AMENDMENT NO. 2
                                     TO THE
                            ASSET PURCHASE AGREEMENT
                                 by and between
                    P-COM, Inc., a Delaware corporation, and
                  Cylink Corporation, a California corporation,

                           dated as of March 13, 1998,

                           as amended by an Amendment
                           dated as of March 13, 1998,

                           dated as of March 27, 1998





                 AMENDMENT NO. 2 TO THE ASSET PURCHASE AGREEMENT


         Section 6.1 of the Asset Purchase  Agreement  ("Asset  Agreement"),  as
amended,  by and  between  P-COM,  Inc.,  a  Delaware  corporation,  and  Cylink
Corporation, a California corporation, is hereby amended to read in its entirety
as follows:

         "Section 6.1 Time of Closing.  The  transactions  contemplated  by this
Agreement  shall be  completed  (the  "Closing")  on March 28, 1998 and shall be
legally effective as of 12:01 a.m.;  provided however,  that with respect to the
purchase and sale of the Accounts  Receivable,  the "AR Closing" and "AR Time of
Closing"  shall  refer to April 1,  1998.  The  Closing  shall take place at the
offices of Morrison & Foerster  LLP, 755 Page Mill Road,  Palo Alto,  California
94304.  The "Closing" shall mean the deliveries to be made by the parties hereto
(other than to the extent related to the purchase and sale of the Assets) at the
Time of Closing in accordance with this Agreement."

         B. Section  3.3(b) of the  Agreement  is hereby  amended to include the
following language after the current last sentence of such section:

         "; provided,  however, that notwithstanding  anything in Section 3.3(a)
or this Section 3.3(b) relating to the calculation of the Net Asset Amount,  for
purposes of determining the Closing Date Balance Sheet and any Final  Adjustment
only, the following  definition  shall be used to determine the Net Asset Amount
of the Business of the Seller at the Time of Closing: $1.1 million (representing
a credit for Seller's  backlog) plus  Inventory plus Accounts  Receivable  (less
allowance  for  doubtful  accounts)  plus  Related  Property  minus all  Assumed
Liabilities  minus  adequate  reserves for warranty and support  obligations  as
determined by Price Waterhouse LLP, independent accountants,  in accordance with
GAAP  (provided  that no reduction in the value of the Related  Property for the
purpose  of  the  Closing  Date  Balance   Sheet  shall  be  made  for  ordinary
depreciation calculated in accordance with GAAP and past practice,  consistently
applied,  that would otherwise  accrue between December 31, 1997 and the Time of
Closing)."

         Except as set forth here, all other terms of the Asset  Agreement shall
remain in full force and effect.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of March 27, 1998.

                                              P-COM, INC.,
                                              a Delaware corporation


                                              By:
                                                  -------------------------
                                                    Warren T. Lazarow
                                                    Secretary


                                              Cylink Corporation,
                                              a California corporation


                                              By: 
                                                  -------------------------
                                                    Robert B. Fougner
                                                    Corporate Secretary