SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12

COM21, INC.
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(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

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(5) Total fee paid:

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[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(4) Date Filed:

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[COM21 LOGO]

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD MAY 17, 2001

TO THE STOCKHOLDERS OF COM21:

NOTICE IS HEREBY GIVEN that the 2001 Annual Meeting of Stockholders of
Com21, Inc. ("Com21") will be held on May 17, 2001 at 11:00 a.m. at 750 Tasman
Drive, Milpitas, California 95035, for the following purposes, as more fully
described in the Proxy Statement accompanying this Notice:

1. To elect eight directors to serve for a one-year term or until their
successors are duly elected and qualified;

2. To approve an additional 1,500,000 shares of Com21's Common Stock which
will be authorized for issuance under the 2000 Stock Option Plan to
individuals in Com21's service, including officers, employees, Board
members and independent consultants;

3. To approve amendments to Com21's 1998 Employee Stock Purchase Plan to
(i) add an additional 650,000 shares authorized for issuance, and (ii)
eliminate the requirement for stockholder approval to increase the
limitation on the number of shares which any one participant may
purchase on any semi-annual purchase date;

4. To ratify the appointment of Deloitte & Touche LLP as Com21's
independent public accountants for the fiscal year ending December 31,
2001; and

5. To transact such other business as may properly come before the meeting,
or any adjournment or adjournments thereof.

Only stockholders of record at the close of business on March 26, 2001 are
entitled to notice of, and to vote at, the Annual Meeting. The stock transfer
books of Com21 will remain open between the record date and the date of the
meeting. A list of stockholders entitled to vote at the Annual Meeting will be
available for inspection at the executive offices of Com21.

All stockholders are cordially invited to attend the meeting in person.
Whether or not you plan to attend, please sign and return the proxy in the
envelope enclosed for your convenience. Should you receive more than one proxy
because your shares are registered in different names and addresses, each proxy
should be signed and returned to assure that all of your shares will be voted.
You may revoke your proxy at any time prior to the Annual Meeting and vote. If
you attend the Annual Meeting and vote by ballot, your proxy will be revoked
automatically and only your vote at the Annual Meeting will be counted.

Sincerely,

/s/ DAVID L. ROBERTSON
David L. Robertson
Vice President, Finance and
Administration,
Chief Financial Officer and
Corporate Secretary

Milpitas, California
April 12, 2001

YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
PLEASE READ THE ATTACHED PROXY STATEMENT CAREFULLY, COMPLETE, SIGN AND DATE THE
ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED
ENVELOPE.
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COM21, INC.
750 TASMAN DRIVE
MILPITAS, CALIFORNIA 95035
------------------------

PROXY STATEMENT

FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 17, 2001

GENERAL

The enclosed proxy ("Proxy") is solicited on behalf of the Board of Com21,
Inc. (the "Board"), a Delaware corporation, for use at the 2001 Annual Meeting
of Stockholders (the "Annual Meeting") to be held at 11:00 a.m. local time, on
Thursday, May 17, 2001, or any adjournment thereof, at 750 Tasman Drive,
Milpitas, California 95035 for the purposes set forth in this Proxy Statement
and the accompanying Notice of Annual Meeting. These proxy solicitation
materials were mailed on or about April 12, 2001 to all stockholders entitled to
vote at the Annual Meeting.

PROXIES

If the enclosed form of proxy is properly signed and returned, the shares
represented thereby will be voted at the Annual Meeting in accordance with the
instructions specified thereon. If the proxy does not specify how the shares
represented thereby are to be voted, the proxy will be voted FOR the election of
the directors proposed by the Board unless the authority to vote for the
election of such directors is withheld and, if no contrary instructions are
given, the proxy will be voted FOR the approval of Proposals 2, 3 and 4
described in the accompanying Notice and Proxy Statement. You may revoke or
change your Proxy at any time before the Annual Meeting by filing with the Chief
Financial Officer of Com21 at Com21's principal executive offices at 750 Tasman
Drive, Milpitas, California 95035, a notice of revocation or another signed
Proxy with a later date. You may also revoke your Proxy by attending the Annual
Meeting and voting in person.

SOLICITATION

Com21 will bear the entire cost of solicitation, including the preparation,
assembly, printing and mailing of this Proxy Statement, the Proxy and any
additional solicitation materials furnished to the stockholders. Copies of
solicitation materials will be furnished to brokerage houses, fiduciaries and
custodians holding shares in their names that are beneficially owned by others
so that they may forward this solicitation material to such beneficial owners.
In addition, Com21 may reimburse such persons for their costs in forwarding the
solicitation materials to such beneficial owners. Common Stockholders can agree
to access the electronic versions of Com21's proxy materials, via the Internet,
rather than receiving printed versions. The original solicitation of proxies by
mail may be supplemented by a solicitation by telephone, telegram or other means
by directors, officers or employees of Com21. Com21 may retain the services of
one or more firms to assist with solicitation of proxies, for an estimated cost
of $5,500 plus reimbursement of expenses.

VOTING

The specific proposals to be considered and acted upon at the Annual
Meeting are summarized in the accompanying Notice and are described in more
detail in this Proxy Statement. On March 26, 2001, the record date for
determination of stockholders entitled to notice of and to vote at the Annual
Meeting, 27,362,348 shares of Com21's Common Stock, par value $0.001, were
issued and outstanding. No shares of Com21's preferred stock, par value $0.001,
were outstanding. Each stockholder is entitled to one vote for each share of
Common Stock held by such stockholder on March 26, 2001. Stockholders may not
cumulate votes in the election of directors.

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All votes will be tabulated by the inspector of election appointed for the
meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions and broker non-votes are counted
as present for purposes of determining the presence or absence of a quorum for
the transaction of business. Abstentions will be counted towards the tabulations
of votes cast on proposals presented to the stockholders and will have the same
effect as negative votes, whereas broker non-votes will not be counted for
purposes of determining whether a proposal has been approved.

DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS

Proposals of stockholders of Com21 that are intended to be presented by
such stockholders at Com21's 2002 Annual Meeting must be received no later than
November 16, 2001, in order that they may be included in the proxy statement and
form of proxy relating to that meeting. Such stockholder proposals should be
submitted to Com21, Inc. at 750 Tasman Drive, Milpitas, California 95035,
Attention: Corporate Secretary.

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MATTERS TO BE CONSIDERED AT ANNUAL MEETING

PROPOSAL ONE

ELECTION OF DIRECTORS

GENERAL

Com21's bylaws have authorized eight directors. Each director is elected
for a period of one year at Com21's annual meeting of stockholders and serves
until the next annual meeting or until his successor is duly elected and
qualified. The executive officers serve at the discretion of the Board. There
are no family relationships among any of Com21's directors or executive
officers. Com21's Amended and Restated Certificate of Incorporation provides for
a Board. The Board currently consists of eight persons. The directors nominated
will have a term of one year, expiring at the 2002 Annual Meeting of
Stockholders or until each successor has been duly elected and qualified. Of the
nominees listed below, Mr. Craig Soderquist, Mr. Paul Baran, Mr. Jerald L. Kent,
Mr. Daniel J. Pike and Dr. James Spilker are currently directors of Com21. If
this proposal is approved, the Board will consist of eight persons.

The nominees for election have agreed to serve if elected, and management
has no reason to believe that such nominee will be unavailable to serve. In the
event the nominee is unable or declines to serve as a director at the time of
the Annual Meeting, the proxies will be voted for any nominee who may be
designated by the present Board to fill the vacancy. Unless otherwise
instructed, the proxy holders will vote the proxies received by them FOR the
nominee named below.

NOMINEES FOR TERM ENDING UPON THE 2002 ANNUAL MEETING OF STOCKHOLDERS

CRAIG SODERQUIST. Mr. Soderquist has served as President of Com21 since
October 2000 and President, Chief Executive Officer and Director since January
2001. He also served as Vice President/General Manager of the Network Systems
Division from August 2000 to October 2000 and Vice President of Business Units
from May 2000 to July 2000. Prior to joining Com21, Mr. Soderquist was Vice
President/General Manager at Philips Semiconductors/VLSI Technology, Inc. from
February 1999 to March 2000. From January 1998 to January 1999, he worked as an
independent consultant in the professional video marketplace assisting companies
with new business development and market expansion. Mr. Soderquist served as
President of Dynatech Video Group from April 1995 through December 1997. He is a
member of the Society of Motion Picture and Television Engineers and the
National Cable Television Association. Mr. Soderquist received a B.S.E.E. from
South Dakota School of Mines and Technology and a M.S.E.E. from the University
of Colorado.

PAUL BARAN. Mr. Baran has been the Chairman of the Board since Com21's
inception in June 1992 and is presently retired. Mr. Baran has received several
awards including the Franklin Institute's Bower Prize for Science (2001) for his
invention of packet switching. Other awards include the Institute of Electronics
and Electrical Engineering, Inc. ("IEEE") Internet Award (2000), the Business
Journal Entrepreneurial Award in Technology (1999)), the Marconi International
Fellowship Award (1991), the IEEE Alexander Graham Bell Medal (1990), the ACM
SIG/Communications Award (1989) and the IEEE Communications Society Edwin
Armstrong Award (1987). He co-founded several companies including Equatorial
Communications, Packet Technologies, Telebit Corporation and Metricom, Inc. Mr.
Baran is a Life Fellow of the IEEE, a Fellow of the AAAS and a member of the
U.S. National Academy of Engineers. Mr. Baran received an M.S. in Computers from
the University of California, Los Angeles, a B.S. in Electrical Engineering, a
Dr.Sci. in Engineering (Hon.) from Drexel University and Ph.D. in Policy
Analysis (Hon.) from the RAND Graduate School.

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1987 to 1992. Mr. Kent serves as a director of Charter Communications, Inc.,
High Speed Access Corp. and Cable Television Laboratories, Inc. Mr. Kent
received a B.A. and a M.B.A. from Washington University and is a certified
public accountant.

DANIEL J. PIKE. Mr. Pike has been a Director of Com21 since March 2000. Mr.
Pike has been Chief Technology Officer at Classic Communications, Inc., since
November 2000 and a senior advisor to @Security Broadband Corp., a private
broadband start-up, since September 2000. Prior to that he served as a Senior
Vice President of Science and Technology at Prime Cable from 1982 to September
2000. Mr. Pike was the recipient of the 1994 Communications Technology Service
in Technology Award and received the NCTA Vanguard Award for Science and
Technology in 1991. He is a Senior Member of the IEEE and SCTE while holding
membership on the CableLabs Board of Directors, NCTA Engineering Committee,
Cable Television Pioneers, Society of Motion Picture and Television Engineers
and the Advisory Board of Communications Technology. Mr. Pike received a B.S.
and a M.S. from Oklahoma State University.

JAMES SPILKER, JR. Dr. Spilker, has been a Director of Com21 since February
2000. Dr. Spilker is a co-founder of Stanford Telecommunications, Inc., where he
has been Chairman of the Board since 1973. He served as President and Chief
Executive Officer of Stanford Telecommunications, Inc., from August 1981 to June
1995. Dr. Spilker is a member of the National Academy of Engineering of the
United States and a Life Fellow of the IEEE. Dr. Spilker received a B.S., M.S.
and Ph.D. in electrical engineering from Stanford University.

JAMES A. GAGNARD. Mr. Gagnard has been President and Chief Executive
Officer of ELetter, Inc., an Internet based company providing direct marketing
services to small businesses, since September 2000. From September 1999 to
September 2000 he was a private investor. Mr. Gagnard also served as President
and Chief Executive Officer at Diffusion, Inc., a private Internet based
application provider, from September 1996 to September 1999 and Trinzic
Corporation, a public software and services company, from January 1990 to August
1995. At Pansophic Systems, Inc., Mr. Gagnard served as Senior Vice President
and General Manager from 1987 to 1990; Vice President, International Operations
from 1985 to 1987 and Vice President, European Operations from 1982 to 1985. Mr.
Gagnard received a BSEE from Illinois Institute of Technology.

GEORGE A. MERRICK. Mr. Merrick has been Chief Executive Officer of Advanced
Rendering Technology, a computer graphics company, since September 1997. Prior
to that, Mr. Merrick was Vice President of Dynatech Corp., a technology holding
company, and President of Visual Communications Technologies Group from
September 1994 to September 1997. Mr. Merrick also served in several executive
capacities with Ampex Corporation, a data and video recording and processing
company, starting in 1978 as a General Manager for Ampex Switcher Co, a startup
acquired by Ampex Corporation. From 1987 to 1990 he served as Vice President of
Ampex Corporation, and President of its Video Systems Subsidiary. From 1990 to
1994 he served as Ampex's Executive Vice President and spokesman on HDTV.
Additionally, from 1989 to 1990, he served as President of Ampex Corporation's
Recording Systems Subsidiary. Mr. Merrick has also served on the board of the
Montreux Television Symposium and MIT's Center for Advanced Television Studies.
Mr. Merrick received a B.S. in Marketing and Finance from San Jose State
University.

SUSAN H. NYCUM. Ms. Nycum has been a Partner at the law firm of Baker &
McKenzie since 1987 where she is a member of the Intellectual
Property/Information Technology/E-Commerce Practice Group. Ms. Nycum has been
Chairman of the American Bar Association Section of Science and Technology,
President of the Computer Law Association, Chair of the International Bar
Association's Committees on Software Protection and Computer Abuse. She served
twice as an ABA appointed member of the National Conference of Lawyers and
Scientists from 1978 to 1984 and from 1991 to 1994. She is the only lawyer to be
elected a Fellow of the Association for Computing Machinery. Ms. Nycum is also a
member of the American Arbitration Association Large Complex Case Panel, both
arbitration and mediation. Ms. Nycum received an A.B. from Ohio Wesleyan
University and a J.D. from Duquesne University Law School.

BOARD AND COMMITTEE MEETINGS

The Board held nine (9) meetings and acted by written consent three (3)
times during the fiscal year ended December 31, 2000. The Board has an audit
committee and a compensation committee. Each of the
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directors attended 67% or more of the aggregate of (i) the total number of
meetings of the Board and (ii) the total number of meetings held by all
committees of the Board on which such director served during the fiscal year
ended December 31, 2000. Mr. Hawk, Mr. Kent and Dr. Wilmot each attended at
least 67% of the total number of meetings of the Board. All other directors,
other than Mr. Hawk, Mr. Kent and Dr. Wilmot, attended at least 75% of the total
number of meetings of the Board. Each of the directors attended 75% or more of
the total number of meetings held by all committees of the Board on which such
director served during the fiscal year ended December 31, 2000.

Audit Committee. The audit committee is primarily responsible for approving
the services performed by Com21's independent auditors and for reviewing and
evaluating Com21's accounting practices and systems of internal accounting
controls. The committee currently consists of three directors, Dr. Wilmot, Mr.
Kramlich and Dr. Spilker. The audit committee held four (4) meetings during the
fiscal year ended December 31, 2000. The Board has determined that all members
of the audit committee are "independent" as that term is defined in Rule 4200 of
the listing standards of the National Association of Securities Dealers. In
April, 2001, the audit committee adopted the Audit Committee Charter, a copy of
which is attached as Appendix A and describes the audit committee's functions in
greater detail.

Compensation Committee. The compensation committee is primarily responsible
for reviewing and approving Com21's general compensation policy and setting
compensation levels for Com21's executive officers. The committee also
administers Com21's incentive compensation plans. The committee currently
consists of two directors, Mr. Kramlich and Dr. Spilker. The compensation
committee held three (3) meetings and acted by written consent six (6) times
during the fiscal year ended December 31, 2000.

DIRECTOR COMPENSATION

Effective January 1, 2001, Com21 will pay $1,000 to each director each time
he is present and participating at a regularly scheduled meeting of the Board.
Com21 will also pay each director $1,000 for his presence and participation at
meetings of the audit and compensation committees of the Board, provided such
committee meeting does not occur on the same day as a regularly scheduled
meeting of the Board. Under the Automatic Option Grant Program in effect under
Com21's 1998 Stock Incentive Plan, each individual who first joins the Board as
a non-employee director will also receive, at the time of such initial election
or appointment, an automatic option grant, to purchase 15,000 shares of Common
Stock, provided such person has not previously been in Com21's employ. In
addition, on the date of each annual stockholders meeting, each individual who
is to continue to serve as a non-employee Board member will automatically be
granted an option to purchase 5,000 shares of Common Stock, provided that such
individual has been on the Board for at least six months. Each automatic grant
for the non-employee Board members will have a term of 10 years, subject to
earlier termination following the optionee's cessation of Board service. Each
automatic option will be immediately exercisable for all of the option shares.
However, any unvested shares purchased under the option will be subject to
repurchase by Com21, at the exercise price paid per share, should the optionee
cease Board service prior to vesting in those shares. The shares subject to each
initial 15,000-share automatic option grant will vest over a four-year period in
successive equal annual installments upon the individual's completion of each
year of Board service measured from the option grant date. Each 5,000-share
automatic option grant will vest over a two-year period in successive equal
annual installments upon the individual's completion of each year of Board
service measured from the option grant date. However, the shares subject to each
automatic grant will immediately vest in full upon certain changes in control or
ownership of Com21 or upon the optionee's death or disability while a Board
member. Each grant under the Automatic Option Grant Program will have an
exercise price per share equal to the fair market value per share of Com21's
Common Stock on the grant date.

The following Board members received an option to purchase 5,000 shares of
Common Stock pursuant to Com21's Automatic Option Grant Program at the time of
the 2000 Annual Meeting: Paul Baran, Robert C. Hawk, Jerald L. Kent, C. Richard
Kramlich, and Robert W. Wilmot at an exercise price of $19.38. Each 5,000-share
automatic option grant will vest over a two-year period in successive equal
annual installments upon the individual's completion of each year of Board
service measured from the option grant date.

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Dr. Spilker and Mr. Pike each received an option to purchase 15,000 shares
of Common Stock pursuant to Com21's Automatic Option Grant Program on February
22, 2000 and March 1, 2000, respectively. Dr. Spilker's option grant was at an
exercise price of $47.88 and Mr. Pike's grant was at an exercise price of
$66.55. Assuming Mr. Gagnard, Mr. Merrick and Ms. Nycum are elected as directors
at the Annual Meeting, each will receive an option to purchase 15,000 shares
pursuant to Com21's Automatic Option Grant Program on the date of the Annual
Meeting. The shares subject to each initial 15,000-share automatic option grant
will vest over a four-year period in successive equal annual installments upon
the individual's completion of each year of Board service measured from the
option grant date.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The members of the compensation committee of Com21's Board are Mr. Kramlich
and Dr. Spilker. No executive officer of Com21 serves on the Board or
compensation committee of any entity which has one or more executive officers
serving as a member of Com21's Board or compensation committee.

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE ELECTION OF ALL
NOMINEES LISTED ABOVE.

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PROPOSAL TWO

APPROVAL OF 1,500,000 ADDITIONAL SHARES AUTHORIZED FOR ISSUANCE
UNDER THE COM21, INC. 2000 STOCK OPTION PLAN

Com21's stockholders are being asked to approve an amendment to the Com21,
Inc. 2000 Stock Option Plan (the "2000 Plan") which will increase the number of
shares of Com21's Common Stock reserved for issuance to individuals in Com21's
service, including officers, employees, Board members and independent
consultants by an additional 1,500,000 shares.

The following is a summary of the principal features of the 2000 Plan. Any
stockholder who wishes to obtain a copy of the actual plan document may do so
upon written request to Com21 at 750 Tasman Drive, Milpitas, California 95035.

The increase was adopted by the Board on January 17, 2001, subject to
stockholder approval at the Annual Meeting.

SHARE RESERVE

3,000,000 shares of Com21's Common Stock will be reserved for issuance over
the term of the 2000 Plan if this proposal is approved. Such share reserve will
be in addition to the 1,444,128 shares of Com21's Common Stock which have
already been reserved for future issuance under Com21's 1998 Stock Incentive
Plan (the "1998 Plan").

As of February 1, 2001, 1,180,206 shares of Common Stock were subject to
outstanding options under the 2000 Plan, no shares of Common Stock had been
issued under the 2000 Plan, and 1,819,794 shares of Common Stock remained
available for future issuance, assuming stockholder approval of this proposal.

As of February 1, 2001, 4,421,904 shares of Common Stock were subject to
outstanding options under the 1998 Plan, 965,105 shares had been issued under
that plan, and 1,444,128 shares remained available for future issuance.

No participant in the 2000 Plan may receive option grants for more than
300,000 shares of Com21's Common Stock per calendar year, subject to adjustment
for subsequent stock splits, stock dividends and similar transactions.
Stockholder approval of this Proposal Two will also constitute approval of that
300,000-share limitation for purposes of Internal Revenue Code Section 162(m).

The shares of Common Stock issuable under the 2000 Plan may be drawn from
shares of Com21's authorized but unissued Common Stock or from shares of Common
Stock which Com21 acquires, including shares purchased on the open market.

Shares subject to any outstanding options under the 2000 Plan which expire
or otherwise terminate prior to exercise will be available for subsequent
issuance. Unvested shares issued under the 2000 Plan which Com21 subsequently
purchases, at the option exercise price paid per share, pursuant to Com21's
repurchase rights under the 2000 Plan will be added back to the number of shares
reserved for issuance under the Purchase Plan and will accordingly be available
for subsequent issuance.

ELIGIBILITY

Officers and employees, non-employee board members and independent
consultants in Com21's service or in the service of its parent and subsidiaries
(whether now existing or subsequently established) will be eligible to
participate in the 2000 Plan.

As of February 1, 2001, five (5) executive officers, seven (7) non-employee
Board members and approximately 448 other employees and consultants were
eligible to participate in the 1998 Plan and the 2000 Plan.

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PLAN ADMINISTRATION

The compensation committee of the Board will have the exclusive authority
to administer the 2000 Plan with respect to option grants made to Com21's
executive officers and non-employee board members and will also have the
authority to make option grants under the 2000 Plan to all other eligible
individuals. However, the Board may appoint a secondary committee of one or more
Board members to have separate but concurrent authority with the compensation
committee to make option grants under the 2000 Plan to individuals other than
executive officers and non-employee board members. The Board has appointed such
a committee, with one Board member, Mr. Soderquist, serving on the committee.

The term plan administrator, as used in this summary, will mean the
compensation committee and any secondary committee, to the extent each such
entity is acting within the scope of its administrative authority under the 2000
Plan.

VALUATION

The fair market value per share of Com21's Common Stock on any relevant
date under the 2000 Plan will be deemed to be equal to the closing selling price
per share on that date on the Nasdaq National Market. On February 1, 2001, the
fair market value per share of Com21's Common Stock determined on such basis was
$5.66.

OPTION GRANTS

The plan administrator will have complete discretion under the 2000 Plan to
determine which eligible individuals are to receive option grants, the time or
times when those grants are to be made, the number of shares subject to each
such grant, the status of any granted option as either an incentive stock option
or a non-statutory option under the federal tax laws, the vesting schedule (if
any) to be in effect for the option grant and the maximum term for which any
granted option is to remain outstanding.

Each granted option will have an exercise price per share determined by the
plan administrator, but the exercise price will not be less than one hundred
percent (100%) of the fair market value of the option shares on the grant date
(110% in the case of an incentive stock option issued to a more than 10%
stockholder). No granted option will have a term in excess of ten years. The
shares subject to each option will generally vest in one or more installments
over a specified period of service measured from the grant date. However, one or
more options may be structured so that they will be immediately exercisable for
any or all of the option shares. The shares acquired under such immediately
exercisable options will be subject to repurchase by Com21, at the exercise
price paid per share, if the optionee ceases service prior to vesting in those
shares.

Upon cessation of service, the optionee will have a limited period of time
in which to exercise his or her outstanding options to the extent exercisable
for vested shares. The plan administrator will have complete discretion to
extend the period following the optionee's cessation of service during which his
or her outstanding options may be exercised (but not beyond the term of the
original option) and/or to accelerate the exercisability or vesting of such
options in whole or in part. Such discretion may be exercised at any time while
the options remain outstanding, whether before or after the optionee's actual
cessation of service.

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STOCK AWARDS

The table below shows, as to Com21's Chief Executive Officer ("CEO"), the
four other most highly compensated executive officers of Com21 (with base salary
and bonus for the 2000 fiscal year in excess of $100,000) and the other
individuals and groups indicated, the number of shares of Common Stock subject
to option grants made in the aggregate under both the 1998 Plan and the 2000
Plan from January 1, 2000 through March 1, 2001, together with the weighted
average exercise price payable per share. Com21 has not made any direct stock
issuances to date under the 1998 Plan.

OPTION TRANSACTIONS

NUMBER OF SHARES WEIGHTED AVERAGE
UNDERLYING EXERCISE PRICE
NAME AND POSITION OPTIONS GRANTED(#) PER SHARE($)
----------------- ------------------ ----------------

Peter D. Fenner(1)......................... 20,000 10.88
Former President and Chief Executive
Officer
Craig Soderquist........................... 365,000 20.67
President
Timothy J. Miller.......................... 50,000 8.63
Vice President, Worldwide Operations
David L. Robertson......................... 65,000 7.31
Vice President, Finance and
Administration and Chief Financial
Officer
John R. Pickens............................ 130,000 21.32
Vice President, Technology and Chief
Technology Officer
William J. Gallagher(2).................... 7,500 14.48
Vice President, Sales & Marketing
Stanley R. Foster(3)....................... -- --
Former Chief Operating Officer
Paul Baran................................. 5,000 19.38
C. Richard Kramlich........................ 5,000 19.38
Robert C. Hawk............................. 5,000 19.38
Jerald L. Kent............................. 5,000 19.38
Robert W. Wilmot........................... 5,000 19.38
James J. Spilker, Jr. ..................... 15,000 47.88
Daniel J. Pike............................. 15,000 66.50
All current executive officers as a
group (5 persons)(4)..................... 610,000 18.40
All current non-employee directors as a
group (7 persons)........................ 55,000 40.00
All employees, including current officers
who are not executive officers, as a
group (518 persons)...................... 3,757,192 20.90

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(1) Mr. Fenner resigned as President effective October, 2000 and resigned as
Chief Executive Officer effective January 1, 2001.

(2) Mr. Gallagher left Com21 on June 30, 2000 and subsequently rejoined Com21 on
February 1, 2001.

(3) Mr. Foster did not receive any grants in fiscal year 2000. Mr. Foster
resigned from Com21 on January 31, 2001.

(4) Current executive officers include all executive officers of Com21 as of
February 1, 2001.

As of February 1, 2001, all grants to executive officers and directors had
been issued from the 1998 Plan, no shares had been issued to officers or
directors under the 2000 Plan.

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As of February 1, 2001, assuming the 1,500,000-share increase is approved
by the stockholders, 1,180,206 shares of Common Stock were subject to
outstanding options under the 2000 Plan, no shares had been issued under the
2000 Plan, and 1,819,794 shares remained available for future issuance.

GENERAL PROVISIONS

ACCELERATION

In the event there should occur a change in control of Com21, each
outstanding option under the 2000 Plan will automatically accelerate in full,
unless assumed or otherwise continued in effect by the successor corporation or
replaced with a cash incentive program which preserves the spread existing on
the unvested option shares (the excess of the fair market value of those shares
over the option exercise price payable for such shares) and provides for
subsequent payout in accordance with the same vesting schedule in effect for
those option shares. In addition, all unvested shares outstanding under the 2000
Plan will immediately vest, except to the extent Com21's repurchase rights with
respect to those shares are to be assigned to the successor corporation or
otherwise continued in effect. The plan administrator will have complete
discretion to grant one or more options under the 2000 Plan which will become
exercisable for all the option shares in the event the optionee's service with
Com21 or the successor entity is terminated (actually or constructively) within
a designated period following a change in control transaction in which those
options are assumed or otherwise continued in effect. The vesting of outstanding
shares under the 2000 Plan may also be structured to accelerate upon similar
terms and conditions.

The plan administrator will have the discretion to structure one or more
option grants under the 2000 Plan so that those options will vest immediately
vest upon a change in control, whether or not the options are to be assumed or
otherwise continued in effect. The plan administrator may also structure any
unvested shares issued under the 2000 Plan so that those shares will immediately
vest upon a change in control.

A change in control will be deemed to occur upon (i) the successful
completion of a tender offer for more than 50% of Com21's outstanding voting
stock or (ii) a change in the majority of the Board effected through one or more
contested elections for Board membership.

The acceleration of vesting in the event of a change in the ownership or
control of Com21 may be seen as an anti-takeover provision and may have the
effect of discouraging a merger proposal, a takeover attempt or other efforts to
gain control of Com21.

STOCKHOLDER RIGHTS AND OPTION TRANSFERABILITY

No optionee will have any stockholder rights with respect to the option
shares until such optionee has exercised the option and paid the exercise price
for the purchased shares. Options are not assignable or transferable other than
by will or the laws of inheritance following optionee's death, and during the
optionee's lifetime, the option may only be exercised by the optionee. However,
non-statutory options may be transferred or assigned during optionee's lifetime
to one or more members of the optionee's family or to a trust established for
one or more such family members or to the optionee's former spouse, to the
extent such transfer is in connection with the optionee's estate plan or
pursuant to a domestic relations order.

CHANGES IN CAPITALIZATION

In the event any change is made to the outstanding shares of Common Stock
by reason of any recapitalization, stock dividend, stock split, combination of
shares, exchange of shares or other change in corporate structure effected
without Com21's receipt of consideration, appropriate adjustments will be made
to (i) the maximum number and/or class of securities issuable under the 2000
Plan, (ii) the maximum number and/or class of securities for which any one
person may be granted stock options under the 2000 Plan per calendar year and
(iii) the number and/or class of securities and the exercise price per share in
effect under each outstanding option. Such adjustments will be designed to
preclude any dilution or enlargement of benefits under the 2000 Plan or the
outstanding options thereunder.

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AMENDMENT AND TERMINATION

The Board may amend or modify the 2000 Plan at any time, subject to any
required stockholder approval pursuant to applicable laws and regulations.
Unless sooner terminated by the Board, the 2000 Plan will terminate on the
earliest of (i) March 1, 2010, (ii) the date on which all shares available for
issuance under the 2000 Plan have been issued as fully-vested shares or (iii)
the termination of all outstanding options in connection with certain changes in
control or ownership of Com21.

FEDERAL INCOME TAX CONSEQUENCES

OPTION GRANTS

Options granted under the 2000 Plan may be either incentive stock options
which satisfy the requirements of Section 422 of the Internal Revenue Code or
non-statutory options which are not intended to meet such requirements. The
Federal income tax treatment for the two types of options differs as follows:

Incentive Options. No taxable income is recognized by the optionee at the
time of the option grant, and no taxable income is generally recognized at the
time the option is exercised. The optionee will, however, recognize taxable
income in the year in which the purchased shares are sold or otherwise made the
subject of a taxable disposition. For Federal tax purposes, dispositions are
divided into two categories: (i) qualifying and (ii) disqualifying. A qualifying
disposition occurs if the sale or other disposition is made more than two (2)
years after the date the option for the shares involved in such sale or
disposition is granted and more than one (1) year after the date the option is
exercised for those shares. If the sale or disposition occurs before these two
periods are satisfied, then a disqualifying disposition will result.

Upon a qualifying disposition, the optionee will recognize long-term
capital gain in an amount equal to the excess of (i) the amount realized upon
the sale or other disposition of the purchased shares over (ii) the exercise
price paid for the shares. If there is a disqualifying disposition of the
shares, then the excess of (i) the fair market value of those shares on the
exercise date over (ii) the exercise price paid for the shares will be taxable
as ordinary income to the optionee. Any additional gain or loss recognized upon
the disposition will be recognized as a capital gain or loss by the optionee.

If the optionee makes a disqualifying disposition of the purchased shares,
then Com21 will be entitled to an income tax deduction, for the taxable year in
which such disposition occurs, equal to the excess of (i) the fair market value
of such shares on the option exercise date over (ii) the exercise price paid for
the shares. If the optionee makes a qualifying disposition, Com21 will not be
entitled to any income tax deduction.

Non-Statutory Options. No taxable income is recognized by an optionee upon
the grant of a non-statutory option. The optionee will in general recognize
ordinary income, in the year in which the option is exercised, equal to the
excess of the fair market value of the purchased shares on the exercise date
over the exercise price paid for the shares, and the optionee will be required
to satisfy the tax withholding requirements applicable to such income.

If the shares acquired upon exercise of the non-statutory option are
unvested and subject to repurchase by Com21 in the event of the optionee's
termination of service prior to vesting in those shares, then the optionee will
not recognize any taxable income at the time of exercise but will have to report
as ordinary income, as and when Com21's repurchase right lapses, an amount equal
to the excess of (i) the fair market value of the shares on the date the
repurchase right lapses over (ii) the exercise price paid for the shares. The
optionee may, however, elect within thirty (30) days of the transfer of the
stock under Section 83(b) of the Internal Revenue Code to include as ordinary
income in the year of exercise of the option an amount equal to the excess of
(i) the fair market value of the purchased shares on the exercise date over (ii)
the exercise price paid for such shares. If the Section 83(b) election is made,
the optionee will not recognize any additional income as and when the repurchase
right lapses.

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Com21 will be entitled to an income tax deduction equal to the amount of
ordinary income recognized by the optionee with respect to the exercised
non-statutory option. The deduction will in general be allowed for the taxable
year of Com21 in which such ordinary income is recognized by the optionee.

DEDUCTIBILITY OF EXECUTIVE COMPENSATION

Com21 anticipates that any compensation deemed paid by it in connection
with the disqualifying disposition of incentive stock option shares or the
exercise of non-statutory options under the 2000 Plan will qualify as
performance-based compensation for purposes of Code Section 162(m) and will not
have to be taken into account for purposes of the $1 million limitation per
covered individual on the deductibility of the compensation paid to certain
executive officers of Com21. Accordingly, all compensation deemed paid with
respect to those options will remain deductible by Com21 without limitation
under Code Section 162(m).

ACCOUNTING TREATMENT

Option grants to employees and Board members with exercise prices equal to
the fair market value of the option shares on the grant date will not result in
any direct charge to the Company's reported earnings. However, the fair value of
those options is required to be disclosed in the notes to the Company's
financial statements, and the Company must also disclose, in footnotes to its
financial statements, the pro-forma impact those options would have upon its
reported earnings were the fair value of those options at the time of grant
treated as a compensation expense. Option grants under the 2000 Plan with
exercise or issue prices less than the fair market value of the shares on the
grant or issue date will result in compensation expense to the Company in an
amount equal to the excess of such fair market value over the exercise price.
The expense must be amortized against the Company's earnings over the period
that the option shares are to vest. Whether or not granted at a discount, the
number of outstanding options may be a factor in determining the Company's
earnings per share on a fully diluted basis.

Option grants made to independent consultants and other non-employees will
result in a direct charge to the Company's reported earnings based upon the fair
value of the option. Awards that vest over time are measured initially as of the
grant date of that option and then subsequently remeasured at each reporting
date until the vesting date of each installment of the underlying option shares.
Awards that are immediately vested are measured at the grant date of the option.

AMENDED PLAN BENEFITS

As of February 1, 2001, no stock options have been granted on the basis of
the 1,500,000 share increase subject to stockholder approval at the Annual
Meeting.

VOTE REQUIRED

The affirmative vote of at least a majority of the shares of Common Stock
present in person or by proxy at the Annual Meeting and entitled to vote is
required for approval of increase of 1,500,000 shares of Com21's Common Stock
authorized for issuance under the 2000 Plan. Should such stockholder approval
not be obtained, then the increase in the number of shares reserved for issuance
under the 2000 Plan will not be implemented and any options granted under the
2000 Plan pursuant to the proposed increase will terminate without ever becoming
exercisable for any of the option shares. However, the 1998 Plan and the 2000
Plan will continue in effect. Option grants may continue to be made over the
2000 Plan until all the shares of Common Stock available for issuance under the
2000 Plan have been issued pursuant to such option grants. Option grants and
direct stock issuances may continue to be made under the 1998 Plan until all the
shares of Common Stock available for issuance under the 1998 Plan have been
issued pursuant to such option grants and direct stock issuances.

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RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD DEEMS THIS PROPOSAL TO BE IN THE BEST INTERESTS OF COM21 AND ITS
STOCKHOLDERS AND RECOMMENDS A VOTE "FOR" APPROVAL OF SUCH PROPOSAL. UNLESS
AUTHORITY TO DO SO IS WITHHELD, THE PERSON(S) NAMED IN EACH PROXY WILL VOTE THE
SHARES REPRESENTED THEREBY "FOR" THE APPROVAL OF THE AMENDMENT TO THE COM21,
INC. 2000 STOCK OPTION PLAN.

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PROPOSAL THREE

APPROVAL OF AMENDMENTS TO THE 1998 EMPLOYEE STOCK PURCHASE PLAN

Com21's stockholders are being asked to approve amendments to Com21's 1998
Employee Stock Purchase Plan (the "Purchase Plan") that will (i) increase the
maximum number of shares of Common Stock available for issuance over the term of
the Purchase Plan by an additional 650,000 shares of Common Stock to 1,350,000
shares, and (ii) eliminate the requirement for stockholder approval in order to
increase the limitation on the number of shares of Common Stock which any one
participant may purchase on any semi-annual purchase date.

The Purchase Plan was adopted by the Board in March 1998 and became
effective on May 21, 1998. In January, 2001, the Board adopted the amendments to
the Purchase Plan which are the subject of this Proposal No. Three.

The following is a summary of the principal features of the Purchase Plan,
as amended. The summary, however, does not purport to be a complete description
of all the provisions of the Purchase Plan. Any stockholder who wishes to obtain
a copy of the actual plan document may do so by written request to Com21's Chief
Financial Officer at Com21's executive offices in Milpitas, California.

ADMINISTRATION

The Purchase Plan is currently administered by the compensation committee
of the Board. The compensation committee, as plan administrator, has full
authority to adopt administrative rules and procedures and to interpret the
provisions of the Purchase Plan. All costs and expenses incurred in plan
administration are paid by Com21 without charge to participants.

SECURITIES SUBJECT TO THE PURCHASE PLAN

1,350,000 shares of Common Stock have been reserved for issuance over the
ten (10)-year term of the Purchase Plan, including the 650,000-share increase
for which stockholder approval is sought under this Proposal No. Three. The
shares may be made available from authorized but unissued shares of Com21's
Common Stock or from shares of Common Stock repurchased by Com21, including
shares repurchased on the open market.

In the event that any change is made to Com21's outstanding Common Stock
(whether by reason of any recapitalization, stock dividend, stock split,
exchange or combination of shares or other change in corporate structure
effected without Com21's receipt of consideration), appropriate adjustments will
be made to (i) the class and maximum number of securities issuable over the term
of the Purchase Plan, (ii) the class and maximum number of securities
purchasable per participant on any one semi-annual purchase date and (iii) the
class and number of securities and the price per share in effect under each
outstanding purchase right.

OFFERING PERIODS AND PURCHASE RIGHTS

Shares of Common Stock will be offered under the Purchase Plan through a
series of successive offering periods, each with a maximum duration of
twenty-four (24) months. The first offering period began on May 21, 1998, in
connection with the initial public offering of the Common Stock, and ended on
the last business day in April 2000. The next offering period began on the first
day of the first pay period after the 2000 Annual Meeting and was reset on the
first business day of November, for a new two-year offering period, after the
purchase on the last business day of October 2000, in accordance with the
Purchase Plan. The Purchase Plan is expected to reset once again for a new
two-year offering period on the first business of May 2001, following the
purchase on the last business day of April and will end on the last business day
of April 2003. Subsequent offering periods will begin as designated by the Plan
Administrator.

At the time the participant joins the offering period, he or she will be
granted a purchase right to acquire shares of Common Stock at semi-annual
intervals over the remainder of that offering period. The purchase dates will
occur on the last business day in April and October each year, and all payroll
deductions collected

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from the participant for the period ending with each such semi-annual purchase
date will automatically be applied to the purchase of Common Stock.

ELIGIBILITY AND PARTICIPATION

Any individual who is employed on a basis under which he or she is expected
to work for more than 20 hours per week for more than five (5) months per
calendar year in the employ of Com21 or any participating parent or subsidiary
corporation (including any corporation which subsequently becomes such at any
time during the term of the Purchase Plan) is eligible to participate in the
Purchase Plan.

An individual who is an eligible employee on the start date of any offering
period may join that offering period at that time or on any subsequent
semi-annual entry date (the first business day in May or November each year)
within that offering period. An individual who first becomes an eligible
employee after such start date may join the offering period on any semi-annual
entry date within that offering period on which he or she is an eligible
employee.

As of February 1, 2001, 230,866 shares of Common Stock had been issued
under the Purchase Plan, and 1,119,134 shares were available for future
issuance, assuming approval of this Proposal No. Three. As of February 1, 2001,
Com21 estimates that approximately 453 employees, including five (5) executive
officers, were eligible to participate in the Purchase Plan.

PURCHASE PRICE

The purchase price of the Common Stock acquired on each semi-annual
purchase date will be equal to 85% of the lower of (i) the fair market value per
share of Common Stock on the participant's entry date into the offering period
or (ii) the fair market value on the semi-annual purchase date. However, the
clause (i) amount for any participant whose entry date is other than the start
date of the offering period will not be less than the fair market value per
share of Common Stock on that start date.

The fair market value of the Common Stock on any relevant date under the
Purchase Plan will be deemed to be equal to the closing selling price per share
on such date on the Nasdaq National Market. On February 1, 2001, the fair market
value per share of Common Stock determined on such basis was $5.66 per share.

PAYROLL DEDUCTIONS AND STOCK PURCHASES

Each participant may authorize periodic payroll deductions in any multiple
of 1% (up to a maximum of 10%) of his or her base salary each offering period to
be applied to the acquisition of Common Stock on each semi-annual purchase date.
The payroll deductions of each participant will automatically be applied on each
semi-annual purchase date (the last business day in April and October of each
year) to the purchase of whole shares of Common Stock at the purchase price in
effect for the participant for that purchase date.

In no event may any one participant purchase more than 1,500 shares of
Common Stock, nor may all participants in the aggregate purchase more than
200,000 shares of Common Stock, on any one semi-annual purchase date. If this
amendment is approved, no stockholder vote will be required to increase the
limitation on the number of shares of Common Stock which any one participant may
purchase on any one semi-annual purchase date.

SPECIAL LIMITATIONS

The Purchase Plan imposes certain limitations upon a participant's right to
acquire Common Stock, including the following:

- Purchase rights may not be granted to any individual who owns stock
(including stock purchasable under any outstanding purchase rights or
other stock options) possessing 5% or more of the total combined voting
power or value of all classes of stock of Com21 or any of its affiliates.

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- Purchase rights granted to a participant may not permit such individual
to purchase more than $25,000 worth of Common Stock (valued at the time
each purchase right is granted) for each calendar year those purchase
rights are outstanding at any time.

- No participant may purchase more than 1,500 shares of Common Stock on any
semi-annual purchase date.

TERMINATION OF PURCHASE RIGHTS

The participant may withdraw from the Purchase Plan at any time, and his or
her accumulated payroll deductions will, at the participant's election, either
be refunded immediately or applied to the purchase of Common Stock on the next
semi-annual purchase date.

The participant's purchase right will immediately terminate upon his or her
cessation of employment or loss of eligible employee status. Any payroll
deductions which the participant may have made for the semi-annual period in
which such cessation of employment or loss of eligibility occurs will be
refunded and will not be applied to the purchase of Common Stock.

STOCKHOLDER RIGHTS

No participant will have any stockholder rights with respect to the shares
covered by his or her purchase rights until the shares are actually purchased on
the participant's behalf. No adjustment will be made for dividends,
distributions or other rights for which the record date is prior to the date of
such purchase.

ASSIGNABILITY

No purchase rights will be assignable or transferable by the participant,
and the purchase rights will be exercisable only by the participant.

CHANGE IN CONTROL

In the event Com21 is acquired by merger or asset sale, all outstanding
purchase rights will automatically be exercised immediately prior to the
effective date of such acquisition. The purchase price will be equal to 85% of
the lower of (i) the fair market value per share of Common Stock on the
participant's entry date into the offering period in which such acquisition
occurs or (ii) the fair market value per share of Common Stock immediately prior
to the effective date of such acquisition, but in no event will the clause (i)
fair market value be less than the fair market value per share of Common Stock
on the start date of the offering period in which such acquisition occurs.

SHARE PRO-RATION

Should the total number of shares of Common Stock to be purchased pursuant
to outstanding purchase rights on any particular date exceed the number of
shares at the time available for issuance under the Purchase Plan, then the plan
administrator will make a pro-rata allocation of the available shares on a
uniform and nondiscriminatory basis, and the payroll deductions of each
participant, to the extent in excess of the aggregate purchase price payable for
the Common Stock allocated to such individual, will be refunded.

AMENDMENT AND TERMINATION

The Purchase Plan will terminate upon the earliest of (i) the last business
day in April 2008, (ii) the date on which all shares available for issuance
thereunder are sold pursuant to exercised purchase rights or (iii) the date on
which all purchase rights are exercised in connection with an acquisition of
Com21.

The Board may at any time alter, suspend or discontinue the Purchase Plan.
However, the Board may not, without stockholder approval, (i) increase the
number of shares issuable under the Purchase Plan, except in connection with
certain changes in Com21's capital structure, (ii) alter the purchase price
formula so as to reduce the purchase price or (iii) modify the requirements for
eligibility to participate in the Purchase Plan. If

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this amendment is approved, a stockholder vote will no longer be required to
increase the limitation on the number of shares of Common Stock which any one
participant may purchase on any one semi-annual purchase date.

FEDERAL TAX CONSEQUENCES

The Purchase Plan is intended to be an "employee stock purchase plan"
within the meaning of Section 423 of the Internal Revenue Code. Under a plan
which so qualifies, no taxable income will be recognized by a participant, and
no deductions will be allowable to Com21, upon either the grant or the exercise
of the purchase rights. Taxable income will not be recognized until there is a
sale or other disposition of the shares acquired under the Purchase Plan or in
the event the participant should die while still owning the purchased shares.

If the participant sells or otherwise disposes of the purchased shares
within two (2) years after his or her entry date into the offering period in
which such shares were acquired or within one (1) year after the semi-annual
purchase date on which those shares were actually acquired, then the participant
will recognize ordinary income in the year of sale or disposition equal to the
amount by which the fair market value of the shares on the purchase date
exceeded the purchase price paid for those shares, and Com21 will be entitled to
an income tax deduction, for the taxable year in which such disposition occurs,
equal in amount to such excess.

If the participant sells or disposes of the purchased shares more than two
(2) years after his or her entry date into the offering period in which the
shares were acquired and more than one (1) year after the semi-annual purchase
date of those shares, then the participant will recognize ordinary income in the
year of sale or disposition equal to the lower of (i) the amount by which the
fair market value of the shares on the sale or disposition date exceeded the
purchase price paid for those shares or (ii) fifteen percent (15%) of the fair
market value of the shares on the participant's entry date into that offering
period. Any additional gain upon the disposition will be taxed as a long-term
capital gain. Com21 will not be entitled to an income tax deduction with respect
to such disposition.

If the participant still owns the purchased shares at the time of death,
his or her estate will recognize ordinary income in the year of death equal to
the lower of (i) the amount by which the fair market value of the shares on the
date of death exceeds the purchase price or (ii) fifteen percent (15%) of the
fair market value of the shares on his or her entry date into the offering
period in which those shares were acquired.

ACCOUNTING TREATMENT

The issuance of Common Stock under the Purchase Plan will not result in
compensation expense chargeable against Com21's reported earnings. However,
Com21 must disclose, in footnotes to its financial statements, the pro-forma
impact the purchase rights granted under the Purchase Plan would have upon
Com21's reported earnings were the fair value of those purchase rights recorded
as compensation expense.

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STOCK ISSUANCES

The table below shows, as to each of Com21's executive officers named in
the Summary Compensation Table of the Executive Compensation and Related
Information section of this Proxy Statement and the various indicated groups,
the number of shares of Common Stock purchased under the Purchase Plan between
the May 21, 1998 effective date of the Purchase Plan and February 1, 2001
together with the weighted average purchase price paid per share.

PURCHASE PLAN TRANSACTIONS

NUMBER OF WEIGHTED
PURCHASED AVERAGE
NAME POSITION SHARES PURCHASE PRICE
---- -------- --------- --------------

Peter D. Fenner........ Former President and Chief Executive Officer -- --
Craig Soderquist....... President and Chief Executive Officer -- --
Timothy I. Miller...... Vice President, Manufacturing 2,773 $10.00
David L. Robertson..... Vice President, Finance and Administration
and Chief Financial Officer 4,027 $ 9.99
John R. Pickens........ Vice President, Technology and Chief
Technical Officer 3,447 $10.01
William J. Gallagher... Vice President, Sales and Marketing 2,922 $10.20
Stanley R. Foster...... Former Chief Operating Officer -- --
All current executive
officers as a group
(5 persons).......... 13,169 $10.04
All employees,
including current
officers who are not
executive officers,
as a group (448
persons)............. 217,697 $10.33

NEW PLAN BENEFITS

No purchase rights have been granted, and no shares of Common Stock have
been issued, under the Purchase Plan on the basis of the 650,000-share increase
for which stockholder approval is sought under this Proposal No. Three.

VOTE REQUIRED

The affirmative vote of a majority of the outstanding voting shares of
Com21 present or represented and entitled to vote at the 2001 Annual Meeting is
required for approval of the amendments to the Purchase Plan. Should such
stockholder approval not be obtained, then the 650,000-share increase will not
be implemented. Any purchase rights granted on the basis of the 650,000-share
increase to the Purchase Plan will immediately terminate. No additional purchase
rights will be granted on the basis of such share increase, and the Purchase
Plan will terminate once the existing share reserve has been issued. In
addition, stockholder approval will continue to be required to increase the
limitation on the number of shares of Common Stock which any
one participant may purchase on any semi-annual purchase date.

RECOMMENDATION OF THE BOARD

THE BOARD BELIEVES THAT THE AMENDMENTS TO THE PURCHASE PLAN ARE NECESSARY
IN ORDER TO CONTINUE TO PROVIDE EQUITY INCENTIVES TO ATTRACT AND RETAIN THE
SERVICES OF HIGH QUALITY EMPLOYEES. FOR THIS REASON, THE BOARD RECOMMENDS THAT
THE STOCKHOLDERS VOTE FOR THE AMENDMENTS TO THE PURCHASE PLAN.

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PROPOSAL FOUR

RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS

The Board has appointed Deloitte & Touche LLP, independent auditors for
Com21 for the 2000 fiscal year, to serve in the same capacity for the year
ending December 31, 2001. The affirmative vote of a majority of the shares
represented and voting at the Annual Meeting is required to ratify the selection
of Deloitte & Touche LLP.

In the event the stockholders fail to ratify the appointment, the Board
will reconsider its selection. Even if the selection is ratified, the Board in
its discretion may direct the appointment of a different independent auditing
firm at any time during the year if the Board believes that such a change would
be in the best interest of Com21 and its stockholders.

A representative of Deloitte & Touche LLP is expected to be at the Annual
Meeting, with the opportunity to make a statement if he or she decides to do so,
and will be available to respond to appropriate questions.

FEES BILLED TO COM21 BY DELOITTE & TOUCHE LLP DURING FISCAL YEAR 2000

Audit Fees:

Fees billed by Deloitte & Touche LLP and their affiliates (collectively
"D&T") for professional services rendered for the audit of Com21's annual
financial statements for the year ended December 31, 2000 and for the review of
the financial statements included in Com21's quarterly reports on Form 10-Q for
that fiscal year totaled $308,784.

Financial Information Systems Design and Implementation Fees:

Com21 did not engage D&T to provide professional services to Com21 relating
to financial information systems design and implementation during fiscal year
2000.

All Other Fees:

Fees billed by D&T during Com21's 2000 fiscal year for all other
professional services rendered, including tax related services assistance on
registration statements and consulting on mergers and acquisitions totaled
$336,189.

In connection with the new standards of independence of Com21's external
auditors promulgated by the Securities and Exchange Commission, during Com21's
2001 fiscal audit year the Audit Committee will consider in advance of the
provision of any non-audit services by Com21's independent accountants whether
the provision of such services is compatible with maintaining the independence
of Com21's external auditors.

RECOMMENDATION OF THE BOARD

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE RATIFICATION OF THE
SELECTION OF DELOITTE & TOUCHE LLP TO SERVE AS COM21'S INDEPENDENT AUDITORS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 2001.

OTHER MATTERS

Com21 knows of no other matters that will be presented for consideration at
the Annual Meeting. If any other matters properly come before the Annual
Meeting, it is the intention of the persons named in the enclosed form of Proxy
to vote the shares they represent as the Board may recommend. Discretionary
authority with respect to such other matters is granted by the execution of the
enclosed Proxy.

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MANAGEMENT

The following table sets forth certain information regarding the executive
officers and directors of Com21 as of February 1, 2001:

NAME AGE POSITION
---- --- --------

Craig Soderquist................... 45 President, Chief Executive Officer
and Director
Paul Baran......................... 74 Chairman of the Board
David L. Robertson................. 59 Vice President, Finance and
Administration, Chief Financial
Officer and Corporate Secretary
William J. Gallagher............... 57 Vice President, Sales and Marketing
Timothy I. Miller.................. 46 Vice President, World Wide
Operations
John Pickens....................... 54 Vice President, Technology and
Chief Technical Officer
C. Richard Kramlich(1)(2).......... 65 Director
Robert C. Hawk..................... 60 Director
Jerald L. Kent..................... 44 Director
Daniel J. Pike..................... 49 Director
Robert W. Wilmot(1)................ 55 Director
James J. Spilker, Jr.(1)(2)........ 67 Director

- ---------------
(1) Member of audit committee.

(2) Member of compensation committee.

PAUL BARAN. Mr. Baran has been the Chairman of the Board since Com21's
inception in June 1992 and is presently retired. Mr. Baran has received several
awards including the Franklin Institute's Bower Prize for Science (2001) for his
invention of packet switching. Other awards include the Institute of Electronics
and Electrical Engineering, Inc. ("IEEE") Internet Award (2000), the Business
Journal Entrepreneurial Award in Technology (1999), the Marconi International
Fellowship Award (1991), the IEEE Alexander Graham Bell Medal (1990), the ACM
SIG/Communications Award (1989) and the IEEE Communications Society Edwin
Armstrong Award (1987). He co-founded several companies including Equatorial
Communications, Packet Technologies, Telebit Corporation and Metricom, Inc. Mr.
Baran is a Life Fellow of the IEEE, a Fellow of the AAAS and a member of the
U.S. National Academy of Engineers. Mr. Baran received an M.S. in Computers from
the University of California, Los Angeles, a B.S. in Electrical Engineering, a
Dr.Sci. in Engineering (Hon.) from Drexel University and Ph.D. in Policy
Analysis (Hon.) from the RAND Graduate School.

DAVID L. ROBERTSON. Mr. Robertson has been Chief Financial Officer and Vice
President, Finance of Com21 since April 1995. From March 1993 through April
1995, Mr. Robertson was the Vice President of Finance and Chief Financial
Officer at Endosonics Corporation, a medical device company. From December 1992
to March 1993, Mr. Robertson was an independent consultant. From November 1990
through December 1992, Mr. Robertson was the Vice President and Chief Financial
Officer at Circadian, Inc., a medical device company. He also participated in
the founding of StrataCom, Inc. and served as a Director of StrataCom for

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23

two years during its early stages. Mr. Robertson is a certified public
accountant, and received a B.A. in Economics from the University of Washington
and an M.B.A. from the University of California, Berkeley.

WILLIAM J. GALLAGHER. Mr. Gallagher retired from Com21 in June 2000 but
then rejoined Com21 in February 2001 as Vice President of Sales & Marketing. Mr.
Gallagher was Vice President of Sales from August 1995 to June 2000. From
October 1994 to July 1995 he was Vice President of Marketing at Pacific Gas &
Electric ("PG&E"), a utility company. From October 1993 to September 1994, Mr.
Gallagher was with MCI Telecommunications Corp. as Vice President, Carrier
Services. From August 1991 to September 1994, Mr. Gallagher was a Vice President
and Consultant at San Francisco Consulting Group. He received a B.A. from the
University of New Mexico.

TIMOTHY I. MILLER. Mr. Miller has been Vice President of World Wide
Operations since June 2000. Mr. Miller previously served as Vice President of
Manufacturing from November 1996 to June 2000 and has been employed by Com21
since October 1994. From November 1990 to September 1994, he was Director of
Manufacturing and Materials at Coactive Computers, a computer software company,
where he was responsible for scheduling and production. Mr. Miller has also held
senior management positions with Tidewater Associates and Morrison Design. Mr.
Miller received both a B.S. in Business Administration and a B.A. from San Jose
State University.

JOHN R. PICKENS. Dr. Pickens has been Vice President, Technology and Chief
Technical Officer since May 1999, previously serving as Director of Technology
Development at Com21 since November 1996. Prior to joining Com21, Dr. Pickens
was Chief Technology Officer for SBE Network Systems where he was responsible
for product development and management of SBE's technology programs. Prior to
his work at SBE, Dr. Pickens was an entrepreneur in residence at the Mayfield
Fund and held several engineering and architecture management positions at 3Com
Corporation. He received a B.S. in Electrical Engineering and a Ph.D. in
Electrical Engineering and Computer Science from the University of California,
Santa Barbara.

C. RICHARD KRAMLICH. Mr. Kramlich has been a Director of Com21 since May
1994. Mr. Kramlich is the co-founder and has been General Partner of New
Enterprise Associates since 1978. He is a Director of Chalone, Inc., Juniper
Networks, Lumisys, Inc., Netsolve and Silicon Graphics, Inc. Mr. Kramlich
received an M.B.A. from Harvard Business School and a B.S. from Northwestern
University.

JERALD L. KENT. Mr. Kent has been a Director of Com21 since May 1999. Mr.
Kent co-founded Charter Communications, Inc. and, from 1992 to the present has
served in various executive capacities at Charter. He has served as President
since 1996 and as Chief Executive Officer since 1997. Previously, Mr. Kent
served in various executive capacities with Cencom Cable Associates, Inc. He
joined Cencom in 1983 as Senior Vice President of Corporate Development and
served as Executive Vice President and Chief Financial Officer from 1987 to
1992. Mr. Kent serves as a director of Charter Communications, Inc., High Speed
Access Corp. and Cable Television Laboratories, Inc. Mr. Kent received a B.A.
and a M.B.A. from Washington University and is a certified public accountant.

ROBERT C. HAWK. Mr. Hawk has been a Director of Com21 since January 1997.
Mr. Hawk has been an independent business consultant since April 1997. From
April 1996 through March 1997, he was President of U.S. West Multimedia, a cable
company. From April 1986 through March 1996, he was the President of Carrier
Division, U.S. West Communications, a telecommunications company. He is a
Director of PairGain Technologies, COVAD Communications, Inc., Xylan Corp.,
Concord Corp., and RADCom Corp. Mr. Hawk received an M.B.A. from the University
of San Francisco and a B.B.A. from the University of Iowa.

DANIEL J. PIKE. Mr. Pike has been a Director of Com21 since March 2000. Mr.
Pike has been Chief Technology Officer at Classic Communications, Inc., since
November 2000 and a senior advisor to @Security Broadband Corp., a private
broadband start-up since September 2000. Prior to that he served as a Senior
Vice President of Science and Technology at Prime Cable from 1982 to September
2000. Mr. Pike was the recipient of the 1994 Communications Technology Service
in Technology Award and received the NCTA Vanguard Award for Science and
Technology in 1991. He is a Senior Member of the IEEE and SCTE while holding
membership on the CableLabs Board of Directors, NCTA Engineering Committee,
Cable Television

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Pioneers, Society of Motion Picture and Television Engineers and the Advisory
Board of Communications Technology. Mr. Pike received a B.S. and a M.S. from
Oklahoma State University.

ROBERT W. WILMOT. Dr. Wilmot has been a Director of Com21 since April 1995.
Dr. Wilmot has been Chairman at Wilmot Consulting Inc. since May 1995. From
April 1994 to May 1995, Dr. Wilmot was an independent consultant and investor.
From May 1985 through April 1994, he was Chairman at Wilmot Enterprises Ltd. His
other prior positions include Vice President and Managing Director of Texas
Instruments and Chief Executive Officer of International Computers PLC, a
computer company. He is a limited partner in four venture funds, and Chairs the
Supervisory Board of EuroVentures BV, a $400 million venture fund operating in 9
European countries. He is a Director of FVC.COM and @POS.COM. Dr. Wilmot
received a B.S. in Electrical Engineering from Nottingham University.

JAMES J. SPILKER, JR. Dr. Spilker, has been a Director of Com21 since
February 2000. Dr. Spilker is a co-founder of Stanford Telecommunications, Inc.,
where he has been Chairman of the Board since 1973 and Principal Scientist since
June 1995. He served as President and Chief Executive Officer of Stanford
Telecommunications, Inc., from August 1981 to June 1995. Dr. Spilker received a
B.S., M.S. and Ph.D. in Electrical Engineering from Stanford University

Com21 has authorized eight directors. Each director is elected for a period
of one year at Com21's annual meeting of stockholders and serves until the next
annual meeting or until his successor is duly elected and qualified. The
executive officers serve at the discretion of the Board. There are no family
relationships among any of Com21's directors or executive officers.

COMMITTEES OF THE BOARD

Compensation Committee. The compensation committee is primarily responsible
for reviewing and approving Com21's general compensation policies and setting
compensation levels for Com21's executive officers. The committee also
administers Com21's incentive compensation plans. In 2000, the committee
consisted of two directors, Mr. Kramlich and Dr. Spilker. In April, 2001, the
audit committee adopted the Audit Committee Charter, a copy of which is attached
as Appendix A. The Board has determined that all members of the audit committee
are "independent" as that term is defined in Rule 4200 of the listing standards
of the National Association of Securities Dealers.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

In 2000, the committee consisted of two directors, Mr. Kramlich and Dr.
Spilker. No executive officer of Com21 serves on the Board or compensation
committee of any entity which has one or more executive officers serving as a
member of Com21's Board or compensation committee.

DIRECTOR COMPENSATION

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EXECUTIVE COMPENSATION

The following table sets forth certain information with respect to the
compensation of Com21's Chief Executive Officer and each of the four (4) other
most highly compensated executive officers of Com21 who were serving as
executive officers of Com21 during fiscal year 2000 (the "Last Fiscal Year") and
whose total annual salary and bonus during such fiscal year exceeded $100,000
and two (2) additional executive officers for whom disclosure would have been
required but for the fact that the individual was not serving as an executive
officer at the end of the Last Fiscal Year (collectively, the "Named Executive
Officers").

SUMMARY COMPENSATION TABLE

LONG-TERM
COMPENSATION
ANNUAL COMPENSATION ------------------
-------------------- UNDERLYING OPTIONS
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS GRANTED(#)(1)
--------------------------- ---- -------- -------- ------------------

Peter D. Fenner(2)........................... 2000 $300,040 $ 99,000(3) 20,000
Former President and 1999 300,742 -- 100,000
Chief Executive Officer 1998 311,580 120,000 100,000
Craig Soderquist(4).......................... 2000 140,780 50,000(5) 365,000
President 1999 -- -- --
1998 -- -- --
Timothy I. Miller............................ 2000 163,002 60,000(3) 50,000
Vice President, Worldwide Operations 1999 152,000 -- 50,000
1998 139,073 53,400 32,700
David L. Robertson........................... 2000 195,314 62,000(3) 65,000
Vice President, Finance and 1999 170,940 -- 50,000
Administration and Chief Financial Officer 1998 170,100 80,000 36,425
John Pickens(6).............................. 2000 156,000 55,000(3) 130,000
Vice President, Technology and 1999 152,610 -- 43,000
Chief Technical Officer 1998 136,218 17,000 15,600
William J. Gallagher(7)...................... 2000 84,736 144,509 50,000
Vice President, Sales and Marketing 1999 157,006 224,673 50,000
1998 149,443 235,018 22,505
Stanley R. Foster(8)......................... 2000 212,325 -- --
Former Chief Operating Officer 1999 -- -- 180,000
1998 -- -- --

- ---------------
(1) All options listed in the table were granted under Com21's 1998 Stock
Incentive Plan. See "-- Option Grants in Last Fiscal Year" for a description
of these options.

(2) Mr. Fenner resigned as President effective October 11, 2000 and Chief
Executive Officer effective January 1, 2001. Mr. Fenner is currently
employed by Com21 as an advisor to the Board and senior management.

(3) The bonuses paid to Messrs. Fenner, Miller, Robertson and Pickens in 2000
were earned for their performance in 1999.

(4) Mr. Soderquist was hired as Vice President of Business Units on May 1, 2000.
Upon his appointment to President in October 2000, his annualized salary for
2000 was adjusted to $300,014.

(5) The bonus paid to Mr. Soderquist in 2000 was a sign-on bonus.

(6) Dr. Pickens has been employed with Com21 since November 1996. Dr. Pickens
was appointed Vice President, Technology and Chief Technical Officer on May
12, 1999.

(7) Mr. Gallagher left Com21 on June 30, 2000 and joined Com21's Advisory Board
in August 2000. His annualized salary for 2000 was $160,000. Mr. Gallagher
rejoined Com21 on February 1, 2001 as Vice President, Sales and Marketing.
Mr. Gallagher's bonuses for 1998, 1999 and 2000 consisted entirely of
commissions.

(8) Mr. Foster joined Com21 December 1999 as Chief Operating Officer. His
annualized salary for 1999 was $200,018. Mr. Foster left Com21 on January
31, 2001.

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OPTION GRANTS IN LAST FISCAL YEAR

POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
NUMBER OF PERCENT OF TOTAL RATES OF STOCK PRICE
SECURITIES OPTIONS GRANTED APPRECIATION FOR OPTION
UNDERLYING TO EMPLOYEES IN TERM($)(4)
OPTIONS FISCAL YEAR EXERCISE EXPIRATION -----------------------
NAME GRANTED(#)(1) (%)(2) PRICE($)(3) DATE 5% 10%
---- ------------- ---------------- ----------- --------------- ---------- ----------

Peter D. Fenner....... 20,000 0.46 10.875 10/10/2010 136,785 346,639
Craig Soderquist...... 85,000 1.95 7.313 12/14/2010 390,924 990,678
75,000 1.72 10.875 10/10/2010 512,942 1,299,896
25,000 0.57 13.875 08/16/2010 218,148 552,829
180,000 4.12 32.000 04/30/2010 3,622,433 9,179,957
Timothy I. Miller..... 40,000 0.92 7.313 12/14/2010 183,964 466,202
10,000 0.23 13.875 08/16/2010 87,259 221,132
David L. Robertson.... 65,000 1.49 7.313 12/14/2010 298,942 757,578
John R. Pickens....... 65,000 1.49 7.313 12/14/2010 298,942 757,578
25,000 0.57 13.875 08/16/2010 218,148 552,829
40,000 0.92 48.750 03/29/2010 1,226,345 3,107,798
William J.
Gallagher........... 7,500 0.17 14.484 08/02/2010 68,317 173,128
Stanley R. Foster..... -- -- -- -- -- --

- ---------------
(1) Mr. Fenner received an option grant on October 11, 2000. Mr. Fenner's option
shares were immediately exercisable and vested for all of the Option Shares
on the date of grant. With regard to Mr. Fenner's grant of October 11, 2000,
any options remaining unexercised after February 1, 2002 shall be
immediately canceled. The options granted to the Named Executive Officers in
the Last Fiscal Year vest as follows: The options granted to Dr. Pickens on
March 30, 2000 and the options granted to Messrs. Miller, Pickens, Robertson
and Soderquist on December 15, 2000 vest in forty-eight (48) equal monthly
installments, upon the optionee's completion of each month of service over
the forty-eight (48) month period following the date of the grant. The
options granted to Mr. Soderquist on May 1, 2000, August 17, 2000, and both
grants of October 11, 2000, as well as the options granted to Messrs. Miller
and Pickens on August 17, 2000, vest for twenty-five percent (25%) of the
option shares upon optionee's completion of one (1) year of service measured
from the vesting commencement date and the balance of the option shares in
thirty-six (36) successive equal monthly installments upon optionee's
completion of each additional month of service over the thirty-six (36)
month period thereafter. The options granted to Mr. Gallagher on August 3,
2000 were immediately vested on the date of grant and shall be exercisable
for all of the option shares on June 30, 2001. Mr. Gallagher terminated his
employment with Com21 on June 30, 2000 and the August 3, 2000 grant to Mr.
Gallagher was made in connection with his acceptance to serve as a member of
the Advisory Board. Mr. Gallagher rejoined Com21 on February 1, 2001 and his
grant of August 3, 2000 remains in effect. Each option has a maximum term of
ten (10) years, subject to earlier termination in the event of the
optionee's cessation of service with Com21. Mr. Foster received no grants
during Fiscal Year 2000.

(2) Based on an aggregate of 4,367,192 options granted to employees, consultants
and directors, including the Named Executive Officers of Com21 during the
fiscal year ended December 31, 2000.

(3) The exercise price per share of each option grant was equal to the fair
market value of the Common Stock on the date of grant as determined by the
price at the close of market as reported by Nasdaq.

(4) The potential realizable value is calculated based on the term of the option
at its time of grant, which is ten years. It is calculated assuming that the
fair market value of Com21's Common Stock on the date of grant appreciates
at the indicated annual rate compounded annually for the entire term of the
option and that the option is exercised and sold on the last day of its term
for the appreciated stock price.

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AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND LAST FISCAL YEAR-END OPTION VALUES

The following table sets forth information concerning option exercises and
option holdings for the Last Fiscal Year with respect to the Named Executive
Officers. Except as set forth below, no options or stock appreciation rights
were exercised by any such individual during such year, and no stock
appreciation rights were outstanding on December 31, 2000.

NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE OPTIONS AT FISCAL YEAR-END(#) FISCAL YEAR-END($)
EXERCISE REALIZED --------------------------------- ----------------------------------
NAME (#)(1) ($)(2) EXERCISABLE(3) UNEXERCISABLE(4) EXERCISABLE(5) UNEXERCISABLE(6)
---- ----------- -------- -------------- ---------------- --------------- ----------------

Peter D. Fenner....... 6,000 $234,600 406,866 106,252 $1,257,476 --
Craig Soderquist...... -- $ -- -- 365,000 -- --
Timothy I. Miller..... 3,000 $ 95,814 42,803 94,205 $ 28,428 --
David L. Robertson.... -- -- 57,228 109,197 $ 58,350 --
John R. Pickens....... 1,000 $ 69,200 65,477 143,948 $ 59,059 --
William J.
Gallagher........... 47,755 $603,958 -- 7,500 -- --
Stanley R. Foster..... -- $ -- 45,000 135,000 -- --

- ---------------
(1) As of December 31, 2000, Messrs. Fenner, Miller, Pickens and Gallagher, were
vested in all of the shares exercised.

(2) Based on the fair market value of the purchased option shares at the time of
exercise less the option exercise price paid for those shares.

(3) Each of the options was granted either under Com21's 1995 Stock Option Plan
which was incorporated into Com21's 1998 Stock Incentive Plan or under the
Com21 1998 Stock Incentive Plan. Each of the options granted under the Com21
1995 Stock Option Plan is immediately exercisable, but all shares purchased
under the options are subject to vesting requirements and may be repurchased
by Com21 at the original exercise price paid per share upon the optionee's
cessation of service prior to vesting in such shares. For those options
granted under the Com21 1995 Stock Option Plan, the repurchase right lapses
with respect to 25% of the option shares upon completion of one year of
service from the vesting commencement date and the balance in a series of
equal monthly installments over the next 36 months of service thereafter.
Options granted under both plans have a maximum term of ten years, subject
to earlier termination in the event of the optionee's cessation of service
with Com21. As of December 31, 2000, Mr. Fenner was vested in 406,866 shares
of his outstanding options, Mr. Soderquist was not vested in any of his
outstanding options, Mr. Miller was vested in 39,756 shares of his
outstanding options, Mr. Robertson was vested in 53,165 shares of his
outstanding options and Dr. Pickens was vested in 64,090 shares of his
outstanding options. Mr. Gallagher terminated his employment on June 30,
2000. Due to his termination, Mr. Gallagher had no outstanding options from
his prior grants as of December 31, 2000. On August 3, 2000 Mr. Gallagher
received a grant for 7,500 options upon his acceptance of a position on the
Com21 Board of Advisors. On December 31, 2000, all 7,500 options were
vested; however, none of the shares will become exercisable until June 30,
2001. On February 1, 2001, Mr. Gallagher re-entered employment with Com21
and received a new grant of 90,000 options with a four-year vesting
schedule. Mr. Foster was vested in 45,000 shares of his outstanding options
as of December 31, 2000.

(4) Mr. Fenner's 20,000-share option grant; Mr. Gallagher's 7,500 share option
grant; Mr. Miller's 10,000 and 40,000-share option grants; Dr. Pickens'
40,000, 25,000 and 65,000 share option grants; Mr. Robertson's 65,000-share
option grant; and Mr. Soderquist's 180,000, 25,000, 50,000, 25,000 and
85,000-share option grants were all granted under Com21's 1998 Stock
Incentive Plan and vest as follows:

Mr. Fenner received an option grant on October 11, 2000. Mr. Fenner's option
shares were immediately exercisable and vested for all of the option shares
on the date of grant. Any of such options remaining unexercised after
February 1, 2002 shall be immediately canceled. The options granted to Dr.
Pickens on March 30, 2000 and the options granted to Messrs. Soderquist,
Miller, Robertson and Pickens on December 15, 2000 vest in forty-eight (48)
equal monthly installments, upon the optionee's completion

25
28

of each month of service over the forty-eight (48) month period following
the date of the grant. The options granted to Mr. Soderquist on May 1, 2000,
August 17, 2000, and both grants of October 11, 2000, as well as the options
granted to Messrs. Miller and Pickens on August 17, 2000, vest for
twenty-five percent (25%) of the option shares upon optionee's completion of
one (1) year of service measured from the vesting commencement date and the
balance of the option shares in thirty-six 36) successive equal monthly
installments upon optionee's completion of each additional month of service
over the thirty-six (36) month period thereafter. The options granted to Mr.
Gallagher on August 3, 2000 were immediately vested on the date of grant and
shall be exercisable for all of the option shares on June 30, 2001. Mr.
Foster received no grants during Fiscal Year 2000. Options granted under
both plans have a maximum term of ten (10) years, subject to earlier
termination in the event of the optionee's cessation of service with Com21.
For the remaining options granted under the Com21 1995 Stock Option Plan,
the repurchase right lapses with respect to 25% of the option shares upon
completion of one year of service from the vesting commencement date and the
balance in a series of equal monthly installments over the next 36 months of
service thereafter.

(5) Based on $4.69 per share, the fair market value of the Common Stock on
December 31, 2000, less the exercise price payable for those shares.

(6) No unexercisable options grants were in the money on December 31, 2000.

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PRINCIPAL STOCKHOLDERS

The following table sets forth certain information known to Com21 with
respect to the beneficial ownership of Com21's Common Stock as of February 1,
2001, except as noted in the footnotes below by (i) all persons who are
beneficial owners of five percent (5%) or more of Com21's Common Stock; (ii)
each director; (iii) Com21's Named Executive Officers; and (iv) all directors
and executive officers as a group. Unless otherwise indicated, each of the
stockholders has sole voting and investment power with respect to the shares
beneficially owned, subject to community property laws, where applicable.

SHARES BENEFICIALLY
OWNED(2)
--------------------
NAME AND ADDRESS OF BENEFICIAL OWNER(1) NUMBER PERCENT
--------------------------------------- --------- -------

Peter D. Fenner(3)....................................... 548,248 2.2%
Paul Baran(4)............................................ 691,045 2.8
Craig Soderquist(5)...................................... 6,312 *
Timothy I. Miller(6)..................................... 71,593 *
David L. Robertson(7).................................... 109,251 *
John R. Pickens(8)....................................... 77,373 *
William J. Gallagher..................................... 61,735 *
Stanley R. Foster(9)..................................... 48,749 *
Robert C. Hawk(10)....................................... 16,582 *
Jerald Kent(11).......................................... 20,000 *
C. Richard Kramlich(12).................................. 35,228 *
New Enterprise Associates VI, L.P.
2490 Sand Hill Road
Menlo Park, CA 94025
Daniel J. Pike(13)....................................... 21,000 *
James J. Spilker, Jr.(14)................................ 25,500 *
Robert W. Wilmot(15)..................................... 102,500 *
All directors and officers as a group (12 persons)(16)... 1,238,119 5.0

- ---------------
* Less than one percent.

(1) Except as otherwise noted above, the address of each person listed on the
table is c/o Com21, Inc., 750 Tasman Drive, Milpitas, California 95035.

(2) Number of shares beneficially owned and the percentage of shares
beneficially owned are based on shares outstanding as of February 1, 2001.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and includes voting and investment power
with respect to such shares. All shares of Common Stock subject to options
currently exercisable or exercisable within 60 days after February 1, 2001
are deemed to be outstanding and to be beneficially owned by the person
holding such options for the purpose of computing the number of shares
beneficially owned and the percentage ownership of such person, but are not
deemed to be outstanding and to be beneficially owned for the purpose of
computing the percentage ownership of any other person. Except as indicated
in the footnotes to the table and subject to applicable community property
laws, based on information provided by the persons named in the table, such
persons have sole voting and investment power with respect to all shares of
Common Stock shown as beneficially owned by them.

(3) Includes 419,366 shares of Common Stock issuable upon exercise of
immediately exercisable options, none of which are subject to Com21's right
of repurchase.

(4) Represents 400,000 shares held by the Baran Family Limited Partnership and
281,045 shares held in the name of the Paul and Evelyn Baran Trust
Agreement dated May 23, 1984. Mr. Baran is a General Partner of the Baran
Family Limited Partnership, and as such he may be deemed to share voting
and investment power with respect to such shares. However, Mr. Baran
disclaims beneficial ownership of 360,000 of such shares. Includes 10,000
shares of immediately exercisable options, 7,500 of which are subject to
Com21's right of repurchase.

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30

(5) Includes 5,312 shares of Common Stock issuable upon exercise of immediately
exercisable options, none of which are subject to Com21's right of
repurchase.

(6) Includes 49,768 shares of Common Stock issuable upon exercise of
immediately exercisable options, 2,344 of which are subject to Com21's
right of repurchase.

(7) Includes 65,754 shares of Common Stock issuable upon exercise of
immediately exercisable options, 3,126 of which are subject to Com21's
right of repurchase.

(8) Includes 74,480 shares of Common Stock issuable upon exercise of
immediately exercisable options, 1,012 of which are subject to Com21's
right of repurchase.

(9) All 48,749 shares of Common Stock are issuable upon exercise of immediately
exercisable options, none of which are subject to Com21's right of
repurchase. Mr. Foster terminated his employment with Com21 on January 31,
2001, and his right to exercise the shares will terminate on April 30,
2001.

(10) Includes 10,000 shares of Common Stock issuable upon exercise of
immediately exercisable options, 7,500 of which are subject to Com21's
right of repurchase.

(11) Includes 20,000 shares of Common Stock issuable upon exercise of
immediately exercisable options, 16,250 of which are subject to Com21's
right of repurchase.

(12) Represents 33 shares of Common Stock held by New Enterprise Associates
Presidents Fund, LP and 35,195 shares beneficially owned by Mr. Kramlich.
Voting and dispositive power over the 33 shares of Common Stock held by New
Enterprise Associates Presidents Fund is held among all the general
partners of New Enterprise Associates. Mr. Kramlich is a General Partner at
New Enterprise Associates, and as such, he may be deemed to share voting
and investment power with respect to such shares. However, Mr. Kramlich
disclaims beneficial ownership of all such shares. Of the 35,195 shares of
Common Stock, 10,000 are shares of Common Stock issuable upon exercise of
immediately exercisable options, 7,500 of which are subject to repurchase
by Com21. Subsequently, the 33 shares of Common Stock held by New
Enterprise Associates Presidents Fund were sold by NEA on February 6, 2001.

(13) Includes 20,000 shares of Common Stock issuable upon exercise of
immediately exercisable options, 11,250 of which are subject to Com21's
right of repurchase.

(14) Includes 22,500 shares of Common Stock issuable upon exercise of
immediately exercisable options, 11,250 of which are subject to Com21's
right of repurchase. Includes 3,000 shares of Common Stock owned by Dr.
Spilker's wife.

(15) Includes 10,000 shares of immediately exercisable options, 7,500 of which
are subject to Com21's right of repurchase.

(16) Includes 297,814 shares of Common Stock issuable upon exercise of
immediately exercisable options, of which 75,232 are subject to Com21's
right of repurchase.

BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

It is the duty of the compensation committee to review and determine the
salaries and bonuses of executive officers of Com21, including the Chief
Executive Officer, and to establish the general compensation policies for such
individuals. The compensation committee also has the sole and exclusive
authority to make discretionary option grants to Com21's executive officers
under Com21's 1998 Stock Incentive Plan and the 2000 Stock Option Plan.

The compensation committee believes that the compensation programs for
Com21's executive officers should reflect Com21's performance and the value
created for Com21's stockholders. In addition, the compensation programs should
support the short-term and long-term strategic goals and values of Com21 and
should reward individual contribution to Com21's success. Com21 is engaged in a
very competitive industry, and Com21's success depends upon its ability to
attract and retain qualified executives through the competitive compensation
packages it offers to such individuals.

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31

General Compensation Policy. The compensation committee's policy is to
provide Com21's executive officers with compensation opportunities which are
based upon their personal performance, the financial performance of Com21 and
their contribution to that performance and which are competitive enough to
attract and retain highly skilled individuals. Each executive officer's
compensation package is comprised of three elements: (i) base salary that is
competitive with the market and reflects individual performance, (ii) annual
variable performance awards payable in cash and tied to Com21's achievement of
annual financial performance goals and (iii) long-term stock-based incentive
awards designed to strengthen the mutuality of interests between the executive
officers and Com21's stockholders. As an officer's level of responsibility
increases, a greater proportion of his or her total compensation will be
dependent upon Com21's financial performance and stock price appreciation rather
than base salary.

Factors. The principal factors that were taken into account in establishing
each executive officer's compensation package for the 2000 fiscal year are
described below. However, the compensation committee may in its discretion apply
entirely different factors, such as different measures of financial performance,
for future fiscal years.

Base Salary. In setting base salaries, the compensation committee reviewed
published compensation survey data for its industry. The base salary for each
officer reflects the salary levels for comparable positions in the published
surveys and the comparative group of companies, as well as the individual's
personal performance and internal alignment considerations. The relative weight
given to each factor varies with each individual in the sole discretion of the
compensation committee. Each executive officer's base salary is adjusted each
year on the basis of (i) the compensation committee's evaluation of the
officer's personal performance for the year and (ii) the competitive marketplace
for persons in comparable positions. Com21's performance and profitability may
also be a factor in determining the base salaries of executive officers.

Annual Incentives. The annual incentive bonus for the Chief Executive
Officer is based on a percentage of his base pay and was tied to reflect the
actual financial performance of Com21 in comparison to Com21's business plan.
The other executive officers of Com21 are also eligible for annual incentive
bonuses equal to a percentage of base salary on the basis of Com21's
performance. No cash bonuses will be paid to the Named Executive Officers for
performance in fiscal year 2000.

CEO Compensation. In setting the total compensation payable to Com21's
Chief Executive Officer for the 2000 fiscal year, the compensation committee
sought to make that compensation competitive with the compensation paid to the
chief executive officers of the companies in the surveyed group, while at the
same time assuring that a significant percentage of compensation was tied to
Com21's performance and stock price appreciation.

The compensation committee did not adjust Mr. Fenner's base salary for the
2000 fiscal year. With respect to Mr. Fenner's base salary, it is the
compensation committee's intent to provide him with a level of stability and
certainty each year and not have this particular component of compensation
affected to any significant degree by Com21's performance factors. For the 2000
fiscal year, Mr. Fenner's base salary was approximately at the median of the
base salary levels of other chief executive officers at the surveyed companies.

The remaining components of Mr. Fenner's 2000 fiscal year compensation,
however, primarily depended on corporate performance. Mr. Fenner was eligible
for a cash bonus for the 2000 fiscal year based on business plan objectives. No
bonus was paid to Mr. Fenner for fiscal year 2000. The compensation committee
awarded a stock option grant to Mr. Fenner in fiscal 2000 in order to provide
him with an equity incentive to the financial success of Com21. The option will
have value for Mr. Fenner only if the market price of the underlying option
shares appreciates over the market price in effect on the date the grant was
made.

Compliance with Internal Revenue Code Section 162(m). Section 162(m) of the
Internal Revenue Code disallows a tax deduction to publicly held companies for
compensation paid to certain of their executive officers, to the extent that
compensation exceeds $1 million per covered officer in any fiscal year. The
limitation applies only to compensation which is not considered to be
performance-based. Non-performance based compensation paid to Com21's executive
officers for the 2000 fiscal year did not exceed the $1 million

29
32

limit per officer, and the compensation committee does not anticipate that the
non-performance based compensation to be paid to Com21's executive officers for
fiscal 2000 will exceed that limit. Com21's 1998 Stock Incentive Plan and the
2000 Stock Option Plan have been structured so that any compensation deemed paid
in connection with the exercise of option grants made under those plans with an
exercise price equal to the fair market value of the option shares on the grant
date will qualify as performance-based compensation which will not be subject to
the $1 million limitation. Because it is unlikely that the cash compensation
payable to any of Com21's executive officers in the foreseeable future will
approach the $1 million limit, the compensation committee has decided at this
time not to take any action to limit or restructure the elements of cash
compensation payable to Com21's executive officers. The compensation committee
will reconsider this decision should the individual cash compensation of any
executive officer ever approach the $1 million level.

It is the opinion of the compensation committee that the executive
compensation policies and plans provide the necessary total remuneration program
to properly align Com21's performance and the interests of Com21's stockholders
through the use of competitive and equitable executive compensation in a
balanced and reasonable manner, for both the short and long-term.

Submitted by the compensation committee of Com21's Board:

C. Richard Kramlich
James J. Spilker, Jr.

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33

AUDIT COMMITTEE REPORT

The information contained in this report shall not be deemed to be
"soliciting material" or to be "filed" with the Securities and Exchange
Commission, nor shall such information be incorporated by reference into any
future filings with the Securities and Exchange Commission, or subject to the
liabilities of Section 18 of the Securities Exchange Act of 1934, as amended,
except to the extent that Com21 specifically incorporates it by reference into a
document filed under the Securities Act of 1933, as amended, or Securities
Exchange Act of 1934, as amended.

The following is the report of the audit committee with respect to Com21's
audited financial statements for the fiscal year ended December 31, 2000,
included in Com21's Annual Report on Form 10-K for that year.

The audit committee has reviewed and discussed the audited financial
statements with management of Com21. Management has the responsibility for the
preparation of the financial statements and the independent auditors have the
responsibility for the examination of those statements.

The audit committee met each quarter with Com21's independent auditors,
Deloitte & Touche LLP, prior to Com21's release of its quarterly financial
statements.

The audit committee has discussed with Deloitte & Touche LLP the matters
required to be discussed by SAS 61 (Communication with Audit Committees), as
amended, which include, among other items, matters related to the conduct of the
audit of Com21's financial statements.

The audit committee has received the written disclosures and the letter
from Deloitte & Touche LLP required by Independence Standards Board Standard No.
1 ("Independence Discussions with Audit Committees"), as amended, and has
discussed with Deloitte & Touche LLP the independence of Deloitte & Touche LLP
from Com21.

Based on the review and discussions referred to above in this report, the
audit committee recommended to Com21's Board of Directors that the audited
financial statements be included in Com21's Annual Report on Form 10-K for the
year ended December 31, 2000 for filing with the Securities and Exchange
Commission.

The Board has determined that all members of the audit committee are
"independent" as that term is defined in Rule 4200 of the listing standards of
the National Association of Securities Dealers.

Submitted by the audit committee of Com21's Board:

C. Richard Kramlich
James J. Spilker, Jr.
Robert W. Wilmot

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STOCK PERFORMANCE GRAPH

The graph depicted below shows a comparison of cumulative total stockholder
returns for Com21, the Standard and Poor's 500 Index and the Nasdaq
Telecommunications Index.

COM21 S&P 500 PEER GROUP
----- ------- ----------

5/21/98 100 100 100
6/30/98 177 102 108
9/30/98 149 92 96
12/31/98 175 111 133
3/31/99 219 117 167
6/30/99 142 125 177
9/30/99 108 117 162
12/31/99 187 135 236
3/31/00 392 138 251
6/30/00 208 134 198
9/30/00 113 134 158
12/31/00 39 123 101

- ---------------
(1) The graph covers the period from May 21, 1998, the commencement date of
Com21's initial public offering of shares of its Common Stock to December
31, 2000.

(2) The graph assumes that on May 21, 1998, $100 was invested in Com21's Common
Stock and in each index, and that all dividends were reinvested. No cash
dividends have been declared on Com21's Common Stock.

(3) Stockholder returns over the indicated period should not be considered
indicative of future stockholder returns.

Notwithstanding anything to the contrary set forth in any of Com21's
previous filings made under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings made by Com21 under those statutes, neither the preceding Stock
Performance Graph nor the Compensation Committee Report is to be incorporated by
reference into any such prior filings, nor shall such graph or report be
incorporated by reference into any future filings made by Com21 under those
statutes.

CERTAIN TRANSACTIONS

On January 7, 2000, David L. Robertson, Com21's Vice President, Finance and
Administration and Chief Financial Officer exercised three options: (i) 9,373
shares of Common Stock at an exercise price of $9.00 per share; (ii) 15,000
shares of Common Stock at an exercise price of $7.00 per share; and (iii) 15,000
shares of Common Stock at an exercise price of $0.80 per share for an aggregate
of $201,357 for 39,373 shares. On December 27, 2000, the Board rescinded all
three exercises of these options.

On January 18, 2000, August 21, 2000 and October 9, 2000, Mr. Fenner,
Com21's former President and Chief Executive Officer, exercised options to
purchase 20,000, 30,000 and 100,000 shares of Common Stock. All three option
grants had an exercise price of $0.40 per share for an aggregate of $60,000 for
150,000 shares. On December 27, 2000, the Board rescinded all three exercises of
these options.

We have granted options to our executive officers and directors. See
"Management -- Director Compensation" and "-- Executive Compensation."

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35

In addition to the indemnification provisions contained in Com21's Amended
and Restated Certificate of Incorporation and Bylaws, Com21 has entered into
separate indemnification agreements with each of its directors and officers.
These agreements require Com21, among other things, to indemnify such director
or officer against expenses (including attorneys' fees), judgments, fines and
settlements (collectively, "Liabilities") paid by such individual in connection
with any action, suit or proceeding arising out of such individual's status or
service as a director or officer of Com21 (other than Liabilities arising from
willful misconduct or conduct that is knowingly fraudulent or deliberately
dishonest) and to advance expenses incurred by such individual in connection
with any proceeding against such individual with respect to which such
individual may be entitled to indemnification by Com21.

All future transactions between Com21 and its officers, directors,
principal stockholders and affiliates will be approved by a majority of the
independent and disinterested members of the Board, and will be on terms no less
favorable to Com21 than could be obtained from unaffiliated third parties.

COMPLIANCE WITH SECTION 16
OF THE SECURITIES EXCHANGE ACT OF 1934

The members of the Board, the executive officers of Com21 and persons who
hold more than 10% of Com21's outstanding Common Stock are subject to the
reporting requirements of Section 16 of the Securities Exchange Act of 1934
which require them to file reports with respect to their ownership of the Common
Stock and their transactions in such Common Stock. Based upon (i) the copies of
Section 16 reports which Com21 received from such persons for their 2000 Fiscal
Year transactions in the Common Stock and their Common Stock holdings, and (ii)
the written representations received from one or more of such persons that no
annual Form 5 reports were required to be filed by them for the 2000 Fiscal
Year, Com21 believes that all reporting requirements under Section 16 for such
fiscal year were met in a timely manner by its directors, executive officers and
greater than ten percent beneficial owners except as set forth below.

Messrs. Hawk and Kramlich each filed an untimely Form 4 in connection with
the receipt of an option grant.

ANNUAL REPORT

A copy of the Annual Report of Com21 for the 2000 Fiscal Year has been
mailed concurrently with this Proxy Statement to all stockholders entitled to
notice of and to vote at the Annual Meeting. The Annual Report is not
incorporated into this Proxy Statement and is not considered proxy solicitation
material.

FORM 10-K

Com21 filed an Annual Report on Form 10-K with the Securities and Exchange
Commission on April 2, 2001. Stockholders may obtain a copy of this report,
without charge, by writing to David L. Robertson, Vice President, Finance and
Administration, Chief Financial Officer and Corporate Secretary of Com21, at
Com21's principal executive offices located at 750 Tasman Drive, Milpitas,
California 95035, or from Com21's Website address at http://www.com21.com.

THE BOARD OF DIRECTORS OF COM21, INC.

Dated: April 12, 2001

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ADDENDUM A
COM21, INC.

AUDIT COMMITTEE CHARTER

I. PURPOSE

The primary function of the Audit Committee is to assist the Board of
Directors in fulfilling its oversight responsibilities by reviewing: the
financial reports and other financial information provided by the Corporation to
any governmental body or the public; the Corporation's systems of internal
controls; and the Corporation's auditing, accounting and financial reporting
processes generally. The Audit Committee's primary duties and responsibilities
are to:

1. Serve as an independent and objective party to monitor the
Corporation's financial reporting process and internal control system;

2. Review and appraise the audit efforts of the Corporation's
independent accountants and internal auditing department; and

3. Provide an open avenue of communication among the independent
accountants, financial and senior management, the internal auditing
department, and the Board of Directors.

The Audit Committee will primarily fulfill these responsibilities by
carrying out the activities enumerated in Section IV of this Charter.

II. COMPOSITION

The Audit Committee shall be comprised of three or more independent
directors.

All members of the Committee shall have a working familiarity with basic
finance and accounting practices, and at least one member of the Committee shall
have accounting or related financial management expertise.

III. MEETINGS

The Committee shall meet on a regular basis and shall hold special meetings
as circumstances require. As part of its job to foster open communication, the
Committee should meet at least annually with management, the director of the
internal auditing department and the independent accountants in separate
executive sessions to discuss any matters that the Committee or each of these
groups believe should be discussed privately. In addition, the Committee or at
least its Chair should meet with the independent accountants and management
quarterly to review the Corporation's financials.

IV. RESPONSIBILITIES AND DUTIES

To fulfill its responsibilities and duties the Audit Committee shall:

Documents/Reports Review

1. Review and update this Charter at least annually.

2. Review the organization's annual financial statements and any
reports or other financial information submitted to any governmental body,
or the public, including any certification, report, opinion, or review
rendered by the independent accountants.

3. Review the regular internal financial reports prepared by and any
internal auditing department and management's response.

A1
37

Independent Accountants

1. Recommend to the Board of Directors the selection of the
independent accountants and approve the fees and other compensation to be
paid to the independent accountants. On an annual basis, the Committee
shall obtain a formal written statement from the accountants delineating
all relationships between the accountants and the Corporation consistent
with Independence Standards Board Standard 1, and shall review and discuss
with the accountants all significant relationships the accountants have
with the Corporation to determine the accountants' independence.

2. Review the performance of the independent accountants and approve
any proposed discharge of the independent accountants when circumstances
warrant.

3. Periodically consult with the independent accountants out of the
presence of management about internal controls and the completeness and
accuracy of the organization's financial statements.

Financial Reporting Processes

1. In consultation with the independent accountants and the internal
auditors, review the integrity of the organization's financial reporting
processes, both internal and external.

2. Consider the independent accountants' judgments about the quality
and appropriateness of the Corporation's accounting principles as applied
in its financial reporting.

3. Consider and approve, if appropriate, major changes to the
Corporation's auditing and accounting principles and practices as suggested
by the independent accountants, management, or the internal auditing
department.

Process Improvement

1. Establish regular and separate systems of reporting to the Audit
Committee by management, the independent accountants and the internal
auditors regarding any significant judgments made in management's
preparation of the financial statements and the view of each as to
appropriateness of such judgments.

2. Following completion of the annual audit, review separately with
management, the independent accountants and the internal auditing
department any significant difficulties encountered during the course of
the audit, including any restrictions on the scope of work or access to
required information.

3. Review any significant disagreement among management and the
independent accountants or the internal auditing department in connection
with the preparation of the financial statements.

4. Review with the independent accountants, the internal auditing
department and management the extent to which changes or improvements in
financial or accounting practices, as approved by the Audit Committee, have
been implemented. (This review should be conducted at an appropriate time
subsequent to implementation of changes or improvements, as decided by the
Committee.)

5. Perform any other activities consistent with this Charter, the
Corporation's By-laws and governing law, as the Committee or the Board
deems necessary or appropriate.

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38

1739-PS-01
39

COM21, INC.
1998 EMPLOYEE STOCK PURCHASE PLAN

(AMENDED AND RESTATED AS OF JANUARY 17, 2001)

I. PURPOSE OF THE PLAN

This Employee Stock Purchase Plan is intended to promote the
interests of Com21, Inc. by providing eligible employees with the opportunity to
acquire a proprietary interest in the Corporation through participation in a
payroll-deduction based employee stock purchase plan designed to qualify under
Section 423 of the Code.

Capitalized terms herein shall have the meanings assigned to such
terms in the attached Appendix.

II. ADMINISTRATION OF THE PLAN

The Plan Administrator shall have full authority to interpret and
construe any provision of the Plan and to adopt such rules and regulations for
administering the Plan as it may deem necessary in order to comply with the
requirements of Code Section 423. Decisions of the Plan Administrator shall be
final and binding on all parties having an interest in the Plan.

III. STOCK SUBJECT TO PLAN

A. The stock purchasable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares of Common
Stock purchased on the open market. The maximum number of shares of Common Stock
which may be issued over the term of the Plan shall not exceed One Million Three
Hundred Fifty Thousand (1,350,000) shares.

B. Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding Common Stock as a class
without the Corporation's receipt of consideration, appropriate adjustments
shall be made to (i) the maximum number and class of securities issuable under
the Plan, (ii) the maximum number and class of securities purchasable per
Participant on any one Purchase Date and (iii) the number and class of
securities and the price per share in effect under each outstanding purchase
right in order to prevent the dilution or enlargement of benefits thereunder.

IV. OFFERING PERIODS

A. Shares of Common Stock shall be offered for purchase under the
Plan through a series of successive offering periods until such time as (i) the
maximum number of shares of Common Stock available for issuance under the Plan
shall have been purchased or (ii) the Plan shall have been sooner terminated.

B. Each offering period shall be of such duration (not to exceed
twenty-four (24) months) as determined by the Plan Administrator prior to the
start date of such offering period. However, the initial offering period shall
commence at the Effective Time and terminate on the last business day in April
2000. The next offering period shall commence on the first business day in
November 2000, and subsequent offering periods shall commence as designated by
the Plan Administrator.

C. Each offering period shall be comprised of a series of one or
more successive Purchase Intervals. Purchase Intervals shall generally run from
the first business day in May each year to the last business day in October of
the same year and from the first business day in November each year to the last
business day in April of the following year. However, the first Purchase
Interval in effect under the initial offering period shall commence at the
Effective Time and terminate on the last business day in October 1998.

D. Should the Fair Market Value per share of Common Stock on any
Purchase Date within an offering period be less than the Fair Market Value per
share of Common Stock on the start date of that offering period, then that
offering period shall automatically terminate immediately after the purchase of
shares of Common Stock on such Purchase Date, and a new offering period shall
commence on the next business day following such Purchase Date. The new offering
period shall have a duration of twenty (24) months, unless a shorter duration is
established by the Plan Administrator within five (5) business days following
the start date of that offering period.

V. ELIGIBILITY

A. Each individual who is an Eligible Employee on the start date
of any offering period under the Plan may enter that offering period on such
start date or on any subsequent Semi-Annual Entry Date within that offering
period, provided he or she remains an Eligible Employee.

B. Each individual who first becomes an Eligible Employee after
the start date of an offering period may enter that offering period on any
subsequent Semi-Annual Entry Date within that offering period on which he or she
is an Eligible Employee.

C. The date an individual enters an offering period shall be
designated his or her Entry Date for purposes of that offering period.

D. To participate in the Plan for a particular offering period,
the Eligible Employee must complete the enrollment forms prescribed by the Plan
Administrator (including a stock purchase agreement and a payroll deduction
authorization) and file such forms with the Plan Administrator (or its
designate) on or before his or her scheduled Entry Date.

VI. PAYROLL DEDUCTIONS

A. The payroll deduction authorized by the Participant for
purposes of acquiring shares of Common Stock during an offering period may be
any multiple of one percent (1%) of the Base Salary paid to the Participant
during each Purchase Interval within that offering period, up to a maximum of
ten percent (10%). The deduction rate so authorized shall continue

in effect throughout the offering period, except to the extent such rate is
changed in accordance with the following guidelines:

(i) The Participant may, at any time during the
offering period, reduce his or her rate of payroll deduction to become
effective as soon as possible after filing the appropriate form with the
Plan Administrator. The Participant may not, however, effect more than
one (1) such reduction per Purchase Interval.

(ii) The Participant may, prior to the commencement of
any new Purchase Interval within the offering period, increase the rate
of his or her payroll deduction by filing the appropriate form with the
Plan Administrator. The new rate (which may not exceed the ten percent
(10%) maximum) shall become effective on the start date of the first
Purchase Interval following the filing of such form.

B. Payroll deductions shall begin on the first pay day
administratively feasible following the Participant's Entry Date into the
offering period and shall (unless sooner terminated by the Participant) continue
through the pay day ending with or immediately prior to the last day of that
offering period. The amounts so collected shall be credited to the Participant's
book account under the Plan, but no interest shall be paid on the balance from
time to time outstanding in such account. The amounts collected from the
Participant shall not be required to be held in any segregated account or trust
fund and may be commingled with the general assets of the Corporation and used
for general corporate purposes.

C. Payroll deductions shall automatically cease upon the
termination of the Participant's purchase right in accordance with the
provisions of the Plan.

D. The Participant's acquisition of Common Stock under the Plan
on any Purchase Date shall neither limit nor require the Participant's
acquisition of Common Stock on any subsequent Purchase Date, whether within the
same or a different offering period.

VII. PURCHASE RIGHTS

A. GRANT OF PURCHASE RIGHT. A Participant shall be granted a
separate purchase right for each offering period in which he or she
participates. The purchase right shall be granted on the Participant's Entry
Date into the offering period and shall provide the Participant with the right
to purchase shares of Common Stock, in a series of successive installments over
the remainder of such offering period, upon the terms set forth below. The
Participant shall execute a stock purchase agreement embodying such terms and
such other provisions (not inconsistent with the Plan) as the Plan Administrator
may deem advisable.

Under no circumstances shall purchase rights be granted under the
Plan to any Eligible Employee if such individual would, immediately after the
grant, own (within the meaning of Code Section 424(d)) or hold outstanding
options or other rights to purchase, stock possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Corporation or any Corporate Affiliate.

B. EXERCISE OF THE PURCHASE RIGHT. Each purchase right shall be
automatically exercised in installments on each successive Purchase Date within
the offering period, and shares of Common Stock shall accordingly be purchased
on behalf of each Participant (other than Participants whose payroll deductions
have previously been refunded pursuant to the Termination of Purchase Right
provisions below) on each such Purchase Date. The purchase shall be effected by
applying the Participant's payroll deductions for the Purchase Interval ending
on such Purchase Date to the purchase of whole shares of Common Stock at the
purchase price in effect for the Participant for that Purchase Date.

C. PURCHASE PRICE. The purchase price per share at which Common
Stock will be purchased on the Participant's behalf on each Purchase Date within
the offering period shall be equal to eighty-five percent (85%) of the lower of
(i) the Fair Market Value per share of Common Stock on the Participant's Entry
Date into that offering period or (ii) the Fair Market Value per share of Common
Stock on that Purchase Date.

D. NUMBER OF PURCHASABLE SHARES. The number of shares of Common
Stock purchasable by a Participant on each Purchase Date during the offering
period shall be the number of whole shares obtained by dividing the amount
collected from the Participant through payroll deductions during the Purchase
Interval ending with that Purchase Date by the purchase price in effect for the
Participant for that Purchase Date. However, the maximum number of shares of
Common Stock purchasable per Participant on any one Purchase Date shall not
exceed One Thousand Five Hundred (1,500) shares, subject to periodic adjustments
in the event of certain changes in the Corporation's capitalization. In
addition, the maximum aggregate number of shares of Common Stock purchasable by
all Participants on any one Purchase Date shall not exceed Two Hundred Thousand
(200,000) shares, subject to periodic adjustments in the event of certain
changes in the Corporation's capitalization.

E. EXCESS PAYROLL DEDUCTIONS. Any payroll deductions not applied
to the purchase of shares of Common Stock on any Purchase Date because they are
not sufficient to purchase a whole share of Common Stock shall be held for the
purchase of Common Stock on the next Purchase Date. However, any payroll
deductions not applied to the purchase of

Common Stock by reason of the limitation on the maximum number of shares
purchasable on the Purchase Date shall be promptly refunded.

F. TERMINATION OF PURCHASE RIGHT. The following provisions shall
govern the termination of outstanding purchase rights:

(i) A Participant may, at any time prior to the next
scheduled Purchase Date in the offering period, terminate his or her
outstanding purchase right by filing the appropriate form with the Plan
Administrator (or its designate), and no further payroll deductions
shall be collected from the Participant with respect to the terminated
purchase right. Any payroll deductions collected during the Purchase
Interval in which such termination occurs shall, at the Participant's
election, be immediately refunded or held for the purchase of shares on
the next Purchase Date. If no such election is made at the time such
purchase right is terminated, then the payroll deductions collected with
respect to the terminated right shall be refunded as soon as possible.

(ii) The termination of such purchase right shall be
irrevocable, and the Participant may not subsequently rejoin the
offering period for which the terminated purchase right was granted. In
order to resume participation in any subsequent offering period, such
individual must re-enroll in the Plan (by making a timely filing of the
prescribed enrollment forms) on or before his or her scheduled Entry
Date into that offering period.

(iii) Should the Participant cease to remain an Eligible
Employee for any reason (including death, disability or change in
status) while his or her purchase right remains outstanding, then that
purchase right shall immediately terminate, and all of the Participant's
payroll deductions for the Purchase Interval in which the purchase right
so terminates shall be immediately refunded. However, should the
Participant cease to remain in active service by reason of an approved
unpaid leave of absence, then the Participant shall have the right,
exercisable up until the last business day of the Purchase Interval in
which such leave commences, to (a) withdraw all the payroll deductions
collected to date on his or her behalf for that Purchase Interval or (b)
have such funds held for the purchase of shares on his or her behalf on
the next scheduled Purchase Date. In no event, however, shall any
further payroll deductions be collected on the Participant's behalf
during such leave. Upon the Participant's return to active service
within (i) ninety (90) days following the commencement of such leave or,
if longer, the period during which such Participant's right to
reemployment with the Corporation is guaranteed by either statute or
contract, his or her payroll deductions under the Plan shall
automatically resume at the rate in effect at the time the leave began,
unless the Participant withdraws from the Plan prior to his or her
return. If the Participant's leave of absence, whether paid or unpaid,
(i) exceeds ninety (90) days and (ii) is not guaranteed by either
statute or contract, then the Participant's status as an Eligible
Employee will be deemed to have terminated on the ninety-first (91st)
day of such leave, and such Participant's purchase right for the
offering period in which such leave began shall thereupon

terminate. An individual who returns to active employment following such
a leave will be treated as a new employee for purposes of participating
in the Plan and will accordingly have a new Entry Date. Such an
individual must re-enroll in the Plan (by making a timely filing of the
prescribed enrollment forms) on or before his or her scheduled Entry
Date into the offering period.

G. CORPORATE TRANSACTION. Each outstanding purchase right shall
automatically be exercised, immediately prior to the effective date of any
Corporate Transaction, by applying the payroll deductions of each Participant
for the Purchase Interval in which such Corporate Transaction occurs to the
purchase of whole shares of Common Stock at a purchase price per share equal to
eighty-five percent (85%) of the lower of (i) the Fair Market Value per share of
Common Stock on the Participant's Entry Date into the offering period in which
such Corporate Transaction occurs or (ii) the Fair Market Value per share of
Common Stock immediately prior to the effective date of such Corporate
Transaction. However, the applicable limitation on the number of shares of
Common Stock purchasable per Participant and in the aggregate shall continue to
apply to any such purchase.

The Corporation shall use its best efforts to provide at least
ten (10)-days prior written notice of the occurrence of any Corporate
Transaction, and Participants shall, following the receipt of such notice, have
the right to terminate their outstanding purchase rights prior to the effective
date of the Corporate Transaction.

H. PRORATION OF PURCHASE RIGHTS. Should the total number of
shares of Common Stock to be purchased pursuant to outstanding purchase rights
on any particular date exceed the number of shares then available for issuance
under the Plan, the Plan Administrator shall make a pro-rata allocation of the
available shares on a uniform and nondiscriminatory basis, and the payroll
deductions of each Participant, to the extent in excess of the aggregate
purchase price payable for the Common Stock pro-rated to such individual, shall
be refunded.

I. ASSIGNABILITY. The purchase right shall be exercisable only by
the Participant and shall not be assignable or transferable by the Participant.

J. STOCKHOLDER RIGHTS. A Participant shall have no stockholder
rights with respect to the shares subject to his or her outstanding purchase
right until the shares are purchased on the Participant's behalf in accordance
with the provisions of the Plan and the Participant has become a holder of
record of the purchased shares.

VIII. ACCRUAL LIMITATIONS

A. No Participant shall be entitled to accrue rights to acquire
Common Stock pursuant to any purchase right outstanding under this Plan if and
to the extent such accrual, when aggregated with (i) rights to purchase Common
Stock accrued under any other purchase right granted under this Plan and (ii)
similar rights accrued under other employee stock purchase plans (within the
meaning of Code Section 423) of the Corporation or any Corporate Affiliate,
would otherwise permit such Participant to purchase more than Twenty-Five
Thousand Dollars ($25,000) worth of stock of the Corporation or any Corporate
Affiliate (determined on the basis

of the Fair Market Value per share on the date or dates such rights are granted)
for each calendar year such rights are at any time outstanding.

B. For purposes of applying such accrual limitations to the
purchase rights granted under the Plan, the following provisions shall be in
effect:

(i) The right to acquire Common Stock under each
outstanding purchase right shall accrue in a series of installments on
each successive Purchase Date during the offering period on which such
right remains outstanding.

(ii) No right to acquire Common Stock under any
outstanding purchase right shall accrue to the extent the Participant
has already accrued in the same calendar year the right to acquire
Common Stock under one (1) or more other purchase rights at a rate equal
to Twenty-Five Thousand Dollars ($25,000) worth of Common Stock
(determined on the basis of the Fair Market Value per share on the date
or dates of grant) for each calendar year such rights were at any time
outstanding.

C. If by reason of such accrual limitations, any purchase right
of a Participant does not accrue for a particular Purchase Interval, then the
payroll deductions which the Participant made during that Purchase Interval with
respect to such purchase right shall be promptly refunded.

D. In the event there is any conflict between the provisions of
this Article and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article shall be controlling.

IX. EFFECTIVE DATE AND TERM OF THE PLAN

A. The Plan was adopted by the Board on March 10, 1998 and shall
become effective at the Effective Time, provided no purchase rights granted
under the Plan shall be exercised, and no shares of Common Stock shall be issued
hereunder, until (i) the Plan shall have been approved by the stockholders of
the Corporation and (ii) the Corporation shall have complied with all applicable
requirements of the 1933 Act (including the registration of the shares of Common
Stock issuable under the Plan on a Form S-8 registration statement filed with
the Securities and Exchange Commission), all applicable listing requirements of
any stock exchange (or the Nasdaq National Market, if applicable) on which the
Common Stock is listed for trading and all other applicable requirements
established by law or regulation. In the event such stockholder approval is not
obtained, or such compliance is not effected, within twelve (12) months after
the date on which the Plan is adopted by the Board, the Plan shall terminate and
have no further force or effect, and all sums collected from Participants during
the initial offering period hereunder shall be refunded.

B. Unless sooner terminated by the Board, the Plan shall
terminate upon the earliest of (i) the last business day in April 2008, (ii) the
date on which all shares available for issuance under the Plan shall have been
sold pursuant to purchase rights exercised under the Plan or (iii) the date on
which all purchase rights are exercised in connection with a Corporate

Transaction. No further purchase rights shall be granted or exercised, and no
further payroll deductions shall be collected, under the Plan following such
termination.

X. AMENDMENT OF THE PLAN

A. The Board may alter, amend, suspend or terminate the Plan at
any time to become effective immediately following the close of any Purchase
Interval. However, the Plan may be amended or terminated immediately upon Board
action, if and to the extent necessary to assure that the Corporation will not
recognize, for financial reporting purposes, any compensation expense in
connection with the shares of Common Stock offered for purchase under the Plan,
should the financial accounting rules applicable to the Plan at the Effective
Time be subsequently revised so as to require the recognition of compensation
expense in the absence of such amendment or termination.

B. The Board amended the Plan on January 12, 2000 (the "2000
Amendment") to increase the shares reserved under the Plan by Four Hundred Fifty
Thousand (450,000) shares, for a total share reserve of Seven Hundred Thousand
(700,000) shares. The 2000 Amendment was approved by the stockholders at the
Corporation's 2000 Annual Meeting,

C. The Board amended the Plan on January 17, 2001, subject to
approval of the Corporation's stockholders at the Corporation's 2000 Annual
Meeting, (i) to increase the number of shares reserved under the Plan by six
hundred and fifty thousand (650,000) shares, for a total share reserve of seven
hundred thousand (1,350,000) shares and (ii) to eliminate the necessity of
stockholder approval to increase the limitation on the number of shares which
any one participant may purchase on any semi-annual purchase date.

D. In no event may the Board effect any of the following
amendments or revisions to the Plan without the approval of the Corporation's
stockholders: (i) increase the number of shares of Common Stock issuable under
the Plan, except for permissible adjustments in the event of certain changes in
the Corporation's capitalization, (ii) alter the purchase price formula so as to
reduce the purchase price payable for the shares of Common Stock purchasable
under the Plan or (iii) modify eligibility requirements for participation in the
Plan.

XI. GENERAL PROVISIONS

A. All costs and expenses incurred in the administration of the
Plan shall be paid by the Corporation; however, each Plan Participant shall bear
all costs and expenses incurred by such individual in the sale or other
disposition of any shares purchased under the Plan.

B. Nothing in the Plan shall confer upon the Participant any
right to continue in the employ of the Corporation or any Corporate Affiliate
for any period of specific duration or interfere with or otherwise restrict in
any way the rights of the Corporation (or any Corporate Affiliate employing such
person) or of the Participant, which rights are hereby expressly reserved by
each, to terminate such person's employment at any time for any reason, with or
without cause.

C. The provisions of the Plan shall be governed by the laws of
the State of California without resort to that State's conflict-of-laws rules.

SCHEDULE A

CORPORATIONS PARTICIPATING IN
EMPLOYEE STOCK PURCHASE PLAN
AS OF THE EFFECTIVE TIME

COM21, Inc.

APPENDIX

The following definitions shall be in effect under the Plan:

A. BASE SALARY shall mean the (i) regular base salary paid to a
Participant by one or more Participating Companies during such individual's
period of participation in one or more offering periods under the Plan plus (ii)
any pre-tax contributions made by the Participant to any Code Section 401(k)
salary deferral plan or any Code Section 125 cafeteria benefit program now or
hereafter established by the Corporation or any Corporate Affiliate. The
following items of compensation shall NOT be included in Base Salary: (i) all
overtime payments, bonuses, commissions (other than those functioning as base
salary equivalents), profit-sharing distributions and other incentive-type
payments and (ii) any and all contributions (other than Code Section 401(k) or
Code Section 125 contributions) made on the Participant's behalf by the
Corporation or any Corporate Affiliate under any employee benefit or welfare
plan now or hereafter established.

B. BOARD shall mean the Corporation's Board of Directors.

C. CODE shall mean the Internal Revenue Code of 1986, as amended.

D. COMMON STOCK shall mean the Corporation's common stock.

E. CORPORATE AFFILIATE shall mean any parent or subsidiary
corporation of the Corporation (as determined in accordance with Code Section
424), whether now existing or subsequently established.

F. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:

(i) a merger or consolidation in which securities possessing
more than fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities are transferred to a person or
persons different from the persons holding those securities immediately
prior to such transaction, or

(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in complete
liquidation or dissolution of the Corporation.

G. CORPORATION shall mean Com21, Inc., a Delaware corporation,
and any corporate successor to all or substantially all of the assets or voting
stock of Com21, Inc. which shall by appropriate action adopt the Plan.

H. EFFECTIVE TIME shall mean the time at which the Underwriting
Agreement is executed and finally priced. Any Corporate Affiliate which becomes
a Participating Corporation after such Effective Time shall designate a
subsequent Effective Time with respect to its employee-Participants.

I. ELIGIBLE EMPLOYEE shall mean any person who is employed by a
Participating Corporation on a basis under which he or she is regularly expected
to render more than twenty (20) hours of service per week for more than five (5)
months per calendar year for earnings considered wages under Code Section
3401(a).

J. ENTRY DATE shall mean the date an Eligible Employee first
commences participation in the offering period in effect under the Plan. The
earliest Entry Date under the Plan shall be the Effective Time.

K. FAIR MARKET VALUE per share of Common Stock on any relevant
date shall be determined in accordance with the following provisions:

(i) If the Common Stock is at the time traded on the Nasdaq
National Market, then the Fair Market Value shall be the closing selling
price per share of Common Stock on the date in question, as such price
is reported by the National Association of Securities Dealers on the
Nasdaq National Market or any successor system. If there is no closing
selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists.

(ii) If the Common Stock is at the time listed on any Stock
Exchange, then the Fair Market Value shall be the closing selling price
per share of Common Stock on the date in question on the Stock Exchange
determined by the Plan Administrator to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape
of transactions on such exchange. If there is no closing selling price
for the Common Stock on the date in question, then the Fair Market Value
shall be the closing selling price on the last preceding date for which
such quotation exists.

(iii) For purposes of the initial offering period which begins
at the Effective Time, the Fair Market Value shall be deemed to be equal
to the price per share at which the Common Stock is sold in the initial
public offering pursuant to the Underwriting Agreement.

L. 1933 ACT shall mean the Securities Act of 1933, as amended.

M. PARTICIPANT shall mean any Eligible Employee of a
Participating Corporation who is actively participating in the Plan.

N. PARTICIPATING CORPORATION shall mean the Corporation and such
Corporate Affiliate or Affiliates as may be authorized from time to time by the
Board to extend the benefits of the Plan to their Eligible Employees. The
Participating Corporations in the Plan are listed in attached Schedule A.

O. PLAN shall mean the Corporation's 1998 Employee Stock Purchase
Plan, as set forth in this document.

P. PLAN ADMINISTRATOR shall mean the committee of two (2) or more
Board members appointed by the Board to administer the Plan.

Q. PURCHASE DATE shall mean the last business day of each
Purchase Interval. The initial Purchase Date shall be October 30, 1998.

R. PURCHASE INTERVAL shall mean each successive six (6)-month
period within the offering period at the end of which there shall be purchased
shares of Common Stock on behalf of each Participant.

S. SEMI-ANNUAL ENTRY DATE shall mean the first business day in
May and November each year on which an Eligible Employee may first enter an
offering period.

T. STOCK EXCHANGE shall mean either the American Stock Exchange
or the New York Stock Exchange.

U. UNDERWRITING AGREEMENT shall mean the agreement between the
Corporation and the underwriter or underwriters managing the initial public
offering of the Common Stock.

52
COM21, INC.

2000 STOCK OPTION PLAN

(As amended by the Board on January 17, 2001)

ARTICLE ONE

GENERAL PROVISIONS

I. PURPOSE OF THE PLAN

This 2000 Stock Option Plan is intended to promote the interests
of Com21, Inc., a Delaware corporation, by providing eligible persons in the
Corporation's service with the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the Corporation as an
incentive for them to remain in such service.

Capitalized terms shall have the meanings assigned to such terms
in the attached Appendix.

II. ADMINISTRATION OF THE PLAN

A. The Primary Committee shall have sole and exclusive authority
to administer the Plan with respect to Section 16 Insiders. Administration of
the Plan with respect to all other persons eligible to participate in that
program may, at the Board's discretion, be vested in the Primary Committee or a
Secondary Committee, or the Board may retain the power to administer that
program with respect to all such persons. However, any option grants for members
of the Primary Committee must be authorized by a disinterested majority of the
Board.

B. Members of the Primary Committee or any Secondary Committee
shall serve for such period of time as the Board may determine and may be
removed by the Board at any time. The Board may also at any time terminate the
functions of any Secondary Committee and reassume all powers and authority
previously delegated to such committee.

C. Each Plan Administrator shall, within the scope of its
administrative functions under the Plan, have full power and authority (subject
to the provisions of the Plan) to establish such rules and regulations as it may
deem appropriate for proper administration of the Plan and to make such
determinations under, and issue such interpretations of, the provisions of that
program and any outstanding options thereunder as it may deem necessary or
advisable. Decisions of the Plan Administrator within the scope of its
administrative functions under the Plan shall be final and binding on all
parties who have an interest in the Plan under its jurisdiction or any stock
option thereunder.

D. Service on the Primary Committee or the Secondary Committee
shall constitute service as a Board member, and members of each such committee
shall accordingly be entitled to full indemnification and reimbursement as Board
members for their service on such committee. No member of the Primary Committee
or the Secondary Committee shall be liable for any act or omission made in good
faith with respect to the Plan or any option grants under the Plan.

III. ELIGIBILITY

A. The persons eligible to participate in the Plan are as
follows:

(i) Employees,

(ii) non-employee members of the Board or the board
of directors of any Parent or Subsidiary, and

(iii) consultants and other independent advisors
who provide services to the Corporation (or any Parent or Subsidiary).

B. Each Plan Administrator shall, within the scope of its
administrative jurisdiction under the Plan, have full authority to determine,
with respect to the option grants under the Plan, which eligible persons are to
receive such grants, the time or times when those grants are to be made, the
number of shares to be covered by each such grant, the status of the granted
option as either an Incentive Option or a Non-Statutory Option, the time or
times when each option is to become exercisable, the vesting schedule (if any)
applicable to the option shares and the maximum term for which the option is to
remain outstanding.

IV. STOCK SUBJECT TO THE PLAN

A. The stock issuable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares repurchased
by the Corporation on the open market. The number of shares of Common Stock
initially reserved for issuance over the term of the Plan shall not exceed three
million (3,000,000) shares.

B. No one person participating in the Plan may receive stock
options for more than three hundred thousand (300,000) shares of Common Stock in
the aggregate per calendar year.

C. Shares of Common Stock subject to outstanding options shall be
available for subsequent issuance under the Plan to the extent those options
expire or terminate for any reason prior to exercise in full. Unvested shares
issued under the Plan and subsequently cancelled or repurchased by the
Corporation at the original issue price paid per share, pursuant to the
Corporation's repurchase rights under the Plan shall be added back to the number
of shares of Common Stock reserved for issuance under the Plan and shall
accordingly be available for reissuance through one or more subsequent option
grants under the Plan. However, should the exercise price of an option under the
Plan be paid with shares of Common Stock, then the

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number of shares of Common Stock available for issuance under the Plan shall be
reduced by the gross number of shares for which the option is exercised, and not
by the net number of shares of Common Stock issued to the holder of such option.

D. If any change is made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding Common Stock as a class
without the Corporation's receipt of consideration, appropriate adjustments
shall be made by the Plan Administrator to (i) the maximum number and/or class
of securities issuable under the Plan, (ii) the maximum number and/or class of
securities for which any one person may be granted stock options and separately
exercisable stock appreciation rights under the Plan per calendar year and (iii)
the number and/or class of securities and the exercise price per share in effect
under each outstanding option under the Plan. Such adjustments to the
outstanding options are to be effected in a manner which shall preclude the
enlargement or dilution of rights and benefits under such options. The
adjustments determined by the Plan Administrator shall be final, binding and
conclusive.

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ARTICLE TWO

OPTION GRANT PROGRAM

I. OPTION TERMS

Each option shall be evidenced by one or more documents in the
form approved by the Plan Administrator; provided, however, that each such
document shall comply with the terms specified below. Each document evidencing
an Incentive Option shall, in addition, be subject to the provisions of the Plan
applicable to such options.

A. EXERCISE PRICE.

1. The exercise price per share shall be fixed by the Plan
Administrator but shall not be less than one hundred percent (100%) of the Fair
Market Value per share of Common Stock on the option grant date.

2. The exercise price shall become immediately due upon
exercise of the option and shall be payable in one or more of the forms
specified below:

(i) cash or check made payable to the Corporation,

(ii) shares of Common Stock held for the requisite
period necessary to avoid a charge to the Corporation's earnings for
financial reporting purposes and valued at Fair Market Value on the
Exercise Date, or

(iii) to the extent the option is exercised for vested
shares, through a special sale and remittance procedure pursuant to
which the Optionee shall concurrently provide irrevocable instructions
to (a) a Corporation-designated brokerage firm to effect the immediate
sale of the purchased shares and remit to the Corporation, out of the
sale proceeds available on the settlement date, sufficient funds to
cover the aggregate exercise price payable for the purchased shares plus
all applicable Federal, state and local income and employment taxes
required to be withheld by the Corporation by reason of such exercise
and (b) the Corporation to deliver the certificates for the purchased
shares directly to such brokerage firm in order to complete the sale.

Except to the extent such sale and remittance procedure is
utilized, payment of the exercise price for the purchased shares must be made on
the Exercise Date.

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B. EXERCISE AND TERM OF OPTIONS. Each option shall be exercisable
at such time or times, during such period and for such number of shares as shall
be determined by the Plan Administrator and set forth in the documents
evidencing the option. However, no option shall have a term in excess of ten
(10) years measured from the option grant date.

C. EFFECT OF TERMINATION OF SERVICE.

1. The following provisions shall govern the exercise of any
options held by the Optionee at the time of cessation of Service or death:

(i) Any option outstanding at the time of the Optionee's
cessation of Service for any reason shall remain exercisable for such
period of time thereafter as shall be determined by the Plan
Administrator and set forth in the documents evidencing the option, but
no such option shall be exercisable after the expiration of the option
term.

(ii) Any option held by the Optionee at the time of death
and exercisable in whole or in part at that time may be subsequently
exercised by the personal representative of the Optionee's estate or by
the person or persons to whom the option is transferred pursuant to the
Optionee's will or the laws of inheritance or by the Optionee's
designated beneficiary or beneficiaries of that option.

(iii) Should the Optionee's Service be terminated for
Misconduct or should the Optionee otherwise engage in Misconduct while
holding one or more outstanding options under this Article Two, then all
those options shall terminate immediately and cease to be outstanding.

(iv) During the applicable post-Service exercise period,
the option may not be exercised in the aggregate for more than the
number of vested shares for which the option is exercisable on the date
of the Optionee's cessation of Service. Upon the expiration of the
applicable exercise period or (if earlier) upon the expiration of the
option term, the option shall terminate and cease to be outstanding for
any vested shares for which the option has not been exercised. However,
the option shall, immediately upon the Optionee's cessation of Service,
terminate and cease to be outstanding to the extent the option is not
otherwise at that time exercisable for vested shares.

2. The Plan Administrator shall have complete discretion,
exercisable either at the time an option is granted or at any time while the
option remains outstanding, to:

(i) extend the period of time for which the option is to
remain exercisable following the Optionee's cessation of Service from
the limited exercise period otherwise in effect for that option to such
greater period of time as the Plan Administrator shall deem appropriate,
but in no event beyond the expiration of the option term, and/or

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(ii) permit the option to be exercised, during the
applicable post-Service exercise period, not only with respect to the
number of vested shares of Common Stock for which such option is
exercisable at the time of the Optionee's cessation of Service but also
with respect to one or more additional installments in which the
Optionee would have vested had the Optionee continued in Service.

D. STOCKHOLDER RIGHTS. The holder of an option shall have no
stockholder rights with respect to the shares subject to the option until such
person shall have exercised the option, paid the exercise price and become a
holder of record of the purchased shares.

E. REPURCHASE RIGHTS. The Plan Administrator shall have the
discretion to grant options which are exercisable for unvested shares of Common
Stock. Should the Optionee cease Service while holding such unvested shares, the
Corporation shall have the right to repurchase, at the exercise price paid per
share, any or all of those unvested shares. The terms upon which such repurchase
right shall be exercisable (including the period and procedure for exercise and
the appropriate vesting schedule for the purchased shares) shall be established
by the Plan Administrator and set forth in the document evidencing such
repurchase right.

F. LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, Incentive Options shall be exercisable only by the Optionee and shall
not be assignable or transferable other than by will or the laws of inheritance
following the Optionee's death. Non-Statutory Options shall be subject to the
same restriction, except that a Non-Statutory Option may be assigned in whole or
in part during the Optionee's lifetime to one or more members of the Optionee's
family or to a trust established exclusively for one or more such family members
or to Optionee's former spouse, to the extent such assignment is in connection
with the Optionee's estate plan or pursuant to a domestic relations order. The
assigned portion may only be exercised by the person or persons who acquire a
proprietary interest in the option pursuant to the assignment. The terms
applicable to the assigned portion shall be the same as those in effect for the
option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem appropriate.
Notwithstanding the foregoing, the Optionee may also designate one or more
persons as the beneficiary or beneficiaries of his or her outstanding options
under this Article Two, and those options shall, in accordance with such
designation, automatically be transferred to such beneficiary or beneficiaries
upon the Optionee's death while holding those options. Such beneficiary or
beneficiaries shall take the transferred options subject to all the terms and
conditions of the applicable agreement evidencing each such transferred option,
including (without limitation) the limited time period during which the option
may be exercised following the Optionee's death.

II. INCENTIVE OPTIONS

The terms specified below shall be applicable to all Incentive
Options. Except as modified by the provisions of this Section II, all the
provisions of Articles One, Two and Three shall be applicable to Incentive
Options. Options which are specifically designated as Non-Statutory Options when
issued under the Plan shall not be subject to the terms of this Section II.

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A. ELIGIBILITY. Incentive Options may only be granted to
Employees.

B. DOLLAR LIMITATION. The aggregate Fair Market Value of the
shares of Common Stock (determined as of the respective date or dates of grant)
for which one or more options granted to any Employee under the Plan (or any
other option plan of the Corporation or any Parent or Subsidiary) may for the
first time become exercisable as Incentive Options during any one calendar year
shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To the
extent the Employee holds two (2) or more such options which become exercisable
for the first time in the same calendar year, the foregoing limitation on the
exercisability of such options as Incentive Options shall be applied on the
basis of the order in which such options are granted.

C. 10% STOCKHOLDER. If any Employee to whom an Incentive Option
is granted is a 10% Stockholder, then the exercise price per share shall not be
less than one hundred ten percent (110%) of the Fair Market Value per share of
Common Stock on the option grant date, and the option term shall not exceed five
(5) years measured from the option grant date.

III. CORPORATE TRANSACTION/CHANGE IN CONTROL

A. In the event of any Corporate Transaction, each outstanding
option shall automatically accelerate so that each such option shall,
immediately prior to the effective date of the Corporate Transaction, become
exercisable for all the shares of Common Stock at the time subject to such
option and may be exercised for any or all of those shares as fully vested
shares of Common Stock. However, an outstanding option shall NOT become
exercisable on such an accelerated basis if and to the extent: (i) such option
is, in connection with the Corporate Transaction, to be assumed by the successor
corporation (or parent thereof) or (ii) such option is to be replaced with a
cash incentive program of the successor corporation which preserves the spread
existing at the time of the Corporate Transaction on any shares for which the
option is not otherwise at that time exercisable and provides for subsequent
payout in accordance with the same exercise/vesting schedule applicable to those
option shares or (iii) the acceleration of such option is subject to other
limitations imposed by the Plan Administrator at the time of the option grant.

B. All outstanding repurchase rights shall automatically
terminate, and the shares of Common Stock subject to those terminated rights
shall immediately vest in full, in the event of any Corporate Transaction,
except to the extent: (i) those repurchase rights are to be assigned to the
successor corporation (or parent thereof) in connection with such Corporate
Transaction or (ii) such accelerated vesting is precluded by other limitations
imposed by the Plan Administrator at the time the repurchase right is issued.

C. Immediately following the consummation of the Corporate
Transaction, all outstanding options shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation (or
parent thereof).

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D. Each option which is assumed in connection with a Corporate
Transaction shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction had
the option been exercised immediately prior to such Corporate Transaction.
Appropriate adjustments to reflect such Corporate Transaction shall also be made
to (i) the exercise price payable per share under each outstanding option,
provided the aggregate exercise price payable for such securities shall remain
the same, (ii) the maximum number and/or class of securities available for
issuance over the remaining term of the Plan and (iii) the maximum number and/or
class of securities for which any one person may be granted stock options under
the Plan per calendar year and (iv) the maximum number and/or class of
securities by which the share reserve is to increase automatically each calendar
year. To the extent the actual holders of the Corporation's outstanding Common
Stock receive cash consideration for their Common Stock in consummation of the
Corporate Transaction, the successor corporation may, in connection with the
assumption of the outstanding options under the Discretionary Option Grant
Program, substitute one or more shares of its own common stock with a fair
market value equivalent to the cash consideration paid per share of Common Stock
in such Corporate Transaction.

E. The Plan Administrator shall have the discretionary authority
to structure one or more outstanding options under the Plan so that those
options shall, immediately prior to the effective date of such Corporate
Transaction, become exercisable for all the shares of Common Stock at the time
subject to those options and may be exercised for any or all of those shares as
fully vested shares of Common Stock, whether or not those options are to be
assumed in the Corporate Transaction. In addition, the Plan Administrator shall
have the discretionary authority to structure one or more of the Corporation's
repurchase rights under the Plan so that those rights shall not be assignable in
connection with such Corporate Transaction and shall accordingly terminate upon
the consummation of such Corporate Transaction, and the shares subject to those
terminated rights shall thereupon vest in full.

F. The Plan Administrator shall have full power and authority to
structure one or more outstanding options under the Plan so that those options
shall become exercisable for all the shares of Common Stock at the time subject
to those options in the event the Optionee's Service is subsequently terminated
by reason of an Involuntary Termination within a designated period (not to
exceed eighteen (18) months) following the effective date of any Corporate
Transaction in which those options are assumed and do not otherwise accelerate.
In addition, the Plan Administrator may structure one or more of the
Corporation's repurchase rights so that those rights shall immediately terminate
with respect to any shares held by the Optionee at the time of his or her
Involuntary Termination, and the shares subject to those terminated repurchase
rights shall accordingly vest in full at that time.

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G. The Plan Administrator shall have the discretionary authority
to structure one or more outstanding options under the Plan so that those
options shall, immediately prior to the effective date of a Change in Control,
become exercisable for all the shares of Common Stock at the time subject to
those options and may be exercised for any or all of those shares as fully
vested shares of Common Stock. In addition, the Plan Administrator shall have
the discretionary authority to structure one or more of the Corporation's
repurchase rights under the Plan so that those rights shall terminate
automatically upon the consummation of such Change in Control, and the shares
subject to those terminated rights shall thereupon vest in full. Alternatively,
the Plan Administrator may condition the automatic acceleration of one or more
outstanding options under the Plan and the termination of one or more of the
Corporation's outstanding repurchase rights under such program upon the
subsequent termination of the Optionee's Service by reason of an Involuntary
Termination within a designated period (not to exceed eighteen (18) months)
following the effective date of such Change in Control.

H. The portion of any Incentive Option accelerated in connection
with a Corporate Transaction or Change in Control shall remain exercisable as an
Incentive Option only to the extent the applicable One Hundred Thousand Dollar
($100,000) limitation is not exceeded. To the extent such dollar limitation is
exceeded, the accelerated portion of such option shall be exercisable as a
Nonstatutory Option under the Federal tax laws.

I. The outstanding options shall in no way affect the right of
the Corporation to adjust, reclassify, reorganize or otherwise change its
capital or business structure or to merge, consolidate, dissolve, liquidate or
sell or transfer all or any part of its business or assets.

9
61

ARTICLE THREE

MISCELLANEOUS

I. TAX WITHHOLDING

The Corporation's obligation to deliver shares of Common Stock
upon the exercise of options under the Plan shall be subject to the satisfaction
of all applicable Federal, state and local income and employment tax withholding
requirements.

II. EFFECTIVE DATE AND TERM OF THE PLAN

A. The Plan shall become effective immediately on the Plan
Effective Date. Options may be granted under the Plan at any time on or after
the Plan Effective Date. However, no options granted under the Plan may be
exercised, and no shares shall be issued under the Plan, until the Plan is
approved by the Corporation's stockholders at the 2000 Annual Meeting. If such
stockholder approval is not obtained, then all options previously granted under
this Plan shall terminate and cease to be outstanding, and no further options
shall be granted and no shares shall be issued under the Plan.

B. The Plan shall terminate upon the earliest to occur of (i)
March 1, 2010, (ii) the date on which all shares available for issuance under
the Plan shall have been issued as fully vested shares or (iii) the termination
of all outstanding options in connection with a Corporate Transaction. Should
the Plan terminate on March 1, 2010, then all option grants outstanding at that
time shall continue to have force and effect in accordance with the provisions
of the documents evidencing such grants.

III. AMENDMENT OF THE PLAN

A. The Board shall have complete and exclusive power and
authority to amend or modify the Plan in any or all respects. However, no such
amendment or modification shall adversely affect the rights and obligations with
respect to stock options at the time outstanding under the Plan unless the
Optionee consents to such amendment or modification. In addition, certain
amendments may require stockholder approval pursuant to applicable laws or
regulations.

B. Options to purchase shares of Common Stock may be granted
under the Plan that are in excess of the number of shares then available for
issuance under the Plan, provided any excess shares actually issued under that
program shall be held in escrow until there is obtained stockholder approval of
an amendment sufficiently increasing the number of shares of Common Stock
available for issuance under the Plan. If such stockholder approval is not
obtained within twelve (12) months after the date the first such excess
issuances are made, then

10
62

(i) any unexercised options granted on the basis of such excess shares shall
terminate and cease to be outstanding and (ii) the Corporation shall promptly
refund to the Optionees the exercise price paid for any excess shares issued
under the Plan and held in escrow, together with interest (at the applicable
Short Term Federal Rate) for the period the shares were held in escrow, and such
shares shall thereupon be automatically cancelled and cease to be outstanding.

IV. USE OF PROCEEDS

Any cash proceeds received by the Corporation from the sale of
shares of Common Stock under the Plan shall be used for general corporate
purposes.

V. REGULATORY APPROVALS

A. The implementation of the Plan, the granting of any stock
option under the Plan and the issuance of any shares of Common Stock upon the
exercise of any granted option shall be subject to the Corporation's procurement
of all approvals and permits required by regulatory authorities having
jurisdiction over the Plan, the stock options granted under it and the shares of
Common Stock issued pursuant to it.

B. No shares of Common Stock or other assets shall be issued or
delivered under the Plan unless and until there shall have been compliance with
all applicable requirements of Federal and state securities laws, including the
filing and effectiveness of the Form S-8 registration statement for the shares
of Common Stock issuable under the Plan, and all applicable listing requirements
of any stock exchange (or the Nasdaq National Market, if applicable) on which
Common Stock is then listed for trading.

VI. NO EMPLOYMENT/SERVICE RIGHTS

Nothing in the Plan shall confer upon the Optionee any right to
continue in Service for any period of specific duration or interfere with or
otherwise restrict in any way the rights of the Corporation (or any Parent or
Subsidiary employing or retaining such person) or of the Optionee, which rights
are hereby expressly reserved by each, to terminate such person's Service at any
time for any reason, with or without cause.

11
63

APPENDIX

The following definitions shall be in effect under the Plan:

A. BOARD shall mean the Corporation's Board of Directors.

B. CHANGE IN CONTROL shall mean a change in ownership or control
of the Corporation effected through either of the following transactions:

(i) the acquisition, directly or indirectly by any person or
related group of persons (other than the Corporation or a person that
directly or indirectly controls, is controlled by, or is under common
control with, the Corporation), of beneficial ownership (within the
meaning of Rule 13d-3 of the 1934 Act) of securities possessing more
than fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities pursuant to a tender or exchange
offer made directly to the Corporation's stockholders, or

(ii) a change in the composition of the Board over a period
of thirty-six (36) consecutive months or less such that a majority of
the Board members ceases, by reason of one or more contested elections
for Board membership, to be comprised of individuals who either (A) have
been Board members continuously since the beginning of such period or
(B) have been elected or nominated for election as Board members during
such period by at least a majority of the Board members described in
clause (A) who were still in office at the time the Board approved such
election or nomination.

C. CODE shall mean the Internal Revenue Code of 1986, as amended.

D. COMMON STOCK shall mean the Corporation's common stock.

E. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:

(ii) the sale, transfer or other disposition of all or
substantially all of the Corporation's assets in complete liquidation or
dissolution of the Corporation.

A-1.
64

F. CORPORATION shall mean Com21, Inc., a Delaware corporation,
and any corporate successor to all or substantially all of the assets or voting
stock of Com21, Inc. which shall by appropriate action adopt the Plan.

G. EMPLOYEE shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and direction
of the employer entity as to both the work to be performed and the manner and
method of performance.

H. EXERCISE DATE shall mean the date on which the Corporation
shall have received written notice of the option exercise.

I. FAIR MARKET VALUE per share of Common Stock on any relevant
date shall be determined in accordance with the following provisions:

(i) If the Common Stock is at the time traded on the Nasdaq
National Market, then the Fair Market Value shall be the closing selling
price per share of Common Stock on the date in question, as such price
is reported by the National Association of Securities Dealers on the
Nasdaq National Market and published in The Wall Street Journal. If
there is no closing selling price for the Common Stock on the date in
question, then the Fair Market Value shall be the closing selling price
on the last preceding date for which such quotation exists.

(ii) If the Common Stock is at the time listed on any Stock
Exchange, then the Fair Market Value shall be the closing selling price
per share of Common Stock on the date in question on the Stock Exchange
determined by the Plan Administrator to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape
of transactions on such exchange and published in The Wall Street
Journal. If there is no closing selling price for the Common Stock on
the date in question, then the Fair Market Value shall be the closing
selling price on the last preceding date for which such quotation
exists.

J. INCENTIVE OPTION shall mean an option which satisfies the
requirements of Code Section 422.

K. INVOLUNTARY TERMINATION shall mean the termination of the
Service of any individual which occurs by reason of:

(i) such individual's involuntary dismissal or discharge by
the Corporation for reasons other than Misconduct, or

(ii) such individual's voluntary resignation following (A) a
change in his or her position with the Corporation which materially
reduces his or her duties and responsibilities or the level of
management to which he or she reports, (B) a reduction in his or her
level of compensation (including base

A-2.
65

salary, fringe benefits and target bonus under any corporate-performance
based bonus or incentive programs) by more than fifteen percent (15%) or
(C) a relocation of such individual's place of employment by more than
fifty (50) miles, provided and only if such change, reduction or
relocation is effected by the Corporation without the individual's
consent.

L. MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary), or any other intentional misconduct
by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition
shall not be deemed to be inclusive of all the acts or omissions which the
Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Optionee, Participant or other person in the
Service of the Corporation (or any Parent or Subsidiary).

M. 1934 ACT shall mean the Securities Exchange Act of 1934, as
amended.

N. NON-STATUTORY OPTION shall mean an option not intended to
satisfy the requirements of Code Section 422.

O. OPTIONEE shall mean any person to whom an option is granted
under the Plan.

P. PARENT shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

Q. PERMANENT DISABILITY OR PERMANENTLY DISABLED shall mean the
inability of the Optionee or the Participant to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment expected to result in death or to be of continuous duration of twelve
(12) months or more.

R. PLAN shall mean the Corporation's 2000 Stock Option Plan, as
set forth in this document.

S. PLAN ADMINISTRATOR shall mean the particular entity, whether
the Primary Committee, the Board or the Secondary Committee, which is authorized
to administer the Plan with respect to one or more classes of eligible persons,
to the extent such entity is carrying out its administrative functions under
that program with respect to the persons under its jurisdiction.

T. PLAN EFFECTIVE DATE shall mean the date the Plan shall become
effective and shall be coincident with the date the Plan is adopted by the
Board.

A-3.
66

U. PRIMARY COMMITTEE shall mean the committee of two (2) or more
non-employee Board members appointed by the Board to administer the
Discretionary Option Grant Program with respect to Section 16 Insiders solely
with respect to the selection of the eligible individuals who may participate in
such program.

V. SECONDARY COMMITTEE shall mean a committee of one or more
Board members appointed by the Board to administer the Plan with respect to
eligible persons other than Section 16 Insiders.

W. SECTION 16 INSIDER shall mean an officer or director of the
Corporation subject to the short-swing profit liabilities of Section 16 of the
1934 Act.

X. SERVICE shall mean the performance of services for the
Corporation (or any Parent or Subsidiary) by a person in the capacity of an
Employee, a non-employee member of the board of directors or a consultant or
independent advisor, except to the extent otherwise specifically provided in the
documents evidencing the option grant.

Y. STOCK EXCHANGE shall mean either the American Stock Exchange
or the New York Stock Exchange.

Z. SUBSIDIARY shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in the
unbroken chain owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.

AA. 10% STOCKHOLDER shall mean the owner of stock (as determined
under Code Section 424(d)) possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Corporation (or any Parent
or Subsidiary).

A-4.

DETACH HERE

PROXY

COM21, INC.
ANNUAL MEETING OF STOCKHOLDERS
MAY 17, 2001

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned, hereby appoints Craig Soderquist and David L. Robertson
and each of them as Proxies of the undersigned, with full power of substitution,
and hereby authorizes them to represent and to vote, as designated below, all of
the shares of Common Stock of Com21, Inc. (the "Company"), held of record by the
undersigned on March 26, 2001 at the Annual Meeting of Stockholders of Com21,
Inc. to be held on May 17, 2001, or at any adjournment or postponement thereof.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL NOS. 1, 2, 3, 4
AND 5. THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS SPECIFIED ON THE
REVERSE SIDE. THIS PROXY WILL BE VOTED FOR PROPOSAL NOS. 1, 2, 3, 4 AND 5 IF NO
SPECIFICATION IS MADE.

SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE

VOTE BY TELEPHONE
It's fast, convenient, and immediate!
Call Toll-Free on a Touch-Tone Phone
1-877-PRX-VOTE (1-877-779-8683).

FOLLOW THESE FOUR EASY STEPS:

1. READ THE ACCOMPANYING PROXY STATEMENT AND PROXY CARD.

2. CALL THE TOLL-FREE NUMBER 1-877-PRX-VOTE (1-877-779-8683).

3. ENTER YOUR 14-DIGIT VOTER CONTROL NUMBER LOCATED ON YOUR PROXY CARD
ABOVE YOUR NAME.

4. FOLLOW THE RECORDED INSTRUCTIONS.

YOUR VOTE IS IMPORTANT!
Call 1-877-PRX-VOTE anytime!

VOTE BY INTERNET
It's fast, convenient, and your vote is immediately confirmed and posted.

FOLLOW THESE FOUR EASY STEPS:

1. READ THE ACCOMPANYING PROXY STATEMENT AND PROXY CARD.

2. GO TO THE WEBSITE HTTP://WWW.EPROXYVOTE.COM/CMTO

3. ENTER YOUR 14-DIGIT VOTER CONTROL NUMBER LOCATED ON YOUR PROXY CARD
ABOVE YOUR NAME.

4. FOLLOW THE INSTRUCTIONS PROVIDED.

YOUR VOTE IS IMPORTANT!
Go to HTTP://WWW.EPROXYVOTE.COM/CMTO anytime!

DO NOT RETURN YOUR PROXY CARD IF YOU ARE VOTING BY TELEPHONE OR INTERNET

DETACH HERE

PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL NOS. 1, 2, 3, 4 AND 5.
THIS PROXY WILL BE VOTED FOR PROPOSAL NOS. 1, 2, 3, 4 AND 5 IF NO SPECIFICATION
IS MADE.

1. To elect eight directors to serve for
a one-year term or until their
successors are duly elected and qualified;
FOR AGAINST ABSTAIN
NOMINEES: (01) Craig Soderquist,
(02) Paul Baran, (03) James R. Gagnard, 2. To approve an additional 1,500,000 shares [ ] [ ] [ ]
(04) Jerald L. Kent, (05) George A. Merrick, authorized for issuance under the Com21, Inc.
(06) Susan Hubbell Nycum, (07) Daniel J. Pike, 2000 Stock Option Plan;
(08) James Spilker, Jr.

3. To approve amendments to the Com21, [ ] [ ] [ ]
FOR WITHHELD MARK HERE Inc. 1998 Stock Purchase Plan;
ALL [ ] [ ] FROM ALL IF YOU PLAN [ ]
NOMINEES NOMINEES TO ATTEND
THE MEETING

MARK HERE 4. To ratify the appointment of Deloitte & [ ] [ ] [ ]
FOR ADDRESS [ ] Touche LLP as Com21's independent
CHANGE AND public accountants for the fiscal year
NOTE BELOW ending December 31, 2001 and;
[ ]
--------------------------------------
For all nominees except as noted above

5. To transact such other business as may properly come before the meeting,
or any adjournment or adjournments thereof.

PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.

Please sign exactly as your name(s) is (are)shown on the shares certificate
to which the Proxy applies. When shares are held by jointtenants, both
should sign. When signing as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a corporation, please sign in
full corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.

Signature: Date: Signature: Date:
----------------------------- ------- ---------------------------------- ------