Document:

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                                                                   EXHIBIT 10.10
                         SUBORDINATED PROMISSORY NOTE

$2,000,000                                                 May  21, 2001
                                                           Palo Alto, California

          Ariel Corporation, a Delaware corporation ("Borrower"), for value
received, hereby unconditionally promises to pay to Mayan Networks Corporation
("Lender"), on the earlier of (a) the Effective Time (as defined in that certain
Agreement and Plan of Merger between Borrower and Lender dated as of March 28,
2001 (the "Merger Agreement")) or (b) Lender's demand following termination of
the Merger Agreement, in lawful money of the United States, at the address of
Lender set forth below, the principal sum of TWO MILLION DOLLARS AND NO CENTS
($2,000,000) or such other amount as represents the aggregate principal amount
of the advances made by Lender to Borrower hereunder, in the amount necessary to
repay in full the unpaid principal balance hereof together with simple interest
on the unpaid principal at a fixed rate equal to 8% per annum; provided,
however, that in the event that the Merger Agreement is terminated by Lender
pursuant to Section 9.01(e) thereof, the amounts due under this Subordinated
Promissory Note (including, without limitation, unpaid principal and accrued and
unpaid principal thereon), shall be due and payable on the one-year anniversary
of such termination of the Merger Agreement. In the event that the Merger
Agreement is terminated by Lender pursuant to Section 9.01(e) thereof, interest
shall continue to accrue on the unpaid principal balance in accordance herewith
until all amounts payable hereunder have been repaid in full by Borrower.

          In the event that any amount of principal or interest, or any other
amount payable hereunder, is not paid in full when due (whether at stated
maturity, by acceleration or otherwise), the Borrower agrees to pay interest on
such unpaid principal or other amount, from the date such amount becomes due
until the date such amount is paid in full, payable on demand, at a rate per
annum equal at all times to 13%.

          All computations of interest shall be made on the basis of a 365-day
year for the number of days actually elapsed.

          This Subordinated Promissory Note (this "Subordinated Note"), and each
Term Loan (as defined below) advanced hereunder, shall be secured by the
collateral (the "Collateral") more specifically described in the Security
Agreement of even date herewith between Borrower and Lender, substantially in
the form of Exhibit A hereto (the "Security Agreement") and in the Intellectual
            ---------
Property Security Agreement of even date herewith between Borrower and Lender,
substantially in the form of Exhibit B hereto (the "IP Security Agreement" and,
                             ---------
collectively with the Security Agreement, the "Security Agreements"). At
Lender's sole and absolute discretion, Lender may require Borrower to execute
and deliver the Security Agreement(s) as a condition precedent to any Term Loan
advanced hereunder. Notwithstanding the foregoing, in the event that the Merger
Agreement is terminated by Lender pursuant to Section 9.01(e) thereof, Lender
agrees to subordinate its security interest in the Collateral to any lender who
thereafter agrees to provide financing to Borrower (a "Subsequent Lender") and
to enter into a lien subordination agreement, in form and substance satisfactory
to Lender and such Subsequent Lender, as such Subsequent Lender shall reasonably
request, to provide for, among other things, (x) the subordination of the Liens
of Lender in any Collateral to the Liens of such Subsequent Lender in such
Collateral, and (y) the agreement of Lender to refrain from taking any action or
exercising any rights with respect to such Collateral for such period of time as
shall be satisfactory to Lender and such Subsequent Lender. BORROWER HEREBY
RATIFIES AND AFFIRMS THE SECURITY INTERESTS GRANTED BY BORROWER TO LENDER UNDER
AND PURSUANT TO THE SECURITY AGREEMENTS.

          Subject to the terms and conditions hereof (including, without
limitation, execution and delivery by Borrower of the Security Agreement(s) in
accordance with the preceding paragraph), and provided no Event of Default has
occurred, Borrower may request one or more advances (each such
<PAGE>

advance a "Term Loan" and such advances collectively, the "Term Loans") under
this Promissory Note (this "Note"). Borrower must give Lender at least three (3)
days' written notice requesting any such Term Loan, and Borrower must affirm in
each such written notice that (i) the representations and warranties of Borrower
set forth in the Merger Agreement are true and correct in all material respects
as of the time of such advance and (ii) Borrower has not breached in any
material respect any covenant contained in the Merger Agreement. Any Term Loan
repaid by Borrower, in whole or in part, may not be reborrowed. Submission by
Borrower to Lender of a budget, in form and substance satisfactory to Lender,
shall be a condition precedent to each Term Loan. Each Term Loan shall be
applied by Borrower exclusively as set forth in the budget submitted by Borrower
as a condition precedent to such Term Loan.

          Anything herein to the contrary notwithstanding, if during any period
for which interest is computed hereunder, the amount of interest computed on the
basis provided for in this Subordinated Note, together with all fees, charges
and other payments which are treated as interest under applicable law, as
provided for herein or in any other document executed in connection herewith,
would exceed the amount of such interest computed on the basis of the Highest
Lawful Rate, the Borrower shall not be obligated to pay, and the Lender shall
not be entitled to charge, collect, receive, reserve or take, interest in excess
of the Highest Lawful Rate, and during any such period the interest payable
hereunder shall be computed on the basis of the Highest Lawful Rate.  As used
herein, "Highest Lawful Rate" means the maximum non-usurious rate of interest,
as in effect from time to time, which may be charged, contracted for, reserved,
received or collected by the Lender in connection with this Subordinated Note
under applicable law.

          Borrower may prepay the outstanding amount hereof in whole or in part
at any time, without premium or penalty. Together with any such prepayment the
Borrower shall pay accrued interest on the amount prepaid.

          Borrower represents and warrants to the Lender that this Subordinated
Note does not contravene any contractual or judicial restriction binding on or
affecting the Borrower and that this Subordinated Note is the legal, valid and
binding obligation of the Borrower enforceable against it in accordance with its
terms.

          Subordination.  Notwithstanding any other provisions of this
          -------------
Subordinated Note to the contrary, by its acceptance of this Subordinated Note,
the Holder of this Subordinated Note agrees as follows:

          (1) The principal of and interest on this Subordinated Note (and all
extensions and renewals thereof and replacements therefor) and all premiums,
fees, costs, expenses and all other sums now or hereafter due in connection with
the foregoing (collectively, the "Subordinated Debt") is subordinate in right of
payment to the payment to TRANSAMERICA BUSINESS CREDIT CORPORATION ("Senior
Lender", which term shall include any other future institutional lender to
Borrower which replaces said Senior Lender), in full in cash, of all present and
future indebtedness for borrowed money of Borrower to Senior Lender and all
interest thereon, and all liabilities, guarantees and other obligations of
Borrower to Senior Lender in connection therewith, now existing or hereafter
arising, including without limitation any interest accruing after the
commencement of any bankruptcy, arrangement, or reorganization proceeding with
respect to Borrower (whether or not such interest is recoverable from Borrower
or allowable or provable in any such proceeding), costs, expenses, penalties,
indemnities, and reimbursement obligations (collectively, the "Senior Debt").
Holder agrees not to directly or indirectly ask for or accept payment of all or
any part of the Subordinated Debt, in cash or other property or by set-off or in
any other manner for any of the Subordinated Debt if Borrower is in default in
its obligations to Senior Lender or if such actions would create an event of
default in respect of such obligations.  Unless and until all of the Senior Debt
has been indefeasibly paid in full, in cash, Holder further agrees not to do any
of the following, directly or indirectly:  (i) demand, sue for, accelerate the
maturity of, or otherwise enforce any of the Subordinated Debt; (ii) enforce any
guaranty of any of the Subordinated Debt, (iii) take, hold or claim any
collateral or security for any of the Subordinated Debt

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(except that Borrower may grant a security interest in certain of its assets to
Lender in respect of the Subordinated Debt, provided, however, that any such
                                            --------  -------
security interest granted by Borrower to Lender in respect of the Subordinated
Debt shall by its terms be junior and subordinate in all respects to the
security interest granted by Borrower to Senior Lender in respect of the Senior
Debt for however long such security interest granted by Borrower to Senior
Lender in respect of the Senior Debt shall remain in effect); (iv) exercise any
rights or remedies with respect to the Subordinated Debt, judicially or non-
judicially (including without limitation the commencement of any bankruptcy or
insolvency proceeding against Borrower), or (v) attempt to do any of the
foregoing; provided that nothing herein shall prevent Holder from converting
this Subordinated Note into equity securities of Borrower on such terms as may
be mutually acceptable to Holder and Borrower.

          (2) Holder agrees that upon any distribution of the assets or
readjustment of the indebtedness of Borrower whether by reason of liquidation,
composition, bankruptcy, arrangement, receivership, assignment for the benefit
of creditors or any other action or proceeding involving the readjustment of all
or any of the Subordinated Debt, or the application of the assets of Borrower to
the payment or liquidation thereof, Senior Lender shall be entitled to receive
payment in full in cash of all of the Senior Debt prior to the payment of all or
any part of the Subordinated Debt, and in order to enable Senior Lender to
enforce its rights hereunder in any such action or proceeding, Senior Lender is
hereby irrevocably authorized and empowered in its sole discretion (but without
any obligation on its part) to make and present for and on behalf of Holder such
proofs of claim against Borrower on account of the Subordinated Debt as Senior
Lender may deem expedient or proper and to vote such proofs of claim in any such
proceeding and to receive and collect any and all dividends or other payments or
disbursements made thereon in whatever form the same may be paid or issued and
to apply same on account of the Senior Debt. Holder further agrees to execute
and deliver to Senior Lender such assignments or other instruments as may be
required by Senior Lender in order to enable Senior Lender to enforce any and
all such claims and to collect any and all dividends or other payments or
disbursements which may be made at any time on account of all and any of the
Subordinated Debt. Any amounts received by Holder contrary to the provisions of
this Section shall be held in trust by Holder for the benefit of Senior Lender
and shall forthwith be paid over to Senior Lender to be applied to Senior Lender
debt in such order as Senior Lender in its sole discretion shall determine,
without limiting any other right of Senior Lender hereunder or otherwise and
without otherwise affecting the liability of Holder.

          (3) Holder agrees that, in addition to any other rights that Senior
Lender may have at law or in equity, Senior Lender may at any time, and from
time to time, without the Holder's consent and without notice to the Holder,
renew, extend or increase any of the Senior Debt or that of any other person at
any time directly or indirectly liable for the payment of any Senior Debt,
accept partial payments of the Senior Debt, settle, release (by operation of law
or otherwise), compound, compromise, collect or liquidate any of the Senior
Debt, make loans or advances to Borrower secured in whole or in part by
collateral or unsecured or refrain from making any loans or advances to
Borrower, change, waive, alter or vary the interest charge on, or any other
terms or provisions of the Senior Debt or any present or future instrument,
document or agreement between Senior Lender and Borrower, release, exchange,
fail to perfect, delay the perfection of, fail to resort to, or realize upon any
collateral, and take any other action or omit to take any other action with
respect to the Senior Debt or any collateral as Senior Lender deems necessary or
advisable in Senior Lender's sole discretion.

          (4) In the event of any financing of Borrower by Senior Lender during
a bankruptcy, arrangement, or reorganization of Borrower, the Holder agrees that
the term "Senior Debt" shall include without limitation all indebtedness,
liabilities and obligations incurred in any such proceeding, and the Holder
agrees to take such actions and execute such documents in such proceedings as
may be reasonably necessary in order to effectuate the foregoing.

          (5) Holder agrees not to contest the validity, perfection, priority or
enforceability of the Senior Debt or Senior Lender's security interest in any
collateral.

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          (6) If, after payment of the Senior Debt, Borrower thereafter becomes
liable to Senior Lender on account of the Senior Debt, or any payment made on
the Senior Debt shall for any reason be returned by Senior Lender, the
provisions herein applicable to such Senior Debt shall thereupon in all respects
become effective with respect to such subsequent or reinstated Senior Debt,
without the necessity of any further act or agreement between Senior Lender and
the Holder.

          (7) In the event of any litigation between Senior Lender and the
Holder based upon or arising out of the provisions herein governing Senior
Lender's rights in respect of the Senior Debt, the prevailing party shall be
entitled to recover all of its reasonable costs and expenses (including without
limitation reasonable attorneys fees) from the non-prevailing party.

          (8) Senior Lender is a third-party beneficiary of the provisions
herein pertaining to the Senior Debt.

          Events of Default.  The occurrence of any of the following shall
          -----------------
constitute an "Event of Default" under this Subordinated Note:

          (1)  the failure to make any payment of principal, interest or any
other amount payable hereunder when due under this Subordinated Note or the
breach of any other condition or obligation under this Subordinated Note;

          (2)  any representation or warranty by Borrower under or in connection
with this Subordinated Note, the Security Agreement, the IP Security Agreement
or any other certificate, document, agreement or instrument delivered to Lender
under or in connection with this Subordinated Note is incorrect in any material
respect when made or deemed made.

          (3)  the breach of any covenant under the Merger Agreement, the
Security Agreement, or the IP Security Agreement and the continuation of any
such breach for five (5) days;

          (4)  the failure to timely file an annual report on Form 10-K as
required by the rules of the Securities and Exchange Commission;

          (5)  the existence of any material changes to Ariel Corporation's
unaudited financial statements for the year ended December 31, 2000 which were
provided by Ariel Corporation to Mayan Networks Corporation prior to the
execution of the Merger Agreement;

          (6)  the filing of a petition by or against the Borrower under any
provision of the Bankruptcy Reform Act, Title 11 of the United States Code, as
amended or recodified from time to time, or under any similar law relating to
bankruptcy, insolvency or other relief for debtors; or appointment of a
receiver, trustee, custodian or liquidator of or for all or any part of the
assets or property of the Borrower; or the insolvency of the Borrower; or the
making of a general assignment for the benefit of creditors by the Borrower; or

          (7)  any of the documents relating to the Collateral after delivery
thereof shall for any reason be revoked or invalidated, or otherwise cease to be
in full force and effect, or the Borrower or any other person shall contest in
any manner the validity or enforceability thereof, or the Borrower or any other
person shall deny that it has any further liability or obligation thereunder; or
any of the documents relating to the Collateral for any reason, except to the
extent permitted by the terms thereof, shall cease to create a valid and
perfected security interest in any of the Collateral purported to be covered
thereby.

          Upon the occurrence of any Event of Default, the Lender, at its
option, may (i) by notice to the Borrower, declare the unpaid principal amount
of this Subordinated Note, all interest accrued and unpaid hereon and all other
amounts payable hereunder to be immediately due and payable, whereupon the
unpaid principal amount of this Subordinated Note, all such interest and all
such other amounts shall become immediately due and payable, without
presentment, demand, protest or further notice of any kind,

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provided that if an event described in paragraph (6) above shall occur, the
--------
result which would otherwise occur only upon giving of notice by the Lender to
the Borrower as specified above shall occur automatically, without the giving of
any such notice; and (ii) whether or not the actions referred to in clause (i)
have been taken, exercise any or all of the Lender's rights and remedies under
the Security Agreements and proceed to enforce all other rights and remedies
available to the Lender under applicable law.

          Upon payment in full of all principal and interest and other amounts,
if any, payable hereunder this Subordinated Note shall be surrendered to
Borrower for cancellation.

          Borrower hereby waives diligence, demand, presentment, protest or
further notice of any kind.  Borrower agrees to make all payments under this
Subordinated Note without setoff or deduction and regardless of any counterclaim
or defense.

          No single or partial exercise of any power under this Subordinated
Note shall preclude any other or further exercise of such power or exercise of
any other power.  No delay or omission on the part of the Lender in exercising
any right under this Subordinated Note shall operate as a waiver of such right
or any other right hereunder.

          This Note shall be binding on the Borrower and its successors and
assigns, and shall be binding upon and inure to the benefit of the Lender, any
future holder of this Subordinated Note and their respective successors and
assigns.  Borrower may not assign or transfer this Subordinated Note or any of
its obligations hereunder without the Lender's prior written consent.

          If Borrower defaults and the indebtedness represented by this
Subordinated Note or any part thereof is collected through legal action or other
judicial proceedings, Borrower agrees to pay, in addition to the principal and
interest payable hereon, reasonable attorneys' fees and costs incurred by Lender
to the extent provided under the Security Agreements.

          Any notice or other communication required or permitted hereunder
shall be in writing and shall be deemed to have been given, and any payment
shall be deemed to have been made, upon delivery if personally delivered, or one
day after deposit if deposited in the United States mail for mailing by
certified mail, postage prepaid, and addressed as follows:

          If to Lender:      Mayan Networks Corporation
                             2115 O'Nel Drive
                             San Jose, CA 95131
                             Attn:  John Tingleff, Chief Financial Officer

          If to Borrower:    Ariel Corporation
                             2540 Route 130
                             Cranbury, NJ 08512
                             Attn:  Dennis Schneider, President

          Lender or Borrower may change their address for purposes of this
paragraph by giving to the other written notice of such new address in
conformance with this paragraph.

          THIS NOTE IS BEING DELIVERED IN AND SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF CALIFORNIA.

               [remainder of this page intentionally left blank]

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<PAGE>

          THIS SUBORDINATED NOTE AMENDS, RESTATES and supersedes, WITHOUT
NOVATION, THAT CERTAIN PROMISSORY NOTE DATED MARCH 28, 2000, IN THE PRINCIPAL
AMOUNT OF $2,000,000 (TWO MILLION DOLLARS AND NO CENTS) GIVEN BY BORROWER TO
LENDER.

                         ARIEL CORPORATION

                         By:_____________________________________
                         Name:
                         Title:

                                       6<PAGE>

                                                                   EXHIBIT 10.11

                              Security Agreement
                              ------------------

          THIS SECURITY AGREEMENT (this "Agreement"), dated as of March __,
2001, is made between ARIEL CORPORATION, a Delaware corporation ("Borrower") and
MAYAN NETWORKS CORPORATION, a _______ corporation ("Lender").

          Borrower and Lender hereby agree as follows:

          SECTION 1.  Definitions; Interpretation.
                      ---------------------------

             (a) All capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings assigned to them in the Note.

             (b) As used in this Agreement, the following terms shall have the
following meanings:

          "Collateral" has the meaning set forth in Section 2.
           ----------

          "Documents" means this Agreement, the Note and all other certificates,
           ---------
documents, agreements and instruments delivered to Lender under or in connection
with the Note.

          "Event of Default" has the meaning set forth in Section 6.
           ----------------

          "Lien" means any mortgage, deed of trust, pledge, security interest,
           ----
assignment, deposit arrangement, charge or encumbrance, lien, or other type of
preferential arrangement.

          "Note" means that certain Promissory Note dated March 28, 2001, made
           ----
by Borrower in favor of Lender, as amended, modified, renewed, extended or
replaced from time to time.

          "Obligations" means all indebtedness, liabilities and other
           -----------
obligations of Borrower to Lender, whether under or in connection with this
Agreement, the Note and the other Documents or otherwise, including, without
limitation, all unpaid principal of the Note, all interest accrued thereon, all
fees and all other amounts payable by Borrower to Lender thereunder or in
connection therewith, whether now existing or hereafter arising, and whether due
or to become due, absolute or contingent, liquidated or unliquidated, determined
or undetermined.

          "Permitted Liens" means:  (i) Liens in favor of the Lender, (ii) the
           ---------------
existing Liens disclosed in writing to the Lender or incurred in connection with
the extension, renewal or refinancing of the indebtedness secured by such
existing Liens, provided that any extension, renewal or replacement Lien shall
                --------
be limited to the property encumbered by the existing Lien and the principal
amount of the indebtedness being extended, renewed or refinanced does not
increase; (iii) Liens for taxes, fees, assessments or other governmental charges
or levies, either not delinquent or being contested in good faith by appropriate
proceedings and which are adequately reserved for, provided the same does not
                                                   --------
have priority over any of the Lender's Liens

                                       1
<PAGE>

and no notice of tax lien has been filed of record; (iv) Liens of materialmen,
mechanics, warehousemen, carriers or employees or other similar Liens provided
for by mandatory provisions of law and securing obligations either not
delinquent or being contested in good faith by appropriate proceedings and which
do not in the aggregate materially impair the use or value of the property or
risk the loss or forfeiture thereof; (v) Liens consisting of deposits or pledges
to secure the performance of bids, trade contracts, leases, public or statutory
obligations, or other obligations of a like nature incurred in the ordinary
course of business (other than for indebtedness); (vi) Liens upon or in any
property acquired or held by Borrower to secure the purchase price of such
property or indebtedness incurred solely for the purpose of financing the
acquisition of such property; and (vii) restrictions and other minor
encumbrances on real property which do not in the aggregate materially impair
the use or value of such property or risk the loss or forfeiture thereof.

          "Person" means an individual, corporation, partnership, joint venture,
           ------
trust, unincorporated organization, governmental agency or authority, or any
other entity of whatever nature.

          "UCC" means the Uniform Commercial Code as the same may, from time to
           ---
time, be in effect in the State of California; provided, however, in the event
that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than the State
of California, the term "UCC" shall mean the Uniform Commercial Code as in
effect from time to time in such other jurisdiction for purposes of the
provisions hereof relating to such attachment, perfection or priority and for
purposes of definitions related to such provisions.

             (c)  Terms Defined in the UCC. Where applicable and except as
                  ------------------------
otherwise defined herein, terms used in this Agreement shall have the meanings
assigned to them in the UCC.

             (d) Interpretation. In this Agreement, (i) the meaning of defined
                 --------------
terms shall be equally applicable to both the singular and plural forms of the
terms defined; and (ii) the captions and headings are for convenience of
reference only and shall not affect the construction of this Agreement.

          SECTION 2.  Security Interest.
                      -----------------
             (a) As security for the payment and performance of the Obligations,
Borrower hereby pledges, assigns, transfers, hypothecates and sets over to
Lender, and hereby grants to Lender a security interest in, all of Borrower's
right, title and interest in, to and under the following property, wherever
located and whether now existing or owned or hereafter acquired or arising
(collectively, the "Collateral"): all accounts, accounts receivable, contract
rights, rights to payment, chattel paper, electronic chattel paper, commercial
tort claims, letter of credit rights and proceeds of letters of credit,
documents, securities, money and instruments, and investment property, whether
held directly or through a securities intermediary, and other obligations of any
kind owed to Borrower; all deposit accounts, and all funds and amounts

                                       2
<PAGE>

therein; all inventory; all equipment; all general intangibles and other
personal property of Borrower; and all proceeds, including insurance proceeds,
and supporting obligations of any and all of the foregoing.

             (b) This Agreement shall create a continuing security interest in
the Collateral which shall remain in effect until terminated in accordance with
Section 16 hereof.

             (c) Notwithstanding the foregoing provisions of this Section 2, the
grant of a security interest as provided herein shall not extend to, and the
term "Collateral" shall not include, any general intangibles of Borrower
(whether owned or held as licensee or lessee, or otherwise), to the extent that
(i) such general intangibles are not assignable or capable of being encumbered
as a matter of law or under the terms of the license, lease or other agreement
applicable thereto (but solely to the extent that any such restriction shall be
enforceable under applicable law), without the consent of the licensor or lessor
thereof or other applicable party thereto and (ii) such consent has not been
obtained; provided, however, that the foregoing grant of security interest shall
extend to, and the term "Collateral" shall include, (A) any general intangible
which is an account receivable or a proceed of, or otherwise related to the
enforcement or collection of, any account receivable, or goods which are the
subject of any account receivable, (B) any and all proceeds of any general
intangibles which are otherwise excluded to the extent that the assignment or
encumbrance of such proceeds is not so restricted, and (C) upon obtaining the
consent of any such licensor, lessor or other applicable party with respect to
any such otherwise excluded general intangibles, such general intangibles as
well as any and all proceeds thereof that might have theretofore have been
excluded from such grant of a security interest and the term "Collateral".

             (d) The security interest granted by Borrower to Lender hereby
shall be junior and subordinate in all respects to the security interest granted
by Borrower to Senior Lender in respect of the Senior Debt for however long such
security interest granted by Borrower to Senior Lender in respect of the Senior
Debt shall remain in effect. Borrower agrees not to contest the validity,
perfection or enforceability of the Senior Debt or Senior Lender's security
interest in any of the Collateral.

          SECTION 3. Financing Statements, Etc. Borrower shall execute and
                     -------------------------
deliver to Lender concurrently with the execution of this Agreement, and
Borrower hereby authorizes Lender to file (with or without Borrower's
signature), at any time and from time to time thereafter, all financing
statements, assignments, continuation financing statements, termination
statements, account control agreements, and other documents and instruments, in
form reasonably satisfactory to Lender, and take all other action, as Lender may
reasonably request, to perfect and continue perfected, maintain the priority of
or provide notice of the security interest of Lender in the Collateral and to
accomplish the purposes of this Agreement. Borrower will join with Lender in
notifying any third party who has possession of any Collateral of Lender's
security interest therein and obtaining an acknowledgment from the third party
that is holding the Collateral for the benefit of Lender. Borrower will not
create any chattel paper without placing a legend on the chattel paper
acceptable to Lender indicating that Lender has a security interest in the
chattel paper.

                                       3
<PAGE>

          SECTION 4.  Representations and Warranties.  Borrower represents and
                      ------------------------------
warrants to Lender that:

             (a) Borrower is a corporation duly organized, validly existing and
in good standing under the law of the jurisdiction of its incorporation and has
all requisite power and authority to execute, deliver and perform its
obligations under this Agreement.

             (b) The execution, delivery and performance by Borrower of this
Agreement have been duly authorized by all necessary corporate action of
Borrower, and this Agreement constitutes the legal, valid and binding obligation
of Borrower, enforceable against Borrower in accordance with its terms.

             (c) No authorization, consent, approval, license, exemption of, or
filing or registration with, any governmental authority or agency, or approval
or consent of any other Person, is required for the due execution, delivery or
performance by Borrower of this Agreement, except for any filings necessary to
perfect any Liens on any Collateral.

             (d) Borrower's chief executive office and principal place of
business (as of the date of the Agreement) is located at the address set forth
in Schedule 1; Borrower's jurisdiction of organization is set forth in Schedule
1; Borrower's exact legal name is as set forth in the first paragraph of this
Agreement; all other locations where Borrower conducts business and other
Collateral is kept (as of the date of this Agreement) are set forth in Schedule
1; and all trade names and trade styles under which Borrower at any time in the
past has conducted or presently conducts its business operations are set forth
in Schedule 1.

             (e) Borrower is not and will not become a lessee under any real
property lease or other agreement governing the location of Collateral at the
premises of another Person pursuant to which the lessor or such other Person may
obtain any rights in any of the Collateral, and no such lease or other such
agreement now prohibits, restrains, impairs or will prohibit, restrain or impair
Borrower's right to remove any Collateral from the premises at which such
Collateral is situated, except for the usual and customary restrictions
contained in such leases of real property.

          SECTION 5. Covenants. So long as any of the Obligations remain
                     ---------
unsatisfied, Borrower agrees that:

             (a) Borrower shall do and perform all reasonable acts that may be
necessary and appropriate to maintain, preserve and protect the Collateral.

             (b) Borrower shall comply in all material respects with all laws,
regulations and ordinances, and all policies of insurance, relating in a
material way to the possession, operation, maintenance and control of the
Collateral.

             (c) Borrower shall give prompt written notice to Lender (and in any
event not later than 10 days prior to any change described below in this
subsection) of: (i) any change in the location of Borrower's chief executive
office or principal place of business; (ii) any change

                                       4
<PAGE>

in the locations set forth in Schedule 1; (iii) any change in its name; (iv) any
changes in, additions to or other modifications of its trade names and trade
styles set forth in Schedule 1; (v) any changes in its identity or structure in
any manner which might make any financing statement filed hereunder incorrect or
misleading; and (vi) any change in its jurisdiction of organization; provided
                                                                     --------
that Borrower shall not change its jurisdiction of organization to a
jurisdiction outside of the United States.

             (d) Borrower shall not surrender or lose possession of (other than
to Lender), sell, lease, rent, or otherwise dispose of or transfer any of the
Collateral or any right or interest therein, except in the ordinary course of
business or unless such Collateral is replaced by comparable Collateral of
similar value or as otherwise permitted by the Documents.

             (e) Borrower shall pay and discharge all taxes, fees, assessments
and governmental charges or levies imposed upon it with respect to the
Collateral prior to the date on which penalties attach thereto, except to the
extent such taxes, fees, assessments or governmental charges or levies are being
contested in good faith by appropriate proceedings.

             (f) Borrower shall maintain and preserve its corporate existence,
its rights to transact business and all other rights, franchises and privileges
necessary or desirable in the normal course of its business and operations and
the ownership of the Collateral, except in connection with any transactions
expressly permitted by the Note or any other Document.

             (g) Borrower shall carry and maintain in full force and effect, at
its own expense and with financially sound and reputable insurance companies,
insurance with respect to the Collateral in such amounts, with such deductibles
and covering such risks as is customarily carried by companies engaged in the
same or similar businesses and owning similar properties in the localities where
Borrower operates. Insurance on the Collateral shall name Lender as additional
insured and as loss payee. Upon the request of Lender, Borrower shall furnish
Lender from time to time with full information as to the insurance carried by it
and, if so requested, copies of all such insurance policies. Borrower shall also
furnish to Lender from time to time upon the request of Lender a certificate of
Borrower's insurance broker or other insurance specialist stating that all
premiums then due on the policies relating to insurance on the Collateral have
been paid and that such policies are in full force and effect. All insurance
policies required under this subsection (g) shall provide that they shall not be
terminated or cancelled nor shall any such policy be materially changed without
at least 30 days' prior written notice to Borrower and Lender.

             (h) Whenever any Collateral is located upon premises in which any
third party has an interest (whether as owner, mortgagee, beneficiary under a
deed of trust, lien or otherwise), Borrower shall, whenever requested by Lender,
use its best efforts to cause such third party to execute and deliver to Lender,
in form and substance satisfactory to Lender, such waivers, subordinations and
collateral access agreements, as Lender shall specify, so as to ensure that
Lender's rights in the Collateral are, and will continue to be, superior to the
rights of any such third party and to ensure that Lender shall have access to
the Collateral in connection with the exercise of its remedies hereunder.
Borrower will keep in full force and effect, and will

                                       5
<PAGE>

comply with all the terms of, any lease of real property where any of the
Collateral now or in the future may be located.

             (i) Borrower shall not create, incur, assume or suffer to exist any
Liens upon or with respect to any of the Collateral, except for Permitted Liens.

          SECTION 6. Events of Default. Any of the following events which shall
                     -----------------
occur and be continuing shall constitute an "Event of Default":

             (a) Borrower shall fail to pay when due (i) any amount of principal
of the Note, or (ii) any amount of interest on the Note or other amount payable
hereunder or under any other Document, or any other Obligations.

             (b) Any representation or warranty by Borrower under or in
connection with this Agreement, the Note or any other Document shall prove to
have been incorrect in any material respect when made or deemed made.

             (c) Borrower shall fail to perform or observe in any material
respect any other term, covenant or agreement contained in this Agreement, the
Note or any other Document on its part to be performed or observed and any such
failure shall remain unremedied for a period of 20 days from the occurrence
thereof (unless Lender reasonably determines that such failure is not capable of
remedy), or any "Event of Default" as defined in the Note or any other Document
shall have occurred and is continuing.

             (d) Borrower shall (i) liquidate, wind up or dissolve (or suffer
any liquidation, wind-up or dissolution), except to the extent expressly
permitted by the Note, (ii) suspend its operations other than in the ordinary
course of business, or (iii) take any corporate action to authorize any of the
actions or events set forth above in this subsection (d).

             (e) Any levy upon, seizure or attachment of any of the Collateral
which shall not have been rescinded or withdrawn.

             (f) Any loss, theft or substantial damage to, or destruction of,
any material portion of the Collateral (unless within 15 days after the
occurrence of any such event, Borrower furnishes to Lender evidence satisfactory
to Lender that the amount of any such loss, theft, damage to or destruction of
the Collateral is fully insured under policies naming Lender as an additional
named insured or loss payee or such Collateral is otherwise replaced by
comparable Collateral of similar value).

          SECTION 7.  Remedies; Power of Attorney.
                      ---------------------------

             (a) Upon the occurrence and continuance of any Event of Default,
Lender may declare any of the Obligations to be immediately due and payable and
shall have, in addition to all other rights and remedies granted to it in this
Agreement, the Note or any other Document, all rights and remedies of a secured
party under the UCC and other applicable laws. Without limiting the generality
of the foregoing, Borrower agrees that: (i) (subject to the terms of the

                                       6
<PAGE>

restrictions in the agreements referred to in Section 5(g)) Lender may peaceably
and without notice enter any premises of Borrower, take possession of any the
Collateral, remove or dispose of all or part of the Collateral on any premises
of Borrower or elsewhere, or, in the case of equipment, render it nonfunctional,
and otherwise collect, receive, appropriate and realize upon all or any part of
the Collateral, and demand, give receipt for, settle, renew, extend, exchange,
compromise, adjust, or sue for all or any part of the Collateral, as Lender may
determine; (ii) Lender may require Borrower to assemble all or any part of the
Collateral and make it available to Lender at any place and time designated by
Lender; (iii) Lender may secure the appointment of a receiver of the Collateral
or any part thereof (to the extent and in the manner provided by applicable
law); (iv) Lender may sell, resell, lease, use, assign, transfer or otherwise
dispose of any or all of the Collateral in its then condition or following any
commercially reasonable preparation or processing (utilizing in connection
therewith any of Borrower's assets, without charge or liability to Lender
therefor) at public or private sale, by one or more contracts, in one or more
parcels, at the same or different times, for cash or credit, or for future
delivery without assumption of any credit risk, all as Lender deems advisable;
provided, however, that Borrower shall be credited with the net proceeds of sale
-----------------
only when such proceeds are finally collected by Lender. Lender shall have the
right upon any such public sale, and, to the extent permitted by law, upon any
such private sale, to purchase the whole or any part of the Collateral so sold,
free of any right or equity of redemption, which right or equity of redemption
Borrower hereby releases, to the extent permitted by law. Borrower hereby agrees
that the sending of notice by ordinary mail, postage prepaid, to the address of
Borrower specified in Section 9, of the place and time of any public sale or of
the time after which any private sale or other intended disposition is to be
made, shall be deemed reasonable notice thereof if such notice is sent ten days
prior to the date of such sale or other disposition or the date on or after
which such sale or other disposition may occur, provided that Lender may provide
                                                --------
Borrower shorter notice or no notice, to the extent permitted by the UCC or
other applicable law.

             (b) The cash proceeds actually received from the sale or other
disposition or collection of Collateral, and any other amounts received in
respect of the Collateral the application of which is not otherwise provided for
herein, shall be applied to the payment of the Obligations. Any surplus thereof
which exists after payment and performance in full of the Obligations shall be
promptly paid over to Borrower or otherwise disposed of in accordance with the
UCC or other applicable law. Borrower shall remain liable to Lender for any
deficiency which exists after any sale or other disposition or collection of
Collateral.

             (c) Lender shall have the right to, in the name of Borrower, or in
the name of Lender or otherwise, without notice to or assent by Borrower, and
Borrower hereby constitutes and appoints Lender (and any of Lender's officers,
employees or agents designated by Lender) as Borrower's true and lawful
attorney-in-fact, with full power and authority to: (i) sign any of the
financing statements which must be executed or filed to perfect or continue
perfected, maintain the priority of or provide notice of Lender's security
interest in the Collateral; (ii) assert, adjust, sue for, compromise or release
any claims under any policies of insurance; (iii) file any claims, take any
action or institute, defend, settle or adjust any actions, suits or proceedings
with respect to the Collateral, as Lender may deem necessary or desirable to
maintain, preserve and protect the Collateral, to collect the Collateral or to
enforce the rights of Lender with respect to the

                                       7
<PAGE>

Collateral; (iv) execute any and all endorsements, assignments or other
documents and instruments necessary to sell, lease, assign, convey or otherwise
transfer title in or dispose of the Collateral; (v) give notices of control,
default or exclusivity (or similar notices) under any account control agreement
or similar agreement with respect to exercising control over deposit accounts or
securities accounts; and (vi) execute any and all such other documents and
instruments, and do any and all acts and things for and on behalf of Borrower,
which Lender may deem necessary or advisable to maintain, protect, realize upon
and preserve the Collateral and Lender's security interest therein and to
accomplish the purposes of this Agreement. Lender agrees that, except upon the
occurrence and during the continuance of an Event of Default, it shall not
exercise the power of attorney, or any rights granted to Lender, pursuant to
clauses (ii) through (v). The foregoing power of attorney is coupled with an
interest and irrevocable so long as the Obligations have not been paid and
performed in full. Borrower hereby ratifies, to the extent permitted by law, all
that Lender shall lawfully and in good faith do or cause to be done by virtue of
and in compliance with this subsection (c).

             (d) Lender has no obligation to clean-up or otherwise prepare the
Collateral for sale. Lender has no obligation to attempt to satisfy the
Obligations by collecting them from any other Person liable for them and Lender
may release, modify or waive any Collateral provided by any other Person to
secure any of the Obligations, all without affecting Lender's rights against
Borrower. Borrower waives any right it may have to require Lender to pursue any
third Person for any of the Obligations. Lender may comply with any applicable
state or federal law requirements in connection with a disposition of the
Collateral and compliance will not be considered adversely to affect the
commercial reasonableness of any sale of the Collateral. Lender may sell the
Collateral without giving any warranties as to the Collateral. Lender may
specifically disclaim any warranties of title or the like. This procedure will
not be considered adversely to affect the commercial reasonableness of any sale
of the Collateral. If Lender sells any of the Collateral upon credit, Borrower
will be credited only with payments actually made by the purchaser, received by
Lender and applied to the indebtedness of the purchaser. In the event the
purchaser fails to pay for the Collateral, Lender may resell the Collateral and
Borrower shall be credited with the proceeds of the sale.

          SECTION 8. Purchase Money Security Interests. To the extent Borrower
                     ---------------------------------
uses the proceeds of any of the Obligations to purchase Collateral, Borrower's
repayment of the Obligations shall apply on a "first-in, first-out" basis so
that the portion of the Obligations used to purchase a particular item of
Collateral shall be paid in the chronological order the Borrower purchased the
Collateral.

          SECTION 9. Notices. All notices or other communications hereunder
                     -------
shall be in writing (including by facsimile transmission) and mailed, sent or
delivered to the respective parties hereto at or to their respective addresses
or facsimile numbers set forth below their names on the signature pages hereof,
or at or to such other address or facsimile number as shall be designated by any
party in a written notice to the other parties hereto. All such notices and
other communications shall be effective (i) if delivered by hand, when
delivered; (ii) if sent by mail, upon the earlier of the date of receipt or five
business days after deposit in the mail, first class; and (iii) if sent by
facsimile transmission, when sent.

                                       8
<PAGE>

          SECTION 10. No Waiver; Cumulative Remedies. No failure on the part of
                      ------------------------------
Lender to exercise, and no delay in exercising, any right, remedy, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, remedy, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights and remedies under this Agreement are cumulative
and not exclusive of any rights, remedies, powers and privileges that may
otherwise be available to Lender.

          SECTION 11. Binding Effect. This Agreement shall be binding upon,
                      --------------
inure to the benefit of and be enforceable by Borrower, Lender and their
respective successors and assigns. Borrower may not assign, transfer,
hypothecate or otherwise convey its rights, benefits, obligations or duties
hereunder without the prior express written consent of Lender. Any such
purported assignment, transfer, hypothecation or other conveyance by Borrower
without the prior express written consent of Lender shall be void. Borrower
acknowledges and agrees that in connection with an assignment of, or grant of a
participation in, the Obligations, Lender may assign, or grant participations
in, all or a portion of its rights and obligations hereunder, including the
benefit of Section 18. Upon any assignment of Lender's rights hereunder, such
assignee shall have, to the extent of such assignment, all rights of Lender
hereunder and may in turn assign such rights. Borrower agrees that, upon any
such assignment, such assignee may enforce directly, without joinder of Lender,
the rights of Lender set forth in this Agreement. Any such assignee shall be
entitled to enforce Lender's rights and remedies under this Agreement to the
same extent as if it were a "Lender" party hereto.

          SECTION 12. Governing Law. This Agreement shall be governed by, and
                      -------------
construed in accordance with, the law of the State of California, except as
required by mandatory provisions of law and to the extent the validity or
perfection of the security interests hereunder, or the remedies hereunder, in
respect of any Collateral are governed by the law of a jurisdiction other than
California.

          SECTION 13. Entire Agreement; Amendment. This Agreement contains the
                      ---------------------------
entire agreement of the parties with respect to the subject matter hereof and
shall not be amended except by the written agreement of the parties.

          SECTION 14. Severability. Whenever possible, each provision of this
                      ------------
Agreement shall be interpreted in such manner as to be effective and valid under
all applicable laws and regulations. If, however, any provision of this
Agreement shall be prohibited by or invalid under any such law or regulation in
any jurisdiction, it shall, as to such jurisdiction, be deemed modified to
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only to
the extent of such prohibition or invalidity without affecting the remaining
provisions of this Agreement, or the validity or effectiveness of such provision
in any other jurisdiction.

          SECTION 15. Counterparts. This Agreement may be executed in any
                      ------------
number of counterparts and by different parties hereto in separate counterparts,
each of which when so

                                       9
<PAGE>

executed shall be deemed to be an original and all of which taken together shall
constitute but one and the same agreement.

          SECTION 16. Termination. Upon payment and performance in full of all
                      -----------
Obligations, the security interests created by this Agreement shall terminate
and Lender shall promptly execute and deliver to Borrower such documents and
instruments reasonably requested by Borrower as shall be necessary to evidence
termination of all such security interests given by Borrower to Lender
hereunder.

          SECTION 17. Conflicts. In the event of any conflict or inconsistency
                      ---------
between this Agreement and the Note, the terms of this Agreement shall control.

          SECTION 18. Costs and Expenses
                      ------------------

             (a) Borrower agrees to pay on demand all costs and expenses of
Lender, and the fees and disbursements of counsel, in connection with the
enforcement or attempted enforcement of, and preservation of any rights or
interests under, this Agreement and the Documents, including in any out-of-court
workout or other refinancing or restructuring or in any bankruptcy case, and the
protection, sale or collection of, or other realization upon, any of the
Collateral, including all expenses of taking, collecting, holding, sorting,
handling, preparing for sale, selling, or the like, and other such expenses of
sales and collections of Collateral.

             (b) Any amounts payable to Lender under this Section 18 or
otherwise under this Agreement if not paid upon demand shall bear interest from
the date of such demand until paid in full, at the default rate of interest set
forth in the Schedule.

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

                              ARIEL CORPORATION

                              By: ________________________________________
                                  Title:

                              Address:

                              2540 Route 130
                              Cranbury, NJ  08512
                              Attn: Dennis Schneider, President

                              Fax:  (     ) _________________

                                       10
<PAGE>

                              MAYAN NETWORKS CORPORATION

                              By: ________________________________________
                                  Title:

                              Address:

                              2115 O'Nel Drive
                              San Jose, CA  95131
                              Attn.:  John Tingleff, Chief Financial Officer

                              Fax:  (408) ___-____
<PAGE>

                                   SCHEDULE 1
                           to the Security Agreement

1.  Locations of Chief Executive Office and Other Locations, Including of
    Collateral

    a.  Chief Executive Office and Principal Place of Business:

    b.  Jurisdiction of organization:

    c.  Other locations where Borrower conducts business or Collateral is kept:

2.  Trade Names and Trade Styles; Other Corporate, Trade or Fictitious Names,
    Etc.

                                      S-1

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