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Sample Business Contracts

OEM Agreement - Packeteer Inc. and ADC Telecommunications Inc.

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                                PACKETEER, INC.
                                 OEM AGREEMENT

                               AGREEMENT NO. 2080


    THIS OEM AGREEMENT (the "Agreement") is entered into as of this 17 day of
December, 1998 (the "Effective Date"), by and between PACKETEER, INC., a
Delaware corporation having its principal place of business at 10495 N. De Anza
Blvd., Cupertino, CA 95014 (together with any Affiliates, "Packeteer"), and ADC
TELECOMMUNICATIONS, INC., a Minnesota corporation having its principal place of
business at 12501 Whitewater Drive, Minnetonka, MN 55343 (together with any
Affiliates, "ADC").

                                    RECITALS

    Packeteer is engaged in the design and manufacture of certain products,
incorporating both hardware and software elements, which products are utilized
in the allocation of bandwidth on wide area network access lines, and related
products.

    ADC is engaged in the design and manufacture of certain products,
incorporating both hardware and software elements, which products are utilized
in networks.

    ADC desires to port Packeteer's software to ADC's platform, and to
incorporate additional ADC software and hardware elements to create an enhanced
WAN access product and to distribute such product.

    Accordingly, the parties agree as follows:

1.  DEFINITIONS

    1.1  "AFFILIATE" means an entity controlling, controlled by, or under
common control with a party, such control being exercised through ownership or
control, directly or indirectly, of 50% or more of the voting power of the
shares.

    1.2  "ADC PRODUCT" means ADC's product that incorporates the Ported
Software, and which provides all the functionality detailed in ATTACHMENT F
("Specifications for ADC Product"), and no greater or lesser functionality than
that detailed therein. In addition to the Ported Software, the ADC Product
includes the following components:

        1.2.1  "ADC SOFTWARE" means the software portion of the ADC Product
(other than the Ported Software) developed by or for ADC. The ADC Software has
been partially developed as of the Effective Date. The ADC Software will be
integrated with Packeteer Software only through the Packeteer API.

        1.2.2.  "ADC HARDWARE" means the hardware portion of the ADC Product
developed by or for ADC.


                                       1.
<PAGE>   2
     1.3  PACKAGES. The Packeteer Software comprises a single OEM software
component that includes the following packaging options:

          1.3.1 "APPLICATION DISCOVERY SOFTWARE PACKAGE" (SHAPING OFF MODE)
means the Packeteer Software as enabled only for analyzing network traffic flow
and usage and for measuring information related to the network traffic flow, as
described in the PacketShaper/ADC OEM Deliverables document referenced in
ATTACHMENT A ("Packeteer Software").

          1.3.1 "RATE CONTROL SOFTWARE PACKAGE" (SHAPING ON/OFF MODE) means the
Packeteer Software as enabled for analyzing network traffic flow and usage and
for prioritizing packets and limiting/controlling partitions that specify
minimum and maximum levels for aggregate traffic classes, as described in the
PacketShaper/ADC OEM Deliverables document referenced in ATTACHMENT A
("Packeteer Software").

     1.4  "PACKETEER DOCUMENTATION" means the training manuals and end user
manuals supplied to ADC by Packeteer relating to the Packeteer Software.

     1.5  "PACKETEER SOFTWARE" means that software listed as "Packeteer
Software" in ATTACHMENT A ("Packeteer Software), and any Updates thereto
provided under this Agreement. The Packeteer Software includes the following
components:

          1.5.1 "PACKETEER SOFTWARE SOURCE" means the human-readable source
code for the Packeteer Software. The Packeteer Software Source does not include
any third party software or materials which Packeteer is unable to sublicense
in source code form.

          1.5.2 "PACKETEER SOFTWARE INFORMATION" means supporting information
provided by Packeteer to enable a programmer reasonably skilled in the art to
make use of the Packeteer Software source.

          1.5.3 "PACKETEER API" means an application programming interface
developed by Packeteer to permit third party software (such as the ADC
Software) to call certain documented functions in the Packeteer Software. The
Packeteer API is described in detail in ATTACHMENT B ("PacketShaper: OEM
Software Porting Guide"), (the "PACKETSHAPER PORTING GUIDE document, Revision
1.10, dated 11/9/98.

     1.6  "PORTED SOFTWARE" means the software, in object code form only,
resulting from ADC's porting and compilation of the Packeteer Software Source
and the Packeteer API to the ADC platform.

     1.7  "SOURCE CODE SITES" means those geographic locations at which ADC may
access, store and use the Packeteer Software Source and that are specified in
ATTACHMENT H ("Source Code Sites"). The Source Code Sites may be changed, or
other sites added, upon mutual written agreement of the parties, where
Packeteer's approval will remain in its sole discretion.

     1.8  "UPDATES" means those additions, modifications, error corrections,
bug fixes, enhancements, updates, upgrades, future versions and any derivative
works made by Packeteer (or by a third party on Packeteer's behalf) to the
Packeteer Software (or any component thereof)




                                       2
<PAGE>   3
and made generally commercially available by Packeteer. Updates is not meant to
include other modules or plug-ins which have unique characteristics for
specific markets and that are designed to be used in connection with the
feature set (and no more than the feature set) of the Packeteer Software
provided to ADC in accordance with ATTACHMENT A ("Packeteer Software").

2.   LICENSE GRANTS

     2.1  LIMITED SOURCE CODE LICENSE. Subject to the terms and conditions of
this Agreement, Packeteer hereby grants to ADC a non-exclusive,
non-transferable license to use the Packeteer Software Source at a Source Code
Site for the sole purpose of porting and compiling the Packeteer Software
Source and Packeteer API to ADC's platform to create the Ported Software for
inclusion in the ADC Product.

     2.2  DISTRIBUTION LICENSE. Subject to the terms and conditions of this
Agreement, Packeteer hereby grants to ADC a non-exclusive, non-transferable,
royalty-bearing license to reproduce the Ported Software and sublicense and
distribute (through multiple tiers of distribution) the Ported Software solely
as integrated with the ADC Product, by way of licenses to end user customers
("End User Licenses" and "End Users," respectively). Notwithstanding the
foregoing, ADC will be permitted to distribute Updates to existing End Users on
an unbundled basis.

     2.3  EXCLUSIONS.

          2.3.1 THIRD PARTY TOOLS. No license is granted hereunder to any third
party development tools or other software required to replicate the Packeteer
Software development environment ("Third Party Tools").

          2.3.2 OTHER EXCLUDED COMPONENTS. The materials delivered may contain
certain third party software excluded from the definition of Packeteer Software
("Excluded Components"). Such Excluded Components and any additional or
different terms applicable thereto are described in ATTACHMENT A.

          2.3.3 NO ADDITIONAL RIGHTS. ADC specifically acknowledges that, other
than as expressly set forth above, no rights to the Packeteer Software are
granted to ADC hereunder and there are no implied licenses under this
Agreement. Without limiting the generality of the foregoing, ADC acknowledges
that it has no right to modify the Packeteer Software Source or Packeteer API,
and that any modification will be deemed a material breach of the Agreement. In
addition to any remedies available to Packeteer for such breach, Packeteer will
have no obligations to support the modified Packeteer Software or the resulting
ADC Product, and ADC shall assign all rights, title and interest in any created
unpermitted modifications to Packeteer. Further, ADC agrees that the ADC
Software and ADC Hardware will only access the Ported Software by means of the
Packeteer API (i.e., no calls will be made to the Ported Software except
through the Packeteer API); breach of the foregoing will also be deemed a
material breach of this Agreement. Except as expressly set forth above, ADC
will have no right to sublicense or transfer the rights granted herein to any
third party.

     2.4  DOCUMENTATION. Subject to the terms and conditions hereof, Packeteer
grants to ADC a royalty-free non-exclusive, non-transferable, sub-licensable
license to localize,

                                       3.



<PAGE>   4
reproduce, distribute, reformat, modify and sublicense the Packeteer
Documentation so as to apply to the ADC Product. ADC recognizes that its
ownership of any derivative works of the Packeteer Documentation is subject to
Packeteer's underlying ownership of the Packeteer Documentation. ADC agrees
that it will not modify or delete any copyright notices or other proprietary
notices included in the Packeteer Documentation without written approval of
Packeteer. Packeteer will have the right to inspect the modified Packeteer
Documentation to ensure that it meets Packeteer's quality standards.

     2.5  TRADEMARK LICENSE. Subject to compliance with the terms of this
Agreement (including, but not limited to, PARAGRAPH 11 ("Trademarks")) and
ATTACHMENT D ("Packeteer Trademarks"), Packeteer hereby grants to ADC a
non-exclusive, non-transferable, limited license to use the trademarks set
forth in ATTACHMENT D ("Packeteer Trademarks") in connection with the marketing
and distribution of the ADC Products.

     2.6  END USER LICENSE. ADC will take all steps necessary to protect
Packeteer's proprietary rights in the Packeteer Software and to ensure that
each ADC Product will be accompanied by a localized copy of ADC's standard
software license agreement applicable to such software which will include terms
and conditions no less protective of Packeteer's interests as those set forth
in ATTACHMENT C ("Packeteer End User License Agreement").

3.   DELIVERY

     3.1  INITIAL DELIVERY; ACCEPTANCE. Upon receipt of the Initial Delivery
Fee, Packeteer will deliver the Packeteer Software to ADC, including the
Packeteer Software Source, the Packeteer Software Information, the Packeteer
API, and the Packeteer Documentation, all in electronic form, and where
suitable, also in paper form. The Packeteer Software will be deemed accepted
upon delivery.

     3.2  MAINTENANCE DELIVERIES. So long as ADC has paid the applicable
maintenance fees and Packeteer is still offering maintenance releases for the
Packeteer Software, Packeteer will deliver applicable Updates to the Packeteer
Software as such Updates are made generally available to Packeteer's customers.
Such deliveries will be deemed accepted upon delivery.

     3.3  INCORPORATING UPDATES. ADC will have the opinion to incorporate such
Updates into the ADC Product, provided that if ADC fails to successfully
incorporated such Updates within one (1) year after such Update is made
available to ADC, (a) the trademark license set forth in PARAGRAPH 2.5
("Trademark License") will terminate and ADC will cease to use the Trademarks
in connection with such ADC Product, and (b) Packeteer will bear no obligation
to continue to provide technical support (but will continue to provide Updates
during the Maintenance Period) for such out-of-date ADC Product.

4.   SUPPORT AND MAINTENANCE

     4.1  DEMONSTRATION. Packeteer will provided a "walk-through" demonstration
(not to exceed one day) for the Packeteer Software, and periodically for each
Update it delivers.

     4.2  MODIFICATIONS TO PACKETEER SOFTWARE. In the course of developing the
ADC Product, ADC may from time to time request that Packeteer make changes to
the Packeteer



                                       4.

<PAGE>   5
* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.


Software in order to provide additional functionality. During the period in
which ADC is paying Packeteer for maintenance and is in compliance with its
maintenance obligations (a "Maintenance Period"), Packeteer agrees to consider
such requested changes promptly, and if it finds, in its sole discretion, such
requested changes to be reasonable to the future development of the Packeteer
Software, to implement such changes promptly as an Update, all without
additional charge to ADC.

      4.3   END USER SUPPORT. ADC will be solely responsible for providing all
support and maintenance for End Users of the ADC Product. ADC will provide its
End Users with reasonable documentation, warranty service, and e-mail or
telephone support for the use of the ADC Product consistent with good industry
practice and the terms of this Agreement.

      4.4   TECHNICAL SUPPORT. During the Maintenance Period, Packeteer will
provide ADC (but not ADC's End Users, distributors or resellers) with
development support (including access to technical, engineering and management
staff) in the form of telephone and e-mail responses to questions that ADC may
have with respect to the current version of the Packeteer Software and any
previous versions released by Packeteer within the past twelve (12) months.
Packeteer will provide support solely for questions related to the unmodified
Packeteer Software. In the event that such technical support requests become
unduly burdensome, the parties shall confer to discuss whether the number of
hours per month which Packeteer spends providing support should be reduced, or
if the fee for such support should be increased.

      4.5   COMPATIBILITY. Updates provided hereunder for functionality that
has previously been implemented by ADC will be "backwards compatible" (so that
there will be no substantial loss of functionality) with the previously
released version and any versions released in the preceding twelve (12) months.

5.    PAYMENTS

      5.1   INITIAL DELIVERY. On the Effective Date, ADC will pay Packeteer a
fee (the "Initial Delivery Fee") of [*]. This Initial Delivery Fee shall include
maintenance and support for a one (1) year period following the Effective Date.
Packeteer will make the initial delivery of the Packeteer Software to ADC within
five (5) business days of the Effective Date.

      5.2   ANNUAL MAINTENANCE. For each additional year (commencing on the
anniversary of the Effective Date) for which ADC desires to receive Updates and
technical support, it will pay Packeteer an annual maintenance fee (the
"Maintenance Fee") as set forth on SCHEDULE 1 ("Fees"). Any decision by ADC not
to pay an annual Maintenance Fee shall terminate those obligations by Packeteer
to provide Updates under PARAGRAPH 3.2 ("Maintenance Deliveries") and technical
support under PARAGRAPHS 4.2 ("Modifications to Packeteer Software") and 4.4
("Technical Support") but shall not otherwise terminate the licenses granted in
PARAGRAPHS 2.1 ("Limited Source Code License") and 2.2 ("Distribution License")
or other obligations of the Parties to this Agreement. Any decision by ADC not
to pay an annual Maintenance Fee shall not relieve ADC from any of its
obligations under this Agreement including the payment of the Royalties under
PARAGRAPH 5.3 ("Royalties"). Upon a failure by ADC to successfully incorporate
any Update as contemplated in PARAGRAPH 3.3 ("Incorporating Updates") within
one (1) year after it is delivered to ADC, (a) ADC will cease to use the
Trademarks (as described




                                       5
<PAGE>   6
in PARAGRAPH 3.3 ("Incorporating Updates")), and (b) Packeteer shall have the
option not to accept any further Maintenance Fee from ADC and to terminate its
obligations to provide Updates under PARAGRAPH 3.2 ("Maintenance Deliveries")
after the current Maintenance Period.

      5.3   ROYALTIES. The royalties and other fees payable will be as set
forth on SCHEDULE 1 ("Fees").

      5.4   TAXES. ADC agrees to pay, and to indemnify and hold Packeteer
harmless from, any sales, use, excise, import or export, value added or similar
tax, not based on Packeteer's net income, as well as the collection or
withholding thereof, including penalties and interest, as well as any costs
associated with the collection or withholding thereof, and all government
permit or license fees and all customs, duty, tariff and similar fees levied
upon the delivery of the Packeteer Software, the ADC Product or related
products, as well as any costs associated with the collection of any of the
foregoing items. ADC will be responsible for obtaining, at its expense, all
required import licenses, permits or other governmental orders. If a resale
certificate or other certificate, document or other evidence of exemption or
payment or withholding of taxes by ADC is required in order to exempt the
distribution or licensing of the Packeteer Software, ADC Product or other
related product from any such liability or to enable Packeteer to claim any tax
exemption, credit, or other benefit, ADC will promptly furnish such certificate
or document to Packeteer.

      5.5   REPORTING. On a quarterly basis, ADC will, within thirty (30) days
following the end of such quarter, provide Packeteer a report including the
following: (a) the number of units of the ADC Product sold during that quarter,
broken down by units in which the Rate Control Software Package is and is not
enabled; (b) geographic information related to the units of ADC Product sold
during that quarter, including, at least, by the country of the sale and, if in
the United States, also by the State and zip code of the sale; (c) the number
of previously sold units of the ADC Product for which the Rate Control Software
Package was enabled during that quarter; and (d) the royalty payments due
during that quarter.

      5.6   AUDIT. Each party will keep and maintain, for a period of three (3)
years, proper records and books of account relating to licenses of the ADC
Product to customers and End Users. Upon reasonable notice to the other party,
a party may have a reputable independent auditor inspect, at the requesting
party's expense, such records to verify the other party's payments hereunder no
more than once every six (6) months; however, if the audit reveals a
discrepancy of more than 5%, then the recordkeeper will pay for the cost of the
audit and the auditing party will have the right to conduct another audit
within the six (6) month period.

      5.7   MANNER OF PAYMENT. All payments due hereunder are in U.S. Dollars.
ADC shall include royalty payments with each report.

      5.8   OVERDUE PAYMENTS. Overdue payments will be subject to a finance
charge of the lesser of one and one-half percent (1-1/2%) per month or the
highest interest rate allowed by law, for each month or fraction thereof that
such amounts are past due.

6.    DEVELOPMENT AND TESTING




                                       6.
<PAGE>   7
      6.1   ADC DEVELOPMENT RESPONSIBILITIES. ADC will be responsible for
creating the Ported Software, the ADC Product, and incorporating Updates in the
ADC Product in compliance with the terms of the Agreement. In addition, ADC
will be responsible for creating and delivering to Packeteer a list of errors
found prior to Packeteer's certification or testing of the ADC Product pursuant
to ATTACHMENT G ("Test Certification Procedures").

      6.2   TESTING AND CERTIFICATION OF ADC PRODUCTS. ADC will test each
version of the ADC Product. Once yearly, Packeteer will certify ADC's test
results or perform independent testing in accordance with the procedures in
ATTACHMENT G ("Test Certification Procedures"). If the ADC Product passes
Packeteer's Test Certification Procedures, then ADC shall be entitled to market
and distribute the ADC Product under the Trademarks under the terms of this
Agreement and advise End Users that the ADC Product has passed the Test
Certification Procedures. ADC will provide Packeteer with reasonable access to
the ADC Software and Ported Software, including, but not limited to, exposing
command line interfaces for the ADC Software in the testing versions of the ADC
Product in order to permit Packeteer to perform regression testing and to
confirm that no unpermitted modifications have been made to the Packeteer
Software. Such regression testing will not be designed to permit Packeteer to
analyze the ADC Software (its source or object code) to determine the manner
and methods utilized in supporting its functionality without the prior written
permission of ADC.

      6.3   LOANED EQUIPMENT. ADC will loan Packeteer all necessary equipment
for such certification testing. All equipment loaned by ADC to Packeteer will
remain the property of ADC, will be fully insured by Packeteer, and will be
returned to ADC at its request after termination of Packeteer's testing
activities hereunder. ADC will pay all shipping and other costs (including,
without limitation, custom fees and duties) resulting from delivery of such
loaned equipment to Packeteer. Any loaned equipment will be returned to ADC by
Packeteer, shipping, insurance and any other applicable costs prepaid by ADC.
While in the possession of Packeteer, the loaned equipment will be maintained
by ADC in good working order.

7.    MARKETING

      7.1   PROMOTIONAL EFFORTS. Without limiting ADC's ability to develop
Competitive Products (as defined in PARAGRAPH 10.8 ("Access")) in compliance
with the terms of this Agreement, ADC agrees to use its reasonable commercial
efforts to market and distribute the ADC Product to End Users. ADC may
advertise the ADC Product in advertising media of ADC's choice. ADC will use
the Trademarks in accordance with the terms of this Agreement in conducting
such marketing efforts.

      7.2   PRESS RELEASE. The parties will create a mutually agreeable press
release to announce the execution of this Agreement. Neither party will
disclose any terms of the Agreement, except pursuant to a mutually agreeable
press release or as otherwise required by law.

8.    WARRANTY

      8.1   PACKETEER WARRANTY. Packeteer warrants for a period of ninety (90)
days from delivery (the "Warranty Period") that the unmodified Packeteer
Software Source will compile in




                                       7.
<PAGE>   8
the development environment specified by Packeteer to yield the corresponding
object code version of such source code (excluding any Excluded Components). If
ADC reports to Packeteer a failure of the Packeteer Software Source to conform
to the foregoing warranty during the Warranty Period, and provides such detail
as Packeteer may require to permit Packeteer to reproduce such failure,
Packeteer, at its expense, shall use reasonable commercial efforts to modify or
replace the Packeteer Software Source to correct such failure. ADC acknowledges
that the Packeteer Software Source delivered by Packeteer to ADC will require
adaptation by ADC or Packeteer for compatibility with ADC platforms and
configurations, which platforms and configurations will generally be different
from the development environment and platform used by Packeteer. ADC
acknowledges that the Packeteer Software is of such complexity that it may have
inherent defects, and agrees that Packeteer makes no other warranty, either
express or implied, as to any matter whatsoever. The foregoing states
Packeteer's sole and exclusive warranty to ADC concerning the Packeteer
Software Source and ADC's sole and exclusive remedy for breach of warranty.

     8.2  DISCLAIMER. EXCEPT AS SET FORTH IN PARAGRAPH 8.1 ("PACKETEER
WARRANTY"), THE PACKETEER SOFTWARE IS PROVIDED TO ADC "AS-IS" AND WITHOUT ANY
WARRANTY OF ANY KIND, EXPRESS, IMPLIED, OR STATUTORY. PACKETEER EXPRESSLY
DISCLAIMS ANY IMPLIED WARRANTIES OF NON-INFRINGEMENT, FITNESS FOR A PARTICULAR
PURPOSE OR MERCHANTABILITY.

9.   INDEMNITY

     9.1  BY PACKETEER. Packeteer agrees to defend and otherwise hold ADC
harmless from any costs, damages and reasonable attorneys' fees resulting from
any claim that the uses permitted hereunder of the Packeteer Software infringe
any U.S. patents or U.S. copyrights, or misappropriate the trade secrets of any
third party, provided that ADC gives Packeteer prompt written notice of any
such claim, tenders to Packeteer the defense or settlement of such a claim at
Packeteer's expense, and cooperates with Packeteer, at Packeteer's expense, in
defending or settling such claim. If Packeteer receives notice of an alleged
infringement or if ADC's use of the Packeteer Software is prevented by
permanent injunction, Packeteer may, at its sole option and expense, procure
for ADC the right to continue use of the Packeteer Software, modify the
Packeteer Software such that it is no longer infringing, or replace the
Packeteer Software with software of similar functional capability (in either of
the latter two options, the revised or replacement software must be backwards
compatible as that term is defined in PARAGRAPH 4.5 ("Compatibility")), or
terminate the license and return to ADC the Initial Delivery Fee. PACKETEER'S
OBLIGATIONS UNDER THIS SECTION WILL BE ADC'S SOLE AND EXCLUSIVE REMEDY FOR ANY
ALLEGED INFRINGEMENT OR MISAPPROPRIATION OF ANY PROPRIETARY RIGHT. PACKETEER
WILL HAVE NO LIABILITY TO ADC IF ANY ALLEGED INFRINGEMENT OR CLAIM THEREOF IS
BASED UPON THE USE OF THE PACKETEER SOFTWARE IN CONNECTION OR IN COMBINATION
WITH EQUIPMENT, DEVICES OR SOFTWARE NOT DELIVERED BY PACKETEER (IF SUCH
INFRINGEMENT OR CLAIM COULD HAVE BEEN AVOIDED BY THE USE OF THE UNMODIFIED
PACKETEER SOFTWARE WITH OTHER EQUIPMENT, DEVICES OR SOFTWARE), OR THE USE OF
THE PACKETEER SOFTWARE OTHER THAN AS PERMITTED UNDER THIS AGREEMENT OR IN A
MANNER FOR WHICH IT WAS NOT INTENDED, OR, AFTER THE TRANSITION PERIOD (AS
DEFINED IN PARAGRAPH



                                       8.

<PAGE>   9
9.1.1) USE OF OTHER THAN THE MOST CURRENT RELEASE OF THE PACKETEER SOFTWARE (IF
SUCH CLAIM WOULD HAVE BEEN PREVENTED BY THE USE OF SUCH RELEASE).

     9.1.1     UPDATES. IF PACKETEER GIVES ADC NOTICE THAT A SPECIFIC UPDATE IS
REQUIRED IN ORDER TO AVOID INFRINGING THE INTELLECTUAL PROPERTY RIGHTS OF A
THIRD PARTY, AND IF WITHIN SIXTY (6) DAYS ("THE TRANSITION PERIOD") ADC FAILS
TO USE SUCH UPDATE AND TO DISTRIBUTE SUCH UPDATE TO ITS END USERS, THEN
PACKETEER WILL HAVE NO LIABILITY TO ADC UNDER PARAGRAPH 9.1 FOR INFRINGING SUCH
INTELLECTUAL PROPERTY RIGHTS IF THE INFRINGEMENT WOULD BE AVOIDED IF ADC
ADOPTED SUCH UPDATE.

     9.2  BY ADC. ADC agrees to defend and otherwise hold Packeteer harmless
from any costs, damages and reasonable attorneys' fees resulting from any claim
that the uses permitted hereunder of the ADC Product infringe any U.S. patents
or U.S. copyrights, or misappropriate the trade secrets of any third party,
provided that Packeteer gives ADC prompt written notice of any such claim,
tenders to ADC the defense or settlement of such a claim at ADC's expense, and
cooperates with ADC, at ADC's expense, in defending or settling such claim.
ADC'S OBLIGATIONS UNDER THIS SECTION WILL BE PACKETEER'S SOLE AND EXCLUSIVE
REMEDY FOR ANY ALLEGED INFRINGEMENT OR MISAPPROPRIATION OF ANY PROPRIETARY
RIGHTS.

10.  PROTECTION OF PROPRIETARY RIGHTS

     10.1  PACKETEER OWNERSHIP. Packeteer and its suppliers are the sole and
exclusive owners of all rights, title and interest, including all Trademarks,
copyrights, patents, trade names, trade secrets, and other intellectual
property rights to the Packeteer Software, and in any modifications made to the
Packeteer Software at ADC's request or suggestion under PARAGRAPH 4.2
("Modifications to Packeteer Software"). Except for the rights expressly
enumerated herein, ADC is not granted any rights to patents, copyrights, trade
secrets, trade names, trademarks (whether or not registered), or any other
rights, franchises or licenses with respect to the Packeteer Software. ADC
agrees to protect the Packeteer Software in accordance with PARAGRAPH 10
("Protection of Proprietary Rights") and ATTACHMENT E ("Secure Procedures").
Failure to protect the proprietary rights of Packeteer and its suppliers in the
Packeteer Software, as required by this Agreement, will be considered a
material breach of this Agreement.

     10.2  ADC OWNERSHIP. ADC and its suppliers are the sole and exclusive
owners of all rights, title and interest, including all trademarks, copyrights,
patents, trade names, trade secrets, mask works, and other intellectual
property rights to the ADC Product (excluding the Ported Software). Except for
the rights expressly enumerated herein (e.g., the right to perform certain
regression testing), Packeteer is not granted any rights to patents,
copyrights, trade secrets, mask works, trade names, trademarks (whether or not
registered), or any other rights, franchises or licenses with respect to the
ADC Product. Packeteer agrees to protect the ADC Product in accordance with
PARAGRAPH 12 ("Confidentiality").



                                       9.
<PAGE>   10
     10.3 COOPERATION. The parties agree to cooperate and execute documents
reasonably requested to confirm such ownership or to obtain protection under
any intellectual property law.

     10.4 PROPRIETARY NOTICES. ADC agrees that as a condition of its rights
hereunder, it shall not alter the proprietary notices included in the materials
delivered by Packeteer, and that each copy of the Ported Software will contain
the same proprietary notices which appear on or in the materials provided by
Packeteer to ADC. More specifically, ADC agrees that a valid Packeteer
copyright notice will appear on the media or will be displayed on any screen
visible to a user when any ADC proprietary notices are visible, in the
following format or such other format as Packeteer specifies by written notice
to ADC: the name of the program, the word "Copyright" and the "(C)" symbol, the
year 1996 (the date of first creation of the Packeteer Software), followed by a
hyphen and the year of the most recent version of the Packeteer Software, and
the name of the copyright owner and the words "All Rights Reserved." Presence
of a copyright notice does not constitute an acknowledgment of publication. ADC
will ensure that the trademark notices are displayed in the ADC Product as set
forth in PARAGRAPH 11 ("Trademarks").

     10.5 UNAUTHORIZED DISTRIBUTION OR COPYING. ADC agrees that (except as
expressly permitted by this Agreement): (a) distributing, copying, duplicating
or otherwise reproducing all or any part of the Packeteer Software, (b)
distributing or using copies of all or any portion of the Packeteer Software
other than as embedded in a royalty-bearing ADC Product, or (c) failing to
ensure that each End User receives a license agreement as required by PARAGRAPH
2.6 ("End User License") will constitute a material breach of this Agreement.

     10.6 GOVERNMENT AGREEMENTS. ADC will take all reasonable steps in making
proposals to and agreements with governments that involve the ADC Product and
related documentation to ensure that Packeteer's proprietary rights receive the
maximum protection available from such governments for commercial computer
software and related documentation developed at private expense.

     10.7 PACKETEER TRADE SECRETS. Packeteer represents that the Packeteer
Software and those techniques, algorithms, and processes contained in the
Packeteer Software which have been developed, acquired or licensed by
Packeteer, or any modification or extraction thereof, constitute trade secrets
of Packeteer and/or its suppliers, and ADC agrees they will be used by ADC only
in accordance with the terms of this Agreement. ADC will take all measures
reasonably required to protect the proprietary rights of Packeteer and its
suppliers in the Packeteer Software Information.

     10.8 ACCESS. In consideration of the licenses and access to proprietary
information and technology of Packeteer granted under this Agreement, ADC
hereby agrees: (a) not to use the Packeteer Software to develop, manufacture or
distribute goods which compete with the Packeteer products ("Competitive
Products"); and (b) to obtain the Packeteer Software only from Packeteer.
Subject to the terms of restrictions on use of proprietary information
(including, but not limited to this PARAGRAPH 10 ("Protection of Proprietary
Rights"), ATTACHMENT D ("Packeteer Trademarks"), and ATTACHMENT E ("Secure
Procedures") provided under this Agreement, this Agreement does not preclude
ADC from independently developing similar technologies or products, where ADC
can demonstrate by competent proof that such independent


                                      10.
<PAGE>   11
development has been created without reference to the Packeteer Software
Source, Packeteer Software Information, or Packeteer Documentation.

11.   TRADEMARKS

      11.1  PROPER USE. Unless ADC or Packeteer opt to terminate the following
requirement of trademark usage and the trademark license of PARAGRAPH 2.5
("Trademark License") under the conditions set out below, ADC will make use of
the Packeteer Trademarks in accordance with the guidelines and requirements set
forth in ATTACHMENT D ("Packeteer Trademarks") and the standard guidelines and
usage requirements as promulgated by Packeteer from time to time regarding the
Trademarks. If Packeteer promulgates any changes to the standard guidelines and
usage requirements, then ADC: (a) shall have six (6) months to continue
operating under the old guidelines; (b) shall have six (6) months to continue
operating under the old guidelines for existing inventory. Either Packeteer or
ADC shall have the right to terminate the trademark usage requirement of this
PARAGRAPH 11.1 ("Proper Use") if ADC does not pay an annual Maintenance Fee as
set out in PARAGRAPH 5.2 ("Annual Maintenance") when such Maintenance Fee is
due. Furthermore, Packeteer shall, under the same instance, additionally be
able to prohibit ADC from using any Packeteer Trademark.

      11.2  RIGHT OF REVIEW. In order to assure the Packeteer Trademarks are
associated only with products and services of Packeteer's high quality
standards, Packeteer will have the right to inspect and review all such
products and services. In the event that any use of the Packeteer Trademark
does not comport with the quality standards set by Packeteer, Packeteer will
advise ADC, and ADC will improve the quality within thirty (30) days so as to
comport with Packeteer's standards or cease use of the Packeteer Trademarks
immediately.

      11.3  NO COMPETITIVE EXPLOITATION OF TRADEMARKS. With respect to any
Competitive Products which ADC develops or markets, ADC agrees that ADC will
not exploit its access to the Packeteer Software, its relationship with
Packeteer, or the existence of the Ported Software to promote Competitive
Products. Furthermore, so long as ADC is marketing the ADC Product under the
Trademarks, ADC agrees to use all reasonable efforts to distinguish the ADC
Product from any Competitive Product when displaying or referring to the ADC
Product in advertisements, catalogs, brochures and at trade shows by (a)
identifying the ADC Product prominently and exclusively with the Trademarks in
such proximity that the viewer is unlikely to associate the ADC Product with the
Competitive Product, and (b) not associating the Trademarks with any
Competitive Product in advertising, press releases, and other promotional and
marketing materials.

12.   CONFIDENTIALITY

      12.1  RESTRICTION ON USE. Except as expressly permitted by this
Agreement, each party ("Recipient"), its employees, and its contractors will
not use in any way for its own account or the account of any third party, nor
disclose to any third party, any Confidential Information revealed to it by the
other party ("Disclosing Party") without the Disclosing Party's prior written
consent; provided, however, that if any Confidential Information of the other
party is required to be disclosed pursuant to any statute, regulation, order,
subpoena or document discovery request, then the Recipient shall provide
written notice thereof to the Disclosing Party as soon as



                                      11.
<PAGE>   12

practicable in order to afford the Disclosing Party an opportunity to seek a
protective order (it being agreed that if the Disclosing Party is unable to
obtain or does not seek a protective order and the Recipient is legally
compelled to disclose such information, disclosure of such information may be
made without liability).

      12.2  DEFINITION OF CONFIDENTIAL INFORMATION. For purposes of this
Agreement, "Confidential Information" consists of (a) any information
designated by the Disclosing party in writing as confidential, (b) the
Packeteer Software Source and the Packeteer Software Information, (c) the
source code and technical documentation for the ADC Product, and (d) the terms
and conditions of this Agreement. Information in oral form will be considered
Confidential Information only to the extent it is (x) identified as
confidential prior to disclosure and (y) summarized in writing and transmitted
to the Recipient, identified as proprietary, within thirty (30) days after the
oral disclosure.

      12.3  EXCLUSIONS FROM DEFINITION OF CONFIDENTIAL INFORMATION.
Confidential Information will not include, and this PARAGRAPH 12
("Confidentiality") will not apply to information that (a) was known to the
Recipient prior to its receipt from the Disclosing Party; (b) is or becomes
public knowledge without fault of Recipient; (c) is acquired by Recipient from
a third party with the right to disclose same and without binder of secrecy;
(d) is independently developed by a party without using the other party's
Confidential Information; or (e) has been approved for release by written
authorization of the Disclosing Party.

      12.4  STANDARD OF CARE. Each party will use the same standard of care
that it applies to its own Confidential Information, but in no event less than
reasonable care. Each party agrees to notify the other promptly in the event of
any breach of confidentiality or security under conditions in which it would
appear that any Confidential Information was prejudiced or exposed to loss, and
will, upon request of the other, take all reasonable steps necessary to recover
any compromised trade secrets disclosed to it or placed in its possession by
virtue of this Agreement. Without limiting the generality of the foregoing, ADC
agrees to comply with the terms of ATTACHMENT E ("Secure Procedures") regarding
the handling of the Packeteer Software.

13.   LIMITATION OF LIABILITY

EXCEPT IN THE CASE OF WILLFULNESS OR GROSS NEGLIGENCE, NEITHER PACKETEER NOR
ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AFFILIATES, OR AGENTS WILL BE LIABLE
TO ADC OR TO ANY THIRD PARTY FOR ANY LOSS OF USE, INTERRUPTION OF BUSINESS, OR
FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
PROFITS OR REVENUES) OR SIMILAR DAMAGES, WHETHER BASED ON TORT (INCLUDING
WITHOUT LIMITATION, NEGLIGENCE OR STRICT LIABILITY), CONTRACT, OR OTHER LEGAL
OR EQUITABLE GROUNDS, EVEN IF PACKETEER HAS BEEN ADVISED OR HAD REASON TO KNOW
OF THE POSSIBILITY OF SUCH DAMAGES AND EVEN IN THE EVENT OF FAILURE OF
EXCLUSIVE REMEDIES. In no event will Packeteer's liability under this
Agreement, including claims for contribution or indemnity, exceed the greater
of US $100,000 (One Hundred Thousand Dollars) and all fees paid pursuant to
this Agreement in the twelve (12) months preceding the claim giving rise to
such liability.


                                      12.
<PAGE>   13


14.  TERM AND TERMINATION

     14.1  TERM. The initial term of this Agreement will be five (5) years from
the Effective Date. At the conclusion of such term (or any subsequent renewal
term), the Agreement will automatically renew for another three (3) year term
unless either party has given written notice to the other at least sixty (60)
days prior to the renewal date of such party's intention not to renew the
Agreement.

     14.2  TERMINATION FOR MATERIAL BREACH. Either party may terminate this
Agreement if the other party has breached any material term of this Agreement
and such breach remains uncured for forty five (45) days after written notice
of such breach (which notice will, in reasonable detail, specify the nature of
such breach).

     14.3  BANKRUPTCY. A party may terminate this Agreement upon written notice
to the other in the event the other (a) becomes insolvent or admits in writing
its inability to pay its debts as they mature, or makes an assignment for the
benefit of creditors; (b) files a petition under any foreign, state, or United
States bankruptcy act, receivership statute, or the like, as they now exist, or
as they may be amended; (c) any third party files against it such a petition,
or an application for a receiver of either party is made by anyone and such
petition or application is not resolved favorably within sixty (60) days; or
(d) discontinues its business.

     14.4  LIMITED DISTRIBUTION RIGHT UPON NONRENEWAL. In the event that
Packeteer elects to renew this Agreement under the terms of PARAGRAPH 14.1
("Term"), ADC will be permitted, for a period of five (5) years from such
election (the "Extension Term"), to continue to sell the ADC Product in the from
in which such ADC Product exists at the time of such election (the "Latest ADC
Product"), subject to ADC's continued compliance with the terms of this
Agreement. During the Extension Term, ADC may sell the Latest ADC Product only
to those End Users who were bound by End User Licenses as of the Date of
Packeteer's election not to renew, and not to new customers. During the
Extension Term (a) ADC's royalty obligations with respect to distributions of
the Latest ADC Product will persist, (b) Packeteer will have no obligation to
provide any maintenance or technical support to ADC, and (c) ADC may not
distribute the Latest ADC Product under the Packeteer Trademarks. The following
sections will be of effect during the Extension Term, and all other sections
will terminate: PARAGRAPHS 1 ("Definitions"), 2.2  ("Distribution License")(but
only the first sentence), 2.3 ("Exclusions"), 2.6 ("End User License"), 4.3
("End User Support"), 5 ("Payments")(excluding PARAGRAPH 5.2 ("Annual
Maintenance")), 9 ("Indemnity"), 10 ("Protection of Proprietary Rights"), 12
("Confidentiality"), 13 ("Limitation of Liability"), 14 ("Term and
Termination"), 15 ("No Patent License."), and 16 ("General").

     14.5  OBLIGATIONS ON CANCELLATION, TERMINATION OR EXPIRATION. Upon
cancellation, termination, or expiration of this Agreement:

           14.5.1  LICENSES TERMINATED. The licenses granted pursuant to
PARAGRAPH 2 ("License Grants") will terminate immediately; provided, however,
that ADC will be permitted to sell (for a period of ninety (90) days from
termination) any finished inventory of ADC Product then in stock.



* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.


                                      13.
<PAGE>   14
     14.5.2    SAFEGUARDING OF PROPRIETARY RIGHTS. ADC will continue to be
responsible for safeguarding the proprietary rights of Packeteer and
Packeteer's suppliers in accordance with this Agreement, including PARAGRAPHS
10 ("Protection of Proprietary Rights"), 11 ("Trademarks"), and ATTACHMENT E
("Secure Procedures") after such cancellation, termination, or expiration.

     14.5.3    RETURN OR DESTRUCTION OF PACKETEER INFORMATION. Except for the
limited exemption set forth in PARAGRAPH 14.5.1 ("Licenses Terminated")
permitting ADC to sell out existing inventory, ADC will immediately discontinue
use and distribution of the Packeteer Software, and return or destroy all
copies of the Packeteer Software and any Packeteer deliverables in its
possession (including copies placed in any storage device under ADC's control);
provided, however, that ADC may keep a reasonable number of copies for
supporting existing End Users. Upon Packeteer's request, ADC will warrant in
writing to Packeteer compliance with this PARAGRAPH 14.5.3.

     14.5.4    PAYMENT. The payment date of all monies due Packeteer will
automatically be accelerated so that they will become due and payable on the
effective date of termination, even if longer terms had been provided
previously.

     14.5.5    CONTINUED USE BY END USERS. End Users will be permitted the
continued and uninterrupted use of the ADC Products for the balance of the term
of their End User agreements, as specified in such agreements, provided that
and so long as the End Users are not in default of their End User agreements.

     14.5.6    SURVIVAL. The following sections will survive the termination of
expiration of this Agreement: PARAGRAPHS 1 ("Definitions"), 2.3 ("Exclusions"),
2.6 ("End User License"), 8 ("Warranty"), 9 ("Indemnity"), 10 ("Protection of
Proprietary Rights"), 12 ("Confidentiality"), 13 ("Limitation of Liability"),
14 ("Term and Termination"), 15 ("No Patent License."), and 16 ("General").

15.  NO PATENT LICENSE.

     15.1 PACKETEER PATENTS. As used herein, "Packeteer Patent Right" means any
right arising under any United States or foreign patent now owned by, or later
issued or assigned to Packeteer, applicable to the Packeteer Software.
Packeteer covenants that, to the extent that ADC, ADC's sublicensees as
authorized in this Agreement, ADC's End Users, and ADC's other direct and
indirect customers of Packeteer Software (collectively "Customers") exercise
the rights expressly granted in PARAGRAPH 2 ("License Grants") to ADC, or which
ADC is authorized to grant to Customers herein, Packeteer will not (a) assert
any Packeteer Patent Right against ADC, (b) assert any Packeteer Patent Right
against Customers, or (c) require any additional fee or royalty from ADC or
Customers based upon any Packeteer Patent Right. Except to the extent of such
covenant not to assert any Packeteer Patent Right, nothing contained herein
will be construed as conferring, by implication, estoppel, or otherwise, any
license or right with respect to any Packeteer Patent Right.

     15.2 ADC PATENTS. As used herein, "ADC Patent Right" means any patent
right arising under any United States or foreign patent issued or assigned to
ADC and having a filing


                                      14.
<PAGE>   15
date after the inventor had access to the Packeteer Software in which (a) an
inventor is (1) an employee of ADC who has had access to the Packeteer Software
or (2) an independent contractor who has had access to the Packeteer Software
and has assigned patent rights in the claimed invention to ADC and (b) the
Packeteer Software contributed to the claimed invention. ADC Patent Right will
not include any patent applications filed three (3) years after termination or
expiration of this Agreement. ADC covenants that it will not (a) assert any ADC
Patent Right against Packeteer or against its sublicensees or customers for
products of a similar nature to that distributed by ADC, or (b) require any fee
or royalty from Packeteer or such sublicensees or customers for the sale of
such products based upon ADC Patent Rights. Except to the extent expressed
above, nothing contained herein will be construed as conferring, by
implication, estoppel, or otherwise any license or right with respect to any
ADC Patent Right.

16.  GENERAL

     16.1 GOVERNING LAW. This Agreement will be governed in all respects by the
laws of the United States of America and the State of California as such laws
are applied to agreements entered into and to be performed entirely within
California between California residents. The parties agree that the United
Nations convention on Contracts for the International Sale of Goods is
specifically excluded from application to this Agreement.

     16.2 GOVERNING LANGUAGE. This governing language and any interpretation or
construction of this Agreement will be English.

     16.3 FORUM. All disputes arising under this Agreement may be brought in
the state and federal courts located in San Jose, California, or Minneapolis,
Minnesota as permitted by law. ADC and Packeteer consent to the personal
jurisdiction of the above courts.

     16.4 NOTICES. All notices or reports permitted or required under this
Agreement will be in writing and will be delivered by personal delivery,
telegram, telex, telecopier, facsimile transmission, or by certified or
registered mail, return receipt requested, and will be deemed given upon
personal delivery, five (5) days after deposit in the mail, or upon
acknowledgment of receipt of electronic transmission. Notices will be sent to
the addresses set forth in the introductory paragraph of this Agreement and
shall be sent to the attention of the Chief Financial Officer, or to such other
address or person as may be designated in writing.

     16.5 INJUNCTIVE RELIEF. It is understood and agreed that, notwithstanding
any other provisions of this Agreement, breach of the provisions of this
Agreement relating to the protection of intellectual property rights
(including, but not limited to, PARAGRAPHS 2 ("License Grants"), 10
("Protection of Proprietary Rights"), 11 ("Trademarks"), 12
("Confidentiality"), ATTACHMENT D ("Packeteer Trademarks"), and ATTACHMENT E
("Secure Procedures") may cause the other party irreparable damage for which
recovery of money damages would be inadequate, and that a party will therefore
be entitled to obtain timely injunctive relief (whether by arbitral or judicial
authority) to protect its rights under this Agreement in addition to any and
all remedies available at law.

     16.6 NO AGENCY. Nothing contained herein will be construed as creating any
agency, partnership, or other form of joint enterprise between the parties.




                                      15.
<PAGE>   16
     16.7 FORCE MAJEURE. Neither party will be liable hereunder by reason of
any failure or delay in the performance of its obligations hereunder (except for
the payment of money) on account of strikes, shortages, riots, insurrection,
fires, flood, storm, explosions, acts of God, war, governmental action, labor
conditions, earthquakes, material shortages or any other cause which is beyond
the reasonable control of such party.

     16.8 WAIVER. The failure of either party to require performance by the
other party of any provision hereof will not affect the full right to require
such performance at any time thereafter; nor will the waiver by either party of
a breach of any provision hereof be taken or held to be a waiver of the
provision itself.

     16.9 SEVERABILITY. In the event that any provision of this Agreement will
be unenforceable or invalid under any applicable law or be so held by applicable
court decision, such unenforceability or invalidity will not render this
Agreement unenforceable or invalid as a whole, and, in such event, such
provision will be changed and interpreted so as to best accomplish the
objectives of such unenforceable or invalid provision within the limits of
applicable law or applicable decisions.

     16.10 HEADINGS. The Paragraph headings appearing in this Agreement are
inserted only as a matter of convenience and in no way define, limit, construe,
or describe the scope or extent of such Paragraph or in any way affect this
Agreement.

     16.11 ASSIGNMENT. Neither this Agreement nor any rights or obligations of
ADC hereunder may be assigned or transferred by ADC in whole or in part, whether
by operation of law or otherwise, without the prior written approval of
Packeteer which shall not unreasonably be withheld. For the purposes of this
Paragraph, a change in ownership or sale of substantially all of the assets of
ADC or the business division of ADC primarily involved in this Agreement shall
not be considered an assignment or transfer of ADC's rights. Packeteer may
exercise full transfer and assignment rights in any manner at Packeteer's
discretion and specifically may sell, pledge, or otherwise transfer its right to
receive royalties under this Agreement.

     16.12 EXPORT. ADC acknowledges that the laws and regulations of the United
States restrict the export and re-export of commodities and technical data of
United States origin, including the Packeteer Software licensed hereunder. ADC
agrees that it will not export or re-export the Packeteer Software or ADC
Product in any form, without the appropriate United States and foreign
governmental licenses, if legally required. ADC agrees that its obligations
pursuant to this Paragraph will survive and continue after any termination or
expiration of rights under this Agreement.

     16.13 FULL POWER. Each party warrants that it has full power to enter into
and perform this Agreement, and the person signing this Agreement on each
party's behalf has been duly authorized and empowered to enter into this
Agreement. Each party further acknowledges that it has read this Agreement,
understands it and agrees to be bound by it.

     16.14 ENTIRE AGREEMENT. This Agreement together with the Attachments and
appendices completely and exclusively states the agreement of the parties
regarding its subject matter. If supersedes, and its terms govern, all prior
proposals, agreements, or other



                                      16.

<PAGE>   17
communications between the parties, oral or written, regarding such subject
matter. This Agreement will not be modified except by a subsequently dated
written amendment signed on behalf of all parties by their duly authorized
representative and any provision of a purchase order purporting to supplement
or vary the provisions hereof will be void.

     16.15  COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which will be considered an original, but all of
which together will constitute one and the same instrument.

     IN WITNESS WHEREOF, the parties hereof have caused this OEM Agreement to
be executed by their duly authorized representatives as of the Effective Date.


PACKETEER, INC.                         ADC TELECOMMUNICATIONS, INC.

/s/  CRAIG ELLIOTT                      /s/  WILLIAM L. MARTIN
-----------------------------------     ---------------------------------
By:  Craig Elliott                      By:  William L. Martin
     ------------------------------          ----------------------------
Its: President & CEO                    Its: President ADC/BBG
     ------------------------------          ----------------------------


                                      17.
<PAGE>   18
                                  ATTACHMENT A

                               PACKETEER SOFTWARE

PACKETEER SOFTWARE

The document entitled "PACKETSHAPER/ADC OEM DELIVERABLES is fully incorporated
within this Attachment A and is directly attached hereto. The Packeteer
Software is limited to the specific modules identified in Section 6.1 of that
document, and to the functionality set forth in Section 6.2 of that document.


EXCLUDED COMPONENTS

None. This list may be modified by Packeteer upon written notice to ADC.



                                      A-1.
<PAGE>   19
                                  ATTACHMENT B

                    PACKETSHAPER: OEM SOFTWARE PORTING GUIDE


THE DOCUMENT ENTITLED "PACKETSHAPER PORTING GUIDE," REVISION 1.10, DATED
11/9/98 IS FULLY INCORPORATED WITHIN THIS ATTACHMENT B AND IS DIRECTLY ATTACHED
HERETO.



                                      B-1.
<PAGE>   20
                                  ATTACHMENT C

                      PACKETEER END USER LICENSE AGREEMENT

The following is a sample form of the Packeteer End User Agreement as of the
Effective Date:

    "THIS AGREEMENT IS PROOF OF YOUR RIGHT TO USE THE SOFTWARE CONTAINED IN
    THE PACKETEER PACKETSHAPER PRODUCT AND CONTAINS ADDITIONAL INFORMATION
     CONCERNING PACKETEER'S PRODUCT WARRANTY AND LIMITATIONS OF LIABILITY.
                           PLEASE READ IT CAREFULLY.

This Agreement is between you (either an individual or an entity) and
PACKETEER, INC. ("Packeteer"). Packeteer is willing to grant you the following
rights to use the software incorporated in or supplied with the Packeteer
PacketShaper product and its accompanying documentation (collectively, the
"Packeteer Software") only if you agree to be bound by all of the terms of this
Agreement. By installing the product (the "Equipment") or using the Packeteer
Software, you agree to be bound by all the terms of this Agreement. If you do
not agree to be bound by any of the terms of this Agreement, Packeteer is
unwilling to grant you any rights to use the Packeteer Software and you must
not use the Packeteer Software or the Equipment; instead you must promptly
return the Equipment and Packeteer Software for a full refund to Packeteer or
to the authorized Packeteer reseller that provided you with the product.

1.   OWNERSHIP: The Packeteer Software is and shall remain a proprietary
product of Packeteer. Packeteer and Packeteer's suppliers shall retain
ownership of all patents, copyrights, trademarks, trade names, trade secrets
and other proprietary rights relating to or residing in the Packeteer Software
and Equipment. Except for the license grant provided in Paragraph 2, you shall
have no right, title or interest in or to the Packeteer Software. The Packeteer
Software is licensed, not sold, to you for use only under the terms of this
Agreement.

2.   GRANT OF LICENSE: Packeteer grants you a non-transferable (except as set
forth in this Paragraph) non-exclusive, restricted right to use the Packeteer
Software as incorporated in or supplied with the Equipment and solely in
connection with the operation of the Equipment for your own internal business
purposes. You understand that Packeteer may update the Packeteer Software at
any time and in doing so incurs no obligation to furnish such updates to you
pursuant to this Agreement. You may transfer the license to use the Packeteer
Software only in connection with a sale or transfer of the Equipment and as
included with the Equipment and not on a standalone basis, provided the buyer
or transferee agrees to be bound by the terms and conditions of this Agreement.

3.   RESTRICTIONS: Packeteer reserves all rights in the Packeteer Software not
expressly granted to you. Except as permitted in Paragraph 2, you may not use,
copy, modify, create derivative works of, distribute, sell, assign, pledge,
sublicense, lease, loan, rent, timeshare, deliver or otherwise transfer the
Packeteer Software, nor permit any other party to do any of the foregoing. You
may not remove from the Packeteer Software, or alter, any of the trademarks,
trade names, logos, patent or copyright notices or markings, or add any other
notices or markings to the Packeteer Software. To the extent permissible by
applicable law, you may not derive or attempt to derive the source code of the
Packeteer Software by any means, nor permit any other party to derive or
attempt to derive such source code. To the extent permissible by applicable
law, you may not reverse engineer, decompile, disassemble, or translate the
Packeteer Software or any part thereof.

4.   LIMITED WARRANTY: Packeteer does not warrant that the functions contained
in the Packeteer Software and Equipment will meet your requirements or that the
operation of your Packeteer Software or Equipment will be uninterrupted or
error free. Packeteer warrants that for a period of ninety (90) days from your
date of receipt of the Equipment and Packeteer Software, (a) the Equipment will
be free of any defects in materials and workmanship and (b) the Packeteer
Software will perform substantially in accordance with the accompanying
documentation. This limited warranty is void if failure of the Equipment or
Packeteer Software to conform with the warranty has resulted from improper
installation, testing, misuse, neglect, accident, fire or other hazard, or any
breach of this Agreement.

5.   LIMITED REMEDIES: In the event of a breach of the foregoing limited
warranty, you must return the Equipment and Packeteer Software to Packeteer or
the Packeteer authorized reseller that provided you with the Packeteer
Software, postage prepaid, before the expiration of the warranty period, with a
copy of the invoice for the unit. Packeteer's sole and exclusive obligation and
your sole and exclusive remedy shall be, at Packeteer's sole discretion, to
either (a) repair the Packeteer Software or Equipment; (b) provide a
replacement unit or a replacement copy of the Packeteer Software or (c) refund
the amount you paid for the unit and terminate this Agreement. Any replacement
copy of the Packeteer Software or replacement Equipment unit will be warranted
for the remainder of the original warranty period or thirty (30) days,
whichever is longer.

6.   NO OTHER WARRANTIES: OTHER THAN THE FOREGOING LIMITED WARRANTY, PACKETEER
HEREBY EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
WITHOUT LIMITATION THE IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, FITNESS
FOR A PARTICULAR PURPOSE AND MERCHANTABILITY. SOME JURISDICTIONS DO NOT ALLOW
THE DISCLAIMER OF IMPLIED WARRANTIES, SO THE ABOVE DISCLAIMER MAY NOT APPLY TO
YOU. IN WHICH CASE THE DURATION OF ANY SUCH IMPLIED WARRANTIES IS LIMITED TO
SIXTY (60) DAYS FROM THE DATE THE EQUIPMENT AND PACKETEER SOFTWARE ARE RECEIVED
BY YOU. THIS WARRANTY GIVES YOU SPECIFIC LEGAL RIGHTS. YOU MAY HAVE OTHER LEGAL
RIGHTS WHICH VARY FROM JURISDICTION TO JURISDICTION.

7.   LIMITATION OF LIABILITY: PACKETEER'S AGGREGATE LIABILITY IN CONNECTION
WITH THIS AGREEMENT, THE PACKETEER SOFTWARE AND THE EQUIPMENT, REGARDLESS OF
THE FORM OF THE ACTION GIVING RISE TO SUCH LIABILITY (WHETHER IN CONTRACT, TORT
OR OTHERWISE), SHALL NOT EXCEED THE AMOUNT PAID BY YOU TO







                                      C-1


<PAGE>   21
PACKETEER. PACKETEER SHALL NOT BE LIABLE TO YOU FOR ANY INDIRECT, EXEMPLARY,
SPECIAL, CONSEQUENTIAL OR INCIDENTAL DAMAGES OF ANY KIND (INCLUDING WITHOUT
LIMITATION LOSS OF DATA, EQUIPMENT DOWNTIME OR LOST PROFITS), EVEN IF PACKETEER
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. SOME JURISDICTIONS DO NOT
ALLOW THE LIMITATION OR EXCLUSION OF LIABILITY FOR CONSEQUENTIAL OR INCIDENTAL
DAMAGES SO THE ABOVE LIMITATION OR EXCLUSION MAY NOT APPLY TO YOU. THE LIMITED
WARRANTY, LIMITED REMEDIES AND LIMITED LIABILITY PROVISIONS CONTAINED IN THIS
AGREEMENT ARE FUNDAMENTAL PARTS OF THE BASIS OF PACKETEER'S BARGAIN HEREUNDER,
AND PACKETEER WOULD NOT BE ABLE TO PROVIDE THE PACKETSHAPER TO YOU ABSENT SUCH
LIMITATIONS.

9.   GOVERNMENT END USERS. The Packeteer Software is comprised of "commercial
computer software" and "commercial computer software documentation" as such
terms are used in 48 C.F.R. 12.212 (SEPT 1995) and is provided to the
Government (a) for acquisition by or on behalf of civilian agencies, consistent
with the policy set forth in 48 C.F.R. 12.212; or (b) for acquisition by or on
behalf of units of the Department of Defense, consistent with the policies set
forth in 48 C.F.R. 227-7202-1 (JUN 1995) and 227-7202-3 (JUN 1995).

10.  EXPORT CONTROL. Since the Packeteer Software is subject to the export
control laws of the United States, you may not export or reexport the
Packeteer Software without the appropriate United States and foreign government
licenses. You shall otherwise comply with all applicable export control laws
and shall defend, indemnify and hold Packeteer and all Packeteer suppliers
harmless from any claims arising out of your violation of such export control
laws.

11.  GENERAL. The United Nations Convention on Contracts for the International
Sale of Goods is specifically disclaimed. If any provision of this Agreement is
held by a court of competent jurisdiction to be unenforceable for any reason,
the remaining provisions hereof shall be unaffected and remain in full force
and effect. This Agreement is the final, complete and exclusive agreement
between the parties relating to the subject matter hereof, and supersedes all
prior or contemporaneous understandings and agreements relating to such subject
matter, whether oral or written. Should you have any questions regarding this
Agreement, or if you desire to contact Packeteer for any reason, please write
to: Packeteer, Inc., 10495 N. De Anza Blvd., Cupertino, California 95014,
U.S.A."



                                      C-2.
<PAGE>   22
                                  ATTACHMENT D

                              PACKETEER TRADEMARKS

Packeteer may adopt certain trademarks, trade names, marks, and logos
("Trademarks") from time to time in its sole discretion. The following
Packeteer Trademarks are licensed to ADC pursuant to this Agreement:

                             [PACKETEER INC. LOGO]

The above trademark is designated to be included on the front panel of the
ServicePoint product(s). Pending platform(s) design, this trademark use will be
in the lower right hand corner of the front panel.

The Trademarks may be modified at any time by Packeteer.

                          USE OF PACKETEER TRADEMARKS

1.   OWNERSHIP OF TRADEMARKS. ADC acknowledges the ownership of the Packeteer
Trademarks in Packeteer. ADC agrees that it will do nothing inconsistent with
such ownership and that all use of the Trademarks by ADC will inure to the
benefit of and be on behalf of Packeteer. ADC acknowledges that Trademarks are
valid under applicable law and that ADC's utilization of the Trademarks will
not create any right, title or interest in or to such Trademarks. ADC
acknowledges Packeteer's exclusive right to use of the Trademarks and agrees
not to do anything contesting or impairing the trademark rights of the
Packeteer. Any use of the Trademarks must identify Packeteer as the owner of
such Trademarks.

2.   QUALITY STANDARDS. Packeteer hereby appoints ADC as its representative for
the limited purpose of controlling the quality of the ADC Products and any
other products or services it supplies in connection with the use of the
Trademarks. ADC agrees that (a) the nature and quality of the ADC Products and
any other products or services it supplies in connection with use of the
Trademarks will conform to the standards set by Packeteer, and (b) it will
cooperate with Packeteer in facilitating Packeteer's monitoring and control of
the nature and quality of such products and services. Such assistance will
include supplying Packeteer, upon its request, with specimens of its use of the
Trademarks, including supplying samples of reprinted documentation,
translations, product packaging and promotional materials that use the
Trademarks in conjunction with ADC's marketing of ADC Products. Upon reasonable
notice to ADC and at Packeteer's sole expense, Packeteer may conduct an
inspection of such specimens at facilities of its choosing to determine
conformance with the standards. ADC will, at Packeteer's request and expense,
assist Packeteer in conducting such inspection and testing including, but not
limited to, providing Packeteer with applicable hardware. If, at any time,
Packeteer determines that ADC has not met the Packeteer quality standards,
Packeteer will so advise ADC and, upon ADC's receipt of such notice by any
means, ADC will have thirty (30) days to improve the quality to the standard
previously approved by Packeteer, or to cease the use of all Trademarks.



                                      D-1.

<PAGE>   23
ADC will comply with all applicable laws and regulations pertaining to the use
of the Trademarks and to the distribution and advertising of the ADC Products;
however, Packeteer shall obtain all appropriate government approvals pertaining
to the use of the Trademarks.

3.   INFRINGEMENT PROCEEDINGS. ADC agrees to notify Packeteer of any
unauthorized use of the Trademarks by others promptly as it comes to ADC's
attention. Packeteer will have the sole right and discretion to bring
infringement or unfair competition proceedings involving the Trademarks.

4.   ADC'S USE OF TRADEMARKS. Except as set forth otherwise in the Agreement,
ADC agrees that it will (a) prominently and permanently include the Packeteer
Trademarks on all copies of the Packeteer Software and on any ADC Products
distributed to End Users (b) use the Packeteer Trademarks, including the
Packeteer logo, in any advertising or printed materials concerning the ADC
Products, (c) use all applicable Trademarks on all copies, advertisements,
brochures, manuals, packaging and other appropriate uses made in the promotion,
sale or use of the ADC Products, and (d) ensure that the logo set forth above
will appear prominently on the logon screen, splash screen, or other first
display created by the Packeteer Software when End Users initialize the
Packeteer Software.

5.   TRADEMARK REGISTRATIONS. ADC, at Packeteer's request and expense, will (a)
promptly provide Packeteer with any specimens, (b) execute all applications for
trademark registrations, assignments or other applicable documents, and (c)
perform any other act reasonably necessary for Packeteer to secure or maintain
any and all trademark rights in any country in which ADC is marketing the ADC
Products in association with a Trademark. ADC's responsibilities will include
complying with the formalities of local law, including, but not limited to,
executing any application for registration as a registered user, executing
additional license agreements suitable for recording with the appropriate
authorities or providing proof of use of the trademarks in any other applicable
documents.

6.   NO UNITARY OR COMPOSITE TRADEMARKS. ADC agrees not to use any other
trademark or service mark in close proximity to any of the Packeteer Trademarks
or combine the marks so as to effectively create a unitary composite mark
without the prior written approval of Packeteer.



                                      D-2.
<PAGE>   24
                                  ATTACHMENT E

                               SECURE PROCEDURES


     1.  AUTHORIZED EMPLOYEES AND CONTRACTORS. ADC agrees that it will not
disclose all or any portion of the Packeteer Software to third parties, with the
exception of authorized employees ("Authorized Employees") and authorized
contractors ("Authorized Contractors") (subject to ADC's having obtained
authorization for use of such contractors in accordance with PARAGRAPH 2 of this
ATTACHMENT E, below) who (a) require access thereto for a purpose authorized by
this Agreement, (b) have signed an employee or contractor agreement in which
such employee or contractor agrees to protect third party confidential
information and (c) in the case of disclosure of Packeteer Software Source or
Packeteer Software Information ("Source Information"), have received a notice of
confidentiality prior to access to such Source Information, and again upon any
termination of such access, that contains, at a minimum provisions substantially
in accordance with the following:

     "Recipient has previously signed an agreement with ADC pursuant to which
     Recipient has agreed to maintain the confidentiality of confidential
     information of ADC and its suppliers (the "Confidential Information") and
     to use the Confidential Information solely for ADC's benefit. The purpose
     of this notice is to apprise Recipient that Recipient will be receiving
     certain proprietary information of Packeteer, including internal source
     code, interface specifications and related documentation for the Packeteer
     product and related Packeteer information, all of which is of a
     confidential nature and which contains valuable trade secrets, known-how,
     and proprietary information of Packeteer (the "Packeteer Information") and
     which constitutes Confidential Information under Recipient's agreement with
     ADC.

     This is to inform Recipient that the Packeteer Information cannot be used
     for any purpose except for the specific purposes which ADC or Packeteer
     authorize in writing and that Recipient is not authorized to disclose the
     Packeteer Information to any person at any time except to employees of
     Packeteer and to those Authorized Employees and Authorized Contractors
     which ADC informs Recipient are authorized to receive such Packeteer
     Information.

     All materials including, without limitation, programs, recorded
     information, documents, drawings, models, apparatus, sketches, designs, and
     lists furnished to Recipient by ADC or Packeteer which are designated in
     writing to be the property of Packeteer remain the property of Packeteer
     and must be returned to Packeteer promptly at its request, together with
     any copies or modifications thereof."

ADC guarantees the compliance of all such Authorized Employees and Authorized
Contractors with their obligations under such confidentiality agreements.

     2.  PRIOR APPROVAL OF CONTRACTORS. Notwithstanding the provisions in this
ATTACHMENT E permitting Authorized Contractors to have access to Source
Information, ADC may not permit a contractor to come into contact with Source
Information, or engage in the


                                      E-1.
<PAGE>   25
development of the Ported Software hereunder unless ADC has first obtained such
authorization in writing from Packeteer. Packeteer, in its sole discretion, may
withhold such approval in the event that a contractor (or contractor's
employer) to whom ADC intends to disclose Source Information is engaged in
Competitive Product development, either for its own benefit or for the benefit
of a third party, or if Packeteer believes that the contractor may be engaged
in similar product development, and ADC cannot assure Packeteer to its
satisfaction that contractor, while engaged in supporting such development
activities, will be able to refrain from commingling or sharing any portion of
the Source Information with any such Competitive Product development.

     3.   PACKETEER SUPPORT INFORMATION.

          3.1  ADC will ensure that all Source Information received from
Packeteer, and copies made thereof, will be properly marked or otherwise
appropriately identified as Packeteer Information before being made available
to Authorized Employees and Authorized Contractors hereunder.

          3.2  ADC will ensure that the same degree of care is used to prevent
the unauthorized use, dissemination, or publication of the Source Information
as ADC uses to protect its own confidential information of a like nature, but
in no event will the safeguards for protecting such Packeteer Support
Information be less than a reasonably prudent business would exercise under
similar circumstances. ADC will take prompt and appropriate action to prevent
unauthorized use or disclosure of Source Information.

          3.3  ADC will instruct Authorized Employees and Authorized
contractors not to copy Source Information on their own, and not to disclose
Source Information to any one not authorized to receive it.

          3.4  Source Information will be handled, used, and stored solely at
the Development Site. The Source Information will not be stored on any computer
or network which is accessible from outside of the Development Site or by
people other than Authorized Employees or Authorized Contractors.

          3.5  ADC will provide Packeteer with a log of all Authorized
Employees and Authorized Contractors who have access to the Source Information
and who have had access in the preceding five (5) years.

     4.   TRADE SECRETS. The Packeteer Software, including the techniques,
algorithms, and processes contained in the Packeteer Software which have been
developed, acquired, or licensed by Packeteer, or any modification or
extraction thereof, constitute trade secrets of Packeteer and/or its suppliers,
and will be used by ADC only in accordance with the terms of this Agreement. ADC
will take all measures reasonably required to protect the proprietary rights of
Packeteer and its suppliers in the Packeteer Software and will promptly notify
Packeteer of any lost or missing items and take all reasonable steps to recover
such items. ADC agrees that it will not attempt to reverse engineer any portion
of the Packeteer Software which is provided to ADC solely in object code form.

     5.   NO COMMINGLING OF TECHNOLOGY. If ADC engages in development of
products (other than the Ported Software) that are comparable to the Packeteer
Software

                                      E-2.








<PAGE>   26
("Comparable Products") during the term of this Agreement, it will ensure that
there is no sharing with such Comparable Products development any of the
following: (a) design documents of schematics supplied by Packeteer; (b) Source
Information or other information based upon or derived from the Source
Information; or (c) any computing resources (including, but not limited to,
computer systems and network storage devices), or (d) personnel with access to
any of (a)-(c) above. ADC will ensure that all Authorized Employees and
Authorized Contractors who have had previous access to the Packeteer Software
will be precluded for a period of twenty-four (24) months after their latest
access to such Packeteer Software from being employed in any Comparable Product
development (either internally or externally) by or for ADC or any Competitive
Product (as defined in PARAGRAPH 10.8 ("Access") of this Agreement) or
Comparable Product development for any third parties. "Employment in any
Competitive (or Comparable) Product development" will be defined as having
direct access to, or producing any specifications, documentation, or source
code, for components of a Competitive (or Comparable) Product.

     6.   PROPRIETARY RIGHTS AUDIT. During the term of the Agreement and for a
period of twenty-four (24) months thereafter, an independent auditor selected
by Packeteer will have access to such portion of ADC's records and premises to
allow Packeteer to determine whether ADC is substantially in compliance with
this ATTACHMENT E and PARAGRAPH 10 ("Protection of Proprietary Rights") of the
Agreement. In no event will audits be made hereunder more frequently than twice
per year. Such access will be (a) during ADC's regular business hours, (b)
arranged so that, to the extent possible, ADC's regular business activities are
minimally disrupted and (c) under the terms of an appropriate confidentiality
agreement executed by the individual(s) conducting such audit. ADC will
immediately correct any deficiencies discovered in the course of the audit.


                                      E-3.
<PAGE>   27


                                  ATTACHMENT F

                         SPECIFICATIONS FOR ADC PRODUCT


A ServicePoint device is a WAN access termination hardware device.

ServicePoint MAS (Modular Access Solutions) is a software base capable of
running on ADC's ServicePoint line of WAN access termination hardware devices
or its partners WAN access termination hardware devices.

ServicePoint MAS software will, after the Effective Date of the Agreement to
which this Attachment F is attached, always include the [*].

Some configurations of the ServicePoint MAS software may also enable the [*].

The ServicePoint MAS software otherwise includes at least one of the following
capabilities in any combination:

[*].



* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.



                                      F-1.
<PAGE>   28
                                  ATTACHMENT H

                               SOURCE CODE SITES

ADC Kentrox facility in Portland, Oregon.

     14375 Northwest Science Park Drive
     Portland, OR 97229

ADC Kentrox facility in the San Francisco bay area (Silicon Valley).

     (As of 12/98)
     2755 Campus Drive, Suite 165
     San Mateo, CA 94403

     (As of 1/99)
     800 El Camino Real, Suite 100
     Mountain View, CA







                                      H-1.
<PAGE>   29


                                   SCHEDULE I

                                      FEES

I.   PRODUCT DISTRIBUTION. ADC will pay Packeteer:

     A.   APPLICATION DISCOVERY SOFTWARE PACKAGE:

          $[*] for each ADC Product distributed by or on behalf of ADC in which
          the Application Discovery Software Package is included. ADC will make
          minimum royalty payments (on a quarterly basis) for Application
          Discovery for the first two years from the FCS Date (as defined in
          Section III below) as set forth below.



          Application    Discovery
          royalties                                              Annual Minimum
          Year                               ADC Prepaid Units   Royalty amount
                                                            
          1                                        [*]            [*]
          2                                        [*]            [*]


          The minimum quarterly payments due for Application Discovery Software
          Package units:



          Year                         Quarter 1     Quarter 2     Quarter 3     Quarter 4
                                                                  
          1      Total = [*]           [*]           [*]           [*]           [*]
          2     Total = [*]            [*]           [*]           [*]           [*]


          B. RATE CONTROL SOFTWARE PACKAGE:

          ADC will pay Packeteer the following for each unit distributed with
          Rate Control functionality and for each unit upgrade to include Rate
          Control functionality


                                                                  
                 First [*] units          Per T1 port or equivalent     [*]
                                          in the United States, and
                                          per E1 port or equivalent
                                          in International markets

             Units [*] to [*]             Per T1 port or equivalent     [*]
                                          in the United States, and
                                          per E1 port or equivalent
                                          in International markets

            Units [*] to [*]              Per T1 port or equivalent     [*]
                                          in the United States, and
                                          per E1 port or equivalent
                                          in International markets

          For all units over [*]          Per T1 port or equivalent     [*]
                                          in the United States, and


                                  SCHEDULE-1.


* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.

<PAGE>   30


                           per E1 port or equivalent
                            in International markets


ADC will make minimum royalty payments (on a quarterly basis) for units which
include (or are upgraded to) Rate Control Software Package for the first two
years of the Agreement as set forth below:



Rate Control royalties
Year                          ADC Prepaid              Annual Minimum
                                    Units              Royalty amount
                                                 
1                                     [*]                         [*]
2                                     [*]                         [*]


The minimum quarterly payments due for Rate Control Software Package units:



Year                               Quarter 1           Quarter 2           Quarter 3            Quarter 4
                                                                               
1    Total = [*]                         [*]                 [*]                 [*]                  [*]
2    Total = [*]                         [*]                 [*]                 [*]                  [*]


ADC will make payments for the prepaid royalty commitments for both the
Application Discovery and Rate Control packages on a quarterly basis for the
first two years. After the first two years (and not during such two-year
period), if the royalty commitments previously paid exceed the amounts due for
the units already shipped, ADC may apply such balance to future units shipped
in accordance with the royalty schedule set forth above.

II. MAINTENANCE RELEASES. There is no further royalty due to Packeteer for any
copies of any Updates distributed to End Users.

     The Maintenance Fee will be [*] annually and paid at the beginning of
     the period. This fee will commence at the beginning of the second year of
     the Agreement.

III. TIMING OF PAYMENTS. The initial obligation to pay the royalties set forth
above shall commence upon the earlier of (i) the first commercial shipment of
an ADC Product unit to the distribution channel (the "FCS Date") and (ii) July
1, 1999, and shall continue for two years thereafter. The quarterly payments
due shall accompany the reports furnished under PARAGRAPH 5.5 ("Reporting"). In
the event that ADC's royalty obligations for units shipped during any quarter
exceeds the minimum quarterly royalty obligation payable for such quarter, ADC
shall remit the additional royalties due along with the other quarterly
payments for such quarter.

References to calendar quarters and year periods for the royalty obligations
(but not the maintenance payments) set forth in Section I above are measured
from the FCS Date.


* Certain information on this page has been omitted and filed separately with
  the Commission. Confidential treatment has been requested with respect to the
  omitted portions.


                                      G-2.