

                                       11

<PAGE>

Agreement or the Stockholders' Agreement or (y) after the Closing, any amounts
owed by Santera to any such Legacy Santera Stockholder upon redemption of shares
of Series A Preferred Stock under the Amended and Restated Certificate of
Incorporation; provided, in any such case, that Tekelec informs the
Representative in writing of such proposed setoff in advance of such setoff and
describes the grounds upon which Tekelec claims the right to make such setoff
(or cause Santera to make such setoff) and provides the Representative a
reasonable opportunity to contest such setoff. If the Representative disputes
such setoff, it shall notify Tekelec thereof within thirty (30) days after
receipt of the notice of setoff, whereupon Tekelec and the Representative shall
meet and attempt in good faith to resolve their differences with respect to such
claimed right of setoff. If the dispute has not been resolved within thirty (30)
days after such Parties first meet to attempt such resolution, any Party may
initiate litigation in accordance with this Agreement. This Section 4.2 does not
create any independent obligation of a Party to Tekelec, nor shall this Section
4.2 circumvent the limitations set forth in Sections 11.5, 11.6, 11.8 and 11.9
of the Merger Agreement.

         4.3      Distributions Following the Release Date.

                  (a)      Promptly following the Release Date (and in any event
no later than 15 calendar days thereafter), but in any event subject to the
proviso at the end of this sentence, the Escrow Agent shall release (i) to
Santera a certificate representing the shares of Series A Preferred Stock then
remaining in the Legacy Preferred Account, and Santera shall promptly issue to
each Person listed on the Escrow Register for the Legacy Santera Stockholders a
certificate representing such Person's pro rata portion of such shares, computed
in accordance with the percentages set forth next to such Person's name on the
Escrow Register for the Legacy Santera Stockholders under the column entitled
"Percentage of Legacy Preferred Shares" and (ii) to each Legacy Santera
Stockholder, such Person's pro rata portion of such other cash, stock or other
property then remaining in the Legacy Preferred Account, computed in accordance
with the percentages set forth next to such Person's name on the Escrow Register
for the Legacy Santera Stockholders under the column entitled "Percentage of
Legacy Preferred Shares;" provided, however, in each of the cases (i) and (ii),
the Escrow Agent shall retain (and not deliver to Santera or such stockholders)
shares of Series A Preferred Stock (including, if applicable, any fractions
thereof), and if there is not a sufficient number of shares of Series A
Preferred Stock, cash, stock or other property, in either case, in an amount in
the aggregate equal to all Disputed Amounts outstanding on the Release Date
which have not been resolved in accordance with Section 4.1. Tekelec and the
Representative shall use their respective commercially reasonable efforts to
resolve all disputes or claims as punctually as possible following the Release
Date and upon such resolution, such parties shall promptly deliver written
notice to the Escrow Agent with instructions for disposition of such shares of
Series A Preferred Stock, or fractions thereof, and such other property.

                  (b)      Promptly following the Release Date, the Escrow Agent
shall release (i) to Santera a certificate representing the New Preferred Escrow
Shares, and Santera shall promptly issue to each Person listed on the Escrow
Register for the Legacy Santera Stockholders a certificate representing such
Person's pro rata portion of the New Preferred Escrow Shares, computed in
accordance with the percentages set forth next to such Person's name on the
Escrow Register for the Legacy Santera Stockholders under the columns entitled
"Percentage of New Preferred Escrow Shares" and (ii) to each Legacy Santera
Stockholder, such Person's pro rata portion of such other cash, stock or other
property then remaining in the New Preferred Account, computed in accordance
with the percentages set forth next to such Person's name on the Escrow Register
for the Legacy Santera Stockholders under the columns entitled "Percentage of
New Preferred Shares."

                                       12

<PAGE>

                                    ARTICLE V
                     TRANSFER OF ESCROWED SHARES; REGISTERS

         5.1      Registration. The Escrow Agent shall keep or cause to be kept
a register or registers (each, an "Escrow Register") for the purpose of
registering the transfers or exchanges of the Preferred Escrow Shares or the New
Preferred Escrow Shares. Upon request of the Escrow Agent and immediately
following any transfer or exchange thereof, Santera shall furnish or cause to be
furnished to the Escrow Agent a list, in such form as the Escrow Agent may
reasonably require, of the name of each Legacy Santera Stockholder and the
percentage of the Preferred Escrow Shares or the New Preferred Escrow Shares, as
the case may be, allocated to each such Legacy Santera Stockholder. The initial
Escrow Register for the Preferred Escrow Shares is set forth on Exhibit C
hereto, and the initial Escrow Register for the New Preferred Escrow Shares is
set forth on Exhibit D hereto.

         5.2      Restrictions. No Legacy Santera Stockholder shall sell,
assign, give, pledge, encumber, dispose or otherwise transfer ownership of any
right, title or interest to all or any portion of the Series A Preferred Stock
deposited with the Escrow Agent hereunder, by operation of law or otherwise,
except in accordance with the Stockholders' Agreement. Upon receipt of
satisfactory evidence of such compliance and transfer from a Legacy Santera
Stockholder, Santera shall reflect such transfer on its books and records and
shall notify the Escrow Agent of such transfer and instruct the Escrow Agent to
make a corresponding adjustment to the applicable Escrow Register.

         5.3      Instrument of Accession. Every stockholder of Santera who is
not an original signatory to this Agreement and, unless such new stockholder is
a wholly-owned subsidiary of Tekelec, every person who becomes a stockholder of
Santera after date hereof as a result of the transfer or other disposition of
shares of Series A Preferred Stock by a Legacy Santera Stockholder shall, as a
condition to becoming a stockholder, become a party to this Agreement by signing
an Instrument of Accession hereto. No Person shall be entitled to receive any
shares of stock of Santera through transfer from another stockholder or
otherwise until Santera has received an Instrument of Accession signed by such
Person, and no transfer or other disposition of shares of stock shall be
effective for any purpose hereunder unless and until recorded on the applicable
Escrow Register.

                                   ARTICLE VI
                                  ESCROW AGENT

         6.1      Duties.

                  (a)      This Agreement sets forth, exclusively, the duties of
the Escrow Agent and no additional duties or obligations shall be inferred
herefrom or implied hereby.

                  (b)      The Escrow Agent shall not be responsible for the
validity of any documents or other property delivered to it pursuant hereto, may
act and rely conclusively upon any instrument or signature believed by it to be
genuine and may assume that any person purporting to give any notice or
instructions hereunder, believed by the Escrow Agent to be authorized, has been
duly authorized so to do.

                                       13

<PAGE>

                  (c)      The Escrow Agent shall not be liable for any error of
judgment, or for any act done or step taken or omitted by it in good faith, or
for any mistake of fact or law, or for anything which it may in good faith do or
refrain from doing in connection herewith, except to the extent that any act or
omission constitutes gross negligence or willful misconduct. In no event shall
the Escrow Agent be liable for special, indirect or consequential loss or damage
of any kind whatsoever (including, but not limited to, lost profits), even if
the Escrow Agent has been advised of such loss or damage and regardless of the
form of action.

                  (d)      The Escrow Agent may consult with, and obtain advice
from, legal counsel in the event of any dispute or question as to the
construction of any of the provisions hereof or its duties hereunder, and it
shall incur no liability and shall be fully protected in acting in good faith in
accordance with the advice of such counsel.

                  (e)      The Escrow Agent shall not be bound by any
modification of this Escrow Agreement unless it shall have specifically
consented thereto in writing.

                  (f)      In the event any instructions (including any fund
transfer instructions) are given to the Escrow Agent hereunder (other than in
writing at the time of execution of this Agreement), whether in writing, by
facsimile or otherwise, the Escrow Agent is authorized to seek confirmation of
such instructions by telephone call-back to the person or persons designated on
Exhibit E attached hereto, and the Escrow Agent may rely upon the confirmations
of anyone purporting to be the person or persons so identified. If the Escrow
Agent is unable to contact any of the authorized representatives identified in
Exhibit E, the Escrow Agent is hereby authorized to seek confirmation of such
instructions by telephone call-back to any one or more of the executive officers
of Santera, Tekelec or the Representative, as the case may be, which shall
include the titles of Chief Executive Officer, Chief Financial Officer, General
Partner or General Counsel, as the Escrow Agent may select. Each such executive
officer shall deliver to the Escrow Agent a fully executed incumbency
certificate within forty-five (45) days after the date of this Agreement and
shall update the same when and as requested by the Escrow Agent, and the Escrow
Agent may rely upon the confirmation of anyone purporting to be any such
officer. The persons and telephone numbers for call-backs may be changed only in
writing actually received and acknowledged by the Escrow Agent. The parties
hereto hereby acknowledge that the foregoing security procedure is commercially
reasonable.

                  (g)      The Escrow Agent and the beneficiary bank in any
transfer hereunder (including any funds transfer hereunder) may rely solely upon
any account numbers or similar identifying number provided by any of the other
parties hereto to identify: (i) the beneficiary, (ii) the beneficiary's bank or
(iii) an intermediary bank. The Escrow Agent may apply any of the escrowed funds
for any payment order it executes using any such identifying number, even where
its use may result in a person other than the beneficiary being paid, or the
transfer of funds to a bank other than the beneficiary's bank or an intermediary
bank.

         6.2      Expenses. Santera shall upon demand pay to the Escrow Agent
(i) the amount of all reasonable expenses, including the reasonable fees and
expenses of counsel, which the Escrow Agent may incur, and (ii) the Escrow
Agent's normal fees for all services rendered, in each case in connection with
the discharge of the Escrow Agent's duties, and the exercise or enforcement of
the rights of the parties hereunder.

                                       14

<PAGE>

         6.3      Resignation. The Escrow Agent may resign by giving written
notice in writing to Tekelec, Santera and the Representative of such
resignation, specifying a date which such resignation shall take effect, which
shall in no event be earlier than sixty (60) days after the giving of such
notice, and shall be discharged from its duties and obligations upon the
appointment of a successor Escrow Agent as hereafter provided and the delivery
to such successor of the Escrow Amount. Immediately upon receipt of such notice,
Tekelec, Santera and the Representative shall appoint a successor Escrow Agent
who shall be mutually acceptable to them. Any such successor Escrow Agent shall
deliver to Tekelec, Santera and the Representative and to the resigning Escrow
Agent a written instrument accepting such appointment hereunder, and thereupon
it shall succeed to all the rights and duties of the Escrow Agent hereunder, and
shall be entitled to receive the Preferred Escrow Shares and the New Preferred
Escrow Shares. In the event that a successor Escrow Agent shall not be so
appointed by the date of resignation specified by the Escrow Agent, the Escrow
Agent shall have the right to appoint as a successor Escrow Agent any national
bank, and the parties hereto agree to accept any such successor Escrow Agent
appointed by the Escrow Agent.

         6.4      Disputes. In the event of any dispute between Tekelec, Santera
or the Representative, or between the Escrow Agent and any one or more of the
other parties hereto, with regard to the Escrow Agent or its duties, or any
other matter concerning the disposition of the Preferred Escrow Shares or the
New Preferred Escrow Shares or in the event that the Escrow Agent, in good
faith, is in doubt as to what action it should take hereunder, the Escrow Agent
may deposit the Preferred Escrow Shares and the New Preferred Escrow Shares with
any court described in Section 12.17 of the Merger Agreement pending the
decision of such court, and the Escrow Agent shall be entitled to refrain from
action pending, and rely upon, the decision of such court. The rights of the
Escrow Agent under this Section 6.4 are cumulative of all other rights which it
may have by law or otherwise.

         6.5      Indemnification of the Escrow Agent. Tekelec, Santera and the
Legacy Santera Stockholders hereby agree, jointly and severally, to indemnify
and hold the Escrow Agent harmless against and from any loss, liability or
expense incurred without gross negligence or willful misconduct on its part and
arising out of or in connection with its services hereunder.

                                   ARTICLE VII
                                 INDEMNIFICATION

         7.1      Indemnification by Tekelec. Tekelec hereby agrees to hold the
Representative, Santera and the Legacy Santera Stockholders harmless and
indemnify each of them from and against (i) any and all claims, losses, damages,
liabilities, expenses or costs incurred by any of them to the extent resulting
from or arising out of any claim by the Escrow Agent pursuant to Section 6.5
hereof as a result of a claim made by Tekelec against such Escrow Agent and (ii)
Tekelec's proportionate share (calculated by reference to Tekelec's ownership of
Santera at the time of any such claim) of any and all claims, losses, damages,
liabilities, expenses or costs incurred by any of them to the extent resulting
from or arising out of any claim by the Escrow Agent pursuant to Section 6.5
hereof as a result of a claim made by Santera against such Escrow Agent.

         7.2      Indemnification by the Legacy Santera Stockholders. The Legacy
Santera Stockholders hereby agree, jointly and severally, to hold Tekelec and
Santera harmless and indemnify each of them from and against any and all claims,
losses, damages, liabilities, expenses or costs incurred by either of them to
the extent resulting from or arising out of any claim by the Escrow

                                       15

<PAGE>

Agent pursuant to Section 6.5 hereof as a result of any matter other than as a
result of a claim made by Tekelec or Santera against such Escrow Agent pursuant
to Section 7.1 hereof. To the extent that shares of Series A Preferred Stock or
other property remains in the Legacy Preferred Account, the indemnification
obligations contained in this Section 7.2 shall be satisfied by the Legacy
Santera Stockholders, pro rata from each such Legacy Santera Stockholder based
on the percentages next to each such Legacy Santera Stockholders' name on the
Escrow Register for the Legacy Preferred Stockholders under the column entitled
"Percentage of Legacy Preferred Shares", all in accordance with the provisions
of Section 4.1 hereof.

                                  ARTICLE VIII
                                  MISCELLANEOUS

         8.1      Notices. All notices, consents, approvals, requests and other
communications hereunder shall be in writing and shall be deemed given when
delivered personally, one (1) day after being delivered to an overnight courier
or when telecopied (with a confirmatory copy sent by overnight courier) to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):

         If to Santera, to:

         Santera Systems Inc.
         3601 East Plano Parkway, #100
         Plano, Texas 75704
         Attention: President
         Facsimile No.: (972) 461-7512

         with copies to:

         Munsch Hardt Kopf & Harr P.C.
         1445 Ross Avenue, Suite 4000
         Dallas, Texas 75202
         Attention: A. Michael Hainsfurther
         Facsimile No.: (214) 855-7584

         If to Tekelec, to:

         Tekelec
         26580 West Agoura Road
         Calabasas, California 91302
         Attention: President
         Facsimile No.: (818) 880-0176

         with copies to:

         Ronald W. Buckly
         Tekelec
         26850 West Agoura Road
         Calabasas, California 91302

                                       16

<PAGE>

         Facsimile No.: (818) 880-0176

         and

         Bryan Cave LLP
         One Metropolitan Square
         211 North Broadway, Suite 3600
         St. Louis, Missouri 63102
         Attention: J. Mark Klamer and Katherine F. Ashton
         Facsimile No.: (314) 259-2020

         If to the Legacy Santera Stockholders, to the Representative:

         Austin Ventures VI, L.P.
         2435 North Central Expressway, Suite 1600
         Richardson, Texas 75080
         Attention: Edward E. Olkkola
         Facsimile No.: (972)-892-3701

         with a copy to:

         Wilson Sonsini Goodrich & Rosati, Professional Corporation
         8911 Capital of Texas Highway North
         Westech 360, Suite 3350
         Austin, Texas 78759
         Attention: Paul R. Tobias
         Facsimile No.: (512) 338-5499

         If to the Escrow Agent:

         J.P. Morgan Trust Company, National Association
         560 Mission Street, 13th Floor
         San Francisco, California 94105
         Attention: Karen Lei
         Facsimile No.: (415) 315-7585

         8.2      Expenses Except as otherwise provided in this Agreement or the
Merger Agreement, each party hereto will pay its own costs and expenses incurred
in connection with the negotiation, execution and performance of this Agreement
and the transactions contemplated hereby.

         8.3      Binding Effect; Assignment. This Agreement shall be binding
upon and inure to the benefit of the respective successors and permitted assigns
of the parties hereto.

         8.4      Amendment; Waiver. No modification, amendment or waiver of any
provision of this Agreement will be effective unless such modification,
amendment or waiver is approved in writing by Santera, Tekelec, the Legacy
Santera Stockholders who own a majority in interest of the capital stock of
Santera owned by all Legacy Santera Stockholders, calculated on an as converted

                                       17

<PAGE>

basis, and the Escrow Agent. The failure of any party to enforce any of the
provisions of this Agreement will in no way be construed as a waiver of such
provisions and will not affect the right of such party thereafter to enforce
each and every provision of this Agreement in accordance with its terms.

         8.5      Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but all of which shall
constitute one and the same instrument. All signatures of the parties hereto may
be transmitted by facsimile, and such facsimile will, for all purposes, be
deemed to be the original signature of such party whose signature it reproduces
and will be binding upon such party.

         8.6      Headings The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.

         8.7      Severability. If any provision of this Agreement shall be
determined to be illegal or unenforceable, the remaining provisions of this
Agreement shall remain in full force and effect, and this Agreement shall be
construed as if the illegal or unenforceable provision were not a part hereof,
so long as the remaining provisions of this Agreement shall be sufficient to
carry out the overall intent of the parties as expressed herein.

         8.8      Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard
to its conflicts of law doctrine.

         8.9      Further Assurances. Each party hereto shall perform all other
acts and execute and deliver all other documents as may be necessary or
appropriate to carry out the purposes and intent of this Agreement.

         8.10     Third Party Beneficiary. Nothing set forth in this Agreement
shall be construed to confer any benefit to any third party who is not a party
to this Agreement.

         8.11     Venue and Jurisdiction. Any disputes arising out of, in
connection with or with respect to this Agreement, the subject matter hereof,
the performance or non-performance of any obligation hereunder, or any of the
transactions contemplated hereby shall be adjudicated as set forth in Section
12.17 of the Merger Agreement.

         8.12     Acknowledgement. Tekelec, Santera and each of the Legacy
Santera Stockholders acknowledge and agree that in determining whether a Tekelec
Indemnified Person has incurred Indemnified Losses with respect to any
particular matter, and in calculating the amount of the Indemnified Losses that
a Tekelec Indemnified Person is entitled to hereunder or under the Merger
Agreement with respect to any such matter, all of the Indemnified Losses
incurred by Santera and/or the Surviving Corporation, as that term is defined in
the Merger Agreement, other than those Indemnified Losses with respect to which
Santera and/or the Surviving Corporation is entitled to indemnification pursuant
to Section 11.1 of the Merger Agreement, with respect to such matters shall be
deemed to have been incurred by the Tekelec Indemnified Persons for all purposes
hereunder and under the Merger Agreement.

         8.13     Additional Parties. The parties hereto acknowledge and agree
that any stockholders of Santera that execute this Agreement after the date
hereof and prior to the Closing shall be considered a Legacy Santera Stockholder
for all purposes hereunder.

                                       18

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.

                                   SANTERA SYSTEMS INC.

                                   By: /s/ David Heard
                                       _______________________________
                                   Name: David Heard
                                         _____________________________
                                   Title: President and CEO
                                          ____________________________
                                   Tax Identification #: _____________

                                   TEKELEC

                                   By: /s/ Frederick M. Lax
                                       _______________________________
                                   Name: Frederick M. Lax
                                         _____________________________
                                   Title: President and CEO
                                          ____________________________

                                   By: Paul J. Pucino
                                       _______________________________
                                   Name: Paul J. Pucino
                                         _____________________________
                                   Title: CFO
                                          ____________________________
                                   Tax Identification #: 95-2746131
                                                         _____________

                                   AUSTIN VENTURES VI, L.P., as Representative

                                   By:  AV Partners VI, L.P., its General
                                        Partner

                                   By: /s/ Edward E. Olkkola
                                       _______________________________
                                        Edward E. Olkkola, General
                                        Partner

                                   AUSTIN VENTURES VI, L.P.

                                   By:  AV Partners VI, L.P., its
                                        General Partner

                                   By: /s/ Edward E. Olkkola
                                       _______________________________
                                        Edward E. Olkkola, General Partner

                                   AUSTIN VENTURES VI AFFILIATES FUND, L.P.

                                   By:  AV Partners VI, L.P., its General
                                        Partner

                                   By: /s/ Edward E. Olkkola
                                       _______________________________
                                        Edward E. Olkkola, General Partner

                                   AUSTIN VENTURES VIII, L.P.

                                   By:  AV Partners VIII, L.P., its General
                                        Partner

                                   By: /s/ Edward E. Olkkola
                                       _______________________________
                                        Edward E. Olkkola, General Partner

                                ESCROW AGREEMENT
                                 Signature Page

<PAGE>

                                   REDPOINT VENTURES II, L.P., by its General
                                   Partner, Redpoint Ventures II, LLC

                                   By:     /s/ R. Thomas Dyal
                                        _____________________________
                                        R. Thomas Dyal, Managing
                                        Director

                                   REDPOINT ASSOCIATES II, LLC, as nominee

                                   By:     /s/ R. Thomas Dyal
                                        _______________________________
                                        R. Thomas Dyal, Managing
                                        Director

                                   REDPOINT TECHNOLOGY PARTNERS Q-I,
                                   L.P., by its General Partner, Redpoint
                                   Ventures I, LLC

                                   By:     /s/ R. Thomas Dyal
                                       _______________________________
                                   Name:   R. Thomas Dyal
                                         _____________________________
                                   Title:  Managing Director
                                          ____________________________

                                   REDPOINT TECHNOLOGY PARTNERS A-I,
                                   L.P., by its General Partner, Redpoint
                                   Ventures I, LLC

                                   By:     /s/ R. Thomas Dyal
                                       _______________________________
                                   Name:   R. Thomas Dyal
                                         _____________________________
                                   Title:  Managing Director
                                          ____________________________

                                   MERITECH CAPITAL PARTNERS L.P.

                                   By:  Meritech Capital Associates L.L.C.
                                          its General Partner

                                   By:  Meritech Management Associates L.L.C.
                                          a managing member

                                   By:     /s/ Mark Stevens
                                       _______________________________
                                            Mark Stevens
                                   Name: _____________________________
                                   Title: ____________________________

                                   MERITECH CAPITAL AFFILIATES L.P.

                                   By:  Meritech Capital Associates L.L.C.
                                          its General Partner

                                   By:  Meritech Management Associates L.L.C.
                                          a managing member

                                   By:      /s/ Mark Stevens
                                       _______________________________
                                            Mark Stevens
                                   Name: _____________________________
                                   Title: ____________________________

                                ESCROW AGREEMENT
                                 Signature Page

<PAGE>

                                   SEQUOIA CAPITAL FRANCHISE FUND, L.P.

                                   By:  SCFF Management, LLC
                                   A Delaware Limited Liability Company
                                   General Partner

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:  Mark Stevens
                                          _____________________________
                                   Title: ____________________________

                                   SEQUOIA CAPITAL FRANCHISE PARTNERS,
                                   L.P.

                                   By: SCFF Management, LLC
                                   A Delaware Limited Liability Company
                                   General Partner

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:  Mark Stevens
                                          _____________________________
                                   Title: ____________________________

                                   SEQUOIA CAPITAL VIII, L.P.

                                   By: SC VIII Management, LLC
                                   A California Limited Liability Company
                                   General Partner

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:  Mark Stevens
                                          _____________________________
                                   Title: ____________________________

                                   SEQUOIA INTERNATIONAL TECHNOLOGY
                                   PARTNERS VIII, L.P.

                                   By: SC VIII Management, LLC

                                   A California Limited Liability Company
                                   General Partner

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:  Mark Stevens
                                          _____________________________
                                   Title: ____________________________

                                ESCROW AGREEMENT
                                 Signature Page

<PAGE>

                                   SEQUOIA INTERNATIONAL TECHNOLOGY
                                   PARTNERS VIII (Q), L.P.

                                   By: SC VIII Management, LLC
                                   A California Limited Liability Company
                                   General Partner

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:         Mark Stevens
                                       _____________________________
                                   Title: ____________________________

                                   SEQUOIA 1997

                                   By:        /s/ Mark Stevens
                                       _______________________________
                                   Name:         Mark Stevens
                                       _____________________________
                                   Title: ____________________________

                                   CMS PARTNERS LLC

                                   By:       /s/ Mark Stevens
                                       _______________________________
                                   Name:        Mark Stevens
                                       _____________________________
                                   Title: ____________________________

                                   INSTITUTIONAL VENTURE PARTNERS VIII,
                                   L.P., by its General Partner, Institutional
                                   Venture Management VIII, LLC

                                   By:       /s/ R. Thomas Dyal
                                        _______________________________
                                        R. Thomas Dyal, Managing Director

                                   IVM INVESTMENT FUND VIII, LLC, by its

                                   Manager, Institutional Venture Management

                                   VIII, LLC

                                   By:       /s/ R. Thomas Dyal
                                        _______________________________
                                        R. Thomas Dyal, Managing Director

                                   BROADBAND FUND, L.P., by its General Partner,
                                   BBF Management, LLC, by its Manager,
                                   Institutional Venture Management VIII, LLC

                                   By:       /s/ R. Thomas Dyal
                                        _______________________________
                                        R. Thomas Dyal, Managing Director

                                ESCROW AGREEMENT
                                 Signature Page

<PAGE>

                                    EXHIBIT A

                         Form of Instrument of Accession

         Reference is made to that certain Escrow Agreement dated as of April
30, 2003, a copy of which is attached hereto (the "Escrow Agreement"), by and
among Santera Systems Inc., a Delaware corporation ("Santera"), Tekelec, a
California corporation ("Tekelec"), those legacy stockholders of Santera who are
listed on the signature page of the Escrow Agreement ("Legacy Santera
Stockholders"), Austin Ventures VI, L.P., as the representative thereunder of
the Legacy Santera Stockholders (the "Representative"), and J.P. Morgan Trust
Company, National Association ("Escrow Agent"). Any terms not defined herein
shall be defined as in the Escrow Agreement.

         The undersigned,_________ , in order to become the owner or holder of
shares (the "Acquired Shares") of _____________________ , $____ par value per
share, of Santera, hereby agrees that by the undersigned's execution hereof (a)
the undersigned is a Stockholder party to the Escrow Agreement subject to all of
the restrictions, conditions and obligations applicable to Stockholders set
forth in the Escrow Agreement and (b) all of the Acquired Shares (and any and
all shares of stock of Santera issued in respect thereof) are and will remain
subject to all of the rights, restrictions, conditions and obligations
applicable to [Preferred Escrow Shares] [New Preferred Escrow Shares] and shall
remain in the [Legacy Preferred Account] [New Preferred Account], in each case
as set forth in the Escrow Agreement. This Instrument of Accession shall take
effect and shall become a part of said Escrow Agreement immediately upon
execution.

         Executed as of the date set forth below under the laws of the State of
Delaware.

                                               Signature:_______________________

                                               Address:_________________________

                                                       _________________________

                                               Date:____________________________
Accepted:

SANTERA SYSTEMS INC.

By:  ____________________________

Date: ___________________________

<PAGE>

                                    EXHIBIT B

                               Form of Stock Power

         For value received, the undersigned,_____________________ , hereby
surrenders, sells, assigns and conveys________________ (________) shares of
___________________________ , $ _______ par value per share, of Santera Systems
Inc., a Delaware corporation ("Santera"), standing in the name of ______________
____ on the books of Santera as of________________________ and represented by
Certificate No.____________ herewith to____________________ , and does hereby
irrevocably constitute and appoint ___________________________ to transfer said
stock on the books of Santera with full power of substitution in the premises.

Dated:______________________________

                                               _________________________________
                                               Name

<PAGE>

                                    EXHIBIT C

                    Escrow Register - Legacy Preferred Shares

                               Number of Legacy         Percentage of Legacy
          Name                 Preferred Shares           Preferred Shares

<PAGE>

                                    EXHIBIT D

                     Escrow Register - New Preferred Shares

                               Number of Legacy         Percentage of Legacy
          Name                 Preferred Shares           Preferred Shares

<PAGE>

                                    EXHIBIT E

                            Confirmation Instructions

If to Santera, to:

         NAME(S)                               TELEPHONE NUMBER(S)

Dave Heard                                     (972) 461-6200
James Orlando                                  (972) 461-6367

If to Tekelec, to:

         NAME(S)                               TELEPHONE NUMBER(S)

Frederick M. Lax                               (818) 880-7887
Paul J. Pucino                                 (818) 880-7921
Ronald W. Buckly                               (818) 880-7979

If to the Representative, to:

         NAME(S)                               TELEPHONE NUMBER(S)

Edward E. Olkkola                              (972) 892-3700

Telephone confirmations shall be made by the Escrow Agent to each of Santera,
Tekelec and the Representative if joint instructions are required pursuant to
this Agreement.

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