(hereinafter Referred To As The "grantor") - FUTURELINK CORP - 12-19-2000 by FTRLQ-Agreements

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									EXHIBIT 10.71 HYPOTHEC ON MOVABLE PROPERTY (GENERAL)
BETWEEN: FUTURELINK CANADA CORP., a corporation continued under the laws of Ontario, having its chief executive office at 2 Gibbs Road, in the City of Toronto, Province of Ontario, M9B 6L6; (hereinafter referred to as the "GRANTOR") FOOTHILL CAPITAL CORPORATION, a California corporation, having a place of business at 2450 Colorado Avenue, Suite 3000 West, in the City of Santa Monica, State of California, USA, 90404; (hereinafter referred to as the "CREDITOR")

AND:

WHEREAS the GRANTOR and the BORROWER (as hereinafter defined) have entered into credit arrangements pursuant to the CREDIT AGREEMENT (as hereinafter defined) whereby the GRANTOR is or may hereafter become indebted to the CREDITOR by virtue of its guarantee of the obligations of the BORROWER under the CREDIT AGREEMENT and the GUARANTEE (as hereinafter defined); WHEREAS the GRANTOR carries on an enterprise; WHEREAS the CREDITOR requires security for the payment of any and all indebtedness and obligations due from time to time by the GRANTOR to the CREDITOR and the GRANTOR has agreed, as security for payment of such indebtedness, to hypothecate in favour of the CREDITOR the "CHARGED PROPERTY" (as hereinafter defined); THE PARTIES AGREE AS FOLLOWS: 1. PREAMBLE 1.1 The preamble forms part hereof as if recited at length herein. 2. DEFINITIONS 2.1 Unless the context otherwise requires, the following expressions will have the respective meanings hereinafter set forth:
2.1.1 "ADVERSE ENCUMBRANCE" means any hypothec, encumbrance, charge, right or prior claim (other than the PERMITTED CHARGES) whether ranking prior to, equal with or after the security hereby created in favour of the CREDITOR, or any seizure or attachment, which affects the whole or any portion of the CHARGED PROPERTY; "BORROWER" means collectively, FutureLink Corp. and each of its subsidiaries listed as borrowers pursuant to the terms of the CREDIT AGREEMENT; "CHARGED PROPERTY" has the meaning attributed to it in Section 3; "CLAIMS" means, collectively, all accounts receivable, book accounts, book debts, debts, claims, monies, rentals, revenues, incomes, loans receivable, demands, rebates, refunds, amounts owing by or claimable from the crown, state or government or any departments, agents or agencies thereof and choses in action which now are or which may at any time hereafter be due or owing to or owned by the GRANTOR or in which the GRANTOR now or hereafter has any other interest and all security interests, hypothecs, assignments,

2.1.2

2.1.3 2.1.4

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-2guarantees, bills of exchange, notes, negotiable instruments, contracts, invoices, books of account, letters of credit and other documents and rights now held or owned or which may be hereafter held or owned by the GRANTOR or any third party on behalf of the GRANTOR in respect of any of the foregoing and all rights of an unpaid vendor, including rights to merchandise returned, repossessed or recovered and including any credit balances, term deposits or other indebtedness due to the GRANTOR by the CREDITOR (without prejudice to the CREDITOR's right of compensation or set-off); 2.1.5 "CREDIT AGREEMENT" means the Loan and Security Agreement dated November 16, 2000 executed among the BORROWER and the CREDITOR, as same may be amended, replaced, supplemented or renewed from time to time, pursuant to which the CREDITOR has extended certain credit facilities to the BORROWER; "DOCUMENTS OF TITLE" means, collectively, all documents of title, whether negotiable or non-negotiable including, without limitation, all warehouse receipts and bills of lading in which the GRANTOR now or hereafter has an interest; "EQUIPMENT" means, collectively, all machinery, equipment, furniture, fixtures, materials, supplies, appliances, dyes, molds, tanks, vehicles, furnaces, boilers, motors, engines, accessories and tools now owned or hereafter acquired by the GRANTOR whether or not the same be affixed to any immoveable property or used upon or in connection therewith, together with all present and future improvements, appurtenances and accessories thereto; "GUARANTEE" means the Guarantee and Postponement of claim dated December 14, 2000 executed among the GRANTOR and the CREDITOR, as same may be amended, replaced, supplemented or renewed from time to time, pursuant to which the GRANTOR has jointly and severally (solidarily) guaranteed the performance of all of the BORROWER'S obligations under the CREDIT AGREEMENT; "HYPOTHEC AMOUNT" means the sum of FIFTY MILLION CANADIAN DOLLARS (Cdn. $50,000,000); "INDEBTEDNESS" means, any and all indebtedness from time to time of the GRANTOR to the CREDITOR arising from or under the GUARANTEE and the CREDIT AGREEMENT, including, without limitation, any and all amounts already owing and which may be owed to the CREDITOR by the GRANTOR and any indebtedness of any nature whatsoever, present and future, direct and indirect, absolute and contingent, matured or not, at any time owing or to become owing by the GRANTOR to the CREDITOR, and whether the GRANTOR be bound alone or with another and whether as principal or surety, and any and all interest accrued thereon and all costs incurred by or on behalf of the CREDITOR for recovering or conserving the CHARGED PROPERTY, the whole in connection with the GUARANTEE and the CREDIT AGREEMENT; "INSURANCE" means, collectively, all insurance policies relating directly or indirectly to any of the CHARGED PROPERTY or any part thereof and all rights and claims under all policies of insurance of whatever nature including, without limitation, under life insurance policies and under insurance against loss or damage; "INTANGIBLE PROPERTY" means, collectively, all incorporeal property now owned or hereafter acquired by the GRANTOR or its interest therein including, without limitation, all patents and patents pending, registered and unregistered trade marks, trade or brand names, service marks, copyrights, industrial designs, formulae, processes, trade secrets, goodwill, contractual rights, licences and permits;

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2.1.13 "INTEREST RATE" means TWENTY-FIVE percent (25%) per annum;

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-32.1.14 "INVENTORY" means, collectively, all property in stock and inventory now owned and hereafter acquired by the GRANTOR including, without limitation, all raw materials, goods in process, finished goods, goods in transit and all packaging and shipping materials and all materials and merchandise procured for the manufacture or production thereof and all goods, wares and merchandise held for sale, lease or resale or furnished or to be furnished under contracts for service or used or consumed in the business of the GRANTOR; "MONIES" means, collectively, all monies, cash, foreign currencies and credits in which the GRANTOR now or hereafter has an interest; "PERMITTED CHARGES" means, collectively, the following 0.0.0.1 security presently existing or hereafter created in favour or for the benefit of the CREDITOR;

2.1.15

2.1.16

2.1.16.1 the security listed in Schedule "A" hereto; 2.1.16.2 inchoate or statutory liens for taxes, assessments or governmental charges which have not been assessed and are not delinquent, or if assessed, are being contested in good faith by appropriate proceedings and provided that in any such case, the effect of such proceedings is to stay any enforcement or the CREDITOR has been provided with security satisfactory to it in an amount sufficient to satisfy such liens; 0.0.0.2 minor title defects or irregularities not in the aggregate materially and adversely affecting the use of the property to which they relate; other encumbrances which are, from time to time, expressly permitted in writing by the CREDITOR, including those permitted pursuant to the terms of the CREDITOR AGREEMENT;

0.0.0.3

2.1.17

"PROCEEDS" means, collectively, all property in any form derived directly or indirectly from any dealings with any of the CHARGED PROPERTY; "RECORDS" means, collectively, firmware and software and all computer and other records and data, whether in hard copy or otherwise, pertaining to any of the CHARGED PROPERTY and the equipment containing same; "SECURITIES" means, collectively, all shares, stocks, warrants, bonds, debentures, debenture stock, and other securities in which the GRANTOR now or hereafter has an interest;

2.1.18

2.1.19

-43. HYPOTHEC AND ADDITIONAL HYPOTHEC 3.1 HYPOTHEC As security for the payment to the CREDITOR of the INDEBTEDNESS and the fulfilment of the obligations of the GRANTOR hereunder, the GRANTOR hereby hypothecates and grants a security interest in, to and in favour of the CREDITOR to the extent of the HYPOTHEC AMOUNT with interest thereon at the INTEREST RATE, both before and after maturity, demand, default and judgment, the following property of the GRANTOR, wherever situate, and all renewals thereof, accretions thereto, replacements thereof, substitutions therefor as well as everything united thereto by accession (herein collectively referred to as the "CHARGED PROPERTY"):
3.1.1 3.1.2 as a universality, the CLAIMS; as a universality, the DOCUMENTS OF TITLE;

-43. HYPOTHEC AND ADDITIONAL HYPOTHEC 3.1 HYPOTHEC As security for the payment to the CREDITOR of the INDEBTEDNESS and the fulfilment of the obligations of the GRANTOR hereunder, the GRANTOR hereby hypothecates and grants a security interest in, to and in favour of the CREDITOR to the extent of the HYPOTHEC AMOUNT with interest thereon at the INTEREST RATE, both before and after maturity, demand, default and judgment, the following property of the GRANTOR, wherever situate, and all renewals thereof, accretions thereto, replacements thereof, substitutions therefor as well as everything united thereto by accession (herein collectively referred to as the "CHARGED PROPERTY"):
3.1.1 3.1.2 3.1.3 3.1.4 3.1.5 3.1.6 3.1.7 3.1.8 3.1.9 3.1.10 3.1.11 as a universality, the CLAIMS; as a universality, the DOCUMENTS OF TITLE; as a universality, the EQUIPMENT; as a universality, the INSURANCE; as a universality, the INTANGIBLE PROPERTY; as a universality, the INVENTORY; as a universality, the MONIES; as a universality, the PROCEEDS; as a universality, the RECORDS; as a universality, the SECURITIES; as a universality, all other corporeal and incorporeal moveable property, assets, rights and undertakings of any nature and kind, now owned or hereafter acquired by the GRANTOR. ADDITIONAL HYPOTHEC To further secure the performance and observance of all the GRANTOR's

3.2

obligations hereunder, the GRANTOR hereby hypothecates and grants a security interest in the CHARGED PROPERTY in favour of the CREDITOR to the extent of a further amount equal to twenty-percent (20%) of the HYPOTHEC AMOUNT. 3.3 DEALINGS WITH CHARGED PROPERTY Notwithstanding the hypothecation of the CHARGED PROPERTY provided herein:
3.3.1 subject to Section 9, the CREDITOR authorizes the GRANTOR to collect the CLAIMS as they fall due; until such time as the security created hereunder has become enforceable, nothing will prevent the GRANTOR from selling, disposing of or dealing with any of the INVENTORY in the ordinary course of its business; until such time as the security created hereunder has become enforceable, the GRANTOR may at any time without the consent of the CREDITOR, sell or otherwise dispose of EQUIPMENT which is not necessary to or useful in connection with the enterprise of the

3.3.2

3.3.3

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-5GRANTOR or which has become worn out or damaged or otherwise unsuitable for its purpose, of a value not exceeding TEN THOUSAND DOLLARS ($10,000.00) per annum; the whole subject to the hypothec of the CREDITOR on any proceeds resulting from the disposition of any INVENTORY or EQUIPMENT and on any rights to such INVENTORY or EQUIPMENT which are retained or reacquired at any time by the GRANTOR. 4. INSURANCE 4.1 As additional security for the payment of the INDEBTEDNESS and the performance of the GRANTOR's obligations hereunder, the GRANTOR will insure and keep insured the CHARGED PROPERTY against loss or damage by fire and such other perils as are customarily insured by those carrying on an enterprise similar to that of the GRANTOR or as may from time to time be specified by the CREDITOR, for their full insurable value, by means of a policy or policies each with loss payable to the CREDITOR and containing a mortgage clause in form and terms approved by the CREDITOR and issued by an insurer or insurers approved by the CREDITOR. The GRANTOR obliges itself to effect such new insurance as the CREDITOR may direct should the insurer(s) cease to have the approval of the CREDITOR. At least ten (10) days before the expiry or cancellation of any policy the GRANTOR will deliver to the CREDITOR evidence of renewal or replacement thereof. 4.2 The GRANTOR will immediately notify the CREDITOR of any loss of or damage to any of the CHARGED PROPERTY which are the subject of a claim made to any insurer of the CHARGED PROPERTY. 4.3 In the event that any insurance proceeds are paid to the CREDITOR following the occurrence of an EVENT OF DEFAULT, it may, at its option, apply such proceeds in the payment or reduction of the INDEBTEDNESS, whether or not exigible, and interest thereon, interest on interest and all other sums owing to the CREDITOR by the GRANTOR or, at the option of the CREDITOR, advance such proceeds to the GRANTOR, in such manner as the CREDITOR deems advisable for the purpose of replacing, repairing or restoring the CHARGED PROPERTY. 5. COVENANTS, REPRESENTATIONS AND WARRANTIES 5.1 The GRANTOR covenants, represents and warrants that as of the date of this agreement and at all times during which this agreement is in effect:
5.1.1 the GRANTOR will pay to the CREDITOR the INDEBTEDNESS without the necessity of demand as and when it becomes due and payable or on demand, if payable on a demand basis, at the office of the CREDITOR indicated on the signature page of this agreement, or at such other place as may from time to time be designated in writing by the CREDITOR; the GRANTOR will pay all reasonable fees and expenses, legal and notarial, and costs of registration, incurred by or on behalf of the CREDITOR in respect of this agreement and all amendments thereto and renewals and discharges thereof, and will pay all appraisal fees relating to the CHARGED PROPERTY as well as all costs, disbursements and expenses in connection with the enforcement of any of the CREDITOR's rights hereunder and in connection with the recovery or conservation of the CHARGED PROPERTY, which costs, disbursements and expenses include, without limitation, the following: 0.0.0.1 all reasonable costs and expenses of maintenance, operation, administration, conservation and/or collection of the CHARGED PROPERTY; 5.1.2.1 reasonable compensation for any person or firm engaged, employed or consulted by or on behalf of the CREDITOR who acts in connection with the maintenance, operation, administration, conservation and/or collection of any of the CHARGED PROPERTY;

5.1.2

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-65.1.3 the GRANTOR will maintain the CHARGED PROPERTY in good repair and prevent any use thereof which might diminish the value thereof or the CREDITOR's hypothec thereon, and from time to time at the request of the CREDITOR give the CREDITOR's officers, employees and agents reasonable access thereto for the purpose of inspection; the GRANTOR has and will have good and marketable title to the CHARGED PROPERTY free and clear of all ADVERSE ENCUMBRANCES; the CHARGED PROPERTY is and will be kept only at the locations indicated in Schedule "B" hereto and will not be removed or disposed of without the prior written consent of the CREDITOR, except for dispositions of INVENTORY in the ordinary course of the GRANTOR's business; the GRANTOR will, at all times, duly and punctually pay and discharge the wages, salaries and other remuneration of all persons employed by the GRANTOR in connection with the enterprise of the GRANTOR and will, from time to time, if so requested by the CREDITOR, obtain such waivers of liens for salaries, wages or other remuneration as may be necessary to ensure that the CREDITOR owns the CHARGED PROPERTY free and clear of all encumbrances; the GRANTOR will at all times do or cause to be done all things necessary or proper to preserve and keep in full force and effect its corporate existence and its ability to carry on its business; subject to the consent of certain landlords of the GRANTOR which the GRANTOR has undertaken to obtain, neither the execution and delivery of this agreement, nor the granting of the hypothecs in respect of the CHARGED PROPERTY, constitutes or will constitute a violation or breach of the documents of incorporation or the by-laws of the GRANTOR or of any provision of any contract or other instrument to which the GRANTOR is a party or of any provision of law to which the GRANTOR is or may be subject; the GRANTOR will pay or cause to be paid as and when due and payable all taxes, rates, charges, levies and assessments, ordinary and extraordinary, which may be assessed on or payable by the GRANTOR or in respect of any of the CHARGED PROPERTY; the GRANTOR carries on and will carry on the enterprise referred to in Schedule "B" and all of the CHARGED PROPERTY is and will be used for the operation of such enterprise; none of the CHARGED PROPERTY is or will be property which is exempt from seizure; none of the CHARGED PROPERTY is property which furnishes a main residence or which is used by and is necessary for the life of a household; the GRANTOR will perform, observe and comply with all obligations, terms, conditions and covenants relating to any financing arrangement or agreement entered into with the CREDITOR; the GRANTOR will immediately notify the CREDITOR in the event that any shares or other securities are received by or issued to it on the purchase, redemption, conversion or cancellation or any other transformation of any of the SECURITIES; the GRANTOR will operate its business and maintain the CHARGED PROPERTY and all other property owned from time to time by it in compliance with the requirements of applicable environmental laws and will not bring thereon or use any air contaminant, pollutant, toxic substances or hazardous waste except in strict compliance with all environmental laws. The GRANTOR will promptly forward to the CREDITOR copies of all

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-7orders, notices, permits, applications, complaints and other communications and reports relating to its breach or potential breach of any environmental laws and will properly and diligently commence and complete all operations and other matters necessary in order to complete the remedy or rectify any such breach; 5.1.16 subject to the PERMITTED CHARGES, the GRANTOR will not grant a hypothec on any of the CHARGED PROPERTY in favour of any other party without the prior written consent of the CREDITOR, which consent will be subject to the beneficiary of the hypothec entering into satisfactory arrangements with the CREDITOR including, without limiting the generality of the foregoing, a provision in such hypothec that upon sale of any of the CHARGED PROPERTY by or for the account of the CREDITOR, such property will be sold free of any hypothecs created therein; at the demand of the CREDITOR, the GRANTOR will from time to time prepare and deliver to the CREDITOR all deeds, documents, vouchers, promissory notes, bills of exchange, notes, negotiable instruments, contracts, invoices, books of account, letters of credit, security agreements, hypothecs, assignments, guarantees and other documents and rights relating to any of the CLAIMS; the GRANTOR will keep proper books of account in accordance with sound accounting practice and will furnish to the CREDITOR such financial and other information, statements and reports relating to the GRANTOR, the enterprise carried on by it and the CHARGED PROPERTY as the CREDITOR may from time to time require. The GRANTOR will permit the CREDITOR, its officers, employees and authorized representatives free and reasonable access to its premises, the enterprise carried on by it, the CHARGED PROPERTY, its computer, including hardware, software and firmware and the financial and computer and other data, records and reports relating to the GRANTOR, its enterprise and the CHARGED PROPERTY and allow them to make copies thereof and to take extracts therefrom. CREDITOR'S RIGHT TO MAKE PAYMENTS If the GRANTOR fails to pay when due any sum payable under this

5.1.17

5.1.18

6. 6.1

agreement or fails to perform any of its obligations hereunder, whether or not the CREDITOR has invoked any EVENT OF DEFAULT, the CREDITOR may do so on the GRANTOR's behalf (but will not be obliged to), without notice to the GRANTOR, and the GRANTOR will pay to the CREDITOR, on demand, all sums so paid by the CREDITOR together with interest thereon at the rate of FIFTEEN percent (15%) per annum. If, for any reason, the CREDITOR's security or rights hereunder are diminished, the CREDITOR may do such things and make such expenditures as are desirable or necessary to preserve its security or rights, without notice to the GRANTOR, in which event the GRANTOR will pay to the CREDITOR, on demand, all sums so paid by the CREDITOR, together with interest thereon at the INTEREST RATE, the whole without prejudice to any other recourse of the CREDITOR hereunder or by law. 7. EVENTS OF DEFAULT 7.1 Each of the following events constitutes an "EVENT OF DEFAULT" hereunder:
7.1.1 7.1.2 any Event of Default as such term is defined under the CREDIT AGREEMENT; any event of default or breach of any obligation of the GRANTOR under the GUARANTEE; failure to pay to the CREDITOR the INDEBTEDNESS or any part thereof without the necessity of demand as and when such sum becomes due and payable or on demand, if payable on a demand basis, subject to notice requirements as provided for under the CREDIT AGREEMENT or at law;

7.1.3

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-87.1.4 if the GRANTOR fails to perform, observe or comply with any covenant, obligation, term or condition on its part to be performed, observed or complied with hereunder which does not specifically constitute an EVENT OF DEFAULT hereunder provided, however, that if the default is susceptible of being remedied, it remains outstanding for a period of more than ten (10) days after receipt by the GRANTOR of written notice specifying the default; if any representation or warranty made by the GRANTOR in connection with this agreement is materially false or misleading; if the GRANTOR fails to care for, maintain, protect or preserve any of the CHARGED PROPERTY and such failure diminishes the value of the CHARGED PROPERTY; if the GRANTOR does not, within ten (10) days of an ADVERSE ENCUMBRANCE first affecting the whole or any portion of the CHARGED PROPERTY either: 0.0.0.1 cause the ADVERSE ENCUMBRANCE to be completely discharged and radiated from the CHARGED PROPERTY; or 0.0.0.2 in good faith contest the ADVERSE ENCUMBRANCE and furnish to the CREDITOR complete security in form, substance and amount acceptable to the CREDITOR against all loss and damages which the CREDITOR might suffer by reason thereof;

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7.1.7

7.1.7.1 if the whole or any portion of the CHARGED PROPERTY is sold in execution or satisfaction of the rights of any other party; 7.1.7.2 if the GRANTOR sells, transfers or disposes of or purports to sell, transfer or dispose of any of the CHARGED PROPERTY, except in the ordinary course of business or as expressly permitted hereunder; 7.1.7.3 if the GRANTOR makes an assignment for the benefit of its creditors, becomes insolvent, commits an act of bankruptcy, ceases or threatens to cease to do business as a going concern or seeks any arrangement or composition with its creditors or invokes, threatens to invoke or indicates its intention to invoke the benefit of any legislation governing insolvent debtors; 7.1.7.4 if any proceeding in bankruptcy, receivership, liquidation or insolvency is commenced in respect of the GRANTOR or in respect of any of its property or if any receiver or receiver manager takes possession of the undertaking or any substantial portion of the property of the GRANTOR or if any creditor enforces or gives notice of its intention to enforce or gives prior notice with respect to the exercise of any of its rights under any security granted to it by the GRANTOR, where such proceeding is still pending or such notice has not been radiated within ten (10) days of the institution of such proceeding or the receipt of such notice, respectively; or 7.1.7.5 if, in the reasonable opinion of the CREDITOR, acting in good faith, there has occurred a material adverse change in the financial or any other condition of the GRANTOR which is likely to result in the impairment of the GRANTOR's ability to repay the INDEBTEDNESS or of the recoverable value of the CHARGED PROPERTY or the CREDITOR's ability to realize thereupon. 8. REMEDIES IN CASE OF DEFAULT 8.1 The occurrence of any one or more of the foregoing events, by the mere lapse of time for performance and, unless expressly otherwise provided hereunder or pursuant to the terms of the CREDIT AGREEMENT, without the necessity of any notice or other proceeding, shall constitute an EVENT OF DEFAULT. Upon the occurrence of any EVENT OF DEFAULT (and without prejudice

-9to the demand nature of any of the INDEBTEDNESS), the GRANTOR will lose the benefit of any term for payment granted by the CREDITOR and all INDEBTEDNESS will become immediately due and payable and

-9to the demand nature of any of the INDEBTEDNESS), the GRANTOR will lose the benefit of any term for payment granted by the CREDITOR and all INDEBTEDNESS will become immediately due and payable and the GRANTOR will, without the necessity of demand or notice (other than as may be required by law) repay the INDEBTEDNESS to the CREDITOR, failing which, in addition to all hypothecary rights and other remedies and recourses presently or in the future available under law:
8.1.1 the CREDITOR may immediately take proceedings for the recovery of all or any portion of the INDEBTEDNESS; the GRANTOR will surrender and abandon the CHARGED PROPERTY, or the part thereof specified by the CREDITOR, to the CREDITOR or such person as may be designated by the CREDITOR, or will consent in writing to turn such property over to the CREDITOR or such person as may be designated by the CREDITOR at the time and place specified by the CREDITOR. ADMINISTRATION AFTER SURRENDER In the event that the CREDITOR obtains the surrender of the whole or any

8.1.2

8.2

portion of the CHARGED PROPERTY and until such time as such CHARGED PROPERTY is restored to the GRANTOR or, as regards any portion thereof, the CREDITOR has concluded a recourse by way of taking in payment, sale by the CREDITOR, sale under judicial authority or otherwise, or in the event that the CREDITOR withdraws the GRANTOR's right to collect the CLAIMS, then, notwithstanding any provision of law to the contrary which may apply as a result of the CREDITOR having acquired or being deemed to have acquired simple, full or any other administration of the whole or any portion of the CHARGED PROPERTY:
8.2.1 the CREDITOR will be entitled to generally delegate the whole or any part of the administration of any CHARGED PROPERTY (including without limitation, the exercise of all discretionary powers) to such person(s) as the CREDITOR may designate or re-designate in the CREDITOR's sole discretion (any such person being herein referred to as an "ADMINISTRATOR"); the CREDITOR and any ADMINISTRATOR will be entitled to reimbursement of all reasonable costs and expenses (including, without limitation, all costs, expenses and reasonable fees incurred by any attorneys or other persons engaged by the CREDITOR or the ADMINISTRATOR in order to assist in such administration or any matter pertaining thereto), as well as all reasonable fees of the CREDITOR and the ADMINISTRATOR incurred in such administration, all of which may be charged by the CREDITOR against any fruits, revenues or proceeds of alienation of the whole or any portion of the CHARGED PROPERTY; the CREDITOR or the ADMINISTRATOR may alienate any CHARGED PROPERTY which by its nature is destined for alienation in the course of the operation of the enterprise of the GRANTOR, by onerous title in such manner as it, in its sole discretion, but acting reasonably, deems appropriate, the whole notwithstanding that it may have only simple administration of the CHARGED PROPERTY; the CREDITOR will be entitled to acquire the whole or any portion of any CHARGED PROPERTY alienated by onerous title in the course of any administration thereof; in the event that the CREDITOR or the ADMINISTRATOR acquires full administration of any CHARGED PROPERTY, neither the CREDITOR nor the ADMINISTRATOR will be under any obligation whatsoever to make such CHARGED PROPERTY productive, increase such CHARGED PROPERTY or the value thereof or appropriate such CHARGED PROPERTY to any purpose other than payment of the INDEBTEDNESS;

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- 10 8.2.6 the CREDITOR and the ADMINISTRATOR will be entitled to use for their own benefits any information which either of them may obtain by reason of their administration of the whole or any portion of the CHARGED PROPERTY; the CREDITOR and the ADMINISTRATOR will be entitled, acting reasonably but whether or not for value, to renounce to any right affecting, benefiting, pertaining to and/or forming part of any CHARGED PROPERTY administered by either of them; neither the CREDITOR nor the ADMINISTRATOR will be obliged, in any manner whatsoever, to prepare any inventory of any CHARGED PROPERTY, insure any CHARGED PROPERTY or give any security for any CHARGED PROPERTY or their administration thereof. Should the CREDITOR or the ADMINISTRATOR, in its discretion, insure the whole or any portion of any CHARGED PROPERTY, the costs and expenses of any insurance shall form part of the costs and expenses referred to in subparagraph 5.1.2 hereof; the CREDITOR and the ADMINISTRATOR may, acting reasonably, change the destination of the whole or any portion of any CHARGED PROPERTY under their administration and will not be bound to continue the use or operation of any CHARGED PROPERTY under their administration which produces fruits or revenues; notwithstanding any provisions of law to the contrary, the CREDITOR and the ADMINISTRATOR will only be obliged to render an account to the GRANTOR upon the written request of the GRANTOR and once the CREDITOR or ADMINISTRATOR has determined, to its satisfaction, the details of such account. TAKING IN PAYMENT In the event that the CREDITOR exercises its right to become the

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absolute owner of the CHARGED PROPERTY or any part thereof, the GRANTOR, concurrently with surrender or at any time thereafter at the request of the CREDITOR, will sign a voluntary Deed providing for the CREDITOR to take in payment the CHARGED PROPERTY or any part thereof. All expenditures and improvements made by any holder of the CHARGED PROPERTY and all payments made on account of the INDEBTEDNESS and the accessories thereof will belong to the CREDITOR without return or compensation. The CREDITOR will not be obliged to compensate or indemnify the GRANTOR or any other person for any cause whatsoever. 8.4 SALE BY THE CREDITOR In the event that the CREDITOR exercises its right to sell the whole or any portion of the CHARGED PROPERTY, such CHARGED PROPERTY may be sold subject to and upon such terms and conditions (including, without limitation, terms extending credit) by way of one or more sales by private agreement, call for tenders or public auction or combinations thereof as the CREDITOR or the ADMINISTRATOR sees fit and the CREDITOR or the ADMINISTRATOR may, at any time, change or substitute any method of sale for any other method of sale of such CHARGED PROPERTY. Notwithstanding any provision of law to the contrary, in any call for tenders, the CREDITOR or ADMINISTRATOR will not be obliged to accept the highest offer or any offer and, in the event that no offer is accepted, may proceed to sell such CHARGED PROPERTY by any other method. 8.5 SALE BY JUDICIAL AUTHORITY In the event that the CREDITOR exercises its right to have the whole or any portion of the CHARGED PROPERTY sold by judicial authority, the GRANTOR expressly agrees that the CREDITOR will not be required to obtain or present to the Court any appraisals of such CHARGED PROPERTY and that such CHARGED PROPERTY may be sold without any upset price therefor.

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- 11 9. CLAIMS 9.1 The CREDITOR may, at any time following the occurrence of an EVENT OF DEFAULT, withdraw the authorization of the GRANTOR to collect the CLAIMS as they fall due and, thereafter, the following will apply:
9.1.1 the CREDITOR will be the only party authorized and entitled to collect, dispose of and deal with the CLAIMS; the CREDITOR will have the right to collect, dispose of and deal with the claims as it may deem expedient including, without limiting the generality of the foregoing, to demand, sue for, enforce, recover and receive payment of the CLAIMS and to compound, compromise, grant extensions, take and give up securities, accept compositions and grant releases and discharges with respect thereto, the whole without notice to the GRANTOR and without any liability for any loss resulting therefrom; actions to enforce rights with respect to the CLAIMS may be instituted by the CREDITOR, at its discretion, in its own name, in the name of the GRANTOR, or in the name of the CREDITOR and the GRANTOR jointly; the CREDITOR will not be obliged to inform the GRANTOR of any irregularity in the payment of any of the CLAIMS. All amounts collected or received by the GRANTOR in respect of the

9.1.2

9.1.3

9.1.4

9.2

CLAIMS (whether prior to or after the CREDITOR has withdrawn the authorization of the GRANTOR to collect the CLAIMS) will be deemed to have been collected or received by the GRANTOR as mandatary of the CREDITOR and will be deposited into such bank accounts as are acceptable from time to time to the CREDITOR. If at any time the CREDITOR so declares and at all times after the CREDITOR has withdrawn the right of the GRANTOR to collect the CLAIMS, all amounts collected or received by the GRANTOR in respect of the CLAIMS will be received by the GRANTOR in trust for the CREDITOR and will be remitted to the CREDITOR in identical form as received. 10. APPLICATION AND IMPUTATION OF PROCEEDS 10.1 Notwithstanding any provisions of law to the contrary, the proceeds of enforcement of any rights of the CREDITOR with respect to the CHARGED PROPERTY, including, without limitation, proceeds of any sale of the CHARGED PROPERTY by the CREDITOR and collections of any CLAIMS, will be applied as follows:
10.1.1 to the reasonable costs and expenses incurred by or on behalf of the CREDITOR in connection with exercising the rights of the CREDITOR; to the payment of any claims ranking in priority to the rights of the CREDITOR in respect of the CHARGED PROPERTY; to the CREDITOR in reduction of the INDEBTEDNESS, subject to its right of imputation as provided herein. The CREDITOR shall have the right to impute any amounts or proceeds

10.1.2

10.1.3

10.2

received by it from or for the account of the GRANTOR, whether pursuant to the terms hereof or as a result of a judicial or other sale, or as an inducement to grant mainlevee or discharge hereof or otherwise, against any portion of the INDEBTEDNESS which it, in its sole discretion, determines and from time to time to vary such determination, the whole notwithstanding any pretended contrary imputation by the GRANTOR or by any other party. 11. REMEDIES CUMULATIVE

- 12 -

- 12 11.1 The different recourses of the CREDITOR hereunder are cumulative and not alternative. The rights and remedies of the CREDITOR hereunder are in addition to every other right and remedy now or hereafter existing in favour of the CREDITOR, whether by law or otherwise. 12. WAIVERS 12.1 No delay or failure on the part of the CREDITOR in exercising any right or remedy hereunder shall affect such right or remedy, nor shall any single or partial exercise thereof preclude any further exercise thereof or the exercise of any other right or remedy. Any waiver by the CREDITOR of any of its rights or remedies hereunder will be valid only if express and in writing. No waiver shall be deemed to be or constitute a waiver of any other rights or remedies of the CREDITOR. In no event will the CREDITOR's acceptance, after the full payment of the INDEBTEDNESS may have become due and payable, of any partial payment, be deemed to alter or affect the CREDITOR's rights with respect to any subsequent payment or default thereon. Moreover, should the CREDITOR grant or tolerate any extension or delay for payment or performance of any obligations of the GRANTOR, such extension, delay, indulgence or tolerance will not be deemed an acquiescence by the CREDITOR in such default or waiver of any of the CREDITOR's rights and remedies hereunder or in respect of any future default. 13. NATURE OF INDEBTEDNESS AND SECURITY 13.1 Nothing contained in this agreement will be deemed to derogate from or alter the demand nature of any of the INDEBTEDNESS, except to the extent that the CREDITOR has expressly and by separate written instrument granted a term for payment. 13.2 The security hereby granted secures and will continue to secure the INDEBTEDNESS on a continuing and fluctuating basis and is and will be valid notwithstanding that the whole or any portion of the prestations in consideration of which the GRANTOR has undertaken its obligations towards the CREDITOR have not yet been received and notwithstanding that the whole or any portion of the INDEBTEDNESS may not yet exist. 13.3 The security hereby granted will remain in full force and effect for the full HYPOTHEC AMOUNT until such time as an express written discharge is executed by the CREDITOR and delivered to the GRANTOR. The hypothecs, security and rights hereby created in favour of the CREDITOR will not be extinguished, reduced, novated or otherwise affected by any payments made to or amounts received by the CREDITOR, directly or indirectly, from the GRANTOR or any other party or as a result of any insurance indemnities arising from loss or damage to any of the CHARGED PROPERTY or by reason of the collection of any CLAIMS. 13.4 Should the INDEBTEDNESS at any time be fully extinguished without an express discharge of the security created hereunder having been granted, and should new INDEBTEDNESS arise, the security created hereunder will secure the new INDEBTEDNESS in the same manner and to the same extent as if there had never occurred an extinction of the old INDEBTEDNESS and the GRANTOR is and will be obligated under the provisions hereof. The GRANTOR will be deemed to have obligated itself for the new INDEBTEDNESS pursuant to the provisions hereof and the security herein created will secure such new INDEBTEDNESS. 14. NATURE OF OBLIGATIONS 14.1 Every obligation of the GRANTOR hereunder is and will remain indivisible and the performance thereof in its entirety may be claimed from each of the heirs, legatees, liquidators of any succession, trustees or legal representatives of the GRANTOR. 14.2 If there be more than one GRANTOR hereunder, all of the obligations of the GRANTOR hereunder will be and remain solidary obligations of such persons, each waiving the benefits of

- 13 division and discussion, such that each of them may be compelled separately to perform all of the obligations of the GRANTOR.

- 13 division and discussion, such that each of them may be compelled separately to perform all of the obligations of the GRANTOR. 15. OTHER SECURITY 15.1 The security created hereunder is in addition to and not in substitution for nor deemed to be substituted by any other security now or hereafter held by or for the benefit of the CREDITOR and shall not be diminished or novated or otherwise affected by any other security or any promissory note or other evidence of indebtedness which the CREDITOR or any party for the benefit of the CREDITOR may have or obtain from the GRANTOR or any other person, nor shall any other security or note or evidence of indebtedness be diminished or novated or otherwise affected hereby. 16. ELECTION OF DOMICILE 16.1 Any notice to or demand upon the GRANTOR shall be given or made at the ordinary place of business of the GRANTOR or at the address in the judicial district referred to on the signature page of this agreement, or at the address of such new place of business of which the GRANTOR shall have subsequently notified the CREDITOR in writing. However, if the CREDITOR is unable to locate the GRANTOR at such address, then any such notice or demand may be served upon the GRANTOR at the Office of the Clerk of the Superior Court, District of Montreal at which office in such event the GRANTOR elects domicile for the purpose of this agreement. 1.1 17. NOTICE 17.1 Any notice, request or other communication hereunder to any party hereto in connection with this agreement shall be in writing and be well and sufficiently given if sent by pre-paid, registered or certified mail, hand-delivered or sent by telecopier to it at its address indicated on the signature page of this agreement. Any such notice shall be deemed to have been received on the date of delivery if hand delivered, on the earlier of the date of actual delivery by the postal authorities or three (3) business days after the date of mailing, if sent by mail, on the date of transmission, if sent by telecopier before 3:00 pm on a business day or on the business day following the date of transmission if sent by telecopier after 3:00 pm on a business day or on a day which is not a business day. In the event of an interruption or abnormal delay in postal service, any notice or other communication shall be hand delivered or sent by telecopier. Any of the parties hereto may, by written notice to the others, given as aforesaid, designate a changed address for such party. For the purposes of this section 17.1, "business day" shall mean a day on which banks are open for business in the City of Toronto, Ontario. 18. GOVERNING LAW 18.1 This agreement shall be governed by and interpreted in accordance with the laws of the Province of Quebec. 19. INTERPRETATION 19.1 Any word herein contained in the singular number will include the plural; any word importing any gender will include the masculine, feminine and neuter genders; any word importing a person will include a corporation, a partnership and any other entity and vice-versa. The headings of this agreement are for convenience of reference only and shall not affect in any manner any of the terms and conditions hereof or the construction or interpretation of this agreement. 20. CONFLICTS/SUPREMACY

- 14 20.1 In the event of a conflict or inconsistency between the provision of this agreement and those of the CREDIT AGREEMENT, the terms of the CREDIT AGREEMENT shall prevail.

- 14 20.1 In the event of a conflict or inconsistency between the provision of this agreement and those of the CREDIT AGREEMENT, the terms of the CREDIT AGREEMENT shall prevail. 21. OTHER DOCUMENTS 21.1 The GRANTOR undertakes to perform all acts and enter into all documentation which may be useful or necessary or required by the CREDITOR for purposes of giving full force and effect to the provisions hereof or to perfect the rights of the CREDITOR hereunder including, without limitation, the right to recover and collect the CLAIMS and to exercise its hypothecary remedies with respect thereto. 22. SEVERABILITY 22.1 Every provision of this agreement is and shall be independent of the other and in the event that any part of this agreement is declared invalid, illegal or unenforceable, then the remaining terms, clauses and provisions of this agreement shall not be affected by such declaration and all of the remaining clauses of this agreement shall remain valid, binding and enforceable. 23. LANGUAGE 23.1 The parties acknowledge that they have required that this agreement and all related documents be prepared in English. Les parties reconnaissent avoir exige que la presente convention et tous les documents connexes soient rediges en anglais. SIGNED AT LOS ANGELES, CALIFORNIA, THIS 14 DAY OF DECEMBER, 2000. FUTURELINK CANADA CORP.
Per: /s/ COREY E. FISCHER ---------------------------------Name: Corey E. Fischer Title: Vice President

Per: Name:

Title: ADDRESS: 2 Gibbs Road Toronto (Ontario) M9B 6L6 FOOTHILL CAPITAL CORPORATION Per:
/s/ WILLIAM SHIAO ---------------------------------Name: William Shiao Title: Vice President

ADDRESS: 2450 Colorado Avenue Suite 3000 West

- 15 Santa Monica, California 90404

- 16 SCHEDULE "A" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. PERMITTED CHARGES - NIL

- 17 SCHEDULE "B" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. II. ENTERPRISE CARRIED ON BY THE GRANTOR - [TO BE COMPLETED]

EXHIBIT 10.72 GENERALSECURITYAGREEMENT
Debtor: 3045207 Nova Scotia Company

Secured Party:

Foothill Capital Corporation

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street

- 15 Santa Monica, California 90404

- 16 SCHEDULE "A" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. PERMITTED CHARGES - NIL

- 17 SCHEDULE "B" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. II. ENTERPRISE CARRIED ON BY THE GRANTOR - [TO BE COMPLETED]

EXHIBIT 10.72 GENERALSECURITYAGREEMENT
Debtor: 3045207 Nova Scotia Company

Secured Party:

Foothill Capital Corporation

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street Halifax, Nova Scotia

- 16 SCHEDULE "A" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. PERMITTED CHARGES - NIL

- 17 SCHEDULE "B" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. II. ENTERPRISE CARRIED ON BY THE GRANTOR - [TO BE COMPLETED]

EXHIBIT 10.72 GENERALSECURITYAGREEMENT
Debtor: 3045207 Nova Scotia Company

Secured Party:

Foothill Capital Corporation

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 Fax No. (902) 425-6350 SECURED PARTY

Name:

Foothill Capital Corporation

- 17 SCHEDULE "B" TO THE HYPOTHEC ON MOVABLE PROPERTY (GENERAL) GRANTED BY FUTURELINK CANADA CORP. ("GRANTOR") IN FAVOUR OF FOOTHILL CAPITAL CORPORATION (THE"CREDITOR"), BEARING FORMAL DATE OF DECEMBER 14, 2000. II. ENTERPRISE CARRIED ON BY THE GRANTOR - [TO BE COMPLETED]

EXHIBIT 10.72 GENERALSECURITYAGREEMENT
Debtor: 3045207 Nova Scotia Company

Secured Party:

Foothill Capital Corporation

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 Fax No. (902) 425-6350 SECURED PARTY

Name: Address:

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404

Fax No.

(310) 453-7443

EFFECTIVE DATE December 14, 2000 (the "Effective Date")

EXHIBIT 10.72 GENERALSECURITYAGREEMENT
Debtor: 3045207 Nova Scotia Company

Secured Party:

Foothill Capital Corporation

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 Fax No. (902) 425-6350 SECURED PARTY

Name: Address:

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404

Fax No.

(310) 453-7443

EFFECTIVE DATE December 14, 2000 (the "Effective Date") 1. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Debtor hereby grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Debtor's rights, title and interests in and to each and every property described or referred to below (collectively, the "COLLATERAL"), all pursuant to and in accordance with the provisions of this Agreement. 2. DESCRIPTION OF COLLATERAL

GENERAL SECURITY AGREEMENT (Business Debtor) PARTIES DEBTOR
Name: Address: 3045207 NOVA SCOTIA COMPANY Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 Fax No. (902) 425-6350 SECURED PARTY

Name: Address:

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404

Fax No.

(310) 453-7443

EFFECTIVE DATE December 14, 2000 (the "Effective Date") 1. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Debtor hereby grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Debtor's rights, title and interests in and to each and every property described or referred to below (collectively, the "COLLATERAL"), all pursuant to and in accordance with the provisions of this Agreement. 2. DESCRIPTION OF COLLATERAL The Collateral includes all of the following personal property and fixtures, and all of the leasehold interests and other property described in paragraph 2.(j) below, (a) all goods now or hereafter comprising part of the inventory of the Debtor and all interests, rights and benefits, both present and future of the Debtor in or to

-2inventory including, without limitation, goods now or hereafter held for sale or lease or furnished or to be furnished under a contract of service or that are raw materials, work in process or materials used or consumed in a business or profession or finished goods;

-2inventory including, without limitation, goods now or hereafter held for sale or lease or furnished or to be furnished under a contract of service or that are raw materials, work in process or materials used or consumed in a business or profession or finished goods; (b) all equipment now or hereafter owned by the Debtor and all interests, rights and benefits, both present and future, of the Debtor in or to equipment including, without limitation, office, warehouse and other furniture, fixtures, machinery, tools, rolling stock, vehicles, accessories, spare parts, supplies and other tangible personal property; (c) all fixtures now or hereafter owned by the Debtor and all interests, rights and benefits, both present and future, of the Debtor in or to fixtures; (d) all chattel paper now or hereafter owned or held by the Debtor and all interests, rights and benefits, both present and future, of the Debtor in, under or to chattel paper; (e) each and every document of title now or hereafter owned by the Debtor or of which the Debtor is or becomes a holder, whether negotiable or non-negotiable, including, without limitation, each and every warehouse receipt and bill of lading, and all interests, rights and benefits, both present and future, of the Debtor in, under or to each and every document of title; (f) each and every instrument now or hereafter owned by the Debtor or of which the Debtor is or becomes a holder, and all interests, rights and benefits, both present and future, of the Debtor in, under or to each and every instrument; (g) each and every security now or hereafter owned by the Debtor or of which the Debtor is or becomes a holder including, without limitation, all shares, stocks, warrants, bonds, debentures, debenture stock or the like issued by a corporation or other person, or a partnership, association or government, and all interests, rights and benefits, both present and future, of the Debtor in, under or to each and every security; (h) all money of the Debtor and all money hereafter acquired by the Debtor and each and every account, debt, claim and demand of every nature and kind which is now due, owing or accruing due or which may hereafter become due, owing or accruing due to the Debtor, or which the Debtor now has or may hereafter have and all interests, rights and benefits, both present and future of the Debtor in or to each and every account, debt, claim and demand including, without limitation, claims against the Crown and claims under insurance policies; (i) all patents, industrial designs, trade-marks, trade secrets and know-how including without limitation, environmental technology and biotechnology, confidential information, trade-names, goodwill, copyrights, personality rights, plant breeders' rights, integrated circuit topographies, software and all other forms of intellectual and industrial property, and any registrations and applications for registration of any of the foregoing (collectively, "INTELLECTUAL PROPERTY"); (j) each and every lease, agreement to lease and leasehold interest of the Debtor and all interests, rights and benefits, both present and future, of the Debtor, in, under

-3or to the same, except the last day of any term of years reserved by any such lease or agreement therefor of which reversion of one day the Debtor shall stand possessed upon trust to assign and dispose of the same as the Secured Party shall direct; (k) each and every intangible now or hereafter owned by the Debtor or of which the Debtor is or becomes a holder, and all interests, rights and benefits, both present and future, of the Debtor in, under or to each and every intangible; (l) with respect to the property described in each of subparagraphs 2.(a) to 2.(k) inclusive, all substitutions and replacements thereof, improvements, increases, additions and

-3or to the same, except the last day of any term of years reserved by any such lease or agreement therefor of which reversion of one day the Debtor shall stand possessed upon trust to assign and dispose of the same as the Secured Party shall direct; (k) each and every intangible now or hereafter owned by the Debtor or of which the Debtor is or becomes a holder, and all interests, rights and benefits, both present and future, of the Debtor in, under or to each and every intangible; (l) with respect to the property described in each of subparagraphs 2.(a) to 2.(k) inclusive, all substitutions and replacements thereof, improvements, increases, additions and accessions thereto and all interests, rights and benefits, both present and future, of the Debtor in, under or to the same; (m) with respect to the property described in each of subparagraphs 2. (a) to 2.(l) inclusive, identifiable or traceable personal property in any form derived directly or indirectly from any dealing with such property or the proceeds therefrom and includes any payment representing indemnity or compensation for loss of or damage to such property or proceeds therefrom; and (n) with respect to the property described in each of subparagraphs 2.(a) to 2.(m) inclusive, all books, accounts, invoices, letters, deeds, contracts, security, securities, instruments, bills, notes, writings, papers, documents and records in any form evidencing or relating thereto, and all other rights and benefits to which the Debtor is now or may hereafter become entitled in respect thereof. In this Agreement, the words "goods", "inventory", "equipment", "chattel paper", "document of title", "instrument", "security", "money", "account", "motor vehicle", "proceeds", "intangible" and "accessions" shall have the same meanings as their defined meanings in the PPSA. In this Agreement, each reference to "Collateral" shall, unless the context otherwise requires, include and be read as "Collateral or any part thereof". All of the Collateral, insofar as the same is not intangible property, is now and will hereafter be kept at the address set out above. 3. SECURED OBLIGATIONS The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Debtor to the Secured Party, present or future, direct or indirect, absolute or contingent, liquidated or unliquidated, matured or not, wheresoever and howsoever incurred, (a) whether arising under this or any other agreement (whether written or oral), instrument or writing; (b) whether arising from dealings between the Secured Party and the Debtor or from other dealings or proceedings by which the Secured Party may be or become in any manner whatever a creditor, obligee or promisee of the Debtor; (c) whether incurred by the Debtor alone or with another or others;

-4(d) whether incurred by the Debtor as principal, surety, indemnitor, obligor or promissor; and (e) whether such obligations, debts and liabilities are from time to time reduced and thereafter increased or entirely extinguished and thereafter incurred again, all including, without limitation, all interest, commissions, legal and other costs, charges and expenses payable in connection with any and all of the foregoing and, in addition thereto, the Expenses (provided for and defined

-4(d) whether incurred by the Debtor as principal, surety, indemnitor, obligor or promissor; and (e) whether such obligations, debts and liabilities are from time to time reduced and thereafter increased or entirely extinguished and thereafter incurred again, all including, without limitation, all interest, commissions, legal and other costs, charges and expenses payable in connection with any and all of the foregoing and, in addition thereto, the Expenses (provided for and defined below). 4. ATTACHMENT Each of the Debtor and the Secured Party acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach: (a) forthwith upon the Effective Date with respect to each and every property included in the Collateral and in which the Debtor then has rights; and (b) forthwith upon the Debtor first acquiring rights in each and every property included in the Collateral and in which the Debtor first acquires such rights subsequent to the Effective Date. For greater certainty, without in any way limiting the above, each of the Debtor and the Secured Party acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges. 5. DEBTOR'S WARRANTIES The Debtor hereby represents and warrants to and covenants with the Secured Party as follows and acknowledges that the Secured Party is, in part, relying upon such representations, warranties and covenants in accepting the security interests, mortgages and charges granted upon the terms of this Agreement: (a) Title to Collateral: The Debtor is the absolute and beneficial owner of the Collateral and none of the Collateral is held in the name of any person other than the Debtor, whether as agent, trustee or other nominee for the Debtor, and all registrations and filings which may be required to preserve the Debtor's title, rights or other interests in the Collateral vis-a-vis others have been made. (b) No Encumbrances: The Collateral is and shall at all times be kept free and clear of any and all, mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever other than those given by the Debtor to or in favour of Secured Party. (c) Due Authorization: The Debtor has the corporate power and capacity to enter into this Agreement and to do all acts and things as are required or contemplated hereunder to be done, observed and performed by it.

-5(d) Right to Grant: The Debtor has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the Debtor shall at all relevant times have the full right, power and authority to perform its obligations hereunder and to grant the security interests, mortgages and charges as herein provided. (e) No Default: The entering into of this Agreement and the performance by the Debtor of its obligations hereunder does not and will not contravene, breach or result in any default under any agreement to which the Debtor is a party or by which the Debtor or any of its properties or assets may be bound and will not result in or permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Litigation: Except as disclosed in writing to the Secured Party, there is no court, administrative, regulatory

-5(d) Right to Grant: The Debtor has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the Debtor shall at all relevant times have the full right, power and authority to perform its obligations hereunder and to grant the security interests, mortgages and charges as herein provided. (e) No Default: The entering into of this Agreement and the performance by the Debtor of its obligations hereunder does not and will not contravene, breach or result in any default under any agreement to which the Debtor is a party or by which the Debtor or any of its properties or assets may be bound and will not result in or permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Litigation: Except as disclosed in writing to the Secured Party, there is no court, administrative, regulatory or similar proceeding (whether civil, quasi-criminal or criminal), arbitration or other dispute settlement procedure, investigation or enquiry by any government body, or any similar matter or proceeding (collectively, "PROCEEDINGS") against or involving the Debtor (whether in progress or threatened) which, if determined adversely to the Debtor, would adversely affect its business, property, financial condition or prospects or its ability to perform any of the provisions of this Agreement. No event has occurred which might give rise to any proceedings and there is no judgment, decree, injunction, rule, award or order of any governmental body outstanding against the Debtor which has or may have an adverse effect on its business, property, financial condition or prospects. (g) Re Intellectual Property: All Intellectual Property applications and registrations are valid and in good standing and the Debtor is the owner of each of such applications and registrations. 6. DEBTOR'S COVENANTS The Debtor covenants and agrees with the Secured Party that: (a) Obligations: The Debtor shall pay, perform, satisfy, fulfil and discharge the Obligations when due. (b) Possession/Description: Forthwith upon request by the Secured Party, the Debtor shall deliver possession of the Collateral to the Secured Party and shall, if requested by the Secured Party, deliver forthwith to the Secured Party such further details respecting the Collateral and, if the Collateral includes fixtures or crops, or oil, gas or other minerals to be extracted, or timber to be cut, identification and legal description (in registerable form) of the lands concerned. Such further details and legal description so delivered shall be deemed to be contained in and form part of this Agreement. 7. EVENTS OF DEFAULT

-6Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Debtor to pay when due any payment of any of the Obligations; (b) the failure of the Debtor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Debtor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing; (d) the failure or inability of the Debtor to pay any of its debts or liabilities as the same fall due; (e) the occurrence of a default by the Debtor under any agreement, instrument or writing entered into by the Debtor with any person(s);

-6Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Debtor to pay when due any payment of any of the Obligations; (b) the failure of the Debtor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Debtor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing; (d) the failure or inability of the Debtor to pay any of its debts or liabilities as the same fall due; (e) the occurrence of a default by the Debtor under any agreement, instrument or writing entered into by the Debtor with any person(s); (f) the Debtor making or agreeing to make an assignment, disposition or conveyance, whether by way of sale or otherwise, of its assets in bulk; (g) the abandonment by the Debtor of the Collateral or any part thereof; (h) the Debtor ceasing or threatening to cease carrying on its business or any of its businesses; (i) the Debtor taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Debtor in respect of the liquidation, dissolution or windingup of the Debtor, including without limitation, any action or proceeding under the Winding Up and Restructuring Act, the Business Corporations Act (Ontario), the Canada Business Corporations Act or other similar legislation in Nova Scotia whether now or hereinafter in effect; (j) the Debtor taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Debtor relating to the reorganization, readjustment, compromise or settlement of the debts owed by the Debtor to its creditors where such reorganization, readjustment, compromise or settlement shall affect a substantial portion of the Debtor's assets, including without limitation, the filing of a notice of intention to make a proposal or the filing of a proposal pursuant to the provisions of the Bankruptcy and Insolvency Act, the making of an order under the Companies' Creditors Arrangements Act or the commencement of any similar action or proceeding by the Debtor or such person or persons; (k) the Debtor committing or threatening to commit any act of bankruptcy pursuant to or set out under the provisions of the Bankruptcy and Insolvency Act; (l) the filing of a petition for a receiving order against the Debtor pursuant to the provisions of the Bankruptcy and Insolvency Act; (m) any execution, sequestration or other process of any court or other tribunal becoming enforceable against the Debtor or a distress or analogous action or

-7proceeding being taken, commenced or issued against the Debtor or levied upon or in respect of the Collateral or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of the Collateral or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the Debtor or any premises in or upon which the Collateral or any part thereof may at any time be situate; (n) a receiver, receiver and manager, agent, liquidator or other similar administrator being appointed in respect of

-7proceeding being taken, commenced or issued against the Debtor or levied upon or in respect of the Collateral or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of the Collateral or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the Debtor or any premises in or upon which the Collateral or any part thereof may at any time be situate; (n) a receiver, receiver and manager, agent, liquidator or other similar administrator being appointed in respect of the Collateral or any part thereof or the taking by a secured party, lien claimant, other encumbrancer, judgement creditor or a person asserting similar rights of possession of the Collateral or any part thereof; (o) the loss, damage, destruction or confiscation of any part of the Collateral, unless upon such event, the Debtor pays to the Secured Party forthwith such amount as the Secured Party in its absolute and uncontrolled discretion determines is satisfactory; and (p) the Secured Party in good faith and having commercially reasonable grounds for believing that the ability of the Debtor to pay any monies hereby secured or to perform any requirement of any provision contained in this Agreement or any other agreement (written or oral), instrument or writing heretofore or hereafter given by the Debtor to the Secured Party is impaired or that the Collateral is in danger of being lost, damaged, destroyed or confiscated. 8. RIGHTS AND REMEDIES Forthwith upon the occurrence of an Event of Default, the security interests, mortgages and charges granted herein shall be enforceable and the Debtor and the Secured Party shall have, in addition to any other rights and remedies provided by law, the rights and remedies of a debtor and a secured party respectively under the PPSA and those provided by this Agreement. In addition, the Secured Party may take possession of the Collateral and enforce any rights of the Debtor in respect of the Collateral by any method available in or permitted by law and may require the Debtor to assemble the Collateral and deliver or make the Collateral available to the Secured Party at any place as may be designated by the Secured Party. 9. EXPENSES The reasonable costs and expenses of the Secured Party in the preparation, execution and delivery of this Agreement, the registration of this Agreement or of notices, financing statements or other filings in respect thereof, the reasonable costs and expenses of the Secured Party in connection with the preparation or review of waivers, consents, amendments, subordination agreements or other matters pertaining to the subject matter of this Agreement, the reasonable costs and expenses expressly provided for in the PPSA and, in addition thereto, the cost of any insurance, taxes, solicitor's fees, costs and other legal expenses and all other costs, charges and expenses of or incurred (on a scale as between a solicitor and his own client) by the Secured Party in respect of any of the foregoing and in respect of the enforcement of the Obligations, including taking possession, custody, holding, preserving, protecting, repairing, using or operating, collecting, realizing, processing, preparing for disposition and disposing of the Collateral (collectively, the "EXPENSES") shall be payable by the Debtor to the Secured Party forthwith upon

-8demand, shall be deemed advanced to the Debtor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Debtor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Debtor authorizes the Secured Party to designate, in its sole discretion, any number of years as the registration period in any financing statement or financing change statement filed with respect to this Agreement or

-8demand, shall be deemed advanced to the Debtor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Debtor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Debtor authorizes the Secured Party to designate, in its sole discretion, any number of years as the registration period in any financing statement or financing change statement filed with respect to this Agreement or any other agreement delivered by the Debtor to the Secured Party ("DESIGNATED PERIOD"). The Debtor acknowledges and confirms that: (a) all registration costs in connection with the filing of the aforesaid financing statements or financing change statements are and shall be reasonable and shall form part of the Expenses; (b) the designation of the number of years comprising the Designated Period shall not constitute an acknowledgement by or commitment or other obligation of the Secured Party to provide financial assistance (whether by loan, agreement or otherwise) to the Debtor at any time or from time to time during the Designated Period; and (c) the Secured Party shall be entitled to exercise all of its rights and remedies provided for in this Agreement forthwith upon the occurrence of an Event of Default notwithstanding that such Event of Default may occur prior to the expiration of the Designated Period. 10. NOTICE OF DISPOSITION Unless not required to do so by applicable law, the Secured Party shall give to the Debtor at least 15 days written notice of the Secured Party's intention to dispose of the Collateral. Such notice may be sent by registered mail to the last known post office address of the Debtor. 11. RECEIVER - APPOINTMENT The Secured Party may take proceedings in any court of competent jurisdiction for the appointment of a receiver or a receiver and manager (the "RECEIVER") of the Collateral or of any part thereof or may by instrument in writing appoint any person to be a receiver of the Collateral or of any part thereof and may remove any receiver so appointed by the Secured Party and appoint another in his stead. 12. RECEIVER - POWERS

-9Any receiver appointed hereunder by instrument in writing shall have power (a) to take possession of the Collateral or any part thereof and, without liability or obligation to the Debtor, to maintain, preserve and protect the same; (b) to carry on or concur in carrying on all or any part of the business or businesses of the Debtor; (c) to borrow money which such receiver, in its sole discretion, determines is required in connection with either or both of the powers provided for in paragraph (a) and (b); and (d) to dispose of the Collateral in whole or in part, and any such disposition may be by public sale (whether by auction, tender or otherwise), private sale, lease or otherwise, and at such time and place and on such terms and for such price and manner of payment thereof, all as such receiver may, in its sole discretion, determine; provided that any such receiver shall be and is deemed to be the agent of the Debtor and the Secured Party shall not in any way be responsible for any misconduct, negligence or nonfeasance of any such receiver. 13. PROCEEDS OF DISPOSITION/DEFICIENCY

-9Any receiver appointed hereunder by instrument in writing shall have power (a) to take possession of the Collateral or any part thereof and, without liability or obligation to the Debtor, to maintain, preserve and protect the same; (b) to carry on or concur in carrying on all or any part of the business or businesses of the Debtor; (c) to borrow money which such receiver, in its sole discretion, determines is required in connection with either or both of the powers provided for in paragraph (a) and (b); and (d) to dispose of the Collateral in whole or in part, and any such disposition may be by public sale (whether by auction, tender or otherwise), private sale, lease or otherwise, and at such time and place and on such terms and for such price and manner of payment thereof, all as such receiver may, in its sole discretion, determine; provided that any such receiver shall be and is deemed to be the agent of the Debtor and the Secured Party shall not in any way be responsible for any misconduct, negligence or nonfeasance of any such receiver. 13. PROCEEDS OF DISPOSITION/DEFICIENCY Any proceeds of any disposition of any of the Collateral shall be applied by the Secured Party firstly on account of the Expenses, and any balance of such proceeds shall be applied by the Secured Party on account of the Obligations (other than the Expenses) in such order of application as the Secured Party may from time to time effect and the same shall not be subject to dispute by the Debtor. If such proceeds fail to satisfy the Obligations, the Debtor shall be liable for the full amount of the deficiency resulting to the Secured Party. 14. GENERAL PROVISIONS (a) Discharge: The Debtor shall not be discharged from the Obligations by any extension of time, additional advances, renewals, amendments or extensions to this Agreement, any waiver by or failure of the Secured Party to enforce any provision of this Agreement or any other agreement, the taking of further security, releasing security, extinguishment of the security interests, mortgages and charges as to all or any part of the Collateral, or any other act except a release or discharge by the Secured Party of the security interests, mortgages and charges granted hereby upon the full payment and performance of the Obligations, at which time the Secured Party shall, at the Debtor's expense, deliver to the Debtor all necessary discharges and releases of the security interests, mortgages and charges granted hereby. (b) Other Security: (i) The security constituted by this Agreement is in addition to and not in substitution for any other security, guarantee or right from time to time held by the Secured Party; (ii) The Secured Party may realize upon or enforce all or part of any security, guarantee or right from time to time held by it in any order it desires and any realization by any means upon any security, guarantee or right shall not bar realization upon any other security, guarantee or right; and (iii) The taking of any action or proceeding or refraining from so doing or any other dealings with or in respect of any other security, guarantee or right from time to time held by the Secured Party shall not release or affect the

- 10 security provided for in this Agreement and the taking of the security hereby granted or any proceedings hereunder for the realization of the security hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable

- 10 security provided for in this Agreement and the taking of the security hereby granted or any proceedings hereunder for the realization of the security hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable in whole or in part without the consent of the Debtor and in any action brought by any assignee to enforce such rights, the Debtor shall not assert against such assignee any claim, defence, right of set-off, or the benefit of any equities which the Debtor now has or may hereafter have against the Secured Party. (e) Entire Agreement: This Agreement sets forth the entire intent and understanding of the parties relating to the subject matter hereof and supersedes and replaces all prior agreements and commitments, whether written or oral, made between the parties and all earlier discussions and negotiations between them. The parties are not relying upon and there are no collateral or other representations, warranties, agreements or covenants made by any of the parties hereto which are not contained herein. (f) Further Assurances: Each of the parties hereto shall and will, from time to time and at all times hereafter upon every reasonable written request so to do, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further papers, acts, deeds, assurances and things as may be necessary or desirable in the opinion of any party or counsel for any party, acting reasonably, for implementing and carrying out more effectually the true intent and meaning of this Agreement including, without limitation, to perfect or better perfect the security interests, mortgages and charges of the Secured Party in the Collateral or any part thereof. (g) Severability: In the event that any covenant or provision contained in this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the validity, legality and enforceability of the remaining covenants and provisions shall not be affected or impaired thereby and all such remaining covenants and provisions shall continue in full force and effect. All covenants and provisions hereof are declared to be separate and distinct covenants or provisions, as the case may be. (h) Headings: All headings and titles in this Agreement are for convenience of reference only and shall not affect the interpretation of the terms hereof. (i) Gender, etc.: In construing this Agreement, all words and personal pronouns relating thereto shall be read and construed as the number and gender of the party

- 11 or parties referred to in each case require, and the verb agreeing therewith shall be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein" and other words commencing with "here" shall, unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Debtor hereunder shall bind the Debtor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Debtor in this Agreement shall be deemed to include a reference to the Debtor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Debtor, their obligations under this Agreement shall be joint and several.

- 11 or parties referred to in each case require, and the verb agreeing therewith shall be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein" and other words commencing with "here" shall, unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Debtor hereunder shall bind the Debtor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Debtor in this Agreement shall be deemed to include a reference to the Debtor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Debtor, their obligations under this Agreement shall be joint and several. (l) Governing Law: This Agreement shall be governed by, and interpreted and enforced in accordance with, the laws in force in the Province of Nova Scotia and the laws of Canada applicable therein and shall be treated in all respects as a Nova Scotia contract. Each party irrevocably submits to the non-exclusive jurisdiction of the courts of Nova Scotia with respect to any matter arising hereunder or related hereto. (m) Notice: Subject to the specific requirements of the PPSA, any demand, notice, request, consent, approval or other communication required or permitted to be made or given by any party hereto to any other party hereto in connection with this Agreement shall be in writing and may be made or given by personal delivery to such party or by transmittal by facsimile transmission or similar electronic means of communication which produces a paper record to such party at the fax number noted on page 1 of this Agreement or, if a corporation, to a director thereof or, if postal services and deliveries are then operating, by mailing the same by prepaid registered post to such party at its address noted on page 1 of this Agreement or at such other address which the party to whom such communication is being given may have designated by notice given in accordance with the provisions of this paragraph. Any communication so delivered or transmitted by electronic means of communication shall be deemed to have been given and received on the day of delivery or transmittal, if a business day, or if not a business day, on the business day next following the day of delivery or transmittal, and any communication so mailed shall be deemed to have been given and received on the fourth business day following and exclusive of the date of mailing. In this paragraph, "business day" means any day except a Saturday, Sunday or statutory holiday in the Province of Ontario. Either party may give notice in writing to the other in the manner provided in this paragraph of any change of fax number or address of the party giving such notice, and from and after the giving of such notice, the fax number or address therein specified shall be deemed to be the fax number or address of such party for purposes of this paragraph. (n) Failure to Perfect: The Secured Party shall not be liable or accountable for any negligence or failure to perfect its security interests, mortgages and charges granted herein, seize, collect, realize, sell or obtain payment for the Collateral or any part thereof and shall not be bound to institute proceedings for the purpose of seizing, collecting, realizing or obtaining possession or payment of the same for the

- 12 purpose of preserving the rights of the Debtor or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Debtor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Debtor with the right to use the name of the Debtor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Debtor. The Debtor agrees to and does hereby ratify all acts done and all

- 12 purpose of preserving the rights of the Debtor or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Debtor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Debtor with the right to use the name of the Debtor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Debtor. The Debtor agrees to and does hereby ratify all acts done and all documents executed and delivered by the Secured Party pursuant to the power of attorney hereby granted and the Debtor hereby confirms that the Secured Party and all third parties are entitled to rely upon such ratification. (q) Time of Essence: Time shall be strictly of the essence of this Agreement and of every part thereof and no extension or variation of this Agreement shall operate as a waiver of this provision. (r) Debtor's Receipt: The Debtor hereby acknowledges receipt of a fully signed copy of this Agreement. IN WITNESS WHEREOF the Debtor and the Secured Party have executed this Agreement and agree to be bound thereby as of the Effective Date set out above.
THE CORPORATE SEAL of 3045207 NOVA SCOTIA COMPANY was hereunto affixed in the presence of: ) ) ) ) ) )

c/s

/s/ COREY E. FISCHER

---------------------------------------------)
Authorized Signatory ) ) )

---------------------------------------------) Authorized Signatory )

- 13 FOOTHILL CAPITAL CORPORATION by its authorized signatories: ) ) ) ) )

/s/ WILLIAM SHIAO

---------------------------------------------)
Authorized Signatory ) ) )

---------------------------------------------) Authorized Signatory ) )

- 13 FOOTHILL CAPITAL CORPORATION by its authorized signatories: ) ) ) ) )

/s/ WILLIAM SHIAO

---------------------------------------------)
Authorized Signatory ) ) )

---------------------------------------------) Authorized Signatory ) )

EXHIBIT 10.73 GUARANTEE AND POSTPONEMENT OF CLAIM ("this Guarantee") THIS GUARANTEE is dated as of December 14, 2000, and made by the undersigned Canadian Subsidiary in favour of Foothill Capital Corporation, a California corporation. WHEREAS: A. Pursuant to the terms of a loan and security agreement as amended, restated, supplemented or otherwise modified from time to time (the "Loan Agreement") dated the date of this Guarantee by and between Foothill Capital Corporation, a California corporation, of Suite 3000 West 2450 Colorado Avenue., Santa Monica, California, 90404 (the "Lender") and FutureLink Corp., a Delaware corporation (the "Borrower"), and certain other subsidiaries of the Borrower identified in the Loan Agreement, the Lender has agreed to make Advances (as such term is defined in the Loan Agreement) to the Borrower; B. 3045207 Nova Scotia Company (the "Canadian Subsidiary"), a corporation incorporated under the laws of Nova Scotia pursuant to the Companies Act with its registered and records office located at Summit Place, 1601 Lower Water Street, PO Box 730, Halifax, Nova Scotia B3J 2V1, is a subsidiary of the Borrower and as such derives economic benefit from the Advances to the Borrower; C. As a condition of and as security for the Advances, the Lender requires the Canadian Subsidiary to guarantee repayment of the Advances , interest thereon calculated in accordance with the Loan Agreement and all other Obligations (as such term is defined in the Loan Agreement) (collectively the "Debt") and to guarantee the observance, payment and performance by the Borrower of all the obligations, payments and otherwise to the Lender under the Loan Agreement, the UK Loan Documents (as such term is defined in the Loan Agreement) and the Loan Documents (as such term is defined in the Loan Agreement) (together with the Debt, collectively the "Guaranteed Obligations"); FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which are hereby acknowledged, the Canadian Subsidiary hereby agrees with the Lender as follows: 1. The Canadian Subsidiary irrevocably, absolutely and unconditionally guarantees to the Lender the due payment by the Borrower to the Lender of the Guaranteed Obligations and the due performance by the Borrower of the Guaranteed Obligations. 2. This Guarantee is a continuing guarantee and is not limited by amount, time or otherwise. 3. The Canadian Subsidiary hereby acknowledges that certain of the rights of interest applicable as to the

EXHIBIT 10.73 GUARANTEE AND POSTPONEMENT OF CLAIM ("this Guarantee") THIS GUARANTEE is dated as of December 14, 2000, and made by the undersigned Canadian Subsidiary in favour of Foothill Capital Corporation, a California corporation. WHEREAS: A. Pursuant to the terms of a loan and security agreement as amended, restated, supplemented or otherwise modified from time to time (the "Loan Agreement") dated the date of this Guarantee by and between Foothill Capital Corporation, a California corporation, of Suite 3000 West 2450 Colorado Avenue., Santa Monica, California, 90404 (the "Lender") and FutureLink Corp., a Delaware corporation (the "Borrower"), and certain other subsidiaries of the Borrower identified in the Loan Agreement, the Lender has agreed to make Advances (as such term is defined in the Loan Agreement) to the Borrower; B. 3045207 Nova Scotia Company (the "Canadian Subsidiary"), a corporation incorporated under the laws of Nova Scotia pursuant to the Companies Act with its registered and records office located at Summit Place, 1601 Lower Water Street, PO Box 730, Halifax, Nova Scotia B3J 2V1, is a subsidiary of the Borrower and as such derives economic benefit from the Advances to the Borrower; C. As a condition of and as security for the Advances, the Lender requires the Canadian Subsidiary to guarantee repayment of the Advances , interest thereon calculated in accordance with the Loan Agreement and all other Obligations (as such term is defined in the Loan Agreement) (collectively the "Debt") and to guarantee the observance, payment and performance by the Borrower of all the obligations, payments and otherwise to the Lender under the Loan Agreement, the UK Loan Documents (as such term is defined in the Loan Agreement) and the Loan Documents (as such term is defined in the Loan Agreement) (together with the Debt, collectively the "Guaranteed Obligations"); FOR VALUABLE CONSIDERATION, the receipt and sufficiency of which are hereby acknowledged, the Canadian Subsidiary hereby agrees with the Lender as follows: 1. The Canadian Subsidiary irrevocably, absolutely and unconditionally guarantees to the Lender the due payment by the Borrower to the Lender of the Guaranteed Obligations and the due performance by the Borrower of the Guaranteed Obligations. 2. This Guarantee is a continuing guarantee and is not limited by amount, time or otherwise. 3. The Canadian Subsidiary hereby acknowledges that certain of the rights of interest applicable as to the Guaranteed Obligations may be computed on the basis of a year of 360 days or 365 days, as the case may be, and paid for the actual number of days elapsed. For the purposes of the Interest Act (Canada), whenever any interest is calculated using a rate based on a year of 360 days or 365 days, as the case may be, such rate determined pursuant to such calculation, when expressed as an annual rate is equivalent to:

-2(a) the applicable rate based on a year of 360 days or 365 days, as the case may be, (b) multiplied by the actual number of days in a calender year in which the period for such interest is payable (or compounded), and (c) divided by 360 days or 365 days, as the case may be. 4. The liability of the Canadian Subsidiary hereunder shall bear interest from the date written demand for payment is deemed to have been given by the Lender to the Canadian Subsidiary at the Prime Interest Rate (defined below) plus 4% per annum (the "Interest Rate"). "Prime Interest Rate" as used in this Guarantee shall mean the

-2(a) the applicable rate based on a year of 360 days or 365 days, as the case may be, (b) multiplied by the actual number of days in a calender year in which the period for such interest is payable (or compounded), and (c) divided by 360 days or 365 days, as the case may be. 4. The liability of the Canadian Subsidiary hereunder shall bear interest from the date written demand for payment is deemed to have been given by the Lender to the Canadian Subsidiary at the Prime Interest Rate (defined below) plus 4% per annum (the "Interest Rate"). "Prime Interest Rate" as used in this Guarantee shall mean the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. 5. The Canadian Subsidiary will provide and grant forthwith to the Lender the security described in the Loan Agreement, including, without limitation, a Canadian Security Agreement (as such term is defined in the Loan Agreement) as security for the obligations of the Canadian Subsidiary hereunder to the Lender. 6. Without releasing, discharging, limiting or otherwise affecting in whole or in part the obligations and liabilities of the Canadian Subsidiary hereunder and without the consent of or notice to the Canadian Subsidiary, the Lender may as it sees fit and regardless of whether the Canadian Subsidiary's risk is increased: (a) grant time, renewals, extensions, indulgences, releases and discharges to the Borrower or any other person or persons now or hereafter liable to the Lender in respect of the Guaranteed Obligations, (b) take or refrain from taking securities or collateral from the Borrower or any other person or persons or from perfecting such securities or collateral in connection with the Guaranteed Obligations, (c) give up, modify, exchange, renew, release, discharge, compromise, realize, enforce or otherwise deal with or do any act or thing in respect of (with or without consideration) any and all collateral, mortgages or other security given by the Borrower or any other person or persons with respect to the Guaranteed Obligations, (d) accept compromises, settlements or arrangements from the Borrower or any other person or persons, (e) exercise any right or remedy which it may have against the Borrower or any other person or persons or with respect to any security for the Guaranteed Obligations, including judicial and nonjudicial foreclosure,

-3(f) apply money at any time received from the Borrower or any other person or persons or from securities upon such part of the Guaranteed Obligations as the Lender may see fit or change any such application in whole or in part from time to time as the Lender may see fit, (g) give credit or make loans or advances to the Borrower, any guarantor or any other person, and discontinue, release, increase or otherwise vary such credit, or (h) otherwise deal with, or waive or modify its right to deal with, the Borrower and any other person or persons and securities as the Lender may see fit, and in no case shall the Lender be responsible for nor the Canadian Subsidiary released from its obligations hereunder by any neglect or omission of the Lender with respect to any of the foregoing. 7. The Canadian Subsidiary renounces all benefits of discussion and division. 8. This Guarantee will not be considered as wholly or partially satisfied by the payment or liquidation at any time or times of any sum or sums of money for the time being due or remaining unpaid to the Lender, and all dividends, compositions, proceeds of security valued and payments received by the Lender from the Borrower

-3(f) apply money at any time received from the Borrower or any other person or persons or from securities upon such part of the Guaranteed Obligations as the Lender may see fit or change any such application in whole or in part from time to time as the Lender may see fit, (g) give credit or make loans or advances to the Borrower, any guarantor or any other person, and discontinue, release, increase or otherwise vary such credit, or (h) otherwise deal with, or waive or modify its right to deal with, the Borrower and any other person or persons and securities as the Lender may see fit, and in no case shall the Lender be responsible for nor the Canadian Subsidiary released from its obligations hereunder by any neglect or omission of the Lender with respect to any of the foregoing. 7. The Canadian Subsidiary renounces all benefits of discussion and division. 8. This Guarantee will not be considered as wholly or partially satisfied by the payment or liquidation at any time or times of any sum or sums of money for the time being due or remaining unpaid to the Lender, and all dividends, compositions, proceeds of security valued and payments received by the Lender from the Borrower or from others or from estates shall be regarded for all purposes as payments in gross without any right on the part of the Canadian Subsidiary to claim in reduction of the liability under this Guarantee the benefit of any such dividends, compositions, proceeds or payments or any securities held by the Lender or proceeds thereof. Nothing but the performance and payment in full of the Guaranteed Obligations shall release the Canadian Subsidiary of its liability under the Guarantee. 9. All monies, advances, renewals and credits in fact borrowed or obtained by the Borrower from the Lender under the Loan Agreement or any other Loan Document (as defined in the Loan Agreement) or under any security held from time to time by the Lender for the Guaranteed Obligations will be deemed to form part of the Guaranteed Obligations, notwithstanding any lack or limitation of status or of power, incapacity or disability of the Borrower or of the directors, partners or agents thereof, or that the Borrower may not be a legal or suable entity, or any irregularity, defect or informality in the borrowing or obtaining of such money, advances, renewals or credits, the whole whether known to the Lender or not, and any sum which may not be recoverable from the Canadian Subsidiary as guarantor shall be recoverable from the Canadian Subsidiary as sole or principal debtor in respect thereof and vice versa and shall be paid to the Lender as aforesaid. 10. This Guarantee is in addition to and not in substitution for any other guarantee by any other person(s), at any time held by the Lender, and any present or future obligation to the Lender incurred or arising otherwise than under a guarantee provided by the Canadian Subsidiary or of any other obligant, whether bound with or apart from the Borrower.

-411. The Canadian Subsidiary hereby expressly authorizes and consents to the Lender, from time to time, without giving notice to the Canadian Subsidiary, and without in any way discharging, limiting or lessening the liability of the Canadian Subsidiary under this Guarantee, omitting or refraining from proving its full claim or any claim or omitting or refraining from valuing any security held by it, in the event of the bankruptcy, liquidation, winding-up or other distribution of assets of the Borrower or of any surety or guarantor for the Guaranteed Obligations or if the Borrower or any surety or guarantor for the Guaranteed Obligations shall make a bulk sale of its assets within the bulk transfer provisions of any applicable legislation or any composition with creditors or scheme of arrangement. 12. The Canadian Subsidiary will be bound by any account settled between the Lender and the Borrower, and if no such account has been so settled any account stated by the Lender will be accepted by the Canadian Subsidiary as prima facie evidence of the amount which at the date of the account so stated is due by the Borrower to the Lender or remains unpaid by the Borrower to the Lender, in the absence of manifest error. 13. The Canadian Subsidiary will not at any time claim to be subrogated in any manner to the rights and position

-411. The Canadian Subsidiary hereby expressly authorizes and consents to the Lender, from time to time, without giving notice to the Canadian Subsidiary, and without in any way discharging, limiting or lessening the liability of the Canadian Subsidiary under this Guarantee, omitting or refraining from proving its full claim or any claim or omitting or refraining from valuing any security held by it, in the event of the bankruptcy, liquidation, winding-up or other distribution of assets of the Borrower or of any surety or guarantor for the Guaranteed Obligations or if the Borrower or any surety or guarantor for the Guaranteed Obligations shall make a bulk sale of its assets within the bulk transfer provisions of any applicable legislation or any composition with creditors or scheme of arrangement. 12. The Canadian Subsidiary will be bound by any account settled between the Lender and the Borrower, and if no such account has been so settled any account stated by the Lender will be accepted by the Canadian Subsidiary as prima facie evidence of the amount which at the date of the account so stated is due by the Borrower to the Lender or remains unpaid by the Borrower to the Lender, in the absence of manifest error. 13. The Canadian Subsidiary will not at any time claim to be subrogated in any manner to the rights and position of the Lender and will not claim the benefit of any security at any time held by the Lender until the Lender has received payment in full of all monies, interest and other amounts due to the Lender under or relating to the Guaranteed Obligations. 14. The Lender will not be bound to exhaust its recourse against the Borrower or any other person or persons or the security or other securities it may hold, or any of them, before requiring payment by the Canadian Subsidiary, and the Lender may enforce the various remedies available to it and may realize upon the various securities or any part of such securities in such order as the Lender may determine. 15. No suit based upon this Guarantee shall be instituted until demand for payment has been made, and demand for payment shall be deemed to have been effectively made upon the Canadian Subsidiary by delivery of written demand to the Canadian Subsidiary at the address of the Canadian Subsidiary last known to the Lender. Moreover, when demand for payment has been made, the Canadian Subsidiary shall also be liable to the Lender for all legal fees and disbursements (on a solicitor and his own client basis) incurred by or on behalf of the Lender resulting from any action instituted on the basis of this Guarantee. 16. All indebtedness of every nature and kind, whether now or hereafter in existence, of the Borrower to the Canadian Subsidiary is hereby postponed to the indebtedness of the Borrower to the Lender and, following the occurrence and during the continuation of an Event of Default (as defined in the Loan Agreement), all money received by the Canadian Subsidiary in respect of or on account of any of the said indebtedness shall be received and held in trust for the Lender and shall forthwith be paid to the Lender without the necessity of demand. The assignment and postponement contained in this Guarantee is independent of and severable from this Guarantee and shall remain in full force and effect until repayment in full to the Lender of all of the Guaranteed Obligations, notwithstanding that the liability of the Canadian Subsidiary under this Guarantee may have been

-5discharged or terminated. No duty, obligation or liability shall arise on the part of the Lender in connection with the aforesaid assignment, including, without limitation, the obligation to ensure that the indebtedness and liability of the Borrower to the Canadian Subsidiary does not become prescribed by statute or otherwise invalidated or rendered unenforceable. 17. This Guarantee shall not be discharged, limited or otherwise affected by anything done, suffered or permitted by the Lender in connection with the Borrower, the Guaranteed Obligations or any security held by or granted to the Lender to secure payment of the Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the obligations and liabilities of the Canadian Subsidiary hereunder shall not be released, limited or otherwise affected by: (a) the insolvency or bankruptcy or ceasing to exist of the Borrower or any other person or persons, (b) the appointment of a receiver for the assets of the Borrower or any other person or persons,

-5discharged or terminated. No duty, obligation or liability shall arise on the part of the Lender in connection with the aforesaid assignment, including, without limitation, the obligation to ensure that the indebtedness and liability of the Borrower to the Canadian Subsidiary does not become prescribed by statute or otherwise invalidated or rendered unenforceable. 17. This Guarantee shall not be discharged, limited or otherwise affected by anything done, suffered or permitted by the Lender in connection with the Borrower, the Guaranteed Obligations or any security held by or granted to the Lender to secure payment of the Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the obligations and liabilities of the Canadian Subsidiary hereunder shall not be released, limited or otherwise affected by: (a) the insolvency or bankruptcy or ceasing to exist of the Borrower or any other person or persons, (b) the appointment of a receiver for the assets of the Borrower or any other person or persons, (c) any change in the name of the Borrower or in the reorganization, merger or amalgamation of the Borrower, (d) the acquisition of the Borrower's business by any person or a change in control of the Borrower, (e) any change whatsoever in the objects, capital structure, constitution or constating documents of the Borrower, (f) any defect in, omission from, failure to file or register or defective filing or registration of any instrument under which the Lender has taken any security or collateral for payment of or performance or observance of any of the Guaranteed Obligations or of any other person who is or may become liable in respect of the Guaranteed Obligations, or (g) any other circumstance which might otherwise constitute a legal or equitable defence available to, or a complete or partial discharge of, the Borrower in respect of the Guaranteed Obligations, or both, but shall, notwithstanding the happening of any such event before or after the execution of this Guarantee, continue to apply to the Guaranteed Obligations. 18. This Guarantee will be operative and binding upon the Canadian Subsidiary, and possession of this instrument by the Lender or its assigns will be conclusive evidence against the Canadian Subsidiary that this Guarantee was not delivered in escrow or pursuant to any agreement that it should not be effective until any conditions precedent or subsequent had been complied with.

-619. The Canadian Subsidiary hereby waives notice of its acceptance of this Guarantee, notice of transactions or obligations contracted or incurred by the Borrower under this Guarantee, notice of default of the Borrower and demand for payment upon the Borrower and the Canadian Subsidiary. 20. Taxes and Other Taxes (a) Any and all payments to the Lender shall be made free and clear of and without deduction or withholding for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and liabilities with respect thereto (as such taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes") imposed by the government of Canada (or any political subdivision or taxing authority thereof or therein), unless such Taxes are required by law or the administration thereof to be deducted or withheld. If the Canadian Subsidiary shall be required by law or the administration thereof to deduct or withhold any such Taxes from or in respect of any amount payable hereunder, then: (i) the amount payable shall be increased as may be necessary so that after making all required deductions or withholdings (including deductions or withholdings applicable to additional amounts paid under this paragraph), the Lender shall receive an amount equal to the sum it would have received if no such deduction or withholding

-619. The Canadian Subsidiary hereby waives notice of its acceptance of this Guarantee, notice of transactions or obligations contracted or incurred by the Borrower under this Guarantee, notice of default of the Borrower and demand for payment upon the Borrower and the Canadian Subsidiary. 20. Taxes and Other Taxes (a) Any and all payments to the Lender shall be made free and clear of and without deduction or withholding for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and liabilities with respect thereto (as such taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes") imposed by the government of Canada (or any political subdivision or taxing authority thereof or therein), unless such Taxes are required by law or the administration thereof to be deducted or withheld. If the Canadian Subsidiary shall be required by law or the administration thereof to deduct or withhold any such Taxes from or in respect of any amount payable hereunder, then: (i) the amount payable shall be increased as may be necessary so that after making all required deductions or withholdings (including deductions or withholdings applicable to additional amounts paid under this paragraph), the Lender shall receive an amount equal to the sum it would have received if no such deduction or withholding had been made, and (ii) the Canadian Subsidiary forthwith shall pay the full amount deducted or withheld to the relevant taxation or other authority in accordance with applicable law. (b) The Canadian Subsidiary agrees to pay forthwith any present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies (all such taxes, charges and levies being herein referred to as "Other Taxes") imposed by the government of Canada (or any political subdivision or taxing authority thereof or therein) which arise from any payment made by the Canadian Subsidiary hereunder or from the execution, delivery or registration of, or otherwise with respect to this Guarantee. (c) The Canadian Subsidiary agrees to indemnify the Lender for the full amount of Taxes or Other Taxes not deducted or withheld and paid by the Canadian Subsidiary in accordance with subparagraphs 20(a) or (b) hereof to the relevant taxation or other authority and any Taxes or Other Taxes imposed by any jurisdiction on the amounts payable by the Canadian Subsidiary under this paragraph 20 paid by the Lender and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or

-7not any such Taxes or Other Taxes were correctly or legally asserted. Payment under this indemnification shall be made within fifteen (15) days from the date the Lender makes written demand therefor. A certificate as to the amount of such Taxes or Other Taxes and evidence of payment thereof submitted to the Canadian Subsidiary by the Lender shall be prima facie evidence of the amount due from the Canadian Subsidiary to the Lender. (d) The Canadian Subsidiary shall furnish to the Lender the original or a certified copy of a receipt evidencing any payment of Taxes or Other Taxes made by the Canadian Subsidiary as soon as such receipt becomes available, together with a certificate of an officer of the Canadian Subsidiary, which certificate indicates the amount of Taxes or Other Taxes, as the case may be, withheld by the Canadian Subsidiary in respect of payments made hereunder. (e) Without prejudice to the survival of any other agreement or obligation of the Canadian Subsidiary hereunder, the obligations of the Canadian Subsidiary under this paragraph 20 shall survive the termination of this Guarantee and the payment of the Guaranteed Obligations. 21. This Guarantee covers all agreements between the parties hereto concerning the subject matter hereof, and none of the parties shall be bound by any representation or promise made by any person relative thereto which is not expressly embodied herein. 22. This Guarantee is governed by and shall be construed in accordance with the laws of the Province of Nova

-7not any such Taxes or Other Taxes were correctly or legally asserted. Payment under this indemnification shall be made within fifteen (15) days from the date the Lender makes written demand therefor. A certificate as to the amount of such Taxes or Other Taxes and evidence of payment thereof submitted to the Canadian Subsidiary by the Lender shall be prima facie evidence of the amount due from the Canadian Subsidiary to the Lender. (d) The Canadian Subsidiary shall furnish to the Lender the original or a certified copy of a receipt evidencing any payment of Taxes or Other Taxes made by the Canadian Subsidiary as soon as such receipt becomes available, together with a certificate of an officer of the Canadian Subsidiary, which certificate indicates the amount of Taxes or Other Taxes, as the case may be, withheld by the Canadian Subsidiary in respect of payments made hereunder. (e) Without prejudice to the survival of any other agreement or obligation of the Canadian Subsidiary hereunder, the obligations of the Canadian Subsidiary under this paragraph 20 shall survive the termination of this Guarantee and the payment of the Guaranteed Obligations. 21. This Guarantee covers all agreements between the parties hereto concerning the subject matter hereof, and none of the parties shall be bound by any representation or promise made by any person relative thereto which is not expressly embodied herein. 22. This Guarantee is governed by and shall be construed in accordance with the laws of the Province of Nova Scotia, and the Canadian Subsidiary attorns to the exclusive jurisdiction of the courts of Nova Scotia in respect of all disputes which may arise under this Guarantee, and irrevocably agrees that such actions and proceedings may be heard and determined in such courts, agrees to be bound by any judgment thereof and irrevocably waives, to the fullest extent possible, the defence of forum non conveniens, provided, however, that the Lender may serve legal process in any manner permitted by law and that nothing herein shall limit the Lender's right to bring proceedings against the Canadian Subsidiary or the property or assets of the Canadian Subsidiary in the courts of any other jurisdiction. 23. So long as any part of the Guaranteed Obligations or any related amounts due, owing or accrued to the Lender remains unpaid or outstanding, the Canadian Subsidiary assumes all responsibility for being and keeping itself informed of the financial condition of the Borrower and of all circumstances bearing upon the nature, scope and extent of the risk which the Canadian Subsidiary assumes and incurs under this Guarantee. 24. The Canadian Subsidiary represents and warrants to the Lender, and acknowledges that the Lender is, in part, relying upon such representations and warranties that:

-8(a) the Canadian Subsidiary has full power and capacity to enter into this Guarantee and to carry out the obligations contemplated herein, (b) this Guarantee has been approved by all necessary corporate action on the part of the Canadian Subsidiary, and, when executed and delivered, will constitute a legal, valid and binding obligation of the Canadian Subsidiary, enforceable in accordance with the terms of this Guarantee, (c) the execution of this Guarantee will not contravene any provision of law, regulation, order or permit applicable to the Canadian Subsidiary, or result in a breach of or constitute a default under or require any consent under any agreement or instrument to which the Canadian Subsidiary is a party or by which the Canadian Subsidiary is bound, (d) the Canadian Subsidiary is not in default under any agreement or instrument to which it is a party which in any way materially and adversely affects its business and there are no suits or judicial proceedings or proceedings before any governmental commission, board or other agency pending or to the knowledge of the Canadian Subsidiary threatened against the Canadian Subsidiary, and (e) FutureLink Corp. is the registered holder of all of the issued and outstanding shares of the Canadian

-8(a) the Canadian Subsidiary has full power and capacity to enter into this Guarantee and to carry out the obligations contemplated herein, (b) this Guarantee has been approved by all necessary corporate action on the part of the Canadian Subsidiary, and, when executed and delivered, will constitute a legal, valid and binding obligation of the Canadian Subsidiary, enforceable in accordance with the terms of this Guarantee, (c) the execution of this Guarantee will not contravene any provision of law, regulation, order or permit applicable to the Canadian Subsidiary, or result in a breach of or constitute a default under or require any consent under any agreement or instrument to which the Canadian Subsidiary is a party or by which the Canadian Subsidiary is bound, (d) the Canadian Subsidiary is not in default under any agreement or instrument to which it is a party which in any way materially and adversely affects its business and there are no suits or judicial proceedings or proceedings before any governmental commission, board or other agency pending or to the knowledge of the Canadian Subsidiary threatened against the Canadian Subsidiary, and (e) FutureLink Corp. is the registered holder of all of the issued and outstanding shares of the Canadian Subsidiary. 25. The Lender may assign its rights under this Guarantee without notice to the Canadian Subsidiary, provided that the assignee has also obtained the rights and obligations of the Lender under the Loan Agreement. 26. The Canadian Subsidiary acknowledges that there are reasonable grounds for believing that, and the directors of the Canadian Subsidiary are of the opinion that, the giving of the financial assistance provided by this Guarantee is in the best interests of the Canadian Subsidiary. 27. This Guarantee enures to the benefit of the Lender and its respective successors and assigns and is binding on the Canadian Subsidiary and its respective successors and assigns. 28. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile transmission shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by facsimile transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement.

-929. In the event that the Lender obtains any judgment in Canadian dollars in respect of any liability of the Canadian Subsidiary in United States dollars, the Lender and the Canadian Subsidiary agree that the rate of exchange to be used to determine the amount of the judgment shall be the rate of exchange quoted by the bankers of the Lender as the rate at which the Lender could purchase United States dollars with Canadian dollars on the banking day preceding the date on which the judgment is rendered. The liability of the Canadian Subsidiary in respect of any amount due in United States dollars shall, despite any judgment in Canadian dollars, be discharged only to the extent that on the banking day following receipt of the payment or satisfaction of the judgment, the Lender, through its bankers, is able to purchase United States dollars with Canadian dollars. If the amount of United States dollars purchased by the Lender is less than the amount of United States dollars originally due to it, the Canadian Subsidiary agrees, as a separate obligation, to indemnify the Lender against such loss, and if the amount so purchased exceeds the sum originally due to the Lender, the Lender agrees to remit such excess to the Canadian Subsidiary. 30. If any provision herein is determined to be void, voidable or unenforceable, in whole or in part, such determination shall not affect or impair or be deemed to affect or impair the validity of any other provision hereof and all the provisions hereof are hereby declared to be separate, severable and distinct.

-929. In the event that the Lender obtains any judgment in Canadian dollars in respect of any liability of the Canadian Subsidiary in United States dollars, the Lender and the Canadian Subsidiary agree that the rate of exchange to be used to determine the amount of the judgment shall be the rate of exchange quoted by the bankers of the Lender as the rate at which the Lender could purchase United States dollars with Canadian dollars on the banking day preceding the date on which the judgment is rendered. The liability of the Canadian Subsidiary in respect of any amount due in United States dollars shall, despite any judgment in Canadian dollars, be discharged only to the extent that on the banking day following receipt of the payment or satisfaction of the judgment, the Lender, through its bankers, is able to purchase United States dollars with Canadian dollars. If the amount of United States dollars purchased by the Lender is less than the amount of United States dollars originally due to it, the Canadian Subsidiary agrees, as a separate obligation, to indemnify the Lender against such loss, and if the amount so purchased exceeds the sum originally due to the Lender, the Lender agrees to remit such excess to the Canadian Subsidiary. 30. If any provision herein is determined to be void, voidable or unenforceable, in whole or in part, such determination shall not affect or impair or be deemed to affect or impair the validity of any other provision hereof and all the provisions hereof are hereby declared to be separate, severable and distinct. 31. In the event of a direct conflict between the terms and provisions of this Guarantee and the Loan Agreement, it is the intention of the parties hereto that both such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of the Loan Agreement shall control and govern; provided, however, that the inclusion of additional obligations on the part of any Borrower (as such term is defined in the Loan Agreement) and supplemental rights and remedies in favour of the Lender shall not be deemed a conflict with the Loan Agreement. 32. The Lender's rights or remedies hereunder shall not be exhausted by the exercise of any such rights or remedies or by any action or by any number of successive actions against the Canadian Subsidiary in respect of the Canadian Subsidiary's obligations hereunder. 33. Upon the bankruptcy, liquidation, winding-up or other distribution of assets of the Borrower or any surety or guarantor for the Guaranteed Obligations, or in the event that the Borrower or any surety or guarantor for the Guaranteed Obligations shall make a bulk sale of its assets within the bulk transfer provisions of any applicable legislation or any composition with creditors or scheme of arrangement, the Lender shall have the right to prove and rank for the full amount of the Guaranteed Obligations, including in its claim all sums paid by the Canadian Subsidiary to the Lender under this Guarantee, and to receive all dividends or other payments in respect of such claim, until all of the Guaranteed Obligations has been paid in full, the Canadian Subsidiary hereby assigning and transferring to the Lender until such time as all of the Guaranteed Obligations has been paid in full all of its rights to prove and rank for such sums paid by the Canadian Subsidiary to the Lender and to receive the full amount of all dividends and payments in respect thereto.

- 10 34. The Canadian Subsidiary shall continue to be liable, up to the limit of the liability under this Guarantee, less any payments made by the Canadian Subsidiary to the Lender, for any balance which may be owing to the Lender by the Borrower after payment of such dividends or other payments to the Lender. In the event of the valuation by the Lender of any of its security and/or retention thereof by the Lender, such valuation and/or retention shall not, as between the Lender and the Canadian Subsidiary, be considered as payment or satisfaction or reduction of the Guaranteed Obligations or any part thereof. 35. Waiver, etc.: No failure or delay on the part of the Lender to exercise any right provided for in or contemplated by this Guarantee shall operate as a waiver thereof unless made in writing and signed by the Lender and, in that event, such waiver shall operate only as a waiver of the right expressly referred to therein. 36. No Amendment: This Guarantee may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum.

- 10 34. The Canadian Subsidiary shall continue to be liable, up to the limit of the liability under this Guarantee, less any payments made by the Canadian Subsidiary to the Lender, for any balance which may be owing to the Lender by the Borrower after payment of such dividends or other payments to the Lender. In the event of the valuation by the Lender of any of its security and/or retention thereof by the Lender, such valuation and/or retention shall not, as between the Lender and the Canadian Subsidiary, be considered as payment or satisfaction or reduction of the Guaranteed Obligations or any part thereof. 35. Waiver, etc.: No failure or delay on the part of the Lender to exercise any right provided for in or contemplated by this Guarantee shall operate as a waiver thereof unless made in writing and signed by the Lender and, in that event, such waiver shall operate only as a waiver of the right expressly referred to therein. 36. No Amendment: This Guarantee may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. 37. Further Assurances: The Canadian Subsidiary shall and will, from time to time and at all times hereafter upon every reasonable written request so to do, cause such meetings to be held, resolutions passed and by-laws enacted, exercise its vote and influence, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further papers, acts, deeds, assurances and things as may be necessary or desirable in the opinion of the Lender or its counsel, acting reasonably, for implementing and carrying out more effectually the true intent and meaning of this Guarantee. 38. Time of Essence: Time shall be strictly of the essence of this Guarantee and of every part thereof and no extension or variation of this Guarantee shall operate as a waiver of this provision. 39. Receipt: The Canadian Subsidiary hereby acknowledges receipt of a fully signed copy of this Guarantee. IN WITNESS WHEREOF the Canadian Subsidiary has executed, and delivered this Guarantee under its corporate seal as of the date given above.
THE CORPORATE SEAL of 3045207 NOVA SCOTIA COMPANY was hereunto affixed in the presence of: /s/ COREY E. FISCHER -----------------------------------------Authorized Signatory ) ) ) ) ) ) ) ) ) ) )

c/s

-----------------------------------------Authorized Signatory

EXHIBIT 10.74 SHAREPLEDGEAGREEMENT
PLEDGOR: 3045207 Nova Scotia Company

SECURED PARTY:

Foothill Capital Corporation

CORPORATION:

1423280 Ontario Inc.

EXHIBIT 10.74 SHAREPLEDGEAGREEMENT
PLEDGOR: 3045207 Nova Scotia Company

SECURED PARTY:

Foothill Capital Corporation

CORPORATION:

1423280 Ontario Inc.

-2SHARE PLEDGE AGREEMENT PARTIES PLEDGOR
Name: Address: 3045207 Nova Scotia Company Summit Place 1601 Lower Water Street PO Box 730 Halifax, Nova Scotia B3J 2V1 (902) 425-6500

Fax No:

SECURED PARTY

Name: Address:

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 (310) 453-7443

Fax No:

CORPORATION

Name: Address:

1423280 Ontario Inc. 100 King Street West 1 First Canadian Place Suite 6600 Toronto, ON M5X 1B8 (416) 863-6666

Fax No:

EFFECTIVE DATE December 14, 2000 (the "Effective Date")

-31. GRANT OF SECURITY INTEREST

-2SHARE PLEDGE AGREEMENT PARTIES PLEDGOR
Name: Address: 3045207 Nova Scotia Company Summit Place 1601 Lower Water Street PO Box 730 Halifax, Nova Scotia B3J 2V1 (902) 425-6500

Fax No:

SECURED PARTY

Name: Address:

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 (310) 453-7443

Fax No:

CORPORATION

Name: Address:

1423280 Ontario Inc. 100 King Street West 1 First Canadian Place Suite 6600 Toronto, ON M5X 1B8 (416) 863-6666

Fax No:

EFFECTIVE DATE December 14, 2000 (the "Effective Date")

-31. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Pledgor hereby assigns, pledges, hypothecates and grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Pledgor's rights, title and interests in and to 7,500,000 Class C voting shares in the capital of the Corporation owned by the Pledgor including without limitation all dividends or other distributions paid or payable in respect thereof from time to time (the "SHARES"), all pursuant to and in accordance with the provisions of this Agreement. 2. SECURED OBLIGATIONS The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Pledgor to the Secured Party, present or

-31. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Pledgor hereby assigns, pledges, hypothecates and grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Pledgor's rights, title and interests in and to 7,500,000 Class C voting shares in the capital of the Corporation owned by the Pledgor including without limitation all dividends or other distributions paid or payable in respect thereof from time to time (the "SHARES"), all pursuant to and in accordance with the provisions of this Agreement. 2. SECURED OBLIGATIONS The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Pledgor to the Secured Party, present or future, direct or indirect, absolute or contingent, liquidated or unliquidated, matured or not, wheresoever and howsoever incurred, (a) whether arising under this or any other agreement (whether written or oral), instrument or writing; (b) whether arising from dealings between the Secured Party and the Pledgor or from other dealings or proceedings by which the Secured Party may be or become in any manner whatever a creditor, obligee or promisee of the Pledgor; (c) whether incurred by the Pledgor alone or with another or others; (d) whether incurred by the Pledgor as principal, surety, indemnitor, obligor or promissor; and (e) whether such obligations, debts and liabilities are from time to time reduced and thereafter increased or entirely extinguished and thereafter incurred again, all including, without limitation, all interest, commissions, legal and other costs, charges and expenses payable in connection with any and all of the foregoing and, in addition thereto, the Expenses (provided for and defined below).

-43. ATTACHMENT Each of the parties hereto acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach: (a) forthwith upon the Effective Date with respect to the Shares in which the Pledgor then has rights; and (b) with respect to Substituted or Additional Shares (defined below) forthwith upon the Pledgor first acquiring rights in such Substituted or Additional Shares. For greater certainty, without in any way limiting the above, each of the parties hereto acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges. 4. PERFECTION (a) Subject to paragraph 4(b) hereof, in furtherance of the security interests, mortgages and charges hereby granted to the Secured Party, the Pledgor agrees that contemporaneously with the execution of this Agreement, it

-43. ATTACHMENT Each of the parties hereto acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach: (a) forthwith upon the Effective Date with respect to the Shares in which the Pledgor then has rights; and (b) with respect to Substituted or Additional Shares (defined below) forthwith upon the Pledgor first acquiring rights in such Substituted or Additional Shares. For greater certainty, without in any way limiting the above, each of the parties hereto acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges. 4. PERFECTION (a) Subject to paragraph 4(b) hereof, in furtherance of the security interests, mortgages and charges hereby granted to the Secured Party, the Pledgor agrees that contemporaneously with the execution of this Agreement, it shall deliver the following to the Secured Party upon the terms hereof: (i) the relevant share certificate(s) representing all of the Shares, duly registered in the name of the Pledgor, and duly endorsed in blank for transfer hereunder and noting conspicuously on the face thereof the following: "TAKE notice that the ownership and transfer of the shares represented by this Certificate are restricted by and are subject to the provisions of a Share Pledge Agreement dated December , 2000". (ii) a transfer in blank of the Shares duly executed by the Pledgor, the Pledgor hereby giving the Secured Party the authority to complete the said transfer on its behalf upon the occurrence of an Event of Default (defined below); (iii) a certified copy of a resolution of the directors of the Corporation approving the hypothecation and pledge of the Shares to the Secured Party, the notation of the Secured Party's interest on the relevant share certificate(s) and in the shareholder ledgers of the Corporation, any further transfers of the Shares made pursuant to this Agreement, and the recording of same in the books and records of the Corporation, which resolution shall state that it may not be amended or revoked without the prior written consent of the Secured Party; and (iv) signed, undated resignations addressed to the Corporation pursuant to which each officer and/or director of the Corporation resigns from all offices with the Corporation and/or as a director on its board of directors. (b) The Secured Party acknowledges and agrees that it shall hold the Shares hereby delivered to it in accordance with the terms of this Agreement.

-55. RIGHT TO VOTE So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to remain as shareholder of record of the Shares and to exercise all voting rights in respect of the Shares. 6. RIGHT TO DIVIDENDS, ETC. So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to receive all dividends and other distributions paid or payable in respect of the Shares. In the event that the Pledgor receives any dividend or other distribution contrary to the foregoing it shall stand possessed of same in trust solely for the Secured Party and shall forthwith pay or deliver the same to the Secured Party to be applied in accordance with paragraph 15.

-55. RIGHT TO VOTE So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to remain as shareholder of record of the Shares and to exercise all voting rights in respect of the Shares. 6. RIGHT TO DIVIDENDS, ETC. So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to receive all dividends and other distributions paid or payable in respect of the Shares. In the event that the Pledgor receives any dividend or other distribution contrary to the foregoing it shall stand possessed of same in trust solely for the Secured Party and shall forthwith pay or deliver the same to the Secured Party to be applied in accordance with paragraph 15. 7. PLEDGOR'S WARRANTIES The Pledgor hereby represents and warrants to and covenants with the Secured Party as follows and acknowledges that the Secured Party is, in part, relying upon such representations, warranties and covenants in accepting the security interests, mortgages and charges granted upon the terms of this Agreement: (a) Ownership of Shares: The Pledgor is the absolute and beneficial owner of the Shares and none of the Shares is held in the name of any person other than the Pledgor, whether as agent, trustee or other nominee for the Pledgor and the Shares are recorded in the name of the Pledgor in the shareholder ledgers and registers in the Corporation's minute book. (b) No Encumbrances: The Shares are owned by the Pledgor with good and marketable title thereto and they are and shall at all times be kept free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever other than those given by the Pledgor to or in favour of Secured Party. (c) Due Authorization: The Pledgor has the corporate power and capacity to enter into this Agreement and to do all acts and things as are required or contemplated hereunder to be done, observed and performed by it. (d) Right to Grant: The Pledgor has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the Pledgor shall at all relevant times have the full right, power and authority to perform its obligations hereunder and to grant the security interests, mortgages and charges as herein provided. (e) No Default: The entering into of this Agreement and the performance by the Pledgor of its obligations hereunder does not and will not contravene, breach or result in any default under any agreement to which the Pledgor is a party or by which the Pledgor or any of the Shares may be bound and will not result in or

-6permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Agreements or Options: No person, firm or corporation other than the Secured Party has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase of the Shares or any interests therein or rights thereto. (g) No Litigation: There is not pending any court, administrative, regulatory or other action or legal proceeding of any sort either to restrain or otherwise prevent in any manner the Pledgor from effectually and legally hypothecating and pledging the Shares to the Secured Party free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever or any suit, action or proceeding the effect of which would be to cause a lien to attach to the Shares or to divest title to the Shares in any manner whatsoever.

-6permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Agreements or Options: No person, firm or corporation other than the Secured Party has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase of the Shares or any interests therein or rights thereto. (g) No Litigation: There is not pending any court, administrative, regulatory or other action or legal proceeding of any sort either to restrain or otherwise prevent in any manner the Pledgor from effectually and legally hypothecating and pledging the Shares to the Secured Party free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever or any suit, action or proceeding the effect of which would be to cause a lien to attach to the Shares or to divest title to the Shares in any manner whatsoever. (h) Issued Capital: The only issued and outstanding shares in the capital of the Corporation owned by the Pledgor are the Shares and no person, firm or corporation has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement, including convertible securities, warrants or convertible obligations of any nature for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of the Corporation. 8. PLEDGOR'S COVENANTS The Pledgor covenants and agrees with the Secured Party that: (a) Obligations: The Pledgor shall pay, perform, satisfy, fulfill and discharge the Obligations when due. (b) No Transfers or Encumbrances: The Pledgor shall not either directly or indirectly (including by way of corporate reorganization, amalgamation or otherwise) sell, transfer, convey, assign, exchange, convert or in any manner dispose of, pledge or in any manner encumber any of the Shares without the prior written consent of the Secured Party, except as expressly permitted or required elsewhere herein. (c) Substituted or Additional Shares: In the event any substituted or additional shares in the capital of the Corporation are received or acquired (directly or indirectly) by or on behalf of the Pledgor, whether as a result of a share issuance, subdivision, consolidation, conversion, reclassification, stock dividend, transfer, sale, reorganization, amalgamation or otherwise (the "SUBSTITUTED OR ADDITIONAL SHARES"), the Pledgor shall stand possessed of the Substituted or Additional Shares in trust for the Secured Party and shall forthwith deliver to the Secured Party the certificate or certificates representing the Substituted or Additional Shares together with a certified copy of the resolution of the directors of the Corporation approving the hypothecation and pledge thereof to the Secured Party whereupon the Secured Party shall hold and deal with the Substituted or Additional Shares and the certificate or certificates evidencing the same as the Shares.

-79. EVENTS OF DEFAULT Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Pledgor to pay when due any payment of any of the Obligations; (b) the failure of the Pledgor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Pledgor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing;

-79. EVENTS OF DEFAULT Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Pledgor to pay when due any payment of any of the Obligations; (b) the failure of the Pledgor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Pledgor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing; (d) the failure or inability of the Pledgor or the Corporation to pay any of its debts or liabilities as the same fall due; (e) the occurrence of a default by the Pledgor under any agreement, instrument or writing entered into by the Pledgor with any person(s); (f) the Pledgor or the Corporation making or agreeing to make an assignment, disposition or conveyance, whether by way of sale or otherwise, of its assets in bulk; (g) the abandonment by the Pledgor or the Corporation of its assets or any part thereof; (h) the Pledgor or the Corporation ceasing or threatening to cease carrying on its business or any of its businesses; (i) the Pledgor or the Corporation taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Pledgor or the Corporation in respect of the liquidation, dissolution or winding-up of the Pledgor or the Corporation, including without limitation, any action or proceeding under the Winding Up and Restructuring Act, the Business Corporations Act (Ontario), the Canada Business Corporations Act or other similar legislation whether now or hereinafter in effect; (j) the Pledgor or the Corporation taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Pledgor or the Corporation relating to the reorganization, readjustment, compromise or settlement of the debts owed by the Pledgor or the Corporation to its creditors where such reorganization, readjustment, compromise or settlement shall affect a substantial portion of the Pledgor's or the Corporation's assets, including without limitation, the filing of a notice of intention to make a proposal or the filing of a proposal pursuant to the provisions of the Bankruptcy and Insolvency Act, the making of an order under the Companies' Creditors Arrangements Act or the commencement of any similar action or proceeding by the Pledgor or the Corporation or such person or persons;

-8(k) the Pledgor or the Corporation committing or threatening to commit any act of bankruptcy pursuant to or set out under the provisions of the Bankruptcy and Insolvency Act; (l) the filing of a petition for a receiving order against the Pledgor or the Corporation pursuant to the provisions of the Bankruptcy and Insolvency Act; (m) any execution, sequestration or other process of any court or other tribunal becoming enforceable against the Pledgor or the Corporation or a distress or analogous action or proceeding being taken, commenced or issued against the Pledgor or the Corporation or levied upon or in respect of its assets or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of its assets or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the

-8(k) the Pledgor or the Corporation committing or threatening to commit any act of bankruptcy pursuant to or set out under the provisions of the Bankruptcy and Insolvency Act; (l) the filing of a petition for a receiving order against the Pledgor or the Corporation pursuant to the provisions of the Bankruptcy and Insolvency Act; (m) any execution, sequestration or other process of any court or other tribunal becoming enforceable against the Pledgor or the Corporation or a distress or analogous action or proceeding being taken, commenced or issued against the Pledgor or the Corporation or levied upon or in respect of its assets or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of its assets or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the Pledgor or the Corporation or any premises in or upon which its assets or any part thereof may at any time be situate or if a notice of an adverse claim in respect of the Shares is made; (n) the loss, damage, destruction or confiscation of any part of the assets of the Pledgor or the Corporation unless upon such event, the Pledgor pays to the Secured Party forthwith such amount as the Secured Party in its absolute and uncontrolled discretion determines is satisfactory; and (o) the Secured Party in good faith and having commercially reasonable grounds for believing that the ability of the Pledgor to pay any monies hereby secured or to perform any requirement of any provision contained in this Agreement or any other agreement (written or oral), instrument or writing heretofore or hereafter given by the Pledgor to the Secured Party is impaired or that the assets of the Pledgor or the Corporation are in danger of being lost, damaged, destroyed or confiscated. 10. RIGHTS AND REMEDIES Forthwith upon the occurrence of an Event of Default, the security interests, mortgages and charges granted herein shall be enforceable and the Pledgor and the Secured Party shall have, in addition to any other rights and remedies provided by law, the rights and remedies of a debtor and a secured party respectively under the PPSA and those provided by this Agreement. 11. EXPENSES The reasonable costs and expenses of the Secured Party in the preparation, execution and delivery of this Agreement, the registration of this Agreement or of notices, financing statements or other filings in respect thereof, the reasonable costs and expenses of the Secured Party in connection with the preparation or review of waivers, consents, amendments or other matters pertaining to the subject matter of this Agreement, the reasonable costs and expenses expressly provided for in the PPSA and, in addition thereto, the cost of any insurance, taxes, solicitor's fees, costs and other legal expenses and all other costs, charges and expenses of or incurred (on a scale as between a solicitor and his own client) by the Secured Party in respect of any of the foregoing and in respect of the enforcement of the Obligations, including taking possession, custody, holding, preserving, protecting, repairing, using or operating, collecting, realizing, processing, preparing for disposition and disposing of the Shares and any other collateral for the Obligations taken by the Secured Party (collectively, the "Expenses") shall be payable by the

-9Pledgor to the Secured Party forthwith upon demand, shall be deemed advanced to the Pledgor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Pledgor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Pledgor authorizes the Secured Party to designate, in its sole discretion, any number of years as the

-9Pledgor to the Secured Party forthwith upon demand, shall be deemed advanced to the Pledgor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Pledgor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Pledgor authorizes the Secured Party to designate, in its sole discretion, any number of years as the registration period in any financing statement or financing change statement filed with respect to this Agreement or any other agreement delivered by the Pledgor to the Secured Party ("DESIGNATED PERIOD"). The Pledgor acknowledges and confirms that: (a) all registration costs in connection with the filing of the aforesaid financing statements or financing change statements are and shall be reasonable and shall form part of the Expenses; (b) the designation of the number of years comprising the Designated Period shall not constitute an acknowledgement by or commitment or other obligation of the Secured Party to provide financial assistance (whether by loan, agreement or otherwise) to the Pledgor at any time or from time to time during the Designated Period; and (c) the Secured Party shall be entitled to exercise all of its rights and remedies provided for in this Agreement forthwith upon the occurrence of an Event of Default notwithstanding that such Event of Default may occur prior to the expiration of the Designated Period. 12. NOTICE OF DISPOSITION Unless not required to do so by applicable law, the Secured Party shall give to the Pledgor at least 15 days written notice of the Secured Party's intention to dispose of the Shares. Such notice may be sent by registered mail to the last known post office address of the Pledgor. 13. MODE OF DISPOSITION The Secured Party may dispose of the Shares by a private sale or public auction or tender at any place and time whatsoever and in such manner and at such price as the Secured Party may reasonably determine, either for cash or on credit, or for part cash and part credit. The Secured Party may postpone any sale prior to the date thereof and may sell the Shares as a whole or in parcels and if in parcels in such order and manner as the Secured Party may reasonably determine. Until the time such sale is completed, the amount of any dividends or other distributions paid or payable by the Corporation in respect of the Shares shall be paid to the Secured Party.

- 10 14. SECURED PARTY MAY PURCHASE Upon the disposition of the Shares at a public sale, the Secured Party may become a purchaser of the Shares free of any right or equity of redemption which right or equity is hereby expressly waived. 15. PROCEEDS OF DISPOSITION/DEFICIENCY Any proceeds of any disposition of any of the Shares shall be applied by the Secured Party firstly on account of the Expenses, and any balance of such proceeds shall be applied by the Secured Party on account of the Obligations (other than the Expenses) in such order of application as the Secured Party may from time to time effect and the same shall not be subject to dispute by the Pledgor. If such proceeds fail to satisfy the Obligations, the Pledgor shall be liable for the full amount of the deficiency resulting to the Secured Party.

- 10 14. SECURED PARTY MAY PURCHASE Upon the disposition of the Shares at a public sale, the Secured Party may become a purchaser of the Shares free of any right or equity of redemption which right or equity is hereby expressly waived. 15. PROCEEDS OF DISPOSITION/DEFICIENCY Any proceeds of any disposition of any of the Shares shall be applied by the Secured Party firstly on account of the Expenses, and any balance of such proceeds shall be applied by the Secured Party on account of the Obligations (other than the Expenses) in such order of application as the Secured Party may from time to time effect and the same shall not be subject to dispute by the Pledgor. If such proceeds fail to satisfy the Obligations, the Pledgor shall be liable for the full amount of the deficiency resulting to the Secured Party. 16. GENERAL PROVISIONS (a) Discharge: The Pledgor shall not be discharged from the Obligations by any extension of time, additional advances, renewals, amendments or extensions to this Agreement, any waiver by or failure of the Secured Party to enforce any provision of this Agreement or any other agreement, the taking of further security, releasing security, extinguishment of the security interests, mortgages and charges as to all or any part of the Shares, or any other act except a release or discharge by the Secured Party of the security interests, mortgages and charges granted hereby upon the full payment and performance of the Obligations, at which time the Secured Party shall, at the Pledgor's expense, deliver to the Pledgor the relevant share certificate(s) representing all of the Shares duly endorsed in blank for transfer, all other documents held by the Secured Party pursuant to this Agreement, and all necessary discharges and releases of the security interests, mortgages and charges granted hereby. (b) Other Security: (i) The security constituted by this Agreement is in addition to and not in substitution for any other security, guarantee or right from time to time held by the Secured Party; (ii) The Secured Party may realize upon or enforce all or part of any security, guarantee or right from time to time held by it in any order it desires and any realization by any means upon any security, guarantee or right shall not bar realization by upon any other security, guarantee or right; and (iii) The taking of any action or proceeding or refraining from so doing or any other dealings with or in respect of any other security, guarantee or right from time to time held by the Secured Party shall not release or affect the security provided for in this Agreement and the taking of the security hereby granted or any proceedings hereunder for the realization of the security

- 11 hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable in whole or in part without the consent of the Pledgor and in any action brought by any assignee to enforce such rights, the Pledgor shall not assert against such assignee any claim, defence, right of set-off, or the benefit of any equities which the Pledgor now has or may hereafter have against the Secured Party.

- 11 hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable in whole or in part without the consent of the Pledgor and in any action brought by any assignee to enforce such rights, the Pledgor shall not assert against such assignee any claim, defence, right of set-off, or the benefit of any equities which the Pledgor now has or may hereafter have against the Secured Party. (e) Entire Agreement: This Agreement sets forth the entire intent and understanding of the parties relating to the subject-matter hereof and supersedes and replaces all prior agreements and commitments, whether written or oral, made between the parties and all earlier discussions and negotiations between them. The parties are not relying upon and there are no collateral or other representations, warranties, agreements or covenants made by any of the parties hereto which are not contained herein. (f) Further Assurances: Each of the parties hereto shall and will, from time to time and at all times hereafter upon every reasonable written request so to do, cause such meetings to be held, resolutions passed and by-laws enacted, exercise its vote and influence, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further papers, acts, deeds, assurances and things as may be necessary or desirable in the opinion of any party or counsel for any party, acting reasonably, for implementing and carrying out more effectually the true intent and meaning of this Agreement including, without limitation, to perfect or better perfect the security interests, mortgages and charges of the Secured Party in the Shares or any part thereof. (g) Severability: In the event that any covenant or provision contained in this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the validity, legality and enforceability of the remaining covenants and provisions shall not be affected or impaired thereby and all such remaining covenants and provisions shall continue in full force and effect. All covenants and provisions hereof are declared to be separate and distinct covenants or provisions, as the case may be. (h) Headings: All headings and titles in this Agreement are for convenience of reference only and shall not affect the interpretation of the terms hereof. (i) Gender, etc.: In construing this Agreement, all words and personal pronouns relating thereto shall be read and construed as the number and gender of the party or parties referred to in each case require, and the verb agreeing therewith shall

- 12 be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein", and other words commencing with "here", shall unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Pledgor hereunder shall bind the Pledgor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Pledgor in this Agreement shall be deemed to include a reference to the Pledgor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Pledgor, their obligations under this Agreement shall be joint and several.

- 12 be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein", and other words commencing with "here", shall unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Pledgor hereunder shall bind the Pledgor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Pledgor in this Agreement shall be deemed to include a reference to the Pledgor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Pledgor, their obligations under this Agreement shall be joint and several. (l) Governing Law: This Agreement shall be governed by, and interpreted and enforced in accordance with, the laws in force in the Province of Nova Scotia and the laws of Canada applicable therein and shall be treated in all respects as a Nova Scotia contract. Each party irrevocably submits to the non-exclusive jurisdiction of the courts of Nova Scotia with respect to any matter arising hereunder or related hereto. (m) Notice: Subject to the specific requirements of the PPSA, any demand, notice, request, consent, approval or other communication required or permitted to be made or given by any party hereto to any other party hereto in connection with this Agreement shall be in writing and may be made or given by personal delivery to such party or by transmittal by facsimile transmission or similar electronic means of communication which produces a paper record to such party at the fax number noted on page 1 of this Agreement or, if a corporation, to a director thereof or, if postal services and deliveries are then operating, by mailing the same by prepaid registered post to such party at its address noted on page 1 of this Agreement or at such other address which the party to whom such communication is being given may have designated by notice given in accordance with the provisions of this paragraph. Any communication so delivered or transmitted by electronic means of communication shall be deemed to have been given and received on the day of delivery or transmittal, if a business day, or if not a business day, on the business day next following the day of delivery or transmittal, and any communication so mailed shall be deemed to have been given and received on the fourth business day following and exclusive of the date of mailing. In this paragraph, "business day" means any day except a Saturday, Sunday or statutory holiday in the Province of Nova Scotia. Either party may give notice in writing to the other in the manner provided in this paragraph of any change of fax number or address of the party giving such notice, and from and after the giving of such notice, the fax number or address therein specified shall be deemed to be the fax number or address of such party for purposes of this paragraph. (n) Failure to Perfect: The Secured Party shall not be liable or accountable for any negligence or failure to perfect its security interests, mortgages and charges granted herein, seize, collect, realize, sell or obtain payment for the Shares or any part thereof and shall not be bound to institute proceedings for the purpose of seizing, collecting, realizing or obtaining possession or payment of the same for the

- 13 purpose of preserving the rights of the Pledgor, the Corporation or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Pledgor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Pledgor with the right to use the name of the Pledgor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Pledgor. The Pledgor agrees to and does hereby ratify all acts done and all

- 13 purpose of preserving the rights of the Pledgor, the Corporation or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Pledgor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Pledgor with the right to use the name of the Pledgor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Pledgor. The Pledgor agrees to and does hereby ratify all acts done and all documents executed and delivered by the Secured Party pursuant to the power of attorney hereby granted and the Pledgor hereby confirms that the Secured Party and all third parties are entitled to rely upon such ratification. (q) Time of Essence: Time shall be strictly of the essence of this Agreement and of every part thereof and no extension or variation of this Agreement shall operate as a waiver of this provision. (r) Pledgor's Receipt: The Pledgor hereby acknowledges receipt of a fully signed copy of this Agreement. (s) Independent Legal Advice: The Pledgor acknowledges having been advised to obtain independent legal representation or advice, in its discretion, prior to executing this Agreement and thereby becoming bound by its terms and subject to its obligations. This Agreement shall become effective when it is signed by the Pledgor. (t) Meaning of Shares: The term "SHARES" as used herein shall include Substituted or Additional Shares. IN WITNESS WHEREOF the Pledgor and the Secured Party have executed this Agreement and agree to be bound thereby as of the Effective Date set out above.
THE CORPORATE SEAL of 3045207 NOVA SCOTIA COMPANY was hereunto affixed in the presence of: ) ) ) ) ) )

c/s

/s/ COREY E. FISCHER

---------------------------------------------)
Authorized Signatory ) ) )

---------------------------------------------) Authorized Signatory )

-14FOOTHILL CAPITAL CORPORATION by its authorized signatories: ) ) ) ) ) Authorized Signatory ) ) /s/ WILLIAM SHIAO ) ---------------------------------------------) Authorized Signatory )

-14) ) ) ) ) Authorized Signatory ) ) /s/ WILLIAM SHIAO ) ---------------------------------------------) Authorized Signatory ) ) FOOTHILL CAPITAL CORPORATION by its authorized signatories:

) ) ) ) ) /s/ COREY E. FISCHER ) ---------------------------------------------) Authorized Signatory ) ) )

THE CORPORATE SEAL OF 1423280 ONTARIO INC. was hereunto affixed in the presence of:

C/S

-------------------------------------------- ) Authorized Signatory )

TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Foothill Capital Corporation, 7,500,000 Class C voting shares in the capital of 1423280 Ontario Inc. (the "Corporation") and does hereby irrevocably constitute and appoint the Secretary of the Corporation as attorney to transfer or register the transfer of the said share on the books of the Corporation, with full power of substitution in the premises. The undersigned has hereunto executed this transfer the 14 day of December, 2000. 3045207 NOVA SCOTIA COMPANY
Per: /s/ COREY E. FISCHER ------------------------------AUTHORIZED SIGNING OFFICER

EXHIBIT 10.75 SHAREPLEDGEAGREEMENT PLEDGOR: FutureLink Corp.
SECURED PARTY: Foothill Capital Corporation

CORPORATION:

3045207 Nova Scotia Company

TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Foothill Capital Corporation, 7,500,000 Class C voting shares in the capital of 1423280 Ontario Inc. (the "Corporation") and does hereby irrevocably constitute and appoint the Secretary of the Corporation as attorney to transfer or register the transfer of the said share on the books of the Corporation, with full power of substitution in the premises. The undersigned has hereunto executed this transfer the 14 day of December, 2000. 3045207 NOVA SCOTIA COMPANY
Per: /s/ COREY E. FISCHER ------------------------------AUTHORIZED SIGNING OFFICER

EXHIBIT 10.75 SHAREPLEDGEAGREEMENT PLEDGOR: FutureLink Corp.
SECURED PARTY: Foothill Capital Corporation

CORPORATION:

3045207 Nova Scotia Company

SHARE PLEDGE AGREEMENT PARTIES PLEDGOR
Name: Address: FutureLink Corp. 2 South Point Drive Lake Forest, California 92630 USA (949) 672-3117

Fax No:

SECURED PARTY
Name: Address: Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 (310) 453-7443

Fax No:

EXHIBIT 10.75 SHAREPLEDGEAGREEMENT PLEDGOR: FutureLink Corp.
SECURED PARTY: Foothill Capital Corporation

CORPORATION:

3045207 Nova Scotia Company

SHARE PLEDGE AGREEMENT PARTIES PLEDGOR
Name: Address: FutureLink Corp. 2 South Point Drive Lake Forest, California 92630 USA (949) 672-3117

Fax No:

SECURED PARTY
Name: Address: Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 (310) 453-7443

Fax No:

CORPORATION
Name: Address: 3045207 Nova Scotia Company Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 (902) 425-6500

Fax No:

EFFECTIVE DATE December 14, 2000 (the "Effective Date")

-31. GRANT OF SECURITY INTEREST

SHARE PLEDGE AGREEMENT PARTIES PLEDGOR
Name: Address: FutureLink Corp. 2 South Point Drive Lake Forest, California 92630 USA (949) 672-3117

Fax No:

SECURED PARTY
Name: Address: Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 (310) 453-7443

Fax No:

CORPORATION
Name: Address: 3045207 Nova Scotia Company Summit Place 1601 Lower Water Street Halifax, Nova Scotia B3J 2V1 (902) 425-6500

Fax No:

EFFECTIVE DATE December 14, 2000 (the "Effective Date")

-31. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Pledgor hereby assigns, pledges, hypothecates and grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Pledgor's rights, title and interests in and to 100 common shares in the capital of the Corporation owned by the Pledgor including without limitation all dividends or other distributions paid or payable in respect thereof from time to time (the "SHARES"), all pursuant to and in accordance with the provisions of this Agreement. 2. SECURED OBLIGATIONS The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Pledgor to the Secured Party, present or

-31. GRANT OF SECURITY INTEREST For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Pledgor hereby assigns, pledges, hypothecates and grants to the Secured Party a security interest (to which the Personal Property Security Act (Nova Scotia) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Pledgor's rights, title and interests in and to 100 common shares in the capital of the Corporation owned by the Pledgor including without limitation all dividends or other distributions paid or payable in respect thereof from time to time (the "SHARES"), all pursuant to and in accordance with the provisions of this Agreement. 2. SECURED OBLIGATIONS The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Pledgor to the Secured Party, present or future, direct or indirect, absolute or contingent, liquidated or unliquidated, matured or not, wheresoever and howsoever incurred, (a) whether arising under this or any other agreement (whether written or oral), instrument or writing; (b) whether arising from dealings between the Secured Party and the Pledgor or from other dealings or proceedings by which the Secured Party may be or become in any manner whatever a creditor, obligee or promisee of the Pledgor; (c) whether incurred by the Pledgor alone or with another or others; (d) whether incurred by the Pledgor as principal, surety, indemnitor, obligor or promissor; and (e) whether such obligations, debts and liabilities are from time to time reduced and thereafter increased or entirely extinguished and thereafter incurred again, all including, without limitation, all interest, commissions, legal and other costs, charges and expenses payable in connection with any and all of the foregoing and, in addition thereto, the Expenses (provided for and defined below).

-43. ATTACHMENT Each of the parties hereto acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach: (a) forthwith upon the Effective Date with respect to the Shares in which the Pledgor then has rights; and (b) with respect to Substituted or Additional Shares (defined below) forthwith upon the Pledgor first acquiring rights in such Substituted or Additional Shares. For greater certainty, without in any way limiting the above, each of the parties hereto acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges. 4. PERFECTION (a) Subject to paragraph 4(b) hereof, in furtherance of the security interests, mortgages and charges hereby granted to the Secured Party, the Pledgor agrees that contemporaneously with the execution of this Agreement, it

-43. ATTACHMENT Each of the parties hereto acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach: (a) forthwith upon the Effective Date with respect to the Shares in which the Pledgor then has rights; and (b) with respect to Substituted or Additional Shares (defined below) forthwith upon the Pledgor first acquiring rights in such Substituted or Additional Shares. For greater certainty, without in any way limiting the above, each of the parties hereto acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges. 4. PERFECTION (a) Subject to paragraph 4(b) hereof, in furtherance of the security interests, mortgages and charges hereby granted to the Secured Party, the Pledgor agrees that contemporaneously with the execution of this Agreement, it shall deliver the following to the Secured Party upon the terms hereof: (i) the relevant share certificate(s) representing all of the Shares, duly registered in the name of the Pledgor, and duly endorsed in blank for transfer hereunder and noting conspicuously on the face thereof the following: "TAKE notice that the ownership and transfer of the shares represented by this Certificate are restricted by and are subject to the provisions of a Share Pledge Agreement dated December __, 2000". (ii) a transfer in blank of the Shares duly executed by the Pledgor, the Pledgor hereby giving the Secured Party the authority to complete the said transfer on its behalf upon the occurrence of an Event of Default (defined below); (iii) a certified copy of a resolution of the directors of the Corporation approving the hypothecation and pledge of the Shares to the Secured Party, the notation of the Secured Party's interest on the relevant share certificate(s) and in the shareholder ledgers of the Corporation, any further transfers of the Shares made pursuant to this Agreement, and the recording of same in the books and records of the Corporation, which resolution shall state that it may not be amended or revoked without the prior written consent of the Secured Party; and (iv) signed, undated resignations addressed to the Corporation pursuant to which each officer and/or director of the Corporation resigns from all offices with the Corporation and/or as a director on its board of directors. (b) The Secured Party acknowledges and agrees that it shall hold the Shares hereby delivered to it in accordance with the terms of this Agreement.

-55. RIGHT TO VOTE So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to remain as shareholder of record of the Shares and to exercise all voting rights in respect of the Shares. 6. RIGHT TO DIVIDENDS, ETC. So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to receive all dividends and other distributions paid or payable in respect of the Shares. In the event that the Pledgor receives any dividend or other distribution contrary to the foregoing it shall stand possessed of same in trust solely for the Secured Party and shall forthwith pay or deliver the same to the Secured Party to be applied in accordance with paragraph 15.

-55. RIGHT TO VOTE So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to remain as shareholder of record of the Shares and to exercise all voting rights in respect of the Shares. 6. RIGHT TO DIVIDENDS, ETC. So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to receive all dividends and other distributions paid or payable in respect of the Shares. In the event that the Pledgor receives any dividend or other distribution contrary to the foregoing it shall stand possessed of same in trust solely for the Secured Party and shall forthwith pay or deliver the same to the Secured Party to be applied in accordance with paragraph 15. 7. PLEDGOR'S WARRANTIES The Pledgor hereby represents and warrants to and covenants with the Secured Party as follows and acknowledges that the Secured Party is, in part, relying upon such representations, warranties and covenants in accepting the security interests, mortgages and charges granted upon the terms of this Agreement: (a) Ownership of Shares: The Pledgor is the absolute and beneficial owner of the Shares and none of the Shares is held in the name of any person other than the Pledgor, whether as agent, trustee or other nominee for the Pledgor and the Shares are recorded in the name of the Pledgor in the shareholder ledgers and registers in the Corporation's minute book. (b) No Encumbrances: The Shares are owned by the Pledgor with good and marketable title thereto and they are and shall at all times be kept free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever other than those given by the Pledgor to or in favour of Secured Party. (c) Due Authorization: The Pledgor has the corporate power and capacity to enter into this Agreement and to do all acts and things as are required or contemplated hereunder to be done, observed and performed by it. (d) Right to Grant: The Pledgor has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the Pledgor shall at all relevant times have the full right, power and authority to perform its obligations hereunder and to grant the security interests, mortgages and charges as herein provided. (e) No Default: The entering into of this Agreement and the performance by the Pledgor of its obligations hereunder does not and will not contravene, breach or result in any default under any agreement to which the Pledgor is a party or by which the Pledgor or any of the Shares may be bound and will not result in or

-6permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Agreements or Options: No person, firm or corporation other than the Secured Party has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase of the Shares or any interests therein or rights thereto. (g) No Litigation: There is not pending any court, administrative, regulatory or other action or legal proceeding of any sort either to restrain or otherwise prevent in any manner the Pledgor from effectually and legally hypothecating and pledging the Shares to the Secured Party free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever or any suit, action or proceeding the effect of which would be to cause a lien to attach to the Shares or to divest title to the Shares in any manner whatsoever.

-6permit the acceleration of the maturity of any indebtedness, liability or obligation of the Debtor under any such agreement. (f) No Agreements or Options: No person, firm or corporation other than the Secured Party has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase of the Shares or any interests therein or rights thereto. (g) No Litigation: There is not pending any court, administrative, regulatory or other action or legal proceeding of any sort either to restrain or otherwise prevent in any manner the Pledgor from effectually and legally hypothecating and pledging the Shares to the Secured Party free and clear of any and all mortgages, hypothecs, pledges, claims, adverse claims, demands, liens, charges, security interests, encumbrances, agreements, rights and equities of any kind whatsoever or any suit, action or proceeding the effect of which would be to cause a lien to attach to the Shares or to divest title to the Shares in any manner whatsoever. (h) Issued Capital: The only issued and outstanding shares in the capital of the Corporation owned by the Pledgor are the Shares and no person, firm or corporation has any agreement or option (whether written or oral) or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement, including convertible securities, warrants or convertible obligations of any nature for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of the Corporation. 8. PLEDGOR'S COVENANTS The Pledgor covenants and agrees with the Secured Party that: (a) Obligations: The Pledgor shall pay, perform, satisfy, fulfill and discharge the Obligations when due. (b) No Transfers or Encumbrances: The Pledgor shall not either directly or indirectly (including by way of corporate reorganization, amalgamation or otherwise) sell, transfer, convey, assign, exchange, convert or in any manner dispose of, pledge or in any manner encumber any of the Shares without the prior written consent of the Secured Party, except as expressly permitted or required elsewhere herein. (c) Substituted or Additional Shares: In the event any substituted or additional shares in the capital of the Corporation are received or acquired (directly or indirectly) by or on behalf of the Pledgor, whether as a result of a share issuance, subdivision, consolidation, conversion, reclassification, stock dividend, transfer, sale, reorganization, amalgamation or otherwise (the "SUBSTITUTED OR ADDITIONAL SHARES"), the Pledgor shall stand possessed of the Substituted or Additional Shares in trust for the Secured Party and shall forthwith deliver to the Secured Party the certificate or certificates representing the Substituted or Additional Shares together with a certified copy of the resolution of the directors of the Corporation approving the hypothecation and pledge thereof to the Secured Party whereupon the Secured Party shall hold and deal with the Substituted or Additional Shares and the certificate or certificates evidencing the same as the Shares.

-79. EVENTS OF DEFAULT Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Pledgor to pay when due any payment of any of the Obligations; (b) the failure of the Pledgor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Pledgor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing;

-79. EVENTS OF DEFAULT Forthwith upon the occurrence of any of the following events (an "EVENT OF DEFAULT"), the Obligations will, without the Secured Party being required to give notice or demand, become due and payable in full and, to the extent applicable, be required to be fully performed: (a) the failure of the Pledgor to pay when due any payment of any of the Obligations; (b) the failure of the Pledgor to perform any of the Obligations; (c) any representation, warranty, statement or report which is false or incorrect in any respect having been made or given by the Pledgor to the Secured Party, whether contained herein or in any other agreement (written or oral), instrument or writing; (d) the failure or inability of the Pledgor or the Corporation to pay any of its debts or liabilities as the same fall due; (e) the occurrence of a default by the Pledgor under any agreement, instrument or writing entered into by the Pledgor with any person(s); (f) the Pledgor or the Corporation making or agreeing to make an assignment, disposition or conveyance, whether by way of sale or otherwise, of its assets in bulk; (g) the abandonment by the Pledgor or the Corporation of its assets or any part thereof; (h) the Pledgor or the Corporation ceasing or threatening to cease carrying on its business or any of its businesses; (i) the Pledgor or the Corporation taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Pledgor or the Corporation in respect of the liquidation, dissolution or winding-up of the Pledgor or the Corporation, including without limitation, any action or proceeding under the Winding Up and Restructuring Act, the Business Corporations Act (Ontario), the Canada Business Corporations Act or other similar Nova Scotia legislation whether now or hereinafter in effect; (j) the Pledgor or the Corporation taking any action or commencing any proceeding or any action or proceeding being taken or commenced by another person or persons against the Pledgor or the Corporation relating to the reorganization, readjustment, compromise or settlement of the debts owed by the Pledgor or the Corporation to its creditors where such reorganization, readjustment, compromise or settlement shall affect a substantial portion of the Pledgor's or the Corporation's assets, including without limitation, the filing of a notice of intention to make a proposal or the filing of a proposal pursuant to the provisions of the Bankruptcy and Insolvency Act, the making of an order under the Companies' Creditors Arrangements Act or the commencement of any similar action or proceeding by the Pledgor or the Corporation or such person or persons;

-8(k) the Pledgor or the Corporation committing or threatening to commit any act of bankruptcy pursuant to or set out under the provisions of the Bankruptcy and Insolvency Act; (l) the filing of a petition for a receiving order against the Pledgor or the Corporation pursuant to the provisions of the Bankruptcy and Insolvency Act; (m) any execution, sequestration or other process of any court or other tribunal becoming enforceable against the Pledgor or the Corporation or a distress or analogous action or proceeding being taken, commenced or issued against the Pledgor or the Corporation or levied upon or in respect of its assets or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of its assets or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the

-8(k) the Pledgor or the Corporation committing or threatening to commit any act of bankruptcy pursuant to or set out under the provisions of the Bankruptcy and Insolvency Act; (l) the filing of a petition for a receiving order against the Pledgor or the Corporation pursuant to the provisions of the Bankruptcy and Insolvency Act; (m) any execution, sequestration or other process of any court or other tribunal becoming enforceable against the Pledgor or the Corporation or a distress or analogous action or proceeding being taken, commenced or issued against the Pledgor or the Corporation or levied upon or in respect of its assets or any part thereof, or any lien, trust claim or any other right or entitlement against or in respect of its assets or any part thereof becoming effective, including, without limitation, a warrant of distress of any rent in respect of any premises occupied by the Pledgor or the Corporation or any premises in or upon which its assets or any part thereof may at any time be situate or if a notice of an adverse claim in respect of the Shares is made; (n) the loss, damage, destruction or confiscation of any part of the assets of the Pledgor or the Corporation unless upon such event, the Pledgor pays to the Secured Party forthwith such amount as the Secured Party in its absolute and uncontrolled discretion determines is satisfactory; and (o) the Secured Party in good faith and having commercially reasonable grounds for believing that the ability of the Pledgor to pay any monies hereby secured or to perform any requirement of any provision contained in this Agreement or any other agreement (written or oral), instrument or writing heretofore or hereafter given by the Pledgor to the Secured Party is impaired or that the assets of the Pledgor or the Corporation are in danger of being lost, damaged, destroyed or confiscated. 10. RIGHTS AND REMEDIES Forthwith upon the occurrence of an Event of Default, the security interests, mortgages and charges granted herein shall be enforceable and the Pledgor and the Secured Party shall have, in addition to any other rights and remedies provided by law, the rights and remedies of a debtor and a secured party respectively under the PPSA and those provided by this Agreement. 11. EXPENSES The reasonable costs and expenses of the Secured Party in the preparation, execution and delivery of this Agreement, the registration of this Agreement or of notices, financing statements or other filings in respect thereof, the reasonable costs and expenses of the Secured Party in connection with the preparation or review of waivers, consents, amendments or other matters pertaining to the subject matter of this Agreement, the reasonable costs and expenses expressly provided for in the PPSA and, in addition thereto, the cost of any insurance, taxes, solicitor's fees, costs and other legal expenses and all other costs, charges and expenses of or incurred (on a scale as between a solicitor and his own client) by the Secured Party in respect of any of the foregoing and in respect of the enforcement of the Obligations, including taking possession, custody, holding, preserving, protecting, repairing, using or operating, collecting, realizing, processing, preparing for disposition and disposing of the Shares and any other collateral for the Obligations taken by the Secured Party (collectively, the "Expenses") shall be payable by the

-9Pledgor to the Secured Party forthwith upon demand, shall be deemed advanced to the Pledgor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Pledgor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Pledgor authorizes the Secured Party to designate, in its sole discretion, any number of years as the

-9Pledgor to the Secured Party forthwith upon demand, shall be deemed advanced to the Pledgor by the Secured Party, shall bear interest at a rate equal to the Prime Rate (defined below) plus 4% per annum calculated, both before and after demand, maturity, default and judgment, from the date each of the Expenses, respectively, was incurred until fully paid by the Pledgor and shall be secured by this Agreement. "PRIME RATE" means the annual rate of interest announced from time to time by Royal Bank of Canada as a reference rate then in effect for determining interest rates on Canadian dollar commercial loans in Canada. The Pledgor authorizes the Secured Party to designate, in its sole discretion, any number of years as the registration period in any financing statement or financing change statement filed with respect to this Agreement or any other agreement delivered by the Pledgor to the Secured Party ("DESIGNATED PERIOD"). The Pledgor acknowledges and confirms that: (a) all registration costs in connection with the filing of the aforesaid financing statements or financing change statements are and shall be reasonable and shall form part of the Expenses; (b) the designation of the number of years comprising the Designated Period shall not constitute an acknowledgement by or commitment or other obligation of the Secured Party to provide financial assistance (whether by loan, agreement or otherwise) to the Pledgor at any time or from time to time during the Designated Period; and (c) the Secured Party shall be entitled to exercise all of its rights and remedies provided for in this Agreement forthwith upon the occurrence of an Event of Default notwithstanding that such Event of Default may occur prior to the expiration of the Designated Period. 12. NOTICE OF DISPOSITION Unless not required to do so by applicable law, the Secured Party shall give to the Pledgor at least 15 days written notice of the Secured Party's intention to dispose of the Shares. Such notice may be sent by registered mail to the last known post office address of the Pledgor. 13. MODE OF DISPOSITION The Secured Party may dispose of the Shares by a private sale or public auction or tender at any place and time whatsoever and in such manner and at such price as the Secured Party may reasonably determine, either for cash or on credit, or for part cash and part credit. The Secured Party may postpone any sale prior to the date thereof and may sell the Shares as a whole or in parcels and if in parcels in such order and manner as the Secured Party may reasonably determine. Until the time such sale is completed, the amount of any dividends or other distributions paid or payable by the Corporation in respect of the Shares shall be paid to the Secured Party.

-1014. SECURED PARTY MAY PURCHASE Upon the disposition of the Shares at a public sale, the Secured Party may become a purchaser of the Shares free of any right or equity of redemption which right or equity is hereby expressly waived. 15. PROCEEDS OF DISPOSITION/DEFICIENCY Any proceeds of any disposition of any of the Shares shall be applied by the Secured Party firstly on account of the Expenses, and any balance of such proceeds shall be applied by the Secured Party on account of the Obligations (other than the Expenses) in such order of application as the Secured Party may from time to time effect and the same shall not be subject to dispute by the Pledgor. If such proceeds fail to satisfy the Obligations, the Pledgor shall be liable for the full amount of the deficiency resulting to the Secured Party.

-1014. SECURED PARTY MAY PURCHASE Upon the disposition of the Shares at a public sale, the Secured Party may become a purchaser of the Shares free of any right or equity of redemption which right or equity is hereby expressly waived. 15. PROCEEDS OF DISPOSITION/DEFICIENCY Any proceeds of any disposition of any of the Shares shall be applied by the Secured Party firstly on account of the Expenses, and any balance of such proceeds shall be applied by the Secured Party on account of the Obligations (other than the Expenses) in such order of application as the Secured Party may from time to time effect and the same shall not be subject to dispute by the Pledgor. If such proceeds fail to satisfy the Obligations, the Pledgor shall be liable for the full amount of the deficiency resulting to the Secured Party. 16. GENERAL PROVISIONS (a) Discharge: The Pledgor shall not be discharged from the Obligations by any extension of time, additional advances, renewals, amendments or extensions to this Agreement, any waiver by or failure of the Secured Party to enforce any provision of this Agreement or any other agreement, the taking of further security, releasing security, extinguishment of the security interests, mortgages and charges as to all or any part of the Shares, or any other act except a release or discharge by the Secured Party of the security interests, mortgages and charges granted hereby upon the full payment and performance of the Obligations, at which time the Secured Party shall, at the Pledgor's expense, deliver to the Pledgor the relevant share certificate(s) representing all of the Shares duly endorsed in blank for transfer, all other documents held by the Secured Party pursuant to this Agreement, and all necessary discharges and releases of the security interests, mortgages and charges granted hereby. (b) Other Security: (i) The security constituted by this Agreement is in addition to and not in substitution for any other security, guarantee or right from time to time held by the Secured Party; (ii) The Secured Party may realize upon or enforce all or part of any security, guarantee or right from time to time held by it in any order it desires and any realization by any means upon any security, guarantee or right shall not bar realization by upon any other security, guarantee or right; and (iii) The taking of any action or proceeding or refraining from so doing or any other dealings with or in respect of any other security, guarantee or right from time to time held by the Secured Party shall not release or affect the security provided for in this Agreement and the taking of the security hereby granted or any proceedings hereunder for the realization of the security

-11hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable in whole or in part without the consent of the Pledgor and in any action brought by any assignee to enforce such rights, the Pledgor shall not assert against such assignee any claim, defence, right of set-off, or the benefit of any equities which the Pledgor now has or may hereafter have against the Secured Party.

-11hereby granted shall not release or affect any other security, guarantee or right from time to time held by the Secured Party. (c) Waiver, etc.: No failure or delay on the part of the Secured Party to exercise any right provided for in or contemplated by this Agreement and no waiver as to an Event of Default hereunder shall operate as a waiver thereof unless made in writing and signed by the Secured Party and, in that event, such waiver shall operate only as a waiver of the right or Event of Default expressly referred to therein. Nothing in this Agreement and nothing referred to in the Obligations shall preclude any other remedy by action or otherwise for the enforcement of this Agreement or the payment and performance in full of the Obligations. (d) Secured Party Assignment: All rights and obligations of the Secured Party hereunder shall be freely assignable in whole or in part without the consent of the Pledgor and in any action brought by any assignee to enforce such rights, the Pledgor shall not assert against such assignee any claim, defence, right of set-off, or the benefit of any equities which the Pledgor now has or may hereafter have against the Secured Party. (e) Entire Agreement: This Agreement sets forth the entire intent and understanding of the parties relating to the subject-matter hereof and supersedes and replaces all prior agreements and commitments, whether written or oral, made between the parties and all earlier discussions and negotiations between them. The parties are not relying upon and there are no collateral or other representations, warranties, agreements or covenants made by any of the parties hereto which are not contained herein. (f) Further Assurances: Each of the parties hereto shall and will, from time to time and at all times hereafter upon every reasonable written request so to do, cause such meetings to be held, resolutions passed and by-laws enacted, exercise its vote and influence, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further papers, acts, deeds, assurances and things as may be necessary or desirable in the opinion of any party or counsel for any party, acting reasonably, for implementing and carrying out more effectually the true intent and meaning of this Agreement including, without limitation, to perfect or better perfect the security interests, mortgages and charges of the Secured Party in the Shares or any part thereof. (g) Severability: In the event that any covenant or provision contained in this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the validity, legality and enforceability of the remaining covenants and provisions shall not be affected or impaired thereby and all such remaining covenants and provisions shall continue in full force and effect. All covenants and provisions hereof are declared to be separate and distinct covenants or provisions, as the case may be. (h) Headings: All headings and titles in this Agreement are for convenience of reference only and shall not affect the interpretation of the terms hereof. (i) Gender, etc.: In construing this Agreement, all words and personal pronouns relating thereto shall be read and construed as the number and gender of the party or parties referred to in each case require, and the verb agreeing therewith shall

-12be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein", and other words commencing with "here", shall unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Pledgor hereunder shall bind the Pledgor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Pledgor in this Agreement shall be deemed to include a reference to the Pledgor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Pledgor, their obligations under this Agreement shall be joint and several.

-12be construed as agreeing with the required word and pronoun. Words such as "hereunder", "hereto", "hereof", "herein", and other words commencing with "here", shall unless the context clearly indicates the contrary, refer to the whole of this Agreement and not to any particular paragraph or part thereof. (j) Binding Effect: All rights of the Secured Party hereunder shall enure to the benefit of its successors and assigns and all obligations of the Pledgor hereunder shall bind the Pledgor, its successors and assigns. Each reference to the Secured Party in this Agreement shall be deemed to include a reference to the Secured Party, its successors and assigns and each reference to the Pledgor in this Agreement shall be deemed to include a reference to the Pledgor, its successors and assigns. (k) Re Liabilities: If more than one person executes this Agreement as Pledgor, their obligations under this Agreement shall be joint and several. (l) Governing Law: This Agreement shall be governed by, and interpreted and enforced in accordance with, the laws in force in the Province of Nova Scotia and the laws of Canada applicable therein and shall be treated in all respects as a Nova Scotia contract. Each party irrevocably submits to the non-exclusive jurisdiction of the courts of Nova Scotia with respect to any matter arising hereunder or related hereto. (m) Notice: Subject to the specific requirements of the PPSA, any demand, notice, request, consent, approval or other communication required or permitted to be made or given by any party hereto to any other party hereto in connection with this Agreement shall be in writing and may be made or given by personal delivery to such party or by transmittal by facsimile transmission or similar electronic means of communication which produces a paper record to such party at the fax number noted on page 1 of this Agreement or, if a corporation, to a director thereof or, if postal services and deliveries are then operating, by mailing the same by prepaid registered post to such party at its address noted on page 1 of this Agreement or at such other address which the party to whom such communication is being given may have designated by notice given in accordance with the provisions of this paragraph. Any communication so delivered or transmitted by electronic means of communication shall be deemed to have been given and received on the day of delivery or transmittal, if a business day, or if not a business day, on the business day next following the day of delivery or transmittal, and any communication so mailed shall be deemed to have been given and received on the fourth business day following and exclusive of the date of mailing. In this paragraph, "business day" means any day except a Saturday, Sunday or statutory holiday in the Province of Nova Scotia. Either party may give notice in writing to the other in the manner provided in this paragraph of any change of fax number or address of the party giving such notice, and from and after the giving of such notice, the fax number or address therein specified shall be deemed to be the fax number or address of such party for purposes of this paragraph. (n) Failure to Perfect: The Secured Party shall not be liable or accountable for any negligence or failure to perfect its security interests, mortgages and charges granted herein, seize, collect, realize, sell or obtain payment for the Shares or any part thereof and shall not be bound to institute proceedings for the purpose of seizing, collecting, realizing or obtaining possession or payment of the same for the

-13purpose of preserving the rights of the Pledgor, the Corporation or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Pledgor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Pledgor with the right to use the name of the Pledgor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Pledgor. The Pledgor agrees to and does hereby ratify all acts done and all

-13purpose of preserving the rights of the Pledgor, the Corporation or any other person, firm or corporation in respect of same. (o) No Amendment: This Agreement may not be amended, altered or qualified except by a memorandum in writing signed by all of the parties hereto and any amendment, alteration or qualification hereof shall be null and void and shall not be binding upon any party who has not signed such memorandum. (p) Power of Attorney: The Secured Party, or any receiver appointed hereunder is hereby irrevocably constituted as the duly appointed lawful attorney of the Pledgor with full power to make, do, execute and deliver all such documents, assignments, acts, matters or things on behalf of the Pledgor with the right to use the name of the Pledgor whenever and wherever it may be deemed necessary or expedient. The power of attorney hereby granted is a power coupled with an interest and shall survive the dissolution, liquidation, winding-up or other termination of existence of the Pledgor. The Pledgor agrees to and does hereby ratify all acts done and all documents executed and delivered by the Secured Party pursuant to the power of attorney hereby granted and the Pledgor hereby confirms that the Secured Party and all third parties are entitled to rely upon such ratification. (q) Time of Essence: Time shall be strictly of the essence of this Agreement and of every part thereof and no extension or variation of this Agreement shall operate as a waiver of this provision. (r) Pledgor's Receipt: The Pledgor hereby acknowledges receipt of a fully signed copy of this Agreement. (s) Independent Legal Advice: The Pledgor acknowledges having been advised to obtain independent legal representation or advice, in its discretion, prior to executing this Agreement and thereby becoming bound by its terms and subject to its obligations. This Agreement shall become effective when it is signed by the Pledgor. (t) Meaning of Shares: The term "SHARES" as used herein shall include Substituted or Additional Shares. IN WITNESS WHEREOF the Pledgor and the Secured Party have executed this Agreement and agree to be bound thereby as of the Effective Date set out above.
THE CORPORATE SEAL of FUTURELINK CORP. was hereunto affixed in the presence of: ) ) ) ) ) )

c/s

/s/ COREY E. FISCHER -------------------------------------------Authorized Signatory ) ) -------------------------------------------Authorized Signatory )

-14FOOTHILL CAPITAL CORPORATION by its authorized signatories: ) ) ) ) )

/s/ WILLIAM SHIAO

-------------------------------------------- )
Authorized Signatory ) ) )

-14FOOTHILL CAPITAL CORPORATION by its authorized signatories: ) ) ) ) )

/s/ WILLIAM SHIAO

-------------------------------------------- )
Authorized Signatory ) ) )

-------------------------------------------- ) Authorized Signatory ) )
THE CORPORATE SEAL of 3045207 NOVA SCOTIA COMPANY was hereunto affixed in the presence of: ) ) ) ) ) ) )

c/s

/s/ COREY E. FISCHER

-------------------------------------------- ) Authorized Signatory ) ) ------------------------------------------- ) Authorized Signatory )

TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Foothill Capital Corporation, 100 common shares in the capital of 3045207 Nova Scotia Company. (the "Corporation") and does hereby irrevocably constitute and appoint the Secretary of the Corporation as attorney to transfer or register the transfer of the said share on the books of the Corporation, with full power of substitution in the premises. The undersigned has hereunto executed this transfer the 14 day of December, 2000. FUTURELINK CORP.
Per: /s/ COREY E. FISCHER ------------------------------------------AUTHORIZED SIGNING OFFICER

EXHIBIT 10.76

LOAN AGREEMENT BY AND BETWEEN FUTURELINK EUROPE LIMITED AS SUBSIDIARY BORROWER,

TRANSFER FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Foothill Capital Corporation, 100 common shares in the capital of 3045207 Nova Scotia Company. (the "Corporation") and does hereby irrevocably constitute and appoint the Secretary of the Corporation as attorney to transfer or register the transfer of the said share on the books of the Corporation, with full power of substitution in the premises. The undersigned has hereunto executed this transfer the 14 day of December, 2000. FUTURELINK CORP.
Per: /s/ COREY E. FISCHER ------------------------------------------AUTHORIZED SIGNING OFFICER

EXHIBIT 10.76

LOAN AGREEMENT BY AND BETWEEN FUTURELINK EUROPE LIMITED AS SUBSIDIARY BORROWER, AND FOOTHILL CAPITAL CORPORATION AS LENDER DATED AS OF DECEMBER 13, 2000

TABLE OF CONTENTS
1. DEFINITIONS AND CONSTRUCTION............................................ 1.1 Definitions...................................................... 1.2 Accounting Terms................................................. 1.3 Code............................................................. 1.4 Construction..................................................... 1.5 Schedules and Exhibits........................................... LOAN AND TERMS OF PAYMENT............................................... 2.1 Revolver Advances................................................ 2.2 [intentionally omitted].......................................... 2.3 Borrowing Procedures and Settlements............................. 2.4 Payments......................................................... 2.5 Overadvances..................................................... 2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations..................................................... 2.7 Cash Management.................................................. 2.8 Crediting Payments; Float Charge................................. 2.9 Designated Account............................................... 2.10 Maintenance of Loan Account; Statements of Obligations........... 1 1 22 22 22 23 23 23 24 24 25 26 26 28 29 29 30

2.

EXHIBIT 10.76

LOAN AGREEMENT BY AND BETWEEN FUTURELINK EUROPE LIMITED AS SUBSIDIARY BORROWER, AND FOOTHILL CAPITAL CORPORATION AS LENDER DATED AS OF DECEMBER 13, 2000

TABLE OF CONTENTS
1. DEFINITIONS AND CONSTRUCTION............................................ 1.1 Definitions...................................................... 1.2 Accounting Terms................................................. 1.3 Code............................................................. 1.4 Construction..................................................... 1.5 Schedules and Exhibits........................................... LOAN AND TERMS OF PAYMENT............................................... 2.1 Revolver Advances................................................ 2.2 [intentionally omitted].......................................... 2.3 Borrowing Procedures and Settlements............................. 2.4 Payments......................................................... 2.5 Overadvances..................................................... 2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations..................................................... 2.7 Cash Management.................................................. 2.8 Crediting Payments; Float Charge................................. 2.9 Designated Account............................................... 2.10 Maintenance of Loan Account; Statements of Obligations........... 2.11 Fees............................................................. 2.12 Letters of Credit................................................ 2.13 [intentionally omitted].......................................... 2.14 Capital Requirements............................................. CONDITIONS; TERM OF AGREEMENT........................................... 3.1 Conditions Precedent to the Initial Extension of Credit.......... 3.2 Conditions Subsequent to the Initial Extension of Credit......... 3.3 Conditions Precedent to all Extensions of Credit................. 3.4 Term............................................................. 3.5 Effect of Termination............................................ 3.6 Early Termination by Subsidiary Borrower......................... CREATION OF SECURITY INTEREST........................................... 4.1 Grant of Security Interest....................................... 4.2 Negotiable Collateral................ERROR! BOOKMARK NOT DEFINED. 4.3 Collection of Accounts, General Intangibles, and Negotiable Collateral.......................... ERROR! BOOKMARK NOT DEFINED. 4.4 Delivery of Additional Documentation Required.................... 4.5 Power of Attorney................................................ 4.6 Right to Inspect................................................. 4.7 Control Agreements............................................... 1 1 22 22 22 23 23 23 24 24 25 26 26 28 29 29 30 30 30 33 33 34 34 36 37 37 37 38 38 38

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TABLE OF CONTENTS
1. DEFINITIONS AND CONSTRUCTION............................................ 1.1 Definitions...................................................... 1.2 Accounting Terms................................................. 1.3 Code............................................................. 1.4 Construction..................................................... 1.5 Schedules and Exhibits........................................... LOAN AND TERMS OF PAYMENT............................................... 2.1 Revolver Advances................................................ 2.2 [intentionally omitted].......................................... 2.3 Borrowing Procedures and Settlements............................. 2.4 Payments......................................................... 2.5 Overadvances..................................................... 2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations..................................................... 2.7 Cash Management.................................................. 2.8 Crediting Payments; Float Charge................................. 2.9 Designated Account............................................... 2.10 Maintenance of Loan Account; Statements of Obligations........... 2.11 Fees............................................................. 2.12 Letters of Credit................................................ 2.13 [intentionally omitted].......................................... 2.14 Capital Requirements............................................. CONDITIONS; TERM OF AGREEMENT........................................... 3.1 Conditions Precedent to the Initial Extension of Credit.......... 3.2 Conditions Subsequent to the Initial Extension of Credit......... 3.3 Conditions Precedent to all Extensions of Credit................. 3.4 Term............................................................. 3.5 Effect of Termination............................................ 3.6 Early Termination by Subsidiary Borrower......................... CREATION OF SECURITY INTEREST........................................... 4.1 Grant of Security Interest....................................... 4.2 Negotiable Collateral................ERROR! BOOKMARK NOT DEFINED. 4.3 Collection of Accounts, General Intangibles, and Negotiable Collateral.......................... ERROR! BOOKMARK NOT DEFINED. 4.4 Delivery of Additional Documentation Required.................... 4.5 Power of Attorney................................................ 4.6 Right to Inspect................................................. 4.7 Control Agreements............................................... REPRESENTATIONS AND WARRANTIES.......................................... 1 1 22 22 22 23 23 23 24 24 25 26 26 28 29 29 30 30 30 33 33 34 34 36 37 37 37 38 38 38

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38 39 39 39 40

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-15.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17 5.18 5.19 5.20 5.21 No Encumbrances.................................................. Eligible Accounts................................................ [intentionally omitted].......................................... Equipment........................................................ Location of Inventory and Equipment.............................. Inventory Records................................................ Location of Chief Executive Office; FEIN......................... Due Organization and Qualification; Subsidiaries................. Due Authorization; No Conflict................................... Litigation....................................................... No Material Adverse Change....................................... Fraudulent Transfer.............................................. Employee Benefits................................................ Environmental Condition.......................................... Brokerage Fees................................................... Intellectual Property............................................ Leases........................................................... DDAs............................................................. Complete Disclosure.............................................. Indebtedness..................................................... Review and Approval of Parent Loan Agreement..................... 40 40 41 41 41 41 41 41 42 43 43 44 44 44 44 44 44 45 45 45 45

5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17 5.18 5.19 5.20 5.21 6.

No Encumbrances.................................................. Eligible Accounts................................................ [intentionally omitted].......................................... Equipment........................................................ Location of Inventory and Equipment.............................. Inventory Records................................................ Location of Chief Executive Office; FEIN......................... Due Organization and Qualification; Subsidiaries................. Due Authorization; No Conflict................................... Litigation....................................................... No Material Adverse Change....................................... Fraudulent Transfer.............................................. Employee Benefits................................................ Environmental Condition.......................................... Brokerage Fees................................................... Intellectual Property............................................ Leases........................................................... DDAs............................................................. Complete Disclosure.............................................. Indebtedness..................................................... Review and Approval of Parent Loan Agreement.....................

40 40 41 41 41 41 41 41 42 43 43 44 44 44 44 44 44 45 45 45 45 45 45 45 47 49 49 50 50 50 51 51 51 51 52 52 52 52 52 52 53 53 53

AFFIRMATIVE COVENANTS................................................... 6.1 Accounting System................................................ 6.2 Collateral Reporting............................................. 6.3 Financial Statements, Reports, Certificates...................... 6.4 [Intentionally Omitted].......................................... 6.5 Return........................................................... 6.6 Maintenance of Properties........................................ 6.7 Taxes............................................................ 6.8 Insurance........................................................ 6.9 Location of Inventory and Equipment.............................. 6.10 Compliance with Laws............................................. 6.11 Leases........................................................... 6.12 Brokerage Commissions............................................ 6.13 Existence........................................................ 6.14 Environmental.................................................... 6.15 Disclosure Updates............................................... 6.16 Compliance with Covenants of Parent Loan Agreement............... NEGATIVE COVENANTS...................................................... 7.1 Indebtedness..................................................... 7.2 Liens............................................................ 7.3 Restrictions on Fundamental Changes.............................. 7.4 Disposal of Assets...............................................

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-27.5 7.6 7.7 7.8 7.9 7.10 7.11 7.12 7.13 7.14 7.15 7.16 7.17 7.18 7.19 7.20 8. 9. Change Name...................................................... Guarantee........................................................ Nature of Business............................................... Prepayments and Amendments....................................... Change of Control................................................ Consignments..................................................... Distributions.................................................... Accounting Methods............................................... Investments...................................................... Transactions with Affiliates..................................... Suspension....................................................... [Intentionally Omitted].......................................... Use of Proceeds.................................................. Change in Location of Chief Executive Office; Inventory and Equipment with Bailees........................................... Securities Accounts.............................................. Compliance with Covenants of Parent Loan Agreement............... 54 54 54 54 54 54 54 54 55 55 55 55 55 55 56 56 56 58 58 59

EVENTS OF DEFAULT....................................................... THE LENDER'S RIGHTS AND REMEDIES........................................ 9.1 Rights and Remedies.............................................. 9.2 Remedies Cumulative..............................................

7.5 7.6 7.7 7.8 7.9 7.10 7.11 7.12 7.13 7.14 7.15 7.16 7.17 7.18 7.19 7.20 8. 9.

Change Name...................................................... Guarantee........................................................ Nature of Business............................................... Prepayments and Amendments....................................... Change of Control................................................ Consignments..................................................... Distributions.................................................... Accounting Methods............................................... Investments...................................................... Transactions with Affiliates..................................... Suspension....................................................... [Intentionally Omitted].......................................... Use of Proceeds.................................................. Change in Location of Chief Executive Office; Inventory and Equipment with Bailees........................................... Securities Accounts.............................................. Compliance with Covenants of Parent Loan Agreement...............

54 54 54 54 54 54 54 54 55 55 55 55 55 55 56 56 56 58 58 59 59 60 60 60 60 61 62 63 63 65 65 65 65 65 65 65

EVENTS OF DEFAULT....................................................... THE LENDER'S RIGHTS AND REMEDIES........................................ 9.1 Rights and Remedies.............................................. 9.2 Remedies Cumulative.............................................. TAXES AND EXPENSES...................................................... WAIVERS; INDEMNIFICATION................................................ 11.1 Demand; Protest.................................................. 11.2 Lender's Liability for Collateral................................ 11.3 Indemnification.................................................. NOTICES................................................................. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.............................. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.............................. 14.1 Assignments and Participations................................... 14.2 Successors....................................................... AMENDMENTS; WAIVERS..................................................... 15.1 Amendments and Waivers........................................... 15.2 No Waivers; Cumulative Remedies.................................. GENERAL PROVISIONS...................................................... 16.1 Effectiveness.................................................... 16.2 Section Headings.................................................

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-316.3 16.4 16.5 16.6 16.7 16.8 16.9 Interpretation................................................... Severability of Provisions....................................... Withholding Taxes................................................ Amendments in Writing............................................ Counterparts; Telefacsimile Execution............................ Revival and Reinstatement of Obligations......................... Integration...................................................... 66 66 66 67 67 67 67

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EXHIBITS AND SCHEDULES
Exhibit S-1 Schedule Schedule Schedule Schedule Schedule P-1 2.7(a) 5.5 5.7 5.8(b) Form of Subsidiary Borrower Borrowing Base Certificate Permitted Liens Cash Management Banks Locations of Inventory and Equipment Chief Executive Office; FEIN Capitalization of Subsidiary Borrower

16.3 16.4 16.5 16.6 16.7 16.8 16.9

Interpretation................................................... Severability of Provisions....................................... Withholding Taxes................................................ Amendments in Writing............................................ Counterparts; Telefacsimile Execution............................ Revival and Reinstatement of Obligations......................... Integration......................................................

66 66 66 67 67 67 67

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EXHIBITS AND SCHEDULES
Exhibit S-1 Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule P-1 2.7(a) 5.5 5.7 5.8(b) 5.8(c) 5.14 5.16 5.18 5.20 Form of Subsidiary Borrower Borrowing Base Certificate Permitted Liens Cash Management Banks Locations of Inventory and Equipment Chief Executive Office; FEIN Capitalization of Subsidiary Borrower Capitalization of Subsidiary Borrower's Subsidiaries Environmental Matters Intellectual Property Demand Deposit Accounts Permitted Indebtedness

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LOAN AGREEMENT THIS LOAN AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, by and between FOOTHILL CAPITAL CORPORATION, a California corporation ("Lender") and FUTURELINK EUROPE LIMITED, a company organized under the laws of England and Wales ("Subsidiary Borrower") and is the "UK Loan Agreement" as that term is used in the below referenced Parent Loan Agreement. The parties agree as follows: 1. DEFINITIONS AND CONSTRUCTION. 1.1 Definitions. As used in this Agreement, the following terms shall have the following definitions: "Account Debtor" means any Person who is or who may become obligated under, with respect to, or on account of, an Account, chattel paper, or a General Intangible. "Accounts" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to "accounts" (as that term is defined in the Code), and any and all supporting obligations in respect thereof. "Acquisition" means any purchase or other acquisition by Parent or its Subsidiaries of the Stock of any other Person or all or substantially all of the assets of any other Person. "Additional Documents" has the meaning set forth in Section 4.4. "Affiliate" means, as applied to any Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" means the possession, directly or indirectly, of the power to direct the management and policies of a Person, whether through the ownership of Stock, by contract, or otherwise; provided, however, that, in any event: (a) any Person which owns directly or indirectly 10% or more of the securities having ordinary voting power for the election of directors or other members of the governing body of a Person or 10% or more of the partnership or other

EXHIBITS AND SCHEDULES
Exhibit S-1 Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule Schedule P-1 2.7(a) 5.5 5.7 5.8(b) 5.8(c) 5.14 5.16 5.18 5.20 Form of Subsidiary Borrower Borrowing Base Certificate Permitted Liens Cash Management Banks Locations of Inventory and Equipment Chief Executive Office; FEIN Capitalization of Subsidiary Borrower Capitalization of Subsidiary Borrower's Subsidiaries Environmental Matters Intellectual Property Demand Deposit Accounts Permitted Indebtedness

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LOAN AGREEMENT THIS LOAN AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, by and between FOOTHILL CAPITAL CORPORATION, a California corporation ("Lender") and FUTURELINK EUROPE LIMITED, a company organized under the laws of England and Wales ("Subsidiary Borrower") and is the "UK Loan Agreement" as that term is used in the below referenced Parent Loan Agreement. The parties agree as follows: 1. DEFINITIONS AND CONSTRUCTION. 1.1 Definitions. As used in this Agreement, the following terms shall have the following definitions: "Account Debtor" means any Person who is or who may become obligated under, with respect to, or on account of, an Account, chattel paper, or a General Intangible. "Accounts" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to "accounts" (as that term is defined in the Code), and any and all supporting obligations in respect thereof. "Acquisition" means any purchase or other acquisition by Parent or its Subsidiaries of the Stock of any other Person or all or substantially all of the assets of any other Person. "Additional Documents" has the meaning set forth in Section 4.4. "Affiliate" means, as applied to any Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" means the possession, directly or indirectly, of the power to direct the management and policies of a Person, whether through the ownership of Stock, by contract, or otherwise; provided, however, that, in any event: (a) any Person which owns directly or indirectly 10% or more of the securities having ordinary voting power for the election of directors or other members of the governing body of a Person or 10% or more of the partnership or other ownership interests of a Person (other than as a limited partner of such Person) shall be deemed to control such Person; (b) each director (or comparable manager) of a Person shall be deemed to be an Affiliate of such Person; and (c) each partnership or joint venture in which a Person is a partner or joint venturer shall be deemed to be an Affiliate of such Person. "Agreement" has the meaning set forth in the preamble hereto.

"ASP Dilution" means, as of any date of determination, a percentage, based upon the experience of the

LOAN AGREEMENT THIS LOAN AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, by and between FOOTHILL CAPITAL CORPORATION, a California corporation ("Lender") and FUTURELINK EUROPE LIMITED, a company organized under the laws of England and Wales ("Subsidiary Borrower") and is the "UK Loan Agreement" as that term is used in the below referenced Parent Loan Agreement. The parties agree as follows: 1. DEFINITIONS AND CONSTRUCTION. 1.1 Definitions. As used in this Agreement, the following terms shall have the following definitions: "Account Debtor" means any Person who is or who may become obligated under, with respect to, or on account of, an Account, chattel paper, or a General Intangible. "Accounts" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to "accounts" (as that term is defined in the Code), and any and all supporting obligations in respect thereof. "Acquisition" means any purchase or other acquisition by Parent or its Subsidiaries of the Stock of any other Person or all or substantially all of the assets of any other Person. "Additional Documents" has the meaning set forth in Section 4.4. "Affiliate" means, as applied to any Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" means the possession, directly or indirectly, of the power to direct the management and policies of a Person, whether through the ownership of Stock, by contract, or otherwise; provided, however, that, in any event: (a) any Person which owns directly or indirectly 10% or more of the securities having ordinary voting power for the election of directors or other members of the governing body of a Person or 10% or more of the partnership or other ownership interests of a Person (other than as a limited partner of such Person) shall be deemed to control such Person; (b) each director (or comparable manager) of a Person shall be deemed to be an Affiliate of such Person; and (c) each partnership or joint venture in which a Person is a partner or joint venturer shall be deemed to be an Affiliate of such Person. "Agreement" has the meaning set forth in the preamble hereto.

"ASP Dilution" means, as of any date of determination, a percentage, based upon the experience of the immediately prior 365 days, that is the result of dividing (a) the Dollar amount of bad debt write-downs, discounts, advertising allowances, credits, or other dilutive items with respect to the Accounts arising from the Subsidiary Borrower's provision of services as an application services provider during such period, by (b) the Dollar amount of Subsidiary Borrower's Collections with respect to Accounts arising from the Subsidiary Borrower's provision of services as an application services provider during such period (excluding extraordinary items) plus the Dollar amount of clause (a). "ASP Dilution Reserve" means, as of any date of determination, an amount sufficient to reduce the advance rate against Eligible ASP Accounts by one percentage point for each percentage point by which ASP Dilution is in excess of 5.0%. "Assignee" has the meaning set forth in Section 14.1(a). "Authorized Person" means any officer or other employee of Subsidiary Borrower. "Availability" means, as of any date of determination, if such date is a Business Day, and determined at the close of business on the immediately preceding Business Day, if such date of determination is not a Business Day, the

"ASP Dilution" means, as of any date of determination, a percentage, based upon the experience of the immediately prior 365 days, that is the result of dividing (a) the Dollar amount of bad debt write-downs, discounts, advertising allowances, credits, or other dilutive items with respect to the Accounts arising from the Subsidiary Borrower's provision of services as an application services provider during such period, by (b) the Dollar amount of Subsidiary Borrower's Collections with respect to Accounts arising from the Subsidiary Borrower's provision of services as an application services provider during such period (excluding extraordinary items) plus the Dollar amount of clause (a). "ASP Dilution Reserve" means, as of any date of determination, an amount sufficient to reduce the advance rate against Eligible ASP Accounts by one percentage point for each percentage point by which ASP Dilution is in excess of 5.0%. "Assignee" has the meaning set forth in Section 14.1(a). "Authorized Person" means any officer or other employee of Subsidiary Borrower. "Availability" means, as of any date of determination, if such date is a Business Day, and determined at the close of business on the immediately preceding Business Day, if such date of determination is not a Business Day, the amount that Subsidiary Borrower is entitled to borrow as Subsidiary Borrower Advances under Section 2.1 (after giving effect to all then outstanding Obligations and all sublimits and reserves applicable hereunder). "Bankruptcy Code" means the United States Bankruptcy Code, as in effect from time to time, or any foreign equivalent thereof, including the English Insolvency Act of 1986 as in effect from time to time in the United Kingdom. "Base Rate" means, the rate of interest announced within Wells Fargo at its principal office in San Francisco as its "prime rate", with the understanding that the "prime rate" is one of Wells Fargo's base rates (not necessarily the lowest of such rates) and serves as the basis upon which effective rates of interest are calculated for those loans making reference thereto and is evidenced by the recording thereof after its announcement in such internal publication or publications as Wells Fargo may designate. "Base Rate Margin" means, as of any date of determination, the following margin, to be effective as of the first day of the calendar month immediately following the date of determination, with such determination to be made based on the most recent report submitted to Lender pursuant to Section 6.2(g): (a) if the average of the Qualified Cash Amount for each of the days in a month is greater than $10,000,000 and the Qualified Cash Amount is greater than $10,000,000 on the last Business Day of such month, zero, and -2-

(b) if the average Qualified Cash Amount for each of the days in a month is equal to or less than $10,000,000 or the Qualified Cash Amount is equal to or less than $10,000,000 on the last Business Day of such month, 1.50 percentage points; provided, however, the failure of the Borrowers to deliver the report of the Qualified Cash Amount by the date required hereunder (after giving effect to any applicable grace period) automatically shall cause the Base Rate Margin to be the highest rate set forth above, effective as of the first day of the calendar month immediately following the date on which the delivery of the report was otherwise required; and provided further, however, that for the period from the Closing Date through the last day of the calendar month during which the Closing Date occurs the Base Rate Margin shall be zero. "Benefit Plan" means a "defined benefit plan" (as defined in Section 3(35) of ERISA) for which Subsidiary Borrower or an ERISA Affiliate of Subsidiary Borrower has been an "employer" (as defined in Section 3(5) of ERISA) within the past six years, or the retirement, pension or health benefit plans (or schemes) maintained or contributed to or required to be contributed to by Subsidiary Borrower and established in the United Kingdom, including, without limitation, the Kerridge Computer Company Pension Scheme and the FutureLink Europe Limited Personal Pension Scheme.

(b) if the average Qualified Cash Amount for each of the days in a month is equal to or less than $10,000,000 or the Qualified Cash Amount is equal to or less than $10,000,000 on the last Business Day of such month, 1.50 percentage points; provided, however, the failure of the Borrowers to deliver the report of the Qualified Cash Amount by the date required hereunder (after giving effect to any applicable grace period) automatically shall cause the Base Rate Margin to be the highest rate set forth above, effective as of the first day of the calendar month immediately following the date on which the delivery of the report was otherwise required; and provided further, however, that for the period from the Closing Date through the last day of the calendar month during which the Closing Date occurs the Base Rate Margin shall be zero. "Benefit Plan" means a "defined benefit plan" (as defined in Section 3(35) of ERISA) for which Subsidiary Borrower or an ERISA Affiliate of Subsidiary Borrower has been an "employer" (as defined in Section 3(5) of ERISA) within the past six years, or the retirement, pension or health benefit plans (or schemes) maintained or contributed to or required to be contributed to by Subsidiary Borrower and established in the United Kingdom, including, without limitation, the Kerridge Computer Company Pension Scheme and the FutureLink Europe Limited Personal Pension Scheme. "Board of Directors" means the board of directors of Subsidiary Borrower or any committee thereof duly authorized to act on behalf thereof. "Books" means all of Subsidiary Borrower's now owned or hereafter acquired books and records (including all of its Records indicating, summarizing, or evidencing its assets (including the Collateral) or liabilities, all of its Records relating to its business operations or financial condition, and all of its goods or General Intangibles related to such information). "Borrowers" means Parent and each of its Subsidiaries signatory to the Parent Loan Agreement, and "Borrower" means any one of them. "Borrowing" means a borrowing hereunder of a Subsidiary Borrower Advance. "Business Day" means any day that is not a Saturday, Sunday, or other day on which national banks are authorized or required to close. "Canadian Obligors" means 3045207 Nova Scotia Company, a company organized under the laws of Nova Scotia, 1423280 Ontario Inc., a company organized under the laws of Ontario, and FutureLink Canada Corp., a company organized under the laws of Ontario. "Canadian Security Documents" is defined in the Parent Loan Agreement. -3-

"Capital Lease" means a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. "Capitalized Lease Obligation" means any Indebtedness represented by obligations under a Capital Lease. "Cash Equivalents" means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having the highest rating obtainable from either S&P or Moody's, (c) commercial paper maturing no more than 1 year from the date of acquisition thereof and, at the time of acquisition, having a rating of A-1 or P-1, or better, from S&P or Moody's, and (d) certificates of deposit or bankers' acceptances maturing within 1 year from the date of acquisition thereof either (i) issued by any bank organized under the laws of the United States or any state thereof which bank has a rating

"Capital Lease" means a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. "Capitalized Lease Obligation" means any Indebtedness represented by obligations under a Capital Lease. "Cash Equivalents" means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having the highest rating obtainable from either S&P or Moody's, (c) commercial paper maturing no more than 1 year from the date of acquisition thereof and, at the time of acquisition, having a rating of A-1 or P-1, or better, from S&P or Moody's, and (d) certificates of deposit or bankers' acceptances maturing within 1 year from the date of acquisition thereof either (i) issued by any bank organized under the laws of the United States or any state thereof which bank has a rating of A or A2, or better, from S&P or Moody's, or (ii) certificates of deposit less than or equal to $100,000 in the aggregate issued by any other bank insured by the Federal Deposit Insurance Corporation. "Cash Management Bank" has the meaning set forth in Section 2.7(a). "Cash Management Account" has the meaning set forth in Section 2.7(a). "Cash Management Agreements" means those certain cash management service agreements, in form and substance satisfactory to Lender, each of which is among Subsidiary Borrower, Lender, and one of the Cash Management Banks. "CFC" means a controlled foreign corporation (as that term is defined in the IRC) organized in connection with the consummation of a Permitted Acquisition. "Change of Control" means (a) Parent ceases to directly own and control 51% of the outstanding capital Stock of UK Holding Company, (b) a majority of the members of the Board of Directors do not constitute Continuing Directors, (c) UK Holding Company ceases to directly own and control 100% of the outstanding capital Stock of Subsidiary Borrower, or (d) the occurrence of a Change of Control (as defined in the Parent Loan Agreement). "Closing Date" means the date of the making of the initial Subsidiary Borrower Advance (or other extension of credit) hereunder or the date on which Lender sends Subsidiary Borrower a written notice that each of the conditions precedent set forth in Section 3.1 either have been satisfied or have been waived. "Code" means the California Uniform Commercial Code, as in effect from time to time. -4-

"Collateral" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest in and to each of the following: (a) Accounts, (b) Books, (c) Equipment, (d) General Intangibles, (e) Inventory, (f) Investment Property,

"Collateral" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest in and to each of the following: (a) Accounts, (b) Books, (c) Equipment, (d) General Intangibles, (e) Inventory, (f) Investment Property, (g) Negotiable Collateral, (h) Real Property, (i) money or other assets of Subsidiary Borrower that now or hereafter come into the possession, custody, or control of Lender, and (j) the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the foregoing, and any and all Accounts, Books, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, Real Property, money, deposit accounts, or other tangible or intangible property resulting from the sale, exchange, collection, or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof. "Collateral Access Agreement" means a landlord waiver, bailee letter, or acknowledgement agreement of any lessor, warehouseman, processor, consignee, or other Person in possession of, having a Lien upon, or having rights or interests in the Equipment or Inventory, in each case, in form and substance satisfactory to Lender. "Collections" means all cash, checks, notes, instruments, and other items of payment (including insurance proceeds, proceeds of cash sales, rental proceeds, and tax refunds) of Subsidiary Borrower. "Companies Act" means the Companies Act of 1985 of England and Wales, as amended. "Continuing Director" means (a) any member of the Board of Directors who was a director (or comparable manager) of Subsidiary Borrower on the Closing Date, and (b) any individual who becomes a member of the Board of Directors after the Closing Date if such individual was appointed or nominated for election to the Board of Directors by a majority of the Continuing Directors, but excluding any such individual originally proposed for election in opposition to the Board of Directors in office at the Closing Date in an actual -5-

or threatened election contest relating to the election of the directors (or comparable managers) of Subsidiary Borrower (as such terms are used in Rule 14a-11 under the Exchange Act) and whose initial assumption of office resulted from such contest or the settlement thereof. "Control Agreement" means a control agreement, in form and substance satisfactory to Lender, executed and delivered by Subsidiary Borrower, Lender, and the applicable securities intermediary with respect to a Securities Account or a bank with respect to a deposit account. "copyright" shall have the meaning ascribed to such term in the United States Copyright Act of 1976, as amended, and includes unregistered copyrights. "Customer Deposit Reserve" means, as of any date of determination, a reserve for deposits received by

or threatened election contest relating to the election of the directors (or comparable managers) of Subsidiary Borrower (as such terms are used in Rule 14a-11 under the Exchange Act) and whose initial assumption of office resulted from such contest or the settlement thereof. "Control Agreement" means a control agreement, in form and substance satisfactory to Lender, executed and delivered by Subsidiary Borrower, Lender, and the applicable securities intermediary with respect to a Securities Account or a bank with respect to a deposit account. "copyright" shall have the meaning ascribed to such term in the United States Copyright Act of 1976, as amended, and includes unregistered copyrights. "Customer Deposit Reserve" means, as of any date of determination, a reserve for deposits received by Subsidiary Borrower from its customers from time to time for services to be rendered or goods to be delivered in an amount as shall be determined by Lender in its Permitted Discretion from time to time on or after the Closing Date. "Daily Balance" means, with respect to each day during the term of this Agreement, the amount of an Obligation owed at the end of such day. "DDA" means any checking or other demand deposit account maintained by Subsidiary Borrower. "Default" means an event, condition, or default that, with the giving of notice, the passage of time, or both, would be an Event of Default. "Designated Account" means account number 0635259 sort code 60-00-04 of Subsidiary Borrower maintained with the Designated Account Bank, or such other Dollar deposit account of Subsidiary Borrower that has been designated as such, in writing, by Subsidiary Borrower to Lender. "Designated Account Bank" means National Westminster Bank, Plc of West Berkshire CBC, P.O. Box 5651, Market Place, Newbury, RG14 5GP. "Dilution" means, as of any date of determination, a percentage, based upon the experience of the immediately prior 365 days, that is the result of dividing (a) the Dollar amount of bad debt write-downs, discounts, advertising allowances, credits, or other dilutive items with respect to the Accounts (other than such Accounts arising from Subsidiary Borrower's provision of services as an application services provider) during such period, by (b) the Dollar amount of Subsidiary Borrower's Collections with respect to Accounts (other than such Accounts arising from Subsidiary Borrower's provision of services as an application services provider) during such period (excluding extraordinary items) plus the Dollar amount of clause (a). -6-

"Dilution Reserve" means, as of any date of determination, an amount sufficient to reduce the advance rate against Eligible UK Accounts by one percentage point for each percentage point by which Dilution is in excess of 5.0%. "Disbursement Letter" means an instructional letter executed and delivered by Subsidiary Borrower to Lender regarding the extensions of credit to be made on the Closing Date, the form and substance of which is satisfactory

"Dilution Reserve" means, as of any date of determination, an amount sufficient to reduce the advance rate against Eligible UK Accounts by one percentage point for each percentage point by which Dilution is in excess of 5.0%. "Disbursement Letter" means an instructional letter executed and delivered by Subsidiary Borrower to Lender regarding the extensions of credit to be made on the Closing Date, the form and substance of which is satisfactory to Lender. "Dollars" or "$" means United States dollars. "Domestic Excess Availability" means "Excess Availability" (as defined in the Parent Loan Agreement. "Domestic Maximum Revolver Amount" means the "Maximum Revolver Amount" (as defined in the Parent Loan Agreement). "Domestic Revolver Usage" means, as of any date of determination, the "Revolver Usage" (as defined in the Parent Loan Agreement). "Eligible Accounts" means Eligible ASP Accounts and Eligible UK Accounts. "Eligible ASP Accounts" means any Account created by Subsidiary Borrower as to which each of the following is applicable (a) such Account does not qualify as an Eligible UK Account solely because the services giving rise to such Account have not been performed by Subsidiary Borrower as of the original invoice date, (b) Lender has a perfected first priority security interest in such Account, (c) such Account arose from Subsidiary Borrower's anticipated provision of services as an application service provider, wherein Subsidiary Borrower hosts the applicable Account Debtor's applications from Subsidiary Borrower's data center, and (d) the period during which such Account shall become an Eligible ASP Account shall commence on the first Business Day of the month immediately following the original invoice date and shall no longer be deemed an Eligible ASP Account on the date that is 60 days immediately following the date that the relevant Account became an Eligible ASP Account. "Eligible UK Accounts" means those Accounts created by Subsidiary Borrower in the ordinary course of its business, that arise out of its sale of goods or rendition of services, that comply with each of the representations and warranties respecting Eligible Accounts made by Subsidiary Borrowers under the Subsidiary Loan Documents, and that are not excluded as ineligible by virtue of one or more of the criteria set forth below; provided, however, that such criteria may be fixed and revised from time to time by Lender in Lender's Permitted Discretion to address the results of any audit performed by Lender from time to time after the Closing Date. Eligible UK Accounts shall not include the following: (a) Accounts that the Account Debtor has failed to pay within 90 days of original invoice date or Accounts with selling terms of more than 30 days; provided, however, upon written request from Subsidiary Borrower to extend the foregoing 90 day -7-

period to up to 120 days in the case of highly creditworthy Account Debtors, Lender agrees to consider such request and approve or deny such request based upon its Permitted Discretion, (b) Accounts owed by an Account Debtor (or its Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or its Affiliates) are deemed ineligible under clause (a) above, (c) Accounts with respect to which the Account Debtor is an employee, Affiliate, or agent of Subsidiary Borrower, (d) Accounts arising in a transaction wherein goods are placed on consignment or are sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a bill and hold, or any other terms by reason of which the payment by the Account Debtor may be conditional,

period to up to 120 days in the case of highly creditworthy Account Debtors, Lender agrees to consider such request and approve or deny such request based upon its Permitted Discretion, (b) Accounts owed by an Account Debtor (or its Affiliates) where 50% or more of all Accounts owed by that Account Debtor (or its Affiliates) are deemed ineligible under clause (a) above, (c) Accounts with respect to which the Account Debtor is an employee, Affiliate, or agent of Subsidiary Borrower, (d) Accounts arising in a transaction wherein goods are placed on consignment or are sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a bill and hold, or any other terms by reason of which the payment by the Account Debtor may be conditional, (e) Accounts that are not payable in a Specified Currency, (f) Accounts with respect to which the Account Debtor either (i) does not maintain its chief executive office in a Specified Country, or (ii) is not organized under the laws of a Specified Country or any political subdivision thereof, or (iii) is the government of any country or sovereign state (other than that of the United Kingdom), or of any state, province, municipality, or other political subdivision thereof, or of any department, agency, public corporation, or other instrumentality thereof, unless (y) the Account is supported by an irrevocable letter of credit satisfactory to Lender (as to form, substance, and issuer or domestic confirming bank) that has been delivered to Lender and is directly drawable by Lender, or (z) the Account is covered by credit insurance in form, substance, and amount, and by an insurer, satisfactory to Lender, (g) [intentionally omitted], (h) Accounts with respect to which the Account Debtor is a creditor of Subsidiary Borrower, has or has asserted a right of setoff, has disputed its liability, or has made any claim with respect to its obligation to pay the Account, to the extent of such claim, right of setoff, or dispute, (i) Accounts with respect to an Account Debtor whose total obligations owing to Subsidiary Borrower exceed 10% of all Eligible Accounts, to the extent of the obligations owing by such Account Debtor in excess of such percentage; provided, however, that, in the case of Computacenter, the foregoing percentage shall be 20% before the excess would be deemed ineligible, (j) Accounts with respect to which the Account Debtor is subject to an Insolvency Proceeding, is not Solvent, has gone out of business, or as to which Subsidiary Borrower has received notice of an imminent Insolvency Proceeding or a material impairment of the financial condition of such Account Debtor, -8-

(k) [intentionally omitted], (l) Accounts, the collection of which, Lender, in its Permitted Discretion, believes to be doubtful by reason of the Account Debtor's financial condition, (m) Accounts that are not subject to a valid and perfected first priority Lender's Lien, (n) Accounts with respect to which (i) the goods giving rise to such Account have not been shipped and billed to the Account Debtor, or (ii) the services giving rise to such Account have not been performed and billed to the Account Debtor, or (o) Accounts that represent the right to receive progress payments or other advance billings that are due prior to the completion of performance by Subsidiary Borrower of the subject contract for goods or services (including any service or maintenance Accounts that are billed in advance of the completion of the rendition of the subject services; provided, however, that solely with respect to a maintenance Account that otherwise fully complies with the criteria for eligibility as an Eligible UK Account and as to which Subsidiary Borrower has completed

(k) [intentionally omitted], (l) Accounts, the collection of which, Lender, in its Permitted Discretion, believes to be doubtful by reason of the Account Debtor's financial condition, (m) Accounts that are not subject to a valid and perfected first priority Lender's Lien, (n) Accounts with respect to which (i) the goods giving rise to such Account have not been shipped and billed to the Account Debtor, or (ii) the services giving rise to such Account have not been performed and billed to the Account Debtor, or (o) Accounts that represent the right to receive progress payments or other advance billings that are due prior to the completion of performance by Subsidiary Borrower of the subject contract for goods or services (including any service or maintenance Accounts that are billed in advance of the completion of the rendition of the subject services; provided, however, that solely with respect to a maintenance Account that otherwise fully complies with the criteria for eligibility as an Eligible UK Account and as to which Subsidiary Borrower has completed performance for the period set forth on the relevant invoice, any such Account shall be deemed an Eligible UK Account). "Environmental Actions" means any complaint, summons, citation, notice, directive, order, claim, litigation, investigation, judicial or administrative proceeding, judgment, letter, or other communication from any Governmental Authority, or any third party involving violations of Environmental Laws or releases of Hazardous Materials from (a) any assets, properties, or businesses of Subsidiary Borrower or any predecessor in interest, (b) from adjoining properties or businesses, or (c) from or onto any facilities which received Hazardous Materials generated by Subsidiary Borrower or any predecessor in interest. "Environmental Law" means any applicable federal, state, provincial, foreign or local statute, law, rule, regulation, ordinance, code, binding and enforceable guideline, binding and enforceable written policy or rule of common law now or hereafter in effect and in each case as amended, or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, to the extent binding on Subsidiary Borrower, relating to the environment, employee health and safety, or Hazardous Materials, including CERCLA; RCRA; the Federal Water Pollution Control Act, 33 USC Section 1251 et seq; the Toxic Substances Control Act, 15 USC, Section 2601 et seq; the Clean Air Act, 42 USC Section 7401 et seq.; the Safe Drinking Water Act, 42 USC. Section 3803 et seq.; the Oil Pollution Act of 1990, 33 USC. Section 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 USC. Section 11001 et seq.; the Hazardous Material Transportation Act, 49 USC Section 1801 et seq.; and the Occupational Safety and Health Act, 29 USC. Section 651 et seq. (to the extent it regulates occupational exposure to Hazardous Materials); any state and local or foreign counterparts or equivalents, in each case as amended from time to time. -9-

"Environmental Liabilities and Costs" means all liabilities, monetary obligations, Remedial Actions, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand by any Governmental Authority or any third party, and which relate to any Environmental Action. "Environmental Lien" means any Lien in favor of any Governmental Authority for Environmental Liabilities and Costs. "Equipment" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to equipment, machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), tools, parts, goods (other than consumer goods, farm products, or Inventory), wherever located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing.

"Environmental Liabilities and Costs" means all liabilities, monetary obligations, Remedial Actions, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand by any Governmental Authority or any third party, and which relate to any Environmental Action. "Environmental Lien" means any Lien in favor of any Governmental Authority for Environmental Liabilities and Costs. "Equipment" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to equipment, machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), tools, parts, goods (other than consumer goods, farm products, or Inventory), wherever located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute thereto. "ERISA Affiliate" means (a) any Person subject to ERISA whose employees are treated as employed by the same employer as the employees of a Subsidiary Borrower under IRC Section 414(b), (b) any trade or business subject to ERISA whose employees are treated as employed by the same employer as the employees of a Subsidiary Borrower under IRC Section 414(c), (c) solely for purposes of Section 302 of ERISA and Section 412 of the IRC, any organization subject to ERISA that is a member of an affiliated service group of which a Subsidiary Borrower is a member under IRC Section 414(m), or (d) solely for purposes of Section 302 of ERISA and Section 412 of the IRC, any Person subject to ERISA that is a party to an arrangement with a Subsidiary Borrower and whose employees are aggregated with the employees of a Subsidiary Borrower under IRC Section 414(o). "Event of Default" has the meaning set forth in Section 8. "Excess Availability" means the amount, as of the date any determination thereof is to be made, equal to Availability minus the aggregate amount, if any, of all trade payables of Subsidiary Borrower aged in excess of their historical levels with respect thereto and all book overdrafts in excess of their historical practices with respect thereto, in each case as determined by Lender in its Permitted Discretion. "Exchange Act" means the Securities Exchange Act of 1934, as in effect from time to time. "Exchange Rate" means and refers to the nominal rate of exchange (vis-a-vis Dollars) for a currency other than Dollars published in the Wall Street Journal (Western Edition) on the date of determination (which shall be a Business Day on which the Wall -10-

Street Journal (Western Edition) is published), expressed as the number of units of such other currency per one Dollar. "Existing Lender" means National Westminster Bank, Plc. "FEIN" means Federal Employer Identification Number. "Foreign Exchange Reserve" means, as of any date of determination, a reserve for foreign currency exchange rate risk with respect to the Eligible Accounts in such amount as shall be determined by Lender in its Permitted Discretion from time to time on or after the Closing Date. "Funding Date" means the date on which a Borrowing occurs.

Street Journal (Western Edition) is published), expressed as the number of units of such other currency per one Dollar. "Existing Lender" means National Westminster Bank, Plc. "FEIN" means Federal Employer Identification Number. "Foreign Exchange Reserve" means, as of any date of determination, a reserve for foreign currency exchange rate risk with respect to the Eligible Accounts in such amount as shall be determined by Lender in its Permitted Discretion from time to time on or after the Closing Date. "Funding Date" means the date on which a Borrowing occurs. "GAAP" means generally accepted accounting principles as in effect from time to time in the United States, consistently applied. "General Intangibles" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to general intangibles (including payment intangibles, contract rights, rights to payment, rights arising under common law, statutes, or regulations, choses or things in action, goodwill, patents, trade names, trademarks, servicemarks, copyrights, blueprints, drawings, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, infringement claims, computer programs, information contained on computer disks or tapes, software, literature, reports, catalogs, money, deposit accounts, insurance premium rebates, tax refunds, and tax refund claims), and any and all supporting obligations in respect thereof, and any other personal property other than goods, Accounts, Investment Property, and Negotiable Collateral. "Governing Documents" means, with respect to any Person, the memorandum and articles of association, the certificate or articles of incorporation, by-laws, or other organizational documents of such Person. "Governmental Authority" means any federal, state, local, or other governmental or administrative body, instrumentality, department, or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, or other similar dispute-resolving panel or body. "Guarantors" means, collectively, each of the Borrowers, Canadian Obligors, and the UK Holding Company, and "Guarantor" means any one of them. "Hazardous Materials" means (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as "hazardous substances," "hazardous materials," "hazardous wastes," "toxic substances," or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or "EP -11-

toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million. "Indebtedness" means (a) all obligations of Subsidiary Borrower for borrowed money, (b) all obligations of Subsidiary Borrower evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations of Subsidiary Borrower in respect of letters of credit, bankers acceptances, interest rate swaps, or other financial products, (c) all obligations of Subsidiary Borrower under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of Subsidiary Borrower, irrespective of whether such obligation or liability is assumed, (e) all obligations of Subsidiary Borrower for the deferred purchase price of assets (other than trade debt incurred in the ordinary course of Subsidiary Borrower's business and repayable in accordance with Subsidiary Borrower's customary trade practices), and (f) any obligation of Subsidiary

toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million. "Indebtedness" means (a) all obligations of Subsidiary Borrower for borrowed money, (b) all obligations of Subsidiary Borrower evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations of Subsidiary Borrower in respect of letters of credit, bankers acceptances, interest rate swaps, or other financial products, (c) all obligations of Subsidiary Borrower under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of Subsidiary Borrower, irrespective of whether such obligation or liability is assumed, (e) all obligations of Subsidiary Borrower for the deferred purchase price of assets (other than trade debt incurred in the ordinary course of Subsidiary Borrower's business and repayable in accordance with Subsidiary Borrower's customary trade practices), and (f) any obligation of Subsidiary Borrower guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse to Subsidiary Borrower) any obligation of any other Person. "Indemnified Liabilities" has the meaning set forth in Section 11.3. "Indemnified Person" has the meaning set forth in Section 11.3. "Insolvency Proceeding" means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state, federal, or foreign bankruptcy or insolvency law, or the appointment of a receiver, administrative receiver or liquidator with respect to a Person or any of its assets, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief. "Intangible Assets" means, with respect to any Person, that portion of the book value of all of such Person's assets that would be treated as intangibles under GAAP. "Intellectual Property" means all patents, patent applications, trademarks, trademark applications, tradenames, tradedress, copyrights, copyright registrations, technology, know-how and processes used in or necessary for the conduct of the business of any Person as currently conducted that are material to the condition (financial or otherwise), business, or operations of such Person. "Inventory" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to inventory, including goods held for sale or lease or to be furnished under a contract of service, goods that are leased by Subsidiary Borrower as lessor, goods that are furnished by Subsidiary Borrower under a contract of -12-

service, and raw materials, work in process, or materials used or consumed in Subsidiary Borrower's business. "Investment" means, with respect to any Person, any investment by such Person in any other Person (including Affiliates) in the form of loans, guarantees, advances, or capital contributions (excluding (a) commission, travel, and similar advances to officers and employees of such Person made in the ordinary course of business, and (b) bona fide Accounts arising from the sale of goods or rendition of services in the ordinary course of business consistent with past practice), purchases or other acquisitions for consideration of Indebtedness or Stock, and any other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. "Investment Property" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to "investment property" as that term is defined in the Code, and any and all supporting obligations in respect thereof. "IRC" means the Internal Revenue Code of 1986, as in effect from time to time.

service, and raw materials, work in process, or materials used or consumed in Subsidiary Borrower's business. "Investment" means, with respect to any Person, any investment by such Person in any other Person (including Affiliates) in the form of loans, guarantees, advances, or capital contributions (excluding (a) commission, travel, and similar advances to officers and employees of such Person made in the ordinary course of business, and (b) bona fide Accounts arising from the sale of goods or rendition of services in the ordinary course of business consistent with past practice), purchases or other acquisitions for consideration of Indebtedness or Stock, and any other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. "Investment Property" means all of Subsidiary Borrower's now owned or hereafter acquired right, title, and interest with respect to "investment property" as that term is defined in the Code, and any and all supporting obligations in respect thereof. "IRC" means the Internal Revenue Code of 1986, as in effect from time to time. "L/C" has the meaning set forth in Section 2.12(a). "L/C Disbursement" means a payment made by Lender pursuant to a Letter of Credit. "L/C Undertaking" has the meaning set forth in Section 2.12(a). "Lender" has the meaning set forth in the preamble to this Agreement. "Lender's Account" means an account at a bank designated by Lender from time to time as the account into which Subsidiary Borrower shall make all payments to Lender under this Agreement and the other Subsidiary Loan Documents; unless and until Lender notifies Subsidiary Borrower, Lender's Account shall be that certain deposit account bearing account number 323-266193 and maintained by Lender with The Chase Manhattan Bank, 4 New York Plaza, 15th Floor, New York, New York 10004, ABA #021000021. "Lender's Liens" means the Liens granted by Subsidiary Borrower to Lender under this Agreement or the other Subsidiary Loan Documents. "Lender Expenses" means all (a) costs or expenses (including taxes, and insurance premiums) required to be paid by Subsidiary Borrower under any of the Subsidiary Loan Documents that are paid or incurred by Lender, (b) reasonable fees or charges paid or incurred by Lender in connection with Lender's transactions with Subsidiary Borrower, including, fees or charges for photocopying, notarization, couriers and messengers, telecommunication, public record searches (including tax lien, litigation, and UCC searches and including searches with the patent and trademark office, the copyright office, the department of motor vehicles, or any foreign equivalent thereof), filing, recording, -13-

publication, appraisal (including periodic Collateral appraisals or business valuations to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement, real estate surveys, real estate title policies and endorsements, and environmental audits, (c) costs and expenses incurred by Lender in the disbursement of funds to or for the account of Subsidiary Borrower (by wire transfer or otherwise), (d) charges paid or incurred by Lender resulting from the dishonor of checks, (e) reasonable costs and expenses paid or incurred by Lender to correct any default or enforce any provision of the Subsidiary Loan Documents, or in gaining possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale, or advertising to sell the Collateral, or any portion thereof, irrespective of whether a sale is consummated, (f) audit fees and expenses of Lender related to audit examinations of the Books to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement, (g) reasonable costs and expenses of third party claims or any other suit paid or incurred by Lender in enforcing or defending the Subsidiary Loan Documents or in connection with the transactions contemplated by the Subsidiary Loan Documents or Lender's relationship with Subsidiary Borrower or any guarantor of the Obligations, (h) Lender's reasonable fees and expenses (including attorneys fees) incurred (i) in advising,

publication, appraisal (including periodic Collateral appraisals or business valuations to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement, real estate surveys, real estate title policies and endorsements, and environmental audits, (c) costs and expenses incurred by Lender in the disbursement of funds to or for the account of Subsidiary Borrower (by wire transfer or otherwise), (d) charges paid or incurred by Lender resulting from the dishonor of checks, (e) reasonable costs and expenses paid or incurred by Lender to correct any default or enforce any provision of the Subsidiary Loan Documents, or in gaining possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale, or advertising to sell the Collateral, or any portion thereof, irrespective of whether a sale is consummated, (f) audit fees and expenses of Lender related to audit examinations of the Books to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement, (g) reasonable costs and expenses of third party claims or any other suit paid or incurred by Lender in enforcing or defending the Subsidiary Loan Documents or in connection with the transactions contemplated by the Subsidiary Loan Documents or Lender's relationship with Subsidiary Borrower or any guarantor of the Obligations, (h) Lender's reasonable fees and expenses (including attorneys fees) incurred (i) in advising, structuring, drafting, reviewing, administering, or amending the Subsidiary Loan Documents, or (ii) in obtaining any tax clearances, reports, certifications, or other documentation from the Internal Revenue Service, Inland Revenue, or any other relevant taxing authority in connection with the transactions and undertakings contemplated by this Agreement, and (i) Lender's reasonable fees and expenses (including attorneys fees) incurred in terminating, enforcing (including attorneys fees and expenses incurred in connection with a "workout," a "restructuring," or an Insolvency Proceeding concerning Subsidiary Borrower or in exercising rights or remedies under the Subsidiary Loan Documents), or defending the Subsidiary Loan Documents, irrespective of whether suit is brought, or in taking any Remedial Action concerning the Collateral. "Lender-Related Person" means Lender, Lender's Affiliates, and the officers, directors, employees, and agents of Lender. "Letter of Credit" means an L/C or an L/C Undertaking, as the context requires. "Letter of Credit Usage" means, as of any date of determination, the aggregate undrawn amount of all outstanding Letters of Credit. "Lien" means any interest in an asset securing an obligation owed to, or a claim by, any Person other than the owner of the asset, whether such interest shall be based on the common law, statute, or contract, whether such interest shall be recorded or perfected, and whether such interest shall be contingent upon the occurrence of some future event or events or the existence of some future circumstance or circumstances, including the lien or security interest arising from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, security agreement, debenture, fixed or floating charge, assignment by way of security, conditional sale or trust receipt, or from a lease, consignment, or bailment for security purposes and also including reservations, exceptions, encroachments, -14-

easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting Real Property. "Loan Account" has the meaning set forth in Section 2.10. "Loan Documents" is defined in the Parent Loan Agreement. "Material Adverse Change" means (a) a material adverse change in the business, prospects, operations, results of operations, assets, liabilities or condition (financial or otherwise) of Subsidiary Borrower, (b) a material impairment of Subsidiary Borrower's ability to perform its obligations under the Subsidiary Loan Documents to which it is a party or of Lender's ability to enforce the Obligations or realize upon the Collateral, (c) a material impairment of the enforceability or priority of the Lender's Liens with respect to the Collateral as a result of an action or failure to act on the part of Subsidiary Borrower, or (d) a Material Adverse Change (as defined in the Parent Loan Agreement).

easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting Real Property. "Loan Account" has the meaning set forth in Section 2.10. "Loan Documents" is defined in the Parent Loan Agreement. "Material Adverse Change" means (a) a material adverse change in the business, prospects, operations, results of operations, assets, liabilities or condition (financial or otherwise) of Subsidiary Borrower, (b) a material impairment of Subsidiary Borrower's ability to perform its obligations under the Subsidiary Loan Documents to which it is a party or of Lender's ability to enforce the Obligations or realize upon the Collateral, (c) a material impairment of the enforceability or priority of the Lender's Liens with respect to the Collateral as a result of an action or failure to act on the part of Subsidiary Borrower, or (d) a Material Adverse Change (as defined in the Parent Loan Agreement). "Maximum Subsidiary Revolver Amount" means the result of (a) $5,000,000, minus (b) the amount by which the Domestic Revolver Usage exceeds $20,000,000 (or, if clause (a) of the definition of Domestic Maximum Revolver Amount has been increased to $30,000,000, the amount by which the Domestic Revolver Usage exceeds $25,000,000). "Negotiable Collateral" means all of Subsidiary Borrower's now owned and hereafter acquired right, title, and interest with respect to letters of credit, letter of credit rights, instruments, promissory notes, drafts, documents, and chattel paper (including electronic chattel paper and tangible chattel paper), and any and all supporting obligations in respect thereof. "Obligations" means all loans, Subsidiary Borrower Advances, debts, principal, interest (including any interest that, but for the provisions of the Bankruptcy Code, would have accrued), contingent reimbursement obligations with respect to outstanding Letters of Credit, premiums, liabilities (including all amounts charged to Subsidiary Borrower's Loan Account pursuant hereto), obligations, fees, charges, costs, Lender Expenses (including any fees or expenses that, but for the provisions of the Bankruptcy Code, would have accrued), lease payments, guaranties, covenants, and duties of any kind and description owing by Subsidiary Borrower to Lender pursuant to or evidenced by the Subsidiary Loan Documents and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all interest not paid when due and all Lender Expenses that Subsidiary Borrower is required to pay or reimburse by the Subsidiary Loan Documents, by law, or otherwise. Any reference in this Agreement or in the Subsidiary Loan Documents to the Obligations shall include all amendments, changes, extensions, modifications, renewals replacements, substitutions, and supplements, thereto and thereof, as applicable, both prior and subsequent to any Insolvency Proceeding. "Originating Lender" has the meaning set forth in Section 14.1(d). -15-

"Overadvance" has the meaning set forth in Section 2.5. "Parent" means FutureLink Corp., a Delaware corporation. "Parent Loan Agreement" means that certain Loan and Security Agreement, dated as of November 16, 2000, among Parent, certain of Parent's Subsidiaries identified on the signature pages thereof, and Lender. "Participant" has the meaning set forth in Section 14.1(d). "Payoff Letter" means a letter, in form and substance satisfactory to Lender, from Existing Lender to Lender respecting the amount necessary to repay in full all of the obligations of Subsidiary Borrower owing to Existing Lender and obtain a release of all of the Liens existing in favor of Existing Lender in and to the assets of Subsidiary Borrower.

"Overadvance" has the meaning set forth in Section 2.5. "Parent" means FutureLink Corp., a Delaware corporation. "Parent Loan Agreement" means that certain Loan and Security Agreement, dated as of November 16, 2000, among Parent, certain of Parent's Subsidiaries identified on the signature pages thereof, and Lender. "Participant" has the meaning set forth in Section 14.1(d). "Payoff Letter" means a letter, in form and substance satisfactory to Lender, from Existing Lender to Lender respecting the amount necessary to repay in full all of the obligations of Subsidiary Borrower owing to Existing Lender and obtain a release of all of the Liens existing in favor of Existing Lender in and to the assets of Subsidiary Borrower. "Permitted Acquisition" means a Permitted Cash Acquisition or a Permitted Non-Cash Acquisition, as the context requires. "Permitted Cash Acquisition" means any Acquisition as to which each of the following is applicable (a) such Acquisition does not qualify as an Permitted Non-Cash Acquisition solely because the consideration payable in respect of the proposed Acquisition includes some form of consideration other than solely the common Stock of Parent or other Stock of Parent that does not require any current cash payment during the term of this Agreement, (b) after giving effect to the proposed Acquisition, the Borrowers have Domestic Excess Availability and unrestricted cash and Cash Equivalents of not less than $20,000,000, (c) the total value of the cash consideration payable by the Borrowers in connection with the proposed Acquisition does not exceed $2,500,000, and (d) the total value of the cash consideration payable by Borrowers in connection with all Permitted Cash Acquisitions shall not exceed $10,000,000 in any consecutive 12 month period. "Permitted Discretion" means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment. "Permitted Dispositions" means (a) sales or other dispositions by Subsidiary Borrower of Equipment that is substantially worn, damaged, or obsolete in the ordinary course of Subsidiary Borrower's business, (b) sales by Subsidiary Borrower of Inventory to buyers in the ordinary course of business, (c) the use or transfer of money or Cash Equivalents by Subsidiary Borrower in a manner that is not prohibited by the terms of this Agreement or the other Subsidiary Loan Documents, and (d) the licensing by Subsidiary Borrower, on a non-exclusive basis, of patents, trademarks, and other intellectual property rights in the ordinary course of Subsidiary Borrower's business. "Permitted Investments" means (a) Investments in Cash Equivalents, (b) Investments in negotiable instruments for collection, and (c) advances made in connection with purchases of goods or services in the ordinary course of business. -16-

"Permitted Liens" means (a) Liens held by Lender, (b) Liens for unpaid taxes that either (i) are not yet delinquent, or (ii) do not constitute an Event of Default hereunder and are the subject of Permitted Protests, (c) Liens set forth on Schedule P-1, (d) the interests of lessors under operating leases, (e) purchase money Liens or the interests of lessors under Capital Leases to the extent that such Liens or interests secure Permitted Purchase Money Indebtedness and so long as such Lien attaches only to the asset purchased or acquired and the proceeds thereof, (f) Liens arising by operation of law in favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or suppliers, incurred in the ordinary course of Subsidiary Borrower's business and not in connection with the borrowing of money, and which Liens either (i) are for sums not yet delinquent, or (ii) are the subject of Permitted Protests, (g) Liens arising from deposits made in connection with obtaining worker's compensation or other unemployment insurance, (h) Liens or deposits to secure performance of bids, tenders, or leases incurred in the ordinary course of Subsidiary Borrower's business and not in connection with the borrowing of money, (i) Liens granted as security for surety or appeal bonds in connection with obtaining such bonds in the ordinary course of Subsidiary Borrower's business, (j) Liens resulting from any judgment or award

"Permitted Liens" means (a) Liens held by Lender, (b) Liens for unpaid taxes that either (i) are not yet delinquent, or (ii) do not constitute an Event of Default hereunder and are the subject of Permitted Protests, (c) Liens set forth on Schedule P-1, (d) the interests of lessors under operating leases, (e) purchase money Liens or the interests of lessors under Capital Leases to the extent that such Liens or interests secure Permitted Purchase Money Indebtedness and so long as such Lien attaches only to the asset purchased or acquired and the proceeds thereof, (f) Liens arising by operation of law in favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or suppliers, incurred in the ordinary course of Subsidiary Borrower's business and not in connection with the borrowing of money, and which Liens either (i) are for sums not yet delinquent, or (ii) are the subject of Permitted Protests, (g) Liens arising from deposits made in connection with obtaining worker's compensation or other unemployment insurance, (h) Liens or deposits to secure performance of bids, tenders, or leases incurred in the ordinary course of Subsidiary Borrower's business and not in connection with the borrowing of money, (i) Liens granted as security for surety or appeal bonds in connection with obtaining such bonds in the ordinary course of Subsidiary Borrower's business, (j) Liens resulting from any judgment or award that is not an Event of Default hereunder, and (k) with respect to any Real Property, easements, rights of way, and zoning restrictions that do not materially interfere with or impair the use or operation thereof by Subsidiary Borrower. "Permitted Non-Cash Acquisition" means an Acquisition so long as: (a) no Default or Event of Default shall have occurred and be continuing or would result from the consummation of the proposed Acquisition, (b) the assets being acquired, or the Person whose Stock is being acquired, are useful in or engaged in, as applicable, the business of Parent and its Subsidiaries or a business reasonably related thereto, (c) the consideration payable in respect of the proposed Acquisition shall be composed solely of common Stock of Parent or other Stock of Parent that does not require any current cash payment during the term of this Agreement (other than a permitted cash payment made pursuant to clause (e) of the definition of Permitted Investments set forth in the Parent Loan Agreement), (d) in the case of (i) a Stock Acquisition of a Person that will not be a CFC or (ii) an asset Acquisition by Parent or any of its Subsidiaries, Parent has provided Lender with written confirmation, supported by reasonably detailed calculations, that on a pro forma basis, created by adding the historical combined financial statements of Parent (including the combined financial statements of any other Person or assets that were the subject of a prior Permitted Acquisition during the relevant period) to the historical consolidated financial statements of the Person to be acquired (or the historical financial statements related to the assets to be acquired) pursuant to the proposed Acquisition (adjusted to eliminate expense items that would not have been incurred and include income items that would have been recognized, in each case, if the combination had been accomplished at the beginning of the -17-

relevant period; such eliminations and inclusions to be mutually agreed upon by Parent and Lender), Borrowers would have been in compliance with each of the financial covenants in Section 7.20 hereof for the 12 months ending as of the fiscal quarter ended immediately prior to the proposed date of consummation of such proposed Acquisition for which there are available financial statements, (e) in the case of (i) a Stock Acquisition of a Person that will not be a CFC, or (ii) an asset Acquisition by Parent or any of its Subsidiaries, Lender has completed its audit, appraisal, and standard due diligence with respect to the assets or Person that is to be the subject of the proposed Acquisition and the results thereof are reasonably satisfactory to Lender, (f) in the case of (i) a Stock Acquisition of a Person that will be a CFC, or (ii) an asset Acquisition by a CFC, Parent has provided to Lender prior written notice thereof not less than 30 days prior to the anticipated closing date of the subject Acquisition together with such documentation that Lender may require demonstrating that after giving effect to the subject Acquisition, the Borrowers and their Subsidiaries (taken as a whole) would not suffer a Material Adverse Change as a result of such proposed Acquisition (and Lender shall have 10 Business Days

relevant period; such eliminations and inclusions to be mutually agreed upon by Parent and Lender), Borrowers would have been in compliance with each of the financial covenants in Section 7.20 hereof for the 12 months ending as of the fiscal quarter ended immediately prior to the proposed date of consummation of such proposed Acquisition for which there are available financial statements, (e) in the case of (i) a Stock Acquisition of a Person that will not be a CFC, or (ii) an asset Acquisition by Parent or any of its Subsidiaries, Lender has completed its audit, appraisal, and standard due diligence with respect to the assets or Person that is to be the subject of the proposed Acquisition and the results thereof are reasonably satisfactory to Lender, (f) in the case of (i) a Stock Acquisition of a Person that will be a CFC, or (ii) an asset Acquisition by a CFC, Parent has provided to Lender prior written notice thereof not less than 30 days prior to the anticipated closing date of the subject Acquisition together with such documentation that Lender may require demonstrating that after giving effect to the subject Acquisition, the Borrowers and their Subsidiaries (taken as a whole) would not suffer a Material Adverse Change as a result of such proposed Acquisition (and Lender shall have 10 Business Days from and after the receipt by Lender of such documentation to notify Parent of its consent to the consummation of the proposed Acquisition and the failure to provide such notification within such period shall be deemed to reflect Lender's consent thereto), (g) in the case of an asset Acquisition by a Person that will not be a CFC, the subject assets are being acquired by one or more of the Borrowers, (h) in the case of a Acquisition of a Person that will not be a CFC, the subject Stock is being acquired in such Acquisition directly by Parent (or NewCo after the Reorganization Transactions), (i) in the case of an asset Acquisition by a Person that will not be a CFC, the relevant Borrower shall have executed and delivered any and all security agreements, UCC-1 financing statements, fixture filings, and other documentation reasonably requested by Lender in order to include the newly acquired assets within the Collateral, (j) in the case of a Stock Acquisition of a Person that will not be a CFC, the Borrowers shall have executed and delivered a supplement to the Stock Pledge Agreement in order to include the Stock being acquired thereunder and shall have delivered to Lender possession of the original Stock certificates respecting all of the issued and outstanding shares of Stock of such acquired Person, together with stock powers with respect thereto endorsed in blank, (k) in the case of a Stock Acquisition of a Person that will not be a CFC, the Borrowers shall have caused such acquired Person to execute and deliver a joinder to this Agreement in order to make such Person a party hereto, together with any and all security agreements, UCC-1 financing statements, fixture filings, and other documentation reasonably -18-

requested by Lender in order to cause such cause acquired Person to be obligated with respect to the Obligations and to include the assets of the acquired Person within the Collateral, and (l) in the case of (i) a Stock Acquisition of a Person that will not be a CFC, or (ii) an asset Acquisition by Parent or any of its Subsidiaries, the agreements, instruments, and other documents executed in connection with the proposed Acquisition provide that (A) neither any Borrower nor any of their respective Subsidiaries shall, in connection with the proposed Acquisition, assume or remain liable in respect of any Indebtedness of the sellers, or other obligations of the sellers (except for obligations incurred in the ordinary course of business in operating the property so acquired and necessary and desirable to the continued operation of such property), and (B) all property so acquired in connection with the proposed Acquisition shall be free and clear of any and all Liens, except for Permitted Liens (and, if any such property is subject to any Lien not permitted by this clause (B) then, concurrently with the proposed Acquisition such Lien is released). "Permitted Protest" means the right of Subsidiary Borrower to protest any Lien (other than any such Lien that

requested by Lender in order to cause such cause acquired Person to be obligated with respect to the Obligations and to include the assets of the acquired Person within the Collateral, and (l) in the case of (i) a Stock Acquisition of a Person that will not be a CFC, or (ii) an asset Acquisition by Parent or any of its Subsidiaries, the agreements, instruments, and other documents executed in connection with the proposed Acquisition provide that (A) neither any Borrower nor any of their respective Subsidiaries shall, in connection with the proposed Acquisition, assume or remain liable in respect of any Indebtedness of the sellers, or other obligations of the sellers (except for obligations incurred in the ordinary course of business in operating the property so acquired and necessary and desirable to the continued operation of such property), and (B) all property so acquired in connection with the proposed Acquisition shall be free and clear of any and all Liens, except for Permitted Liens (and, if any such property is subject to any Lien not permitted by this clause (B) then, concurrently with the proposed Acquisition such Lien is released). "Permitted Protest" means the right of Subsidiary Borrower to protest any Lien (other than any such Lien that secures the Obligations), taxes (other than payroll taxes or taxes that are the subject of a United States federal tax lien), or rental payment, provided that (a) a reserve with respect to such obligation is established on the Books in such amount as is required under GAAP, (b) any such protest is instituted promptly and prosecuted diligently by Subsidiary Borrower in good faith, and (c) Lender is satisfied that, while any such protest is pending, there will be no impairment of the enforceability, validity, or priority of any of the Lender's Liens. "Permitted Purchase Money Indebtedness" means, so long as no Event of Default has occurred and is continuing or would result therefrom, Purchase Money Indebtedness incurred by Subsidiary Borrower in an amount not to exceed $250,000 during any fiscal year. "Person" means natural persons, corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships, joint ventures, trusts, land trusts, business trusts, or other organizations, irrespective of whether they are legal entities, and governments and agencies and political subdivisions thereof. "Personal Property Collateral" means all Collateral other than Real Property. "Purchase Money Indebtedness" means Indebtedness (other than the Obligations, but including Capitalized Lease Obligations), incurred at the time of, or within 20 days after, the acquisition of any fixed assets for the purpose of financing all or any part of the acquisition cost thereof. "Qualified Cash Amount" means, as of any date of determination, the amount of cash and Cash Equivalents of Parent and its Subsidiaries that is on deposit with banks, or in Securities Accounts with securities intermediaries, or any combination thereof and which such deposit account or Securities Account, in the case of any deposit account or Securities -19-

Account maintained by a branch office located within the United States of any bank or securities intermediary, is subject to a Control Agreement. "Real Property" means any estates or interests in real property now owned or hereafter acquired by Subsidiary Borrower and the improvements thereto. "Record" means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. "Remedial Action" means all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (d) conduct any other actions authorized by 42 USC Section 9601 or any equivalent foreign legislation.

Account maintained by a branch office located within the United States of any bank or securities intermediary, is subject to a Control Agreement. "Real Property" means any estates or interests in real property now owned or hereafter acquired by Subsidiary Borrower and the improvements thereto. "Record" means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form. "Remedial Action" means all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (d) conduct any other actions authorized by 42 USC Section 9601 or any equivalent foreign legislation. "Renewal Date" has the meaning set forth in Section 3.4. "SEC" means the United States Securities and Exchange Commission and any successor thereto. "Securities Account" means a "securities account" as that term is defined in the Code. "Security Agreement" means a security agreement executed and delivered by the Borrowers in favor of Lender, in form and substance satisfactory to Lender. "Specified Country" means the United States of America, the United Kingdom, the Republic of Ireland, or such other countries as Lender may determine from time to time. "Specified Currency" means Dollars or the lawful money of the United Kingdom. "Stock" means all shares, options, warrants, interests, participations, or other equivalents (regardless of how designated) of or in a Person, whether voting or nonvoting, including ordinary shares, preference shares, common stock, preferred stock, or any other "equity security" (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC under the Exchange Act). "Stock Acquisition" means an Acquisition by Parent or its Subsidiaries of all of the Stock of any Person. "Stock Pledge Agreement" means that certain Stock Pledge Agreement, dated as of November 16, 2000, among the Borrowers and Lender. -20-

"Subsidiary" of a Person means a corporation, partnership, limited liability company, or other entity in which that Person directly or indirectly owns or controls the shares of Stock having ordinary voting power to elect a majority of the board of directors (or appoint other comparable managers) of such corporation, partnership, limited liability company, or other entity; provided, however, that references herein to Parent and its Subsidiaries, to Borrowers and their Subsidiaries, or other similar expressions shall not include any CFCs acquired, directly or indirectly, by Parent after the Closing Date; it being understood that UK Holding Company, Subsidiary Borrower, and each of the Canadian Obligors shall be included in such references. "Subsidiary Borrower" has the meaning set forth in the preamble to this Agreement. "Subsidiary Borrower Advances" has the meaning set forth in Section 2.1. "Subsidiary Borrower Borrowing Base" has the meaning set forth in Section 2.1.

"Subsidiary" of a Person means a corporation, partnership, limited liability company, or other entity in which that Person directly or indirectly owns or controls the shares of Stock having ordinary voting power to elect a majority of the board of directors (or appoint other comparable managers) of such corporation, partnership, limited liability company, or other entity; provided, however, that references herein to Parent and its Subsidiaries, to Borrowers and their Subsidiaries, or other similar expressions shall not include any CFCs acquired, directly or indirectly, by Parent after the Closing Date; it being understood that UK Holding Company, Subsidiary Borrower, and each of the Canadian Obligors shall be included in such references. "Subsidiary Borrower" has the meaning set forth in the preamble to this Agreement. "Subsidiary Borrower Advances" has the meaning set forth in Section 2.1. "Subsidiary Borrower Borrowing Base" has the meaning set forth in Section 2.1. "Subsidiary Borrower Borrowing Base Certificate" means a certificate in the form of Exhibit S-1. "Subsidiary Loan Documents" means this Agreement, the Payoff Letter, the Cash Management Agreements, the Control Agreements, the Security Agreement, the Canadian Security Documents, the UK Debenture, the UK Guaranty, the UK Stock Pledge Agreement (Parent), any other UK Security Documents, any note or notes executed by Subsidiary Borrower in connection with this Agreement and payable to Lender, and any other agreement entered into, now or in the future, by Subsidiary Borrower and Lender in connection with this Agreement. "Subsidiary Borrower Revolver Usage" means, as of any date of determination, the sum of (a) the then extant amount of outstanding Subsidiary Borrower Advances, plus (b) the then extant amount of the Letter of Credit Usage. "Taxes" has the meaning set forth in Section 16.5. "Triggering Event" means either (a) the occurrence and continuation of an Event of Default, or (b) the failure of Parent and its Subsidiaries to maintain (i) an average Qualified Cash Amount for each of the days in any month greater than $10,000,000, or (ii) a Qualified Cash Amount greater than $10,000,000 on the last Business Day of any month. "UK Debenture" means the fixed and floating charge debenture, executed and delivered by Subsidiary Borrower and UK Holding Company in favor of Lender, in form and substance satisfactory to Lender. -21-

"UK Guaranty" means a Guaranty executed and delivered by UK Holding Company and the Borrowers of the Indebtedness of Subsidiary Borrower owing under the Subsidiary Loan Documents, in form and substance satisfactory to Lender. "UK Holding Company" means KNS Holdings Limited, a company organized under the laws of England and Wales. "UK Stock Pledge Agreement (Parent)" means a share charge, in form and substance satisfactory to Lender, executed and delivered by Parent with respect to 65% of the shares of UK Holding Company. Underlying Issuer" means a third Person which is the beneficiary of an L/C Undertaking and which has issued a letter of credit at the request of Lender for the benefit of Borrowers. "Underlying Letter of Credit" means a letter of credit that has been issued by an Underlying Issuer. "Voidable Transfer" has the meaning set forth in Section 16.8.

"UK Guaranty" means a Guaranty executed and delivered by UK Holding Company and the Borrowers of the Indebtedness of Subsidiary Borrower owing under the Subsidiary Loan Documents, in form and substance satisfactory to Lender. "UK Holding Company" means KNS Holdings Limited, a company organized under the laws of England and Wales. "UK Stock Pledge Agreement (Parent)" means a share charge, in form and substance satisfactory to Lender, executed and delivered by Parent with respect to 65% of the shares of UK Holding Company. Underlying Issuer" means a third Person which is the beneficiary of an L/C Undertaking and which has issued a letter of credit at the request of Lender for the benefit of Borrowers. "Underlying Letter of Credit" means a letter of credit that has been issued by an Underlying Issuer. "Voidable Transfer" has the meaning set forth in Section 16.8. "Wells Fargo" means Wells Fargo Bank, National Association, a national banking association. 1.2 ACCOUNTING TERMS. All accounting terms not specifically defined herein shall be construed in accordance with GAAP. When used herein, the term "financial statements" shall include the notes and schedules thereto. 1.3 CODE. Any terms used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein. 1.4 CONSTRUCTION. Unless the context of this Agreement or any other Loan Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term "including" is not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement or any other Subsidiary Loan Document refer to this Agreement or such other Subsidiary Loan Document, as the case may be, as a whole and not to any particular provision of this Agreement or such other Subsidiary Loan Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement or in the other Subsidiary Loan Documents to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person's successors and assigns. Any requirement -22-

of a writing contained herein or in the other Subsidiary Loan Documents shall be satisfied by the transmission of a Record and any Record transmitted shall constitute a representation and warranty as to the accuracy and completeness of the information contained therein. 1.5 SCHEDULES AND EXHIBITS. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference. 2. LOAN AND TERMS OF PAYMENT. 2.1 REVOLVER ADVANCES. (a) Subject to the terms and conditions of this Agreement, and during the term of this Agreement, Lender agrees to make advances ("Subsidiary Borrower Advances") to Subsidiary Borrower in an amount at any one time outstanding not to exceed an amount equal to the lesser of (i) the then extant Maximum Subsidiary Revolver Amount less the Letter of Credit Usage, or (ii) the Subsidiary Borrower Borrowing Base less the Letter of Credit

of a writing contained herein or in the other Subsidiary Loan Documents shall be satisfied by the transmission of a Record and any Record transmitted shall constitute a representation and warranty as to the accuracy and completeness of the information contained therein. 1.5 SCHEDULES AND EXHIBITS. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference. 2. LOAN AND TERMS OF PAYMENT. 2.1 REVOLVER ADVANCES. (a) Subject to the terms and conditions of this Agreement, and during the term of this Agreement, Lender agrees to make advances ("Subsidiary Borrower Advances") to Subsidiary Borrower in an amount at any one time outstanding not to exceed an amount equal to the lesser of (i) the then extant Maximum Subsidiary Revolver Amount less the Letter of Credit Usage, or (ii) the Subsidiary Borrower Borrowing Base less the Letter of Credit Usage. For purposes of this Agreement, "Subsidiary Borrower Borrowing Base," as of any date of determination, shall mean the result of: (y) the lesser of (i) the sum of (A) 85% of the amount of Eligible UK Accounts; provided, however, that the amount of Eligible UK Accounts owing by all Account Debtors located in the Republic of Ireland shall not exceed $250,000, less the amount, if any, of the Dilution Reserve, plus (B) the lesser of (1) 85% of the amount of Eligible ASP Accounts, less the amount, if any, of the ASP Dilution Reserve, and, (2) $500,000, and (ii) an amount equal to Subsidiary Borrower's Collections with respect to Accounts for the immediately preceding 45 day period, minus (z) the aggregate amount of reserves, if any, established by Lender under Section 2.1(b). (b) Anything to the contrary in this Section 2.1 notwithstanding, Lender shall have the right to establish reserves in such amounts, and with respect to such matters, as Lender in its Permitted Discretion shall deem necessary or appropriate, against the -23-

Subsidiary Borrower Borrowing Base, including reserves with respect to (i) sums that Subsidiary Borrower is required to pay (such as taxes, assessments, insurance premiums, or, in the case of leased assets, rents or other amounts payable under such leases) and has failed to pay under any Section of this Agreement or any other Subsidiary Loan Document, (ii) amounts owing by Subsidiary Borrower to any Person to the extent secured by a Lien on, or trust over, any of the Collateral (other than any existing Permitted Lien set forth on Schedule P-1 which is specifically identified thereon as entitled to have priority over the Lender's Liens), which Lien or trust, in the Permitted Discretion of Lender likely would have a priority superior to the Lender's Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or other taxes where given priority under applicable law) in and to such item of the Collateral, (iii) one (1) months rent for each leased location of Subsidiary Borrower for which an acceptable Collateral Access Agreement has not been received by Lender (irrespective of whether any rent is currently due), (iv) the Foreign Exchange Reserve, (v) the Customer Deposit Reserve, and (vi) interest that has accrued on the Obligations during the Interim Period (as defined in Section 2.6(d) hereof) but has not yet been paid.

Subsidiary Borrower Borrowing Base, including reserves with respect to (i) sums that Subsidiary Borrower is required to pay (such as taxes, assessments, insurance premiums, or, in the case of leased assets, rents or other amounts payable under such leases) and has failed to pay under any Section of this Agreement or any other Subsidiary Loan Document, (ii) amounts owing by Subsidiary Borrower to any Person to the extent secured by a Lien on, or trust over, any of the Collateral (other than any existing Permitted Lien set forth on Schedule P-1 which is specifically identified thereon as entitled to have priority over the Lender's Liens), which Lien or trust, in the Permitted Discretion of Lender likely would have a priority superior to the Lender's Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or other taxes where given priority under applicable law) in and to such item of the Collateral, (iii) one (1) months rent for each leased location of Subsidiary Borrower for which an acceptable Collateral Access Agreement has not been received by Lender (irrespective of whether any rent is currently due), (iv) the Foreign Exchange Reserve, (v) the Customer Deposit Reserve, and (vi) interest that has accrued on the Obligations during the Interim Period (as defined in Section 2.6(d) hereof) but has not yet been paid. (c) Lender shall have no obligation to make additional Subsidiary Borrower Advances hereunder to the extent such additional Subsidiary Borrower Advances would cause the Subsidiary Borrower Revolver Usage to exceed the then extant Maximum Subsidiary Revolver Amount. (d) Amounts borrowed pursuant to this Section may be repaid and, subject to the terms and conditions of this Agreement, reborrowed at any time during the term of this Agreement. 2.2 [INTENTIONALLY OMITTED] 2.3 BORROWING PROCEDURES AND SETTLEMENTS. (a) PROCEDURE FOR BORROWING. Each Borrowing shall be made by a written request by an Authorized Person delivered to Lender (which notice must be received by Lender no later than 10:00 a.m. (California time) on the Business Day that is the requested Funding Date specifying (i) the amount of such Borrowing, and (ii) the requested Funding Date, which shall be a Business Day. At Lender's election, in lieu of delivering the abovedescribed request in writing, any Authorized Person may give Lender telephonic notice of such request by the required time, with such telephonic notice to be confirmed in writing within 24 hours of the giving of such notice. (b) MAKING OF SUBSIDIARY BORROWER ADVANCES. If Lender has received a timely request for a Borrowing in accordance with the provisions hereof, and subject to the satisfaction of the applicable terms and conditions set forth herein, Lender shall make the proceeds of such Subsidiary Borrower Advance available to Subsidiary Borrower -24-

on the applicable Funding Date by transferring available funds equal to such proceeds to Subsidiary Borrower's Designated Account. 2.4 PAYMENTS. (a) PAYMENTS BY SUBSIDIARY BORROWER. (i) Except as otherwise expressly provided herein, all payments by Subsidiary Borrower shall be made to Lender's Account and shall be made in Dollars and in immediately available funds, no later than 11:00 a.m. (California time) on the date specified herein. Any payment received by Lender later than 11:00 a.m. (California time), shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day. (b) APPLICATION, AND REVERSAL OF PAYMENTS. (i) All payments shall be remitted to Lender and all such payments (other than payments received while no Default or Event of Default has occurred and is continuing and which relate to the payment of principal or interest of specific Obligations or which relate to the payment of specific fees), and all proceeds of Accounts or other

on the applicable Funding Date by transferring available funds equal to such proceeds to Subsidiary Borrower's Designated Account. 2.4 PAYMENTS. (a) PAYMENTS BY SUBSIDIARY BORROWER. (i) Except as otherwise expressly provided herein, all payments by Subsidiary Borrower shall be made to Lender's Account and shall be made in Dollars and in immediately available funds, no later than 11:00 a.m. (California time) on the date specified herein. Any payment received by Lender later than 11:00 a.m. (California time), shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day. (b) APPLICATION, AND REVERSAL OF PAYMENTS. (i) All payments shall be remitted to Lender and all such payments (other than payments received while no Default or Event of Default has occurred and is continuing and which relate to the payment of principal or interest of specific Obligations or which relate to the payment of specific fees), and all proceeds of Accounts or other Collateral received by Lender, shall be applied as follows: A. first, to pay any Lender Expenses then due to Lender under the Subsidiary Loan Documents, until paid in full, B. second, to pay any fees then due to Lender under the Subsidiary Loan Documents until paid in full, C. third, ratably to pay interest due in respect of Subsidiary Borrower Advances until paid in full, D. fourth, to pay the principal of all Subsidiary Borrower Advances until paid in full, E. fifth, if an Event of Default has occurred and is continuing, to be held by Lender as cash collateral in an amount up to 105% of the then extant Letter of Credit Usage until paid in full, F. sixth, to pay any other Obligations until paid in full, and G. seventh, to Subsidiary Borrower (to be wired to the Designated Account) or such other Person entitled thereto under applicable law. (ii) In each instance, so long as no Default or Event of Default has occurred and is continuing, Section 2.4(b) shall not be deemed to apply to any -25-

payment by Subsidiary Borrower specified by Subsidiary Borrower to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement. (iii) For purposes of the foregoing, "paid in full" means payment of all amounts owing under the Subsidiary Loan Documents according to the terms thereof, including loan fees, service fees, professional fees, interest (and specifically including interest accrued after the commencement of any Insolvency Proceeding), default interest, interest on interest, and expense reimbursements, whether or not the same would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding. (iv) In the event of a direct conflict between the priority provisions of this Section 2.4 and other provisions contained in any other Subsidiary Loan Document, it is the intention of the parties hereto that such priority provisions in such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.4 shall control and govern. 2.5 OVERADVANCES. If, at any time or for any reason, the amount of Obligations owed by Subsidiary Borrower to Lender pursuant to Sections 2.1 and 2.12 is greater than either the Dollar or percentage limitations

payment by Subsidiary Borrower specified by Subsidiary Borrower to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement. (iii) For purposes of the foregoing, "paid in full" means payment of all amounts owing under the Subsidiary Loan Documents according to the terms thereof, including loan fees, service fees, professional fees, interest (and specifically including interest accrued after the commencement of any Insolvency Proceeding), default interest, interest on interest, and expense reimbursements, whether or not the same would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding. (iv) In the event of a direct conflict between the priority provisions of this Section 2.4 and other provisions contained in any other Subsidiary Loan Document, it is the intention of the parties hereto that such priority provisions in such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.4 shall control and govern. 2.5 OVERADVANCES. If, at any time or for any reason, the amount of Obligations owed by Subsidiary Borrower to Lender pursuant to Sections 2.1 and 2.12 is greater than either the Dollar or percentage limitations set forth in Sections 2.1 or 2.12, (an "Overadvance"), Subsidiary Borrower immediately shall pay to Lender, in cash, the amount of such excess, which amount shall be used by Lender to reduce the Obligations in accordance with the priorities set forth in Section 2.4(b). In addition, Subsidiary Borrower hereby promises to pay the Obligations (including principal, interest, fees, costs, and expenses) in Dollars in full to Lender as and when due and payable under the terms of this Agreement and the other Subsidiary Loan Documents. 2.6 INTEREST RATES AND LETTER OF CREDIT FEE: RATES, PAYMENTS, AND CALCULATIONS. (a) INTEREST RATES. Except as provided in clause (c) below, all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to the Base Rate plus the Base Rate Margin. The foregoing notwithstanding, at no time shall any portion of the Obligations bear interest on the Daily Balance thereof at a per annum rate less than 8%. To the extent that interest accrued hereunder at the rate set forth herein would be less than the foregoing minimum daily rate, the interest rate chargeable hereunder for such day automatically shall be deemed increased to the minimum rate. (b) LETTER OF CREDIT FEE. Subsidiary Borrower shall pay Lender a Letter of Credit fee (in addition to the charges, commissions, fees, and costs set forth in -26-

Section 2.12(e)) which shall accrue at a rate equal to 1.25% per annum times the Daily Balance of the undrawn amount of all outstanding Letters of Credit. (c) DEFAULT RATE. Upon the occurrence and during the continuation of an Event of Default, (i) all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to 4 percentage points above the per annum rate otherwise applicable hereunder, and (ii) the Letter of Credit fee provided for above shall be increased to 4 percentage points above the per annum rate otherwise applicable hereunder. (d) PAYMENT. Interest, Letter of Credit fees, and all other fees payable hereunder shall be due and payable, in arrears, on the first day of each month at any time that Obligations or obligation to extend credit hereunder are outstanding. Subsidiary Borrower hereby authorizes Lender, from time to time, without prior notice to Subsidiary Borrower, to charge such interest and fees, all Lender Expenses (as and when incurred), the charges, commissions, fees, and costs provided for in Section 2.12(e) (as and when accrued or incurred), the fees and

Section 2.12(e)) which shall accrue at a rate equal to 1.25% per annum times the Daily Balance of the undrawn amount of all outstanding Letters of Credit. (c) DEFAULT RATE. Upon the occurrence and during the continuation of an Event of Default, (i) all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to 4 percentage points above the per annum rate otherwise applicable hereunder, and (ii) the Letter of Credit fee provided for above shall be increased to 4 percentage points above the per annum rate otherwise applicable hereunder. (d) PAYMENT. Interest, Letter of Credit fees, and all other fees payable hereunder shall be due and payable, in arrears, on the first day of each month at any time that Obligations or obligation to extend credit hereunder are outstanding. Subsidiary Borrower hereby authorizes Lender, from time to time, without prior notice to Subsidiary Borrower, to charge such interest and fees, all Lender Expenses (as and when incurred), the charges, commissions, fees, and costs provided for in Section 2.12(e) (as and when accrued or incurred), the fees and costs provided for in Section 2.11 (as and when accrued or incurred), and all other payments as and when due and payable under any Subsidiary Loan Document to Subsidiary Borrower's Loan Account, which amounts thereafter constitute Subsidiary Borrower Advances hereunder and shall accrue interest at the rate then applicable to Subsidiary Borrower Advances hereunder. Any interest not paid when due shall be compounded by being charged to Subsidiary Borrower's Loan Account and shall thereafter constitute Subsidiary Borrower Advances hereunder and shall accrue interest at the rate then applicable to Subsidiary Borrower Advances hereunder. Anything contained in this Section 2.6(d) to the contrary notwithstanding, interest accruing on the Obligations solely for the period (the "Interim Period") commencing on the Closing Date through May 1, 2001 (the "First Interest Payment Date") shall be paid on the First Interest Payment Date; provided, however, that nothing herein shall be deemed to mean that interest shall not accrue on the Obligations during the Interim Period. All interest accruing on the Obligations from and after the First Interest Payment Date shall be due and payable in accordance with the first sentence of this Section 2.6(d). (e) COMPUTATION. All interest and fees chargeable under the Subsidiary Loan Documents shall be computed on the basis of a 360 day year for the actual number of days elapsed. In the event the Base Rate is changed from time to time hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately shall be increased or decreased by an amount equal to such change in the Base Rate. (f) INTENT TO LIMIT CHARGES TO MAXIMUM LAWFUL RATE. In no event shall the interest rate or rates payable under this Agreement, plus any other amounts paid in -27-

connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Subsidiary Borrower and Lender, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided, however, that, anything contained herein to the contrary notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto, as of the date of this Agreement, Subsidiary Borrower is and shall be liable only for the payment of such maximum as allowed by law, and payment received from Subsidiary Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess. 2.7 CASH MANAGEMENT. (a) Subsidiary Borrower shall (i) continue to maintain cash management services of a type and on terms satisfactory to Lender at one or more of the banks set forth on Schedule 2.7(a) (each, a "Cash Management Bank"), and shall request in writing and otherwise take such reasonable steps to ensure that all of its Account Debtors forward payment of the amounts owed by them directly to such Cash Management Bank, and (ii) deposit or cause to be deposited promptly, and in any event no later than the first Business Day after the date of

connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Subsidiary Borrower and Lender, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided, however, that, anything contained herein to the contrary notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto, as of the date of this Agreement, Subsidiary Borrower is and shall be liable only for the payment of such maximum as allowed by law, and payment received from Subsidiary Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess. 2.7 CASH MANAGEMENT. (a) Subsidiary Borrower shall (i) continue to maintain cash management services of a type and on terms satisfactory to Lender at one or more of the banks set forth on Schedule 2.7(a) (each, a "Cash Management Bank"), and shall request in writing and otherwise take such reasonable steps to ensure that all of its Account Debtors forward payment of the amounts owed by them directly to such Cash Management Bank, and (ii) deposit or cause to be deposited promptly, and in any event no later than the first Business Day after the date of receipt thereof, all Collections (including those sent directly by Account Debtors to a Cash Management Bank) into a bank account in Lender's name (a "Cash Management Account") at one of the Cash Management Banks. (b) Each Cash Management Bank shall establish and maintain Cash Management Agreements with Lender and Subsidiary Borrower, in form and substance acceptable to Lender. Each such Cash Management Agreement shall provide, among other things, that (i) all items of payment deposited in such Cash Management Account and proceeds thereof are held by such Cash Management Bank on behalf of Lender or bailee-in-possession for Lender, (ii) the Cash Management Bank has no rights of setoff or recoupment or any other claim against the applicable Cash Management Account, other than for payment of its service fees and other charges directly related to the administration of such Cash Management Account and for returned checks or other items of payment, and (iii) from and after the receipt by the applicable Cash Management Bank of a notice that a Triggering Event has occurred, it immediately will forward in Dollars by daily sweep all amounts in the applicable Cash Management Account to the Lender's Account. (c) So long as no Default or Event of Default has occurred and is continuing, Subsidiary Borrower may amend Schedule 2.7(a) to add or replace a Cash Management Bank or Cash Management Account; provided, however, that (i) such prospective Cash Management Bank shall be satisfactory to Lender and Lender shall have consented in writing in advance to the opening of such Cash Management Account with the prospective Cash Management Bank, and (ii) prior to the time of the opening of such Cash Management Account, Subsidiary Borrower and such prospective Cash Management Bank shall have executed and delivered to Lender a Cash Management Agreement. Subsidiary Borrower shall close any of its Cash Management Accounts (and establish replacement cash -28-

management accounts in accordance with the foregoing sentence) promptly and in any event within 30 days of notice from Lender that the creditworthiness of any Cash Management Bank is no longer acceptable in Lender's reasonable judgment, or as promptly as practicable and in any event within 60 days of notice from Lender that the operating performance, funds transfer, or availability procedures or performance of the Cash Management Bank with respect to Cash Management Accounts or Lender's liability under any Cash Management Agreement with such Cash Management Bank is no longer acceptable in Lender's reasonable judgment. (d) The Cash Management Accounts shall be cash collateral accounts, with all cash, checks and similar items of payment in such accounts securing payment of the Obligations. 2.8 CREDITING PAYMENTS; FLOAT CHARGE. The receipt of any payment item by Lender (whether from transfers to Lender by the Cash Management Banks pursuant to the Cash Management Agreements or otherwise) shall not be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to the Lender's Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then Subsidiary Borrower shall be deemed not to have made such payment and interest shall be calculated

management accounts in accordance with the foregoing sentence) promptly and in any event within 30 days of notice from Lender that the creditworthiness of any Cash Management Bank is no longer acceptable in Lender's reasonable judgment, or as promptly as practicable and in any event within 60 days of notice from Lender that the operating performance, funds transfer, or availability procedures or performance of the Cash Management Bank with respect to Cash Management Accounts or Lender's liability under any Cash Management Agreement with such Cash Management Bank is no longer acceptable in Lender's reasonable judgment. (d) The Cash Management Accounts shall be cash collateral accounts, with all cash, checks and similar items of payment in such accounts securing payment of the Obligations. 2.8 CREDITING PAYMENTS; FLOAT CHARGE. The receipt of any payment item by Lender (whether from transfers to Lender by the Cash Management Banks pursuant to the Cash Management Agreements or otherwise) shall not be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to the Lender's Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then Subsidiary Borrower shall be deemed not to have made such payment and interest shall be calculated accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be deemed received by Lender only if it is received into the Lender's Account on a Business Day on or before 11:00 a.m. (California time). If any payment item is received into the Lender's Account on a non-Business Day or after 11:00 a.m. (California time) on a Business Day, it shall be deemed to have been received by Lender as of the opening of business on the immediately following Business Day. From and after the Closing Date, Lender shall be entitled to charge Subsidiary Borrower for 1 Business Day of `clearance' or `float' at the rate applicable to Subsidiary Borrower Advances under Section 2.6 on all Collections that are received by Subsidiary Borrower (regardless of whether forwarded by the Cash Management Banks to Lender). This across-the-board 1 Business Day clearance or float charge on all Collections is acknowledged by the parties to constitute an integral aspect of the pricing of the financing of Subsidiary Borrower and shall apply irrespective of whether or not there are any outstanding monetary Obligations; the effect of such clearance or float charge being the equivalent of charging 1 Business Day of interest on such Collections. 2.9 DESIGNATED ACCOUNT. Lender is authorized to make the Subsidiary Borrower Advances and Lender is authorized to issue the Letters of Credit under this Agreement based upon telephonic or other instructions received from anyone purporting to be an Authorized Person, or without instructions if pursuant to Section 2.6(d). Subsidiary Borrower agrees to establish and maintain the Designated Account with the Designated Account Bank for the purpose of receiving the proceeds of the Subsidiary Borrower Advances requested by Subsidiary Borrower and made by Lender hereunder. Unless otherwise agreed by Lender and Subsidiary Borrower, any Subsidiary Borrower Advance requested by Subsidiary Borrower and made by Lender hereunder shall be made to the Designated Account. -29-

2.10 MAINTENANCE OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS. Lender shall maintain an account on its books in the name of Subsidiary Borrower (the "Loan Account") on which Subsidiary Borrower will be charged with all Subsidiary Borrower Advances made by Lender to Subsidiary Borrower or for Subsidiary Borrower's account, the Letters of Credit issued by Lender for Subsidiary Borrower's account, and with all other payment Obligations hereunder or under the other Subsidiary Loan Documents, including, accrued interest, fees and expenses, and Lender Expenses. In accordance with Section 2.8, the Loan Account will be credited with all payments received by Lender from Subsidiary Borrower or for Subsidiary Borrower's account, including all amounts received in the Lender's Account from any Cash Management Bank. Lender shall render statements regarding the Loan Account to Subsidiary Borrower, including principal, interest, fees, and including an itemization of all charges and expenses constituting Lender Expenses owing, and such statements shall be conclusively presumed to be correct and accurate and constitute an account stated between Subsidiary Borrower and Lender unless, within 30 days after receipt thereof by Subsidiary Borrower, Subsidiary Borrower shall deliver to Lender written objection thereto describing the error or errors contained in any such statements. 2.11 FEES. Subsidiary Borrower shall pay to Lender the following fees and charges, which fees and charges shall be non-refundable when paid (irrespective of whether this Agreement is terminated thereafter):

2.10 MAINTENANCE OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS. Lender shall maintain an account on its books in the name of Subsidiary Borrower (the "Loan Account") on which Subsidiary Borrower will be charged with all Subsidiary Borrower Advances made by Lender to Subsidiary Borrower or for Subsidiary Borrower's account, the Letters of Credit issued by Lender for Subsidiary Borrower's account, and with all other payment Obligations hereunder or under the other Subsidiary Loan Documents, including, accrued interest, fees and expenses, and Lender Expenses. In accordance with Section 2.8, the Loan Account will be credited with all payments received by Lender from Subsidiary Borrower or for Subsidiary Borrower's account, including all amounts received in the Lender's Account from any Cash Management Bank. Lender shall render statements regarding the Loan Account to Subsidiary Borrower, including principal, interest, fees, and including an itemization of all charges and expenses constituting Lender Expenses owing, and such statements shall be conclusively presumed to be correct and accurate and constitute an account stated between Subsidiary Borrower and Lender unless, within 30 days after receipt thereof by Subsidiary Borrower, Subsidiary Borrower shall deliver to Lender written objection thereto describing the error or errors contained in any such statements. 2.11 FEES. Subsidiary Borrower shall pay to Lender the following fees and charges, which fees and charges shall be non-refundable when paid (irrespective of whether this Agreement is terminated thereafter): (a) UNUSED LINE FEE. On the first day of each month during the term of this Agreement, an unused line fee in the amount equal to .375% per annum times the result of (a) the then extant Maximum Subsidiary Revolver Amount, less (b) the sum of (i) the average Daily Balance of Subsidiary Borrower Advances that were outstanding during the immediately preceding month, plus (ii) the average Daily Balance of the Letter of Credit Usage during the immediately preceding month, and (b) AUDIT, APPRAISAL, AND VALUATION CHARGES. Audit, appraisal, and valuation fees and charges as follows, (i) a fee of $750 pay day, per auditor, plus out-of-pocket expenses for each financial audit of Subsidiary Borrower performed by personnel employed by Lender, (ii) if implemented, a one time charge of $3,000 plus out-of-pocket expenses for expenses for the establishment of electronic collateral reporting systems, and (iii) the actual charges paid or incurred by Lender if it elects to employ the services of one or more third Persons to perform financial audits of Subsidiary Borrower, to appraise the Collateral, or any portion thereof, or to assess Subsidiary Borrower's business valuation. 2.12 LETTERS OF CREDIT (a) Subject to the terms and conditions of this Agreement, Lender agrees to issue letters of credit for the account of Subsidiary Borrower (each, an "L/C") or to purchase participations or execute indemnities or reimbursement obligations (each such undertaking, an "L/C Undertaking") with respect to letters of credit issued by an Underlying Issuer (as of the Closing Date, the prospective Underlying Issuer is to be Wells Fargo) for the account of Subsidiary Borrower. To request the issuance of an L/C or an L/C Undertaking -30-

(or the amendment, renewal, or extension of an outstanding L/C or L/C Undertaking), Subsidiary Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by Lender) to Lender and Lender (reasonably in advance of the requested date of issuance, amendment, renewal, or extension) a notice requesting the issuance of an L/C or L/C Undertaking, or identifying the L/C or L/C Undertaking to be amended, renewed, or extended, the date of issuance, amendment, renewal, or extension, the date on which such L/C or L/C Undertaking is to expire, the amount of such L/C or L/C Undertaking, the name and address of the beneficiary thereof (or of the Underlying Letter of Credit, as applicable), and such other information as shall be necessary to prepare, amend, renew, or extend such L/C or L/C Undertaking. If requested by Lender, Subsidiary Borrower also shall be an applicant under the application with respect to any Underlying Letter of Credit that is to be the subject of an L/C Undertaking. Lender shall have no obligation to issue a Letter of Credit if any of the following would result after giving effect to the requested Letter of Credit: (i) the Letter of Credit Usage would exceed the Subsidiary Borrower Borrowing Base less the amount of outstanding Subsidiary Borrower Advances, or

(or the amendment, renewal, or extension of an outstanding L/C or L/C Undertaking), Subsidiary Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by Lender) to Lender and Lender (reasonably in advance of the requested date of issuance, amendment, renewal, or extension) a notice requesting the issuance of an L/C or L/C Undertaking, or identifying the L/C or L/C Undertaking to be amended, renewed, or extended, the date of issuance, amendment, renewal, or extension, the date on which such L/C or L/C Undertaking is to expire, the amount of such L/C or L/C Undertaking, the name and address of the beneficiary thereof (or of the Underlying Letter of Credit, as applicable), and such other information as shall be necessary to prepare, amend, renew, or extend such L/C or L/C Undertaking. If requested by Lender, Subsidiary Borrower also shall be an applicant under the application with respect to any Underlying Letter of Credit that is to be the subject of an L/C Undertaking. Lender shall have no obligation to issue a Letter of Credit if any of the following would result after giving effect to the requested Letter of Credit: (i) the Letter of Credit Usage would exceed the Subsidiary Borrower Borrowing Base less the amount of outstanding Subsidiary Borrower Advances, or (ii) the Letter of Credit Usage would exceed $500,000, or (iii) the Letter of Credit Usage would exceed the then extant Maximum Subsidiary Revolver Amount less the then extant amount of outstanding Subsidiary Borrower Advances. (b) Subsidiary Borrower and Lender acknowledge and agree that certain Underlying Letters of Credit may be issued to support letters of credit that already are outstanding as of the Closing Date. Each Letter of Credit (and corresponding Underlying Letter of Credit) shall have an expiry date no later than 30 days prior to the date on which this Agreement is scheduled to terminate under Section 3.4 (without regard to any potential renewal term) and all such Letters of Credit (and corresponding Underlying Letter of Credit) shall be in form and substance acceptable to Lender (in the exercise of its Permitted Discretion), including the requirement that the amounts payable thereunder must be payable in Dollars. If Lender is obligated to advance funds under a Letter of Credit, Subsidiary Borrower immediately shall reimburse such L/C Disbursement to Lender by paying to Lender an amount equal to such L/C Disbursement not later than 11:00 a.m., California time, on the date that such L/C Disbursement is made, if Subsidiary Borrower shall have received written or telephonic notice of such L/C Disbursement prior to 10:00 a.m., California time, on such date, or, if such notice has not been received by Subsidiary Borrower prior to such time on such date, then not later than 11:00 a.m., California time, on (i) the Business Day that Subsidiary Borrower receives such notice, if such notice is received prior to 10:00 a.m., California time, on the date of receipt, and, in the absence of such reimbursement, the L/C Disbursement immediately and automatically shall be deemed to be a Subsidiary Borrower Advance hereunder and, thereafter, shall bear interest at the rate then applicable to Subsidiary Borrower Advances under Section 2.6. To the extent an L/C Disbursement is -31-

deemed to be a Subsidiary Borrower Advance hereunder, Subsidiary Borrower's obligation to reimburse such L/C Disbursement shall be discharged and replaced by the resulting Subsidiary Borrower Advance. (c) Subsidiary Borrower hereby agrees to indemnify, save, defend, and hold Lender harmless from any loss, cost, expense, or liability, and reasonable attorneys fees incurred by Lender arising out of or in connection with any Letter of Credit; provided, however, that Subsidiary Borrower shall be obligated hereunder to indemnify for any loss, cost, expense, or liability that is caused by the gross negligence or willful misconduct of Lender. Subsidiary Borrower agrees to be bound by the Underlying Issuer's regulations and interpretations of any Underlying Letter of Credit or by Lender's interpretations of any L/C issued by Lender to or for Subsidiary Borrower's account, even though this interpretation may be different from Subsidiary Borrower's own, and Subsidiary Borrower understands and agrees that Lender shall not be liable for any error, negligence, or mistake, whether of omission or commission, in following Subsidiary Borrower's instructions or those contained in the Letter of Credit or any modifications, amendments, or supplements thereto; provided, however, that Subsidiary Borrower shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that is caused by the gross negligence or willful misconduct of Lender. Subsidiary Borrower understands that the L/C Undertakings may require Lender to indemnify the Underlying Issuer for certain costs or liabilities arising out of claims by Subsidiary Borrower against

deemed to be a Subsidiary Borrower Advance hereunder, Subsidiary Borrower's obligation to reimburse such L/C Disbursement shall be discharged and replaced by the resulting Subsidiary Borrower Advance. (c) Subsidiary Borrower hereby agrees to indemnify, save, defend, and hold Lender harmless from any loss, cost, expense, or liability, and reasonable attorneys fees incurred by Lender arising out of or in connection with any Letter of Credit; provided, however, that Subsidiary Borrower shall be obligated hereunder to indemnify for any loss, cost, expense, or liability that is caused by the gross negligence or willful misconduct of Lender. Subsidiary Borrower agrees to be bound by the Underlying Issuer's regulations and interpretations of any Underlying Letter of Credit or by Lender's interpretations of any L/C issued by Lender to or for Subsidiary Borrower's account, even though this interpretation may be different from Subsidiary Borrower's own, and Subsidiary Borrower understands and agrees that Lender shall not be liable for any error, negligence, or mistake, whether of omission or commission, in following Subsidiary Borrower's instructions or those contained in the Letter of Credit or any modifications, amendments, or supplements thereto; provided, however, that Subsidiary Borrower shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that is caused by the gross negligence or willful misconduct of Lender. Subsidiary Borrower understands that the L/C Undertakings may require Lender to indemnify the Underlying Issuer for certain costs or liabilities arising out of claims by Subsidiary Borrower against such Underlying Issuer. Subsidiary Borrower hereby agrees to indemnify, save, defend, and hold Lender harmless with respect to any loss, cost, expense (including reasonable attorneys fees), or liability incurred by Lender under any L/C Undertaking as a result of Lender's indemnification of any Underlying Issuer; provided, however, that Subsidiary Borrower shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that is caused by the gross negligence or willful misconduct of Lender. (d) Subsidiary Borrower hereby authorizes and directs any Underlying Issuer to deliver to Lender all instruments, documents, and other writings and property received by such Underlying Issuer pursuant to such Underlying Letter of Credit and to accept and rely upon Lender's instructions with respect to all matters arising in connection with such Underlying Letter of Credit and the related application. (e) Any and all charges, commissions, fees, and costs incurred by Lender relating to Underlying Letters of Credit shall be Lender Expenses for purposes of this Agreement and immediately shall be reimbursable by Subsidiary Borrower to Lender for the account of Lender; it being acknowledged and agreed by Subsidiary Borrower that, as of the Closing Date, the issuance charge imposed by the prospective Underlying Issuer is .35% per annum times the face amount of each Underlying Letter of Credit, that such issuance charge may be changed from time to time, and that the Underlying Issuer also imposes a schedule of charges for amendments, extensions, drawings, and renewals. (f) If by reason of (i) any change in any applicable law, treaty, rule, or regulation or any change in the interpretation or application thereof by any Governmental -32-

Authority, or (ii) compliance by the Underlying Issuer or Lender with any direction, request, or requirement (irrespective of whether having the force of law) of any Governmental Authority or monetary authority including, Regulation D of the Federal Reserve Board as from time to time in effect (and any successor thereto): (i) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued hereunder, or (ii) there shall be imposed on the Underlying Issuer or Lender any other condition regarding any Underlying Letter of Credit or any Letter of Credit issued pursuant hereto; and the result of the foregoing is to increase, directly or indirectly, the cost to Lender of issuing, making, guaranteeing, or maintaining any Letter of Credit or to reduce the amount receivable in respect thereof by Lender, then, and in any such case, Lender may, at any time within a reasonable period after the additional cost is incurred or the amount received is reduced, notify Subsidiary Borrower, and Subsidiary Borrower shall pay on demand such amounts as Lender may specify to be necessary to compensate Lender for such additional cost or reduced receipt, together with interest on such amount from the date of such demand until payment in full thereof at the rate then applicable to Subsidiary Borrower Advances hereunder. The determination by Lender of any

Authority, or (ii) compliance by the Underlying Issuer or Lender with any direction, request, or requirement (irrespective of whether having the force of law) of any Governmental Authority or monetary authority including, Regulation D of the Federal Reserve Board as from time to time in effect (and any successor thereto): (i) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued hereunder, or (ii) there shall be imposed on the Underlying Issuer or Lender any other condition regarding any Underlying Letter of Credit or any Letter of Credit issued pursuant hereto; and the result of the foregoing is to increase, directly or indirectly, the cost to Lender of issuing, making, guaranteeing, or maintaining any Letter of Credit or to reduce the amount receivable in respect thereof by Lender, then, and in any such case, Lender may, at any time within a reasonable period after the additional cost is incurred or the amount received is reduced, notify Subsidiary Borrower, and Subsidiary Borrower shall pay on demand such amounts as Lender may specify to be necessary to compensate Lender for such additional cost or reduced receipt, together with interest on such amount from the date of such demand until payment in full thereof at the rate then applicable to Subsidiary Borrower Advances hereunder. The determination by Lender of any amount due pursuant to this Section, as set forth in a certificate setting forth the calculation thereof in reasonable detail, shall, in the absence of manifest or demonstrable error, be final and conclusive and binding on all of the parties hereto. 2.13 [INTENTIONALLY OMITTED]. 2.14 CAPITAL REQUIREMENTS. If, after the date hereof, Lender determines that (i) the adoption of or change in any law, rule, regulation or guideline regarding capital requirements for banks or bank holding companies, or any change in the interpretation or application thereof by any Governmental Authority charged with the administration thereof, or (ii) compliance by Lender or its parent bank holding company with any guideline, request or directive of any such entity regarding capital adequacy (whether or not having the force of law), the effect of reducing the return on Lender's or such holding company's capital as a consequence of Lender's obligations hereunder to a level below that which Lender or such holding company could have achieved but for such adoption, change, or compliance (taking into consideration Lender's or such holding company's then existing policies with respect to capital adequacy and assuming the full utilization of such entity's capital) by any amount deemed by Lender to be material, then Lender may notify Subsidiary Borrower thereof. Following receipt of such notice, Subsidiary Borrower agrees to pay Lender on demand the amount of such reduction of return of capital as and when such reduction is determined, payable within 90 days after presentation by Lender of a statement in the amount and setting forth in reasonable detail Lender's calculation thereof and the assumptions upon which such calculation was based (which statement shall be deemed true and correct absent manifest -33-

error). In determining such amount, Lender will use any reasonable averaging and attribution method. 3. CONDITIONS; TERM OF AGREEMENT. 3.1 CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT. The obligation of Lender to make the initial Subsidiary Borrower Advance (or otherwise to extend any credit provided for hereunder), is subject to the fulfillment, to the satisfaction of Lender, of each of the conditions precedent set forth below: (a) the Closing Date shall occur on or before December 31, 2000; (b) Lender shall have received all financing statements required by Lender, duly executed by Subsidiary Borrower, and Lender shall have received searches reflecting the filing of all such financing statements; (c) Lender shall have received each of the following documents, in form and substance satisfactory to Lender, duly executed, and each such document shall be in full force and effect: (i) [intentionally omitted],

error). In determining such amount, Lender will use any reasonable averaging and attribution method. 3. CONDITIONS; TERM OF AGREEMENT. 3.1 CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT. The obligation of Lender to make the initial Subsidiary Borrower Advance (or otherwise to extend any credit provided for hereunder), is subject to the fulfillment, to the satisfaction of Lender, of each of the conditions precedent set forth below: (a) the Closing Date shall occur on or before December 31, 2000; (b) Lender shall have received all financing statements required by Lender, duly executed by Subsidiary Borrower, and Lender shall have received searches reflecting the filing of all such financing statements; (c) Lender shall have received each of the following documents, in form and substance satisfactory to Lender, duly executed, and each such document shall be in full force and effect: (i) [intentionally omitted], (ii) the Disbursement Letter, (iii) the Cash Management Agreements, (iv) the Payoff Letter, (v) the UK Debenture, together with all certificates representing the shares of Subsidiary Borrower pledged thereunder, as well as Stock powers with respect thereto endorsed in blank, and other deeds and documents of title required to be deposited thereunder, (vi) the UK Guaranty, (vii) the UK Stock Pledge Agreement (Parent), together with all certificates representing the shares of Stock pledged thereunder, as well as Stock powers with respect thereto endorsed in blank, (viii) the Canadian Security Documents, and (ix) the Security Agreement; (d) [intentionally omitted]; (e) Lender shall have received a certificate from the Secretary of each of Subsidiary Borrower and UK Holding Company attesting to the resolutions of the Board -34-

of Directors of each of Subsidiary Borrower and UK Holding Company authorizing their respective execution, delivery, and performance of this Agreement and the other Subsidiary Loan Documents to which each is a party and authorizing specific officers of each to execute the same, and amending their respective articles of association to disapply any rights of lien, pre-emption rights, or any rights of veto on the transfer of any shares which are the subject of any security granted pursuant to any of the Loan Documents or Subsidiary Loan Documents or enforcement of such security or where the transfer is made at the direction of Lender or a receiver; (f) Lender shall have received copies of Subsidiary Borrower's Governing Documents, as amended, modified, or supplemented to the Closing Date, certified by the Secretary of Subsidiary Borrower; (g) Lender shall have received a certificate of status with respect to Subsidiary Borrower, dated within 30 days of the Closing Date, such certificate to be issued by the registrar of companies, which certificate shall indicate that Subsidiary Borrower is in good standing in such jurisdiction;

of Directors of each of Subsidiary Borrower and UK Holding Company authorizing their respective execution, delivery, and performance of this Agreement and the other Subsidiary Loan Documents to which each is a party and authorizing specific officers of each to execute the same, and amending their respective articles of association to disapply any rights of lien, pre-emption rights, or any rights of veto on the transfer of any shares which are the subject of any security granted pursuant to any of the Loan Documents or Subsidiary Loan Documents or enforcement of such security or where the transfer is made at the direction of Lender or a receiver; (f) Lender shall have received copies of Subsidiary Borrower's Governing Documents, as amended, modified, or supplemented to the Closing Date, certified by the Secretary of Subsidiary Borrower; (g) Lender shall have received a certificate of status with respect to Subsidiary Borrower, dated within 30 days of the Closing Date, such certificate to be issued by the registrar of companies, which certificate shall indicate that Subsidiary Borrower is in good standing in such jurisdiction; (h) Lender shall have received certificates of status with respect to Subsidiary Borrower, each dated within 30 days of the Closing Date, such certificates to be issued by the appropriate officer of the jurisdictions (other than the jurisdiction of organization of Subsidiary Borrower) in which its failure to be duly qualified or licensed would constitute a Material Adverse Change, which certificates shall indicate that Subsidiary Borrower is in good standing in such jurisdictions; (i) Lender shall have received copies of UK Holding Company's Governing Documents, as amended, modified, or supplemented to the Closing Date, certified by the Secretary of UK Holding Company; (j) Lender shall have received a certificate of status with respect to UK Holding Company, dated within 30 days of the Closing Date, such certificate to be issued by the registrar of companies, which certificate shall indicate that UK Holding Company is in good standing in such jurisdiction; (k) Lender shall have received certificates of status with respect to UK Holding Company, each dated within 30 days of the Closing Date, such certificates to be issued by the appropriate officer of the jurisdictions (other than the jurisdiction of organization of UK Holding Company) in which its failure to be duly qualified or licensed would constitute a Material Adverse Change, which certificates shall indicate that UK Holding Company is in good standing in such jurisdictions; (l) Lender shall have received a certificate from the Secretary of each Guarantor attesting to the resolutions of such Guarantor's Board of Directors authorizing its execution, delivery, and performance of each of the Subsidiary Loan Documents to which such Guarantor is a party and authorizing specific officers of such Guarantor to execute the same; -35-

(m) Lender shall have received a certificate from the Secretary of Parent certifying that there have been no amendments, restatements, supplements, or modifications to the Governing Documents of any of the Borrowers since the "Closing Date" (as defined in the Parent Loan Agreement); (n) Lender shall have received a certificate of insurance, together with the endorsements thereto, as are required by Section 6.8, the form and substance of which shall be satisfactory to Lender; (o) Lender shall have received such Collateral Access Agreements with respect to such of Subsidiary Borrower's facilities as Lender may require; (p) Lender shall have received opinions of Subsidiary Borrower's counsel (and, in Lender's sole discretion, Lender's foreign counsel) in form and substance satisfactory to Lender; (q) Lender shall have received satisfactory evidence (including a certificate of a director of Subsidiary Borrower) that all tax returns required to be filed by Subsidiary Borrower have been timely filed and all taxes upon Subsidiary Borrower or its properties, assets, income, and franchises (including Real Property taxes and payroll taxes) have been paid prior to delinquency, except such taxes that are the subject of a Permitted Protest;

(m) Lender shall have received a certificate from the Secretary of Parent certifying that there have been no amendments, restatements, supplements, or modifications to the Governing Documents of any of the Borrowers since the "Closing Date" (as defined in the Parent Loan Agreement); (n) Lender shall have received a certificate of insurance, together with the endorsements thereto, as are required by Section 6.8, the form and substance of which shall be satisfactory to Lender; (o) Lender shall have received such Collateral Access Agreements with respect to such of Subsidiary Borrower's facilities as Lender may require; (p) Lender shall have received opinions of Subsidiary Borrower's counsel (and, in Lender's sole discretion, Lender's foreign counsel) in form and substance satisfactory to Lender; (q) Lender shall have received satisfactory evidence (including a certificate of a director of Subsidiary Borrower) that all tax returns required to be filed by Subsidiary Borrower have been timely filed and all taxes upon Subsidiary Borrower or its properties, assets, income, and franchises (including Real Property taxes and payroll taxes) have been paid prior to delinquency, except such taxes that are the subject of a Permitted Protest; (r) Lender shall have completed its business, legal, and collateral due diligence, including (i) a collateral audit and review of Subsidiary Borrower's books and records and verification of Subsidiary Borrower's representations and warranties to Lender, the results of which shall be satisfactory to Lender, and (ii) an inspection of each of the locations where Inventory is located, the results of which shall be satisfactory to Lender; (s) Subsidiary Borrower shall pay all Lender Expenses incurred in connection with the transactions evidenced by this Agreement; (t) Subsidiary Borrower shall have received all licenses, approvals or evidence of other actions required by any Governmental Authority in connection with the execution and delivery by Subsidiary Borrower of this Agreement or any other Subsidiary Loan Document or with the consummation of the transactions contemplated hereby and thereby; and (u) all other documents and legal matters in connection with the transactions contemplated by this Agreement shall have been delivered, executed, or recorded and shall be in form and substance satisfactory to Lender. 3.2 CONDITIONS SUBSEQUENT TO THE INITIAL EXTENSION OF CREDIT. The obligation of Lender to continue to make Subsidiary Borrower Advances (or otherwise extend credit hereunder) is subject to the fulfillment, on or before the date applicable thereto, of each of -36-

the conditions subsequent set forth below (the failure by Subsidiary Borrower to so perform or cause to be performed constituting an Event of Default): (a) within 30 days of the Closing Date, deliver to Lender certified copies of the policies of insurance, together with the endorsements thereto, as are required by Section 6.8, the form and substance of which shall be satisfactory to Lender and its counsel. 3.3 CONDITIONS PRECEDENT TO ALL EXTENSIONS OF CREDIT. The obligation of Lender to make all Subsidiary Borrower Advances (or to extend any other credit hereunder) shall be subject to the following conditions precedent: (a) the representations and warranties contained in this Agreement and the other Subsidiary Loan Documents shall be true and correct in all material respects on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date); (b) no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit,

the conditions subsequent set forth below (the failure by Subsidiary Borrower to so perform or cause to be performed constituting an Event of Default): (a) within 30 days of the Closing Date, deliver to Lender certified copies of the policies of insurance, together with the endorsements thereto, as are required by Section 6.8, the form and substance of which shall be satisfactory to Lender and its counsel. 3.3 CONDITIONS PRECEDENT TO ALL EXTENSIONS OF CREDIT. The obligation of Lender to make all Subsidiary Borrower Advances (or to extend any other credit hereunder) shall be subject to the following conditions precedent: (a) the representations and warranties contained in this Agreement and the other Subsidiary Loan Documents shall be true and correct in all material respects on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date); (b) no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof, except to the extent such Default or Event of Default has been waived in writing by Lender; (c) no injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the extending of such credit shall have been issued and remain in force by any Governmental Authority against Subsidiary Borrower, Lender, or any of their Affiliates; and (d) no Material Adverse Change shall have occurred. 3.4 TERM. This Agreement shall become effective upon the execution and delivery hereof by Subsidiary Borrower and Lender and shall continue in full force and effect for a term ending on November 16, 2003 (the "Renewal Date") and automatically shall be renewed for successive 1 year periods thereafter, unless sooner terminated pursuant to the terms hereof. Either Subsidiary Borrower or Lender may terminate this Agreement effective on the Renewal Date or on any anniversary of the Renewal Date by giving the other party at least 90 days prior written notice thereof. The foregoing notwithstanding, Lender shall have the right to terminate its obligations under this Agreement immediately and without notice upon the occurrence and during the continuation of an Event of Default. 3.5 EFFECT OF TERMINATION. On the date of termination of this Agreement, all Obligations (including contingent reimbursement obligations of Subsidiary Borrower with respect to any outstanding Letters of Credit) immediately shall become due and payable without notice or demand. No termination of this Agreement, however, shall relieve or discharge Subsidiary Borrower of its duties, Obligations, or covenants hereunder and the Lender's Liens in the Collateral shall remain in effect until all Obligations have been fully and finally discharged and Lender's obligations to provide additional credit hereunder have been terminated. When this Agreement has been terminated and all of the Obligations have -37-

been fully and finally discharged and Lender's obligations to provide additional credit under the Subsidiary Loan Documents have been terminated irrevocably, Lender will, at Subsidiary Borrower's sole expense, execute and deliver any UCC termination statements, lien releases, mortgage releases, re-assignments of trademarks, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, the Lender's Liens and all notices of security interests and liens previously filed by Lender with respect to the Obligations. 3.6 EARLY TERMINATION BY SUBSIDIARY BORROWER. Subsidiary Borrower has the option, at any time upon 90 days prior written notice by Subsidiary Borrower to Lender, to terminate this Agreement by paying to Lender, in cash, the Obligations (including either (i) providing cash collateral to be held by Lender in an amount equal to 105% of the then extant Letter of Credit Usage, or (ii) causing the original Letters of Credit to be returned to Lender). If Subsidiary Borrower has sent a notice of termination pursuant to the provisions of this

been fully and finally discharged and Lender's obligations to provide additional credit under the Subsidiary Loan Documents have been terminated irrevocably, Lender will, at Subsidiary Borrower's sole expense, execute and deliver any UCC termination statements, lien releases, mortgage releases, re-assignments of trademarks, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, the Lender's Liens and all notices of security interests and liens previously filed by Lender with respect to the Obligations. 3.6 EARLY TERMINATION BY SUBSIDIARY BORROWER. Subsidiary Borrower has the option, at any time upon 90 days prior written notice by Subsidiary Borrower to Lender, to terminate this Agreement by paying to Lender, in cash, the Obligations (including either (i) providing cash collateral to be held by Lender in an amount equal to 105% of the then extant Letter of Credit Usage, or (ii) causing the original Letters of Credit to be returned to Lender). If Subsidiary Borrower has sent a notice of termination pursuant to the provisions of this Section, then Lender's obligations to extend credit hereunder shall terminate and Subsidiary Borrower shall be obligated to repay the Obligations (including either (i) providing cash collateral to be held by Lender in an amount equal to 105% of the then extant Letter of Credit Usage, or (ii) causing the original Letters of Credit to be returned to Lender), on the date set forth as the date of termination of this Agreement in such notice. 4. CREATION OF SECURITY INTEREST. 4.1 [INTENTIONALLY OMITTED]. 4.2 [INTENTIONALLY OMITTED]. 4.3 [INTENTIONALLY OMITTED]. 4.4 DELIVERY OF ADDITIONAL DOCUMENTATION REQUIRED. At any time upon the request of Lender, Subsidiary Borrower shall execute and deliver to Lender, any and all financing statements, original financing statements in lieu of continuation statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title, and all other documents (the "Additional Documents") that Lender may request in its Permitted Discretion, in form and substance satisfactory to Lender, to perfect and continue perfected or better perfect the Lender's Liens in the Collateral (whether now owned or hereafter arising or acquired), to create and perfect Liens in favor of Lender in any Real Property acquired after the Closing Date, and in order to fully consummate all of the transactions contemplated hereby and under the other Subsidiary Loan Documents. To the maximum extent permitted by applicable law, Subsidiary Borrower authorizes Lender to execute any such Additional Documents in Subsidiary Borrower's name and authorize Lender to file such executed Additional Documents in any appropriate filing office. In addition, on such periodic basis as Lender shall require, Subsidiary Borrower shall (a) provide Lender with a report of all new patentable, copyrightable, or trademarkable materials acquired or generated by Subsidiary Borrower during the prior period, (b) cause all patents, copyrights, and trademarks acquired or generated by Subsidiary Borrower that are not already the subject of a registration with the -38-

appropriate filing office (or an application therefor diligently prosecuted) to be registered with such appropriate filing office in a manner sufficient to impart constructive notice of Subsidiary Borrower's ownership thereof, and (c) cause to be prepared, executed, and delivered to Lender supplemental schedules to the applicable Subsidiary Loan Documents to identify such patents, copyrights, and trademarks as being subject to the security interests created thereunder. 4.5 POWER OF ATTORNEY. Subsidiary Borrower hereby irrevocably makes, constitutes, and appoints Lender (and any of Lender's officers, employees, or Lenders designated by Lender) as Subsidiary Borrower's true and lawful attorney, with power to (a) if Subsidiary Borrower refuses to, or fails timely to execute and deliver any of the documents described in Section 4.4, sign the name of Subsidiary Borrower on any of the documents described in Section 4.4, (b) at any time that an Event of Default has occurred and is continuing, sign Subsidiary Borrower's name on any invoice or bill of lading relating to the Collateral, drafts against Account Debtors, or notices to Account Debtors, (c) send requests for verification of Accounts, (d) endorse Subsidiary Borrower's name on any Collection item that may come into Lender's possession, (e) at any time that an Event of Default has

appropriate filing office (or an application therefor diligently prosecuted) to be registered with such appropriate filing office in a manner sufficient to impart constructive notice of Subsidiary Borrower's ownership thereof, and (c) cause to be prepared, executed, and delivered to Lender supplemental schedules to the applicable Subsidiary Loan Documents to identify such patents, copyrights, and trademarks as being subject to the security interests created thereunder. 4.5 POWER OF ATTORNEY. Subsidiary Borrower hereby irrevocably makes, constitutes, and appoints Lender (and any of Lender's officers, employees, or Lenders designated by Lender) as Subsidiary Borrower's true and lawful attorney, with power to (a) if Subsidiary Borrower refuses to, or fails timely to execute and deliver any of the documents described in Section 4.4, sign the name of Subsidiary Borrower on any of the documents described in Section 4.4, (b) at any time that an Event of Default has occurred and is continuing, sign Subsidiary Borrower's name on any invoice or bill of lading relating to the Collateral, drafts against Account Debtors, or notices to Account Debtors, (c) send requests for verification of Accounts, (d) endorse Subsidiary Borrower's name on any Collection item that may come into Lender's possession, (e) at any time that an Event of Default has occurred and is continuing, make, settle, and adjust all claims under Subsidiary Borrower's policies of insurance and make all determinations and decisions with respect to such policies of insurance, and (f) at any time that an Event of Default has occurred and is continuing, settle and adjust disputes and claims respecting the Accounts, chattel paper, or General Intangibles directly with Account Debtors, for amounts and upon terms that Lender determines to be reasonable, and Lender may cause to be executed and delivered any documents and releases that Lender determines to be necessary. The appointment of Lender as Subsidiary Borrower's attorney, and each and every one of its rights and powers, being coupled with an interest, is irrevocable until all of the Obligations have been fully and finally repaid and performed and Lender's obligations to extend credit hereunder are terminated. 4.6 RIGHT TO INSPECT. Lender (through any of its respective officers, employees, or agents) shall have the right, from time to time hereafter to inspect the Books and to check, test, and appraise the Collateral in order to verify Subsidiary Borrower's financial condition or the amount, quality, value, condition of, or any other matter relating to, the Collateral. 4.7 CONTROL AGREEMENTS. Subsidiary Borrower agrees that it will not transfer assets out of any Securities Accounts other than as permitted under Section 7.19 and, if to another securities intermediary, unless each of Subsidiary Borrower, Lender, and the substitute securities intermediary have entered into a Control Agreement. No arrangement contemplated hereby or by any Control Agreement in respect of any Securities Accounts or other Investment Property shall be modified by Subsidiary Borrower without the prior written consent of Lender. Upon the occurrence and during the continuance of a Default or Event of Default, Lender may notify any securities intermediary to liquidate the applicable Securities Account or any related Investment Property maintained or held thereby and remit the proceeds thereof to the Lender's Account. -39-

5. REPRESENTATIONS AND WARRANTIES. In order to induce Lender to enter into this Agreement, Subsidiary Borrower makes the following representations and warranties to Lender which shall be true, correct, and complete, in all material respects, as of the date hereof, and shall be true, correct, and complete, in all material respects, as of the Closing Date, and at and as of the date of the making of each Subsidiary Borrower Advance (or other extension of credit) made thereafter, as though made on and as of the date of such Subsidiary Borrower Advance (or other extension of credit) (except to the extent that such representations and warranties relate solely to an earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement: 5.1 NO ENCUMBRANCES. Subsidiary Borrower has good and indefeasible title to its Collateral and the Real Property, free and clear of Liens except for Permitted Liens. 5.2 ELIGIBLE ACCOUNTS. The Eligible Accounts are bona fide existing payment obligations of Account Debtors created by the sale and delivery of Inventory or the rendition of services to such Account Debtors in the ordinary course of Subsidiary Borrower's business, owed to Subsidiary Borrower without known defenses,

5. REPRESENTATIONS AND WARRANTIES. In order to induce Lender to enter into this Agreement, Subsidiary Borrower makes the following representations and warranties to Lender which shall be true, correct, and complete, in all material respects, as of the date hereof, and shall be true, correct, and complete, in all material respects, as of the Closing Date, and at and as of the date of the making of each Subsidiary Borrower Advance (or other extension of credit) made thereafter, as though made on and as of the date of such Subsidiary Borrower Advance (or other extension of credit) (except to the extent that such representations and warranties relate solely to an earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement: 5.1 NO ENCUMBRANCES. Subsidiary Borrower has good and indefeasible title to its Collateral and the Real Property, free and clear of Liens except for Permitted Liens. 5.2 ELIGIBLE ACCOUNTS. The Eligible Accounts are bona fide existing payment obligations of Account Debtors created by the sale and delivery of Inventory or the rendition of services to such Account Debtors in the ordinary course of Subsidiary Borrower's business, owed to Subsidiary Borrower without known defenses, disputes, offsets, counterclaims, or rights of return or cancellation. As to each Eligible Account, such Account is not: (a) owed by an employee, Affiliate, or agent of Subsidiary Borrower, (b) on account of a transaction wherein goods were placed on consignment or were sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a bill and hold, or on any other terms by reason of which the payment by the Account Debtor may be conditional, (c) payable in a currency other than a Specified Currency, (d) owed by an Account Debtor that has or has asserted a right of setoff, has disputed its liability, or has made any claim with respect to its obligation to pay the account, (e) owed by an Account Debtor that is subject to any Insolvency Proceeding or is not Solvent or as to which Subsidiary Borrower has received notice of an imminent Insolvency Proceeding or a material impairment of the financial condition of such Account Debtor, (f) on account of a transaction as to which the goods giving rise to such Account have not been shipped and billed to the Account Debtor or the services giving rise to such Account have not been performed and accepted by the Account Debtor, -40-

(g) a right to receive progress payments or other advance billings that are due prior to the completion of performance by Subsidiary Borrower of the subject contract for goods or services, and (h) an Account that has not been billed to the customer. 5.3 [INTENTIONALLY OMITTED] 5.4 EQUIPMENT. All of the Equipment is used or held for use in Subsidiary Borrower's business and is fit for such purposes. 5.5 LOCATION OF INVENTORY AND EQUIPMENT. The Inventory and Equipment are not stored with a bailee, warehouseman, or similar party and, other than Inventory and Equipment in transit, are located only at the locations identified on Schedule 5.5. 5.6 INVENTORY RECORDS. Subsidiary Borrower keeps correct and accurate records itemizing and describing the type, quality, and quantity of its Inventory and the book value thereof.

(g) a right to receive progress payments or other advance billings that are due prior to the completion of performance by Subsidiary Borrower of the subject contract for goods or services, and (h) an Account that has not been billed to the customer. 5.3 [INTENTIONALLY OMITTED] 5.4 EQUIPMENT. All of the Equipment is used or held for use in Subsidiary Borrower's business and is fit for such purposes. 5.5 LOCATION OF INVENTORY AND EQUIPMENT. The Inventory and Equipment are not stored with a bailee, warehouseman, or similar party and, other than Inventory and Equipment in transit, are located only at the locations identified on Schedule 5.5. 5.6 INVENTORY RECORDS. Subsidiary Borrower keeps correct and accurate records itemizing and describing the type, quality, and quantity of its Inventory and the book value thereof. 5.7 LOCATION OF CHIEF EXECUTIVE OFFICE; FEIN. The chief executive office of Subsidiary Borrower is located at the address indicated in Schedule 5.7 and the tax payer identification number of Subsidiary Borrower is identified in Schedule 5.7. 5.8 DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES (a) Subsidiary Borrower is duly organized and existing and in good standing under the laws of the jurisdiction of its organization and qualified to do business in any state where the failure to be so qualified reasonably could be expected to have a Material Adverse Change. (b) Set forth on Schedule 5.8(b), is a complete and accurate description of the authorized capital Stock of Subsidiary Borrower, by class, and, as of the Closing Date, a description of the number of shares of each such class that are issued and outstanding. Other than as described on Schedule 5.8(b), there are no subscriptions, options, warrants, or calls relating to any shares of Subsidiary Borrower's capital Stock, including any right of conversion or exchange under any outstanding security or other instrument. Subsidiary Borrower is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital Stock or any security convertible into or exchangeable for any of its capital Stock. (c) Set forth on Schedule 5.8(c), is a complete and accurate list of Subsidiary Borrower's direct and indirect Subsidiaries, showing: (i) the jurisdiction of their organization; (ii) the number of shares of each class of common and preferred Stock or ordinary and preferred shares authorized for each of such Subsidiaries; and (iii) the number and the percentage of the outstanding shares of each such class owned directly or indirectly -41-

by Subsidiary Borrower. All of the outstanding capital Stock of each such Subsidiary has been validly issued and is fully paid and non-assessable. (d) Except as set forth on Schedule 5.8(c), there are no subscriptions, options, warrants, or calls relating to any shares of the capital Stock of any Subsidiary of Subsidiary Borrower, including any right of conversion or exchange under any outstanding security or other instrument. Neither Subsidiary Borrower nor any of its Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of any Subsidiary Borrower's Subsidiaries' capital Stock or any security convertible into or exchangeable for any such capital Stock. 5.9 Due Authorization; No Conflict. (a) The execution, delivery, and performance by Subsidiary Borrower of this Agreement and the Subsidiary Loan Documents to which it is a party have been duly authorized by all necessary action on the part of Subsidiary Borrower.

by Subsidiary Borrower. All of the outstanding capital Stock of each such Subsidiary has been validly issued and is fully paid and non-assessable. (d) Except as set forth on Schedule 5.8(c), there are no subscriptions, options, warrants, or calls relating to any shares of the capital Stock of any Subsidiary of Subsidiary Borrower, including any right of conversion or exchange under any outstanding security or other instrument. Neither Subsidiary Borrower nor any of its Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of any Subsidiary Borrower's Subsidiaries' capital Stock or any security convertible into or exchangeable for any such capital Stock. 5.9 Due Authorization; No Conflict. (a) The execution, delivery, and performance by Subsidiary Borrower of this Agreement and the Subsidiary Loan Documents to which it is a party have been duly authorized by all necessary action on the part of Subsidiary Borrower. (b) The execution, delivery, and performance by Subsidiary Borrower of this Agreement and the Subsidiary Loan Documents to which it is a party do not and will not (i) violate any provision of law or regulation applicable to Subsidiary Borrower, the Governing Documents of Subsidiary Borrower, or any order, judgment, or decree of any court or other Governmental Authority binding on Subsidiary Borrower, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of Subsidiary Borrower, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Subsidiary Borrower, other than Permitted Liens, or (iv) require any approval of Subsidiary Borrower's interestholders or any approval or consent of any Person under any material contractual obligation of Subsidiary Borrower. (c) Other than the filing of financing statements and fixture filings, certain of the Subsidiary Loan Documents with the SEC, filings with the registrar of Companies House in the United Kingdom, the execution, delivery, and performance by Subsidiary Borrower of this Agreement and the Subsidiary Loan Documents to which Subsidiary Borrower is a party do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority or other Person. (d) This Agreement and the other Subsidiary Loan Documents to which Subsidiary Borrower is a party, and all other documents contemplated hereby and thereby, when executed and delivered by Subsidiary Borrower will be the legally valid and binding obligations of Subsidiary Borrower, enforceable against Subsidiary Borrower in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors' rights generally. -42-

(e) The Lender's Liens are validly created, perfected, and first priority Liens, subject only to Permitted Liens (f) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan Documents to which it is a party have been duly authorized by all necessary action on the part of such Guarantor. (g) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan Documents to which it is a party do not and will not (i) violate any provision of law or regulation applicable to such Guarantor, the Governing Documents of such Guarantor, or any order, judgment, or decree of any court or other Governmental Authority binding on such Guarantor, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of such Guarantor, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of such Guarantor, other than Permitted Liens, or (iv) require any approval of such Guarantor's interestholders or any approval or consent of any Person under any material contractual obligation of such Guarantor. (h) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan

(e) The Lender's Liens are validly created, perfected, and first priority Liens, subject only to Permitted Liens (f) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan Documents to which it is a party have been duly authorized by all necessary action on the part of such Guarantor. (g) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan Documents to which it is a party do not and will not (i) violate any provision of law or regulation applicable to such Guarantor, the Governing Documents of such Guarantor, or any order, judgment, or decree of any court or other Governmental Authority binding on such Guarantor, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of such Guarantor, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of such Guarantor, other than Permitted Liens, or (iv) require any approval of such Guarantor's interestholders or any approval or consent of any Person under any material contractual obligation of such Guarantor. (h) As to each Guarantor, the execution, delivery, and performance by such Guarantor of the Subsidiary Loan Documents to which such Guarantor is a party do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority or other Person. As to each Guarantor, the Subsidiary Loan Documents to which such Guarantor is a party, and all other documents contemplated hereby and thereby, when executed and delivered by such Guarantor will be legally valid and binding obligations of such Guarantor, enforceable against such Guarantor in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors' rights generally. 5.10 Litigation. Other than those matters disclosed on Schedule 5.10, there are no actions, suits, or proceedings pending or, to the best knowledge of Subsidiary Borrower, threatened against Subsidiary Borrower, except for (a) matters that are fully covered by insurance (subject to customary deductibles), and (b) matters arising after the Closing Date that, if decided adversely to Subsidiary Borrower reasonably could not be expected to result in a Material Adverse Change. 5.11 No Material Adverse Change. All financial statements relating to Subsidiary Borrower that have been delivered by Subsidiary Borrower to Lender have been prepared in accordance with GAAP (except, in the case of unaudited financial statements, for the lack of footnotes and being subject to year-end audit adjustments) and present fairly in all material respects, Subsidiary Borrower's financial condition as of the date thereof and results of operations for the period then ended. There has not been a Material Adverse Change with -43-

respect to Subsidiary Borrower since the date of the latest financial statements submitted to Lender on or before the Closing Date. 5.12 Fraudulent Transfer. (a) Subsidiary Borrower is Solvent. (b) No transfer of property is being made by Subsidiary Borrower and no obligation is being incurred by Subsidiary Borrower in connection with the transactions contemplated by this Agreement or the other Subsidiary Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of Subsidiary Borrower. 5.13 Employee Benefits. Except for mandatory Benefit Plans, none of Subsidiary Borrower or any of its ERISA Affiliates maintains or contributes to any Benefit Plan. Each mandatory Benefit Plan has been operated and administered and complies in all material respects with applicable laws. 5.14 Environmental Condition. Except as set forth on Schedule 5.14, (a) to Subsidiary Borrower's knowledge, none of Subsidiary Borrower's properties or assets has ever been used by Subsidiary Borrower or by previous

respect to Subsidiary Borrower since the date of the latest financial statements submitted to Lender on or before the Closing Date. 5.12 Fraudulent Transfer. (a) Subsidiary Borrower is Solvent. (b) No transfer of property is being made by Subsidiary Borrower and no obligation is being incurred by Subsidiary Borrower in connection with the transactions contemplated by this Agreement or the other Subsidiary Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of Subsidiary Borrower. 5.13 Employee Benefits. Except for mandatory Benefit Plans, none of Subsidiary Borrower or any of its ERISA Affiliates maintains or contributes to any Benefit Plan. Each mandatory Benefit Plan has been operated and administered and complies in all material respects with applicable laws. 5.14 Environmental Condition. Except as set forth on Schedule 5.14, (a) to Subsidiary Borrower's knowledge, none of Subsidiary Borrower's properties or assets has ever been used by Subsidiary Borrower or by previous owners or operators in the disposal of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, where such production, storage, handling, treatment, release or transport was in violation, in any material respect, of applicable Environmental Law, (b) to Subsidiary Borrower's knowledge, none of Subsidiary Borrower's properties or assets has ever been designated or identified in any manner pursuant to any environmental protection statute as a Hazardous Materials disposal site, (c) Subsidiary Borrower has not received notice that a Lien arising under any Environmental Law has attached to any revenues or to any Real Property owned or operated by Subsidiary Borrower, and (d) Subsidiary Borrower has not received a summons, citation, notice, or directive from the Environmental Protection Agency or any other federal or state governmental agency concerning any action or omission by Subsidiary Borrower resulting in the releasing or disposing of Hazardous Materials into the environment. 5.15 Brokerage Fees. Subsidiary Borrower has not utilized the services of any broker or finder in connection with Subsidiary Borrower obtaining financing from Lender under this Agreement and no brokerage commission or finders fee is payable by Subsidiary Borrower in connection herewith. 5.16 Intellectual Property. Subsidiary Borrower owns, or holds licenses in, all Intellectual Property that is necessary to the conduct of its business as currently conducted. Attached hereto as Schedule 5.16 is a true, correct, and complete listing of all Intellectual Property as to which Subsidiary Borrower is the owner or is an exclusive licensee. Subsidiary Borrower holds no copyrights or exclusive licenses relative to copyrights. 5.17 Leases. Subsidiary Borrower enjoys peaceful and undisturbed possession under all leases material to the business of Subsidiary Borrower and to which Subsidiary Borrower is a party or under which Subsidiary Borrower is operating. All of such leases are -44-

valid and subsisting and no material default by Subsidiary Borrower exists under any of them. 5.18 DDAs. Set forth on Schedule 5.18 are all of the DDAs of Subsidiary Borrower, including, with respect to each depository (i) the name and address of such depository, and (ii) the account numbers of the accounts maintained with such depository. 5.19 Complete Disclosure. All factual information (taken as a whole) furnished by or on behalf of Subsidiary Borrower in writing to Lender (including all information contained in the Schedules hereto or in the other Subsidiary Loan Documents) for purposes of or in connection with this Agreement, the other Subsidiary Loan Documents or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of Subsidiary Borrower in writing to the Lender will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material

valid and subsisting and no material default by Subsidiary Borrower exists under any of them. 5.18 DDAs. Set forth on Schedule 5.18 are all of the DDAs of Subsidiary Borrower, including, with respect to each depository (i) the name and address of such depository, and (ii) the account numbers of the accounts maintained with such depository. 5.19 Complete Disclosure. All factual information (taken as a whole) furnished by or on behalf of Subsidiary Borrower in writing to Lender (including all information contained in the Schedules hereto or in the other Subsidiary Loan Documents) for purposes of or in connection with this Agreement, the other Subsidiary Loan Documents or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of Subsidiary Borrower in writing to the Lender will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. 5.20 Indebtedness. Set forth on Schedule 5.20 is a true and complete list of all Indebtedness of Subsidiary Borrower outstanding immediately prior to the Closing Date that is to remain outstanding after the Closing Date and such Schedule accurately reflects the aggregate principal amount of such Indebtedness and the principal terms thereof. 5.21 Review and Approval of Parent Loan Agreement. Subsidiary Borrower has reviewed the Parent Loan Agreement and all Exhibits and Schedules referred to therein and has approved all terms and conditions relating to or affecting Subsidiary Borrower contained therein. Subsidiary Borrower acknowledges and agrees that the credit facility evidenced hereby shall terminate automatically and be of no further force and effect in the event that the Parent Loan Agreement shall terminate for any reason. 6. AFFIRMATIVE COVENANTS. Subsidiary Borrower covenants and agrees that, so long as any credit hereunder shall be available and until full and final payment of the Obligations, Subsidiary Borrower shall do and shall cause each of its Subsidiaries to do all of the following: 6.1 Accounting System. Maintain a system of accounting that enables Subsidiary Borrower to produce financial statements in accordance with GAAP and maintain records pertaining to the Collateral that contain information as from time to time reasonably may be requested by Lender. Subsidiary Borrower also shall keep an inventory reporting system that shows all additions, sales, claims, returns, and allowances with respect to the Inventory. 6.2 Collateral Reporting. Provide Lender with the following documents at the following times in form satisfactory to Lender: -45-------------------------------------------------------------------------------Weekly (a) a sales journal, collection journal, and credit register since the last such schedule (each such journal and register shall identify separately all Accounts arising from Subsidiary Borrower's provision of services as an application services provider) and a calculation of the Subsidiary Borrower Borrowing Base as of such date, and (b) notice of all returns, disputes, or claims. -------------------------------------------------------------------------------Monthly (not later than the 15th day of each month) (c) Inventory reports specifying Subsidiary Borrower's cost of its Inventory, by category,

(d) a detailed calculation of the Subsidiary Borrower Borrowing Base (including detail regarding those Accounts

-------------------------------------------------------------------------------Weekly (a) a sales journal, collection journal, and credit register since the last such schedule (each such journal and register shall identify separately all Accounts arising from Subsidiary Borrower's provision of services as an application services provider) and a calculation of the Subsidiary Borrower Borrowing Base as of such date, and (b) notice of all returns, disputes, or claims. -------------------------------------------------------------------------------Monthly (not later than the 15th day of each month) (c) Inventory reports specifying Subsidiary Borrower's cost of its Inventory, by category,

(d) a detailed calculation of the Subsidiary Borrower Borrowing Base (including detail regarding those Accounts that are not Eligible Accounts and detail identifying separately all Accounts arising from Subsidiary Borrower's provision of services as an application services provider), (e) a detailed aging, by total, of the Accounts of Subsidiary Borrower (each such aging shall identify separately all Accounts arising from Subsidiary Borrower's provision of services as an application services provider), together with a reconciliation to the detailed calculation of the Subsidiary Borrower Borrowing Base previously provided to Lender, (f) a summary aging, by vendor, of Subsidiary Borrower's accounts payable and any book overdraft, (g) a report calculating the Qualified Cash Amount for each day of the prior month, (h) a calculation of Dilution and ASP Dilution for the prior month, and (i) a detailed calculation of Subsidiary Borrower's Collections for the immediately preceding month. -------------------------------------------------------------------------------Quarterly (j) a detailed list of Subsidiary Borrower's customers, (k) a report regarding Subsidiary Borrower's accrued, but unpaid, ad valorem taxes, -------------------------------------------------------------------------------Upon request by (l) copies of invoices in connection with the accounts, Lender credit memos, remittance advices, deposit slips, shipping and delivery documents in connection with the Accounts and, for Inventory and Equipment acquired by Subsidiary Borrower, purchase orders and invoices, and (m) such other reports as to the Collateral or the financial condition of Subsidiary Borrower as Lender may request. --------------------------------------------------------------------------------

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In addition, Subsidiary Borrower agrees to cooperate fully with Lender to facilitate and implement a system of electronic collateral reporting in order to provide electronic reporting of each of the items set forth above. 6.3 Financial Statements, Reports, Certificates. Deliver to Lender:

In addition, Subsidiary Borrower agrees to cooperate fully with Lender to facilitate and implement a system of electronic collateral reporting in order to provide electronic reporting of each of the items set forth above. 6.3 Financial Statements, Reports, Certificates. Deliver to Lender: (a) as soon as available, but in any event within 30 days (45 days in the case of a month that is the end of one of the first 3 fiscal quarters in a fiscal year) after the end of each month during each of Parent's fiscal years, (i) a company prepared consolidated balance sheet, income statement, and statement of cash flow covering Parent's and its Subsidiaries' operations during such period, (ii) a certificate signed by the chief financial officer of Parent to the effect that: A. the financial statements delivered hereunder have been prepared in accordance with GAAP (except for the lack of footnotes and being subject to year-end audit adjustments) and fairly present in all material respects the financial condition of Parent and its Subsidiaries, B. the representations and warranties of Borrowers contained in this Agreement and the other Loan Documents are true and correct in all material respects on and as of the date of such certificate, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date), and C. there does not exist any condition or event that constitutes a Default or Event of Default (or, to the extent of any non-compliance, describing such non-compliance as to which he or she may have knowledge and what action Borrowers have taken, are taking, or propose to take with respect thereto), and (iii) for each month that is the date on which a financial covenant in Section 7.20 of the Parent Loan Agreement is to be tested, a compliance certificate in the form attached to the Parent Loan Agreement demonstrating, in reasonable detail, compliance at the end of such period with the applicable financial covenants contained in Section 7.20 of the Parent Loan Agreement, (iv) a certificate signed by the chief financial officer of Subsidiary Borrower to the effect that: A. the representations and warranties of Subsidiary Borrower contained in this Agreement and the other Subsidiary Loan Documents -47-

are true and correct in all material respects on and as of the date of such certificate, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date), and B. there does not exist any condition or event that constitutes a Default or Event of Default (or, to the extent of any non-compliance, describing such non-compliance as to which he or she may have knowledge and what action Subsidiary Borrower has taken, is taking, or proposes to take with respect thereto), and (b) as soon as available, but in any event within 90 days after the end of each of Parent's fiscal years, (i) financial statements of Parent and its Subsidiaries for each such fiscal year, audited by independent certified public accountants reasonably acceptable to Lender and certified, without any qualifications, by such accountants to have been prepared in accordance with GAAP (such audited financial statements to include a balance sheet, income statement, and statement of cash flow and, if prepared, such accountants' letter to management), (ii) a certificate of such accountants addressed to Lender stating that such accountants do not have knowledge of the existence of any Default or Event of Default under Section 7.20 of the Parent Loan Agreement, (c) as soon as available, but in any event within 30 days prior to the start of each of Parent's fiscal years, (i) copies of Borrowers' Projections, in form and substance (including as to scope and underlying assumptions)

are true and correct in all material respects on and as of the date of such certificate, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date), and B. there does not exist any condition or event that constitutes a Default or Event of Default (or, to the extent of any non-compliance, describing such non-compliance as to which he or she may have knowledge and what action Subsidiary Borrower has taken, is taking, or proposes to take with respect thereto), and (b) as soon as available, but in any event within 90 days after the end of each of Parent's fiscal years, (i) financial statements of Parent and its Subsidiaries for each such fiscal year, audited by independent certified public accountants reasonably acceptable to Lender and certified, without any qualifications, by such accountants to have been prepared in accordance with GAAP (such audited financial statements to include a balance sheet, income statement, and statement of cash flow and, if prepared, such accountants' letter to management), (ii) a certificate of such accountants addressed to Lender stating that such accountants do not have knowledge of the existence of any Default or Event of Default under Section 7.20 of the Parent Loan Agreement, (c) as soon as available, but in any event within 30 days prior to the start of each of Parent's fiscal years, (i) copies of Borrowers' Projections, in form and substance (including as to scope and underlying assumptions) satisfactory to Lender, in its sole discretion, for the forthcoming 2 years, year by year, and for the forthcoming fiscal year, month by month, certified by the chief financial officer of Parent as being such officer's good faith best estimate of the financial performance of Parent and its Subsidiaries during the period covered thereby, (d) if and when filed by any Borrower or Subsidiary Borrower, (i) 10-Q quarterly reports, Form 10-K annual reports, Form 8-K current reports, or any filings with the registrar of companies at Companies House, (ii) any other filings made by any Borrower or Subsidiary Borrower with the SEC, -48-

(iii) copies of (A) Borrowers' federal income tax returns, and any amendments thereto, filed with the Internal Revenue Service, and (B) Subsidiary Borrower's income tax returns filed with the Inland Revenue authorities in the United Kingdom, and (iv) any other information that is provided by Parent to its shareholders generally, (e) if and when filed by any Borrower, Canadian Obligor, or Subsidiary Borrower and as requested by Lender, satisfactory evidence of payment of applicable excise taxes in each jurisdiction in which (i) any Borrower, Canadian Obligor, or Subsidiary Borrower conducts business or is required to pay any such excise tax, (ii) where any Borrower's, Canadian Obligor's, or Subsidiary Borrower's failure to pay any such applicable excise tax would result in a Lien on the properties or assets of any Borrower, Canadian Obligor, or Subsidiary Borrower, as applicable, or (iii) where any Borrower's, Canadian Obligor's, or Subsidiary Borrower's failure to pay any such applicable excise tax reasonably could be expected to result in a Material Adverse Change, (f) as soon as Subsidiary Borrower has knowledge of any event or condition that constitutes a Default or an Event of Default, notice thereof and a statement of the curative action that Subsidiary Borrower proposes to take with respect thereto, and (g) upon the request of Lender, any other report reasonably requested relating to the financial condition of Subsidiary Borrower. In addition to the financial statements referred to above, Subsidiary Borrower agrees to deliver financial statements prepared on both a consolidated and consolidating basis and agrees that Subsidiary Borrower, or any Subsidiary of Subsidiary Borrower, will not have a fiscal year different from that of Parent. Subsidiary Borrower

(iii) copies of (A) Borrowers' federal income tax returns, and any amendments thereto, filed with the Internal Revenue Service, and (B) Subsidiary Borrower's income tax returns filed with the Inland Revenue authorities in the United Kingdom, and (iv) any other information that is provided by Parent to its shareholders generally, (e) if and when filed by any Borrower, Canadian Obligor, or Subsidiary Borrower and as requested by Lender, satisfactory evidence of payment of applicable excise taxes in each jurisdiction in which (i) any Borrower, Canadian Obligor, or Subsidiary Borrower conducts business or is required to pay any such excise tax, (ii) where any Borrower's, Canadian Obligor's, or Subsidiary Borrower's failure to pay any such applicable excise tax would result in a Lien on the properties or assets of any Borrower, Canadian Obligor, or Subsidiary Borrower, as applicable, or (iii) where any Borrower's, Canadian Obligor's, or Subsidiary Borrower's failure to pay any such applicable excise tax reasonably could be expected to result in a Material Adverse Change, (f) as soon as Subsidiary Borrower has knowledge of any event or condition that constitutes a Default or an Event of Default, notice thereof and a statement of the curative action that Subsidiary Borrower proposes to take with respect thereto, and (g) upon the request of Lender, any other report reasonably requested relating to the financial condition of Subsidiary Borrower. In addition to the financial statements referred to above, Subsidiary Borrower agrees to deliver financial statements prepared on both a consolidated and consolidating basis and agrees that Subsidiary Borrower, or any Subsidiary of Subsidiary Borrower, will not have a fiscal year different from that of Parent. Subsidiary Borrower agrees that their independent certified public accountants are authorized to communicate with Lender and to release to Lender whatever financial information concerning Subsidiary Borrower that Lender reasonably may request. Subsidiary Borrower waives the right to assert a confidential relationship, if any, it may have with any accounting firm or service bureau in connection with any information requested by Lender pursuant to or in accordance with this Agreement, and agrees that Lender may contact directly any such accounting firm or service bureau in order to obtain such information. 6.4 [Intentionally Omitted]. 6.5 Return. Cause returns and allowances as between Subsidiary Borrower and its Account Debtors to be on the same basis and in accordance with the usual customary practices of Subsidiary Borrower as they exist at the time of the execution and delivery of this Agreement. If, at a time when no Event of Default has occurred and is continuing, any Account Debtor returns any Inventory to Subsidiary Borrower, Subsidiary Borrower promptly shall determine the reason for such return and, if Subsidiary Borrower accepts such return, issue a credit memorandum (with a copy to be sent to Lender) in the appropriate -49-

amount to such Account Debtor. If, at a time when an Event of Default has occurred and is continuing, any Account Debtor returns any Inventory to Subsidiary Borrower, Subsidiary Borrower promptly shall determine the reason for such return and, if Lender consents (which consent shall not be unreasonably withheld), issue a credit memorandum (with a copy to be sent to Lender) in the appropriate amount to such Account Debtor. 6.6 Maintenance of Properties. Maintain and preserve all of its properties which are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply at all times with the provisions of all leases to which it is a party as lessee, so as to prevent any loss or forfeiture thereof or thereunder. 6.7 Taxes. Cause all assessments and taxes, whether real, personal, or otherwise, due or payable by, or imposed, levied, or assessed against Subsidiary Borrower or any of its assets to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or tax shall be the subject of a Permitted Protest. Subsidiary Borrower will make timely payment or deposit of all tax payments and withholding taxes required of it by applicable laws, including those laws

amount to such Account Debtor. If, at a time when an Event of Default has occurred and is continuing, any Account Debtor returns any Inventory to Subsidiary Borrower, Subsidiary Borrower promptly shall determine the reason for such return and, if Lender consents (which consent shall not be unreasonably withheld), issue a credit memorandum (with a copy to be sent to Lender) in the appropriate amount to such Account Debtor. 6.6 Maintenance of Properties. Maintain and preserve all of its properties which are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply at all times with the provisions of all leases to which it is a party as lessee, so as to prevent any loss or forfeiture thereof or thereunder. 6.7 Taxes. Cause all assessments and taxes, whether real, personal, or otherwise, due or payable by, or imposed, levied, or assessed against Subsidiary Borrower or any of its assets to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or tax shall be the subject of a Permitted Protest. Subsidiary Borrower will make timely payment or deposit of all tax payments and withholding taxes required of it by applicable laws, including those laws concerning PAYE, National Insurance, and other social security payments, VAT, and UK, and foreign income and corporation taxes, and will, upon request, furnish Lender with proof satisfactory to Lender indicating that Subsidiary Borrower has made such payments or deposits. Subsidiary Borrower shall deliver satisfactory evidence of payment of applicable excise taxes in each jurisdictions in which Subsidiary Borrower is required to pay any such excise tax. 6.8 Insurance. (a) At Subsidiary Borrower's expense, maintain insurance respecting its property and assets wherever located, covering loss or damage by fire, theft, explosion, and all other hazards and risks as ordinarily are insured against by other Persons engaged in the same or similar businesses. Subsidiary Borrower also shall maintain business interruption, public liability, and product liability insurance, as well as insurance against larceny, embezzlement, and criminal misappropriation. All such policies of insurance shall be in such amounts and with such insurance companies as are reasonably satisfactory to Lender. Subsidiary Borrower shall deliver copies of all such policies to Lender with a satisfactory lender's loss payable endorsement naming Lender as sole loss payee or additional insured, as appropriate. Each policy of insurance or endorsement shall contain a clause requiring the insurer to give not less than 30 days prior written notice to Lender in the event of cancellation of the policy for any reason whatsoever. (b) Subsidiary Borrower shall give Lender prompt notice of any loss covered by such insurance. Lender shall have the exclusive right to adjust any losses payable under any such insurance policies in excess of $50,000, without any liability to Subsidiary Borrower whatsoever in respect of such adjustments. Any monies received as payment for any loss under any insurance policy mentioned above (other than liability insurance policies) -50-

or as payment of any award or compensation for condemnation or taking by eminent domain, shall be paid over to Lender to be applied at the option of Lender either to the prepayment of the Obligations or shall be disbursed to Subsidiary Borrower under staged payment terms reasonably satisfactory to Lender for application to the cost of repairs, replacements, or restorations. Any such repairs, replacements, or restorations shall be effected with reasonable promptness and shall be of a value at least equal to the value of the items or property destroyed prior to such damage or destruction. (c) Subsidiary Borrower shall not take out separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 6.8, unless Lender is included thereon as named insured with the loss payable to Lender under a lender's loss payable endorsement or its equivalent. Subsidiary Borrower immediately shall notify Lender whenever such separate insurance is taken out, specifying the insurer thereunder and full particulars as to the policies evidencing the same, and copies of such policies promptly shall be provided to Lender. 6.9 Location of Inventory and Equipment. Keep the Inventory and Equipment, other than Inventory and Equipment in transit, of Subsidiary Borrower only at the locations identified on Schedule 5.5; provided, however,

or as payment of any award or compensation for condemnation or taking by eminent domain, shall be paid over to Lender to be applied at the option of Lender either to the prepayment of the Obligations or shall be disbursed to Subsidiary Borrower under staged payment terms reasonably satisfactory to Lender for application to the cost of repairs, replacements, or restorations. Any such repairs, replacements, or restorations shall be effected with reasonable promptness and shall be of a value at least equal to the value of the items or property destroyed prior to such damage or destruction. (c) Subsidiary Borrower shall not take out separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 6.8, unless Lender is included thereon as named insured with the loss payable to Lender under a lender's loss payable endorsement or its equivalent. Subsidiary Borrower immediately shall notify Lender whenever such separate insurance is taken out, specifying the insurer thereunder and full particulars as to the policies evidencing the same, and copies of such policies promptly shall be provided to Lender. 6.9 Location of Inventory and Equipment. Keep the Inventory and Equipment, other than Inventory and Equipment in transit, of Subsidiary Borrower only at the locations identified on Schedule 5.5; provided, however, that Subsidiary Borrower may amend Schedule 5.5 so long as such amendment occurs by written notice to Lender not less than 30 days prior to the date on which such inventory or equipment is moved to such new location, so long as such new location is within the United Kingdom, and so long as, at the time of such written notification, Subsidiary Borrower provides any filings necessary to perfect and continue perfected the Lender's Liens, and also provides to Lender a Collateral Access Agreement. 6.10 Compliance with Laws. Comply with the requirements of all applicable laws, rules, regulations, and orders of any Governmental Authority, other than laws, rules, regulations, and orders the non-compliance with which, individually or in the aggregate, would not result in and reasonably could not be expected to result in a Material Adverse Change. 6.11 Leases. Pay when due all rents and other amounts payable under any leases to which Subsidiary Borrower is a party or by which any properties and assets of Subsidiary Borrower is bound, unless such payments are the subject of a Permitted Protest. 6.12 Brokerage Commissions. Pay any and all brokerage commission or finders fees incurred in connection with or as a result of Subsidiary Borrower obtaining financing from Lender under this Agreement. Subsidiary Borrower agrees and acknowledges that payment of all such brokerage commissions or finders fees shall be the sole responsibility of Subsidiary Borrower, and Subsidiary Borrower agrees to indemnify, defend, and hold Lender harmless from and against any claim of any broker or finder arising out of Subsidiary Borrower obtaining financing from Lender under this Agreement. -51-

6.13 Existence. At all times preserve and keep in full force and effect Subsidiary Borrower's and each Canadian Obligor's valid existence and good standing and any rights and franchises material to Subsidiary Borrower's businesses. 6.14 Environmental. (a) Keep any property either owned or operated by Subsidiary Borrower free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens, (b) comply, in all material respects, with Environmental Laws and provide to Lender documentation of such compliance which Lender reasonably requests, (c) promptly notify Lender of any release of a Hazardous Material of any reportable quantity from or onto property owned or operated by Subsidiary Borrower and take any Remedial Actions required to abate said release or otherwise to come into compliance with applicable Environmental Law, and (d) promptly provide Lender with written notice within 10 days of the receipt of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of Subsidiary Borrower, (ii) commencement of any Environmental Action or notice that an Environmental Action will be filed against Subsidiary Borrower, and (iii) notice of a violation, citation, or other administrative order which reasonably could be expected to result in a Material Adverse Change.

6.13 Existence. At all times preserve and keep in full force and effect Subsidiary Borrower's and each Canadian Obligor's valid existence and good standing and any rights and franchises material to Subsidiary Borrower's businesses. 6.14 Environmental. (a) Keep any property either owned or operated by Subsidiary Borrower free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens, (b) comply, in all material respects, with Environmental Laws and provide to Lender documentation of such compliance which Lender reasonably requests, (c) promptly notify Lender of any release of a Hazardous Material of any reportable quantity from or onto property owned or operated by Subsidiary Borrower and take any Remedial Actions required to abate said release or otherwise to come into compliance with applicable Environmental Law, and (d) promptly provide Lender with written notice within 10 days of the receipt of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of Subsidiary Borrower, (ii) commencement of any Environmental Action or notice that an Environmental Action will be filed against Subsidiary Borrower, and (iii) notice of a violation, citation, or other administrative order which reasonably could be expected to result in a Material Adverse Change. 6.15 Disclosure Updates. Promptly and in no event later than 5 Business Days after obtaining knowledge thereof, (a) notify Lender if any written information, exhibit, or report furnished to Lender contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances in which made, and (b) correct any defect or error that may be discovered therein or in any Subsidiary Loan Document or in the execution, acknowledgement, filing, or recordation thereof. 6.16 Compliance with Covenants of Parent Loan Agreement. Promptly take all such actions as are necessary to assure that as a Subsidiary of Parent it is in compliance with all requirements applicable to Subsidiaries of Parent pursuant to the Parent Loan Agreement. 7. NEGATIVE COVENANTS. Subsidiary Borrower covenants and agrees that, so long as any credit hereunder shall be available and until full and final payment of the Obligations, Subsidiary Borrower will not and will not permit any of its Subsidiaries to do any of the following: 7.1 Indebtedness. Create, incur, assume, permit, guarantee, or otherwise become or remain, directly or indirectly, liable with respect to any Indebtedness, except: (a) Indebtedness evidenced by this Agreement and the other Loan Documents, together with Indebtedness owed to Underlying Issuers with respect to Underlying Letters of Credit; -52-

(b) Indebtedness set forth on Schedule 5.20; (c) Permitted Purchase Money Indebtedness; (d) refinancings, renewals, or extensions of Indebtedness permitted under clauses (b) and (c) of this Section 7.1 (and continuance or renewal of any Permitted Liens associated therewith) so long as: (i) the terms and conditions of such refinancings, renewals, or extensions do not, in Lender's judgment, materially impair the prospects of repayment of the Obligations by Subsidiary Borrower or materially impair Subsidiary Borrower's creditworthiness, (ii) such refinancings, renewals, or extensions do not result in an increase in the principal amount of, or interest rate with respect to, the Indebtedness so refinanced, renewed, or extended, (iii) such refinancings, renewals, or extensions do not result in a shortening of the average weighted maturity of the Indebtedness so refinanced, renewed, or extended, nor are they on terms or conditions, that, taken as a whole, are materially more burdensome or restrictive to Subsidiary Borrower, and (iv) if the Indebtedness that is refinanced, renewed, or extended was subordinated in right of payment to the Obligations, then the terms and conditions of the

(b) Indebtedness set forth on Schedule 5.20; (c) Permitted Purchase Money Indebtedness; (d) refinancings, renewals, or extensions of Indebtedness permitted under clauses (b) and (c) of this Section 7.1 (and continuance or renewal of any Permitted Liens associated therewith) so long as: (i) the terms and conditions of such refinancings, renewals, or extensions do not, in Lender's judgment, materially impair the prospects of repayment of the Obligations by Subsidiary Borrower or materially impair Subsidiary Borrower's creditworthiness, (ii) such refinancings, renewals, or extensions do not result in an increase in the principal amount of, or interest rate with respect to, the Indebtedness so refinanced, renewed, or extended, (iii) such refinancings, renewals, or extensions do not result in a shortening of the average weighted maturity of the Indebtedness so refinanced, renewed, or extended, nor are they on terms or conditions, that, taken as a whole, are materially more burdensome or restrictive to Subsidiary Borrower, and (iv) if the Indebtedness that is refinanced, renewed, or extended was subordinated in right of payment to the Obligations, then the terms and conditions of the refinancing, renewal, or extension Indebtedness must include subordination terms and conditions that are at least as favorable to Lender as those that were applicable to the refinanced, renewed, or extended Indebtedness; and (e) Indebtedness composing Permitted Investments. 7.2 Liens. Create, incur, assume, or permit to exist, directly or indirectly, any Lien on or with respect to any of its assets, of any kind, whether now owned or hereafter acquired, or any income or profits therefrom, except for Permitted Liens (including Liens that are replacements of Permitted Liens to the extent that the original Indebtedness is refinanced, renewed, or extended under Section 7.1(d) and so long as the replacement Liens only encumber those assets that secured the refinanced, renewed, or extended Indebtedness). 7.3 Restrictions on Fundamental Changes. (a) Except in connection with the consummation of a Permitted Acquisition (provided, however, that in any such Permitted Acquisition, Subsidiary Borrower shall be the surviving entity of any merger, consolidation, reorganization, or recapitalization), enter into any merger, consolidation, reorganization, or recapitalization, or reclassify its Stock; (b) Liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution); and (c) Convey, sell, lease, license, assign, transfer, or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its assets. 7.4 Disposal of Assets. Other than Permitted Dispositions, convey, sell, lease, license, assign, transfer, or otherwise dispose of Subsidiary Borrower's assets. -53-

7.5 Change Name. Change Subsidiary Borrower's name, FEIN (or foreign equivalent), corporate structure or identity, or add any new fictitious name; provided, however, that Subsidiary Borrower may change its name upon at least 30 days prior written notice by Subsidiary Borrower to Lender of such change and so long as, at the time of such written notification, Subsidiary Borrower provides any filings necessary to perfect and continue perfected Lender's Liens. 7.6 Guarantee. Guarantee or otherwise become in any way liable with respect to the obligations of any third Person except by endorsement of instruments or items of payment for deposit to the account of Subsidiary Borrower or which are transmitted or turned over to Lender. 7.7 Nature of Business. Make any change in the principal nature of Subsidiary Borrower's business. 7.8 Prepayments and Amendments.

7.5 Change Name. Change Subsidiary Borrower's name, FEIN (or foreign equivalent), corporate structure or identity, or add any new fictitious name; provided, however, that Subsidiary Borrower may change its name upon at least 30 days prior written notice by Subsidiary Borrower to Lender of such change and so long as, at the time of such written notification, Subsidiary Borrower provides any filings necessary to perfect and continue perfected Lender's Liens. 7.6 Guarantee. Guarantee or otherwise become in any way liable with respect to the obligations of any third Person except by endorsement of instruments or items of payment for deposit to the account of Subsidiary Borrower or which are transmitted or turned over to Lender. 7.7 Nature of Business. Make any change in the principal nature of Subsidiary Borrower's business. 7.8 Prepayments and Amendments. (a) Except in connection with a refinancing permitted by Section 7.1(d), prepay, redeem, defease, purchase, or otherwise acquire any Indebtedness of Subsidiary Borrower, any Borrower, Canadian Obligor, or UK Holding Company, other than the Obligations in accordance with this Agreement or the Indebtedness under the Parent Loan Agreement in accordance with its terms, and (b) Except in connection with a refinancing permitted by Section 7.1(d), directly or indirectly, amend, modify, alter, increase, or change any of the terms or conditions of any agreement, instrument, document, indenture, or other writing evidencing or concerning Indebtedness permitted under Sections 7.1(b) or (c). 7.9 Change of Control. Cause, permit, or suffer, directly or indirectly, any Change of Control. 7.10 Consignments. Consign any Inventory or sell any Inventory on bill and hold, sale or return, sale on approval, or other conditional terms of sale. 7.11 Distributions. Make any distribution or declare or pay any dividends (in cash or other property other than by way of a rights or bonus issue of ordinary shares) on, or purchase, acquire, redeem, or retire any of Subsidiary Borrower's Stock, of any class, whether now or hereafter outstanding; provided, however, that Subsidiary Borrower may declare and pay dividends to UK Holding Company so long as (i) after the receipt by UK Holding Company of the proposed dividend, Parent continues to own and control 100% of the outstanding capital Stock of UK Holding Company, and (ii) immediately upon receipt thereof, UK Holding Company declares and pays a dividend to Parent of all amounts received pursuant to clause (i) above. 7.12 Accounting Methods. Modify or change its method of accounting (other than as may be required to conform to GAAP) or enter into, modify, or terminate any agreement -54-

currently existing, or at any time hereafter entered into with any third party accounting firm or service bureau for the preparation or storage of Subsidiary Borrower's accounting records without said accounting firm or service bureau agreeing to provide Lender information regarding the Collateral or the financial condition of Subsidiary Borrower. 7.13 Investments. Except for Permitted Investments and Permitted Acquisitions, directly or indirectly, make or acquire any Investment, or incur any liabilities (including contingent obligations) for or in connection with any Investment; provided, however, that Subsidiary Borrower shall not have Permitted Investments (other than in the Cash Management Accounts) in excess of $50,000 outstanding at any one time unless Subsidiary Borrower and the applicable securities intermediary or bank have entered into Control Agreements or similar arrangements governing such Permitted Investments, as Lender shall determine in its Permitted Discretion, to perfect (and further establish) the Lender's Liens in such Permitted Investments. Anything in this Section 7.13, this Agreement, or any of the other Subsidiary Loan Documents to the contrary notwithstanding, Subsidiary Borrower shall not permit a CFC to consummate an Acquisition of another CFC unless any such Acquisition is a Permitted Cash Acquisition or Permitted Non-Cash Acquisition.

currently existing, or at any time hereafter entered into with any third party accounting firm or service bureau for the preparation or storage of Subsidiary Borrower's accounting records without said accounting firm or service bureau agreeing to provide Lender information regarding the Collateral or the financial condition of Subsidiary Borrower. 7.13 Investments. Except for Permitted Investments and Permitted Acquisitions, directly or indirectly, make or acquire any Investment, or incur any liabilities (including contingent obligations) for or in connection with any Investment; provided, however, that Subsidiary Borrower shall not have Permitted Investments (other than in the Cash Management Accounts) in excess of $50,000 outstanding at any one time unless Subsidiary Borrower and the applicable securities intermediary or bank have entered into Control Agreements or similar arrangements governing such Permitted Investments, as Lender shall determine in its Permitted Discretion, to perfect (and further establish) the Lender's Liens in such Permitted Investments. Anything in this Section 7.13, this Agreement, or any of the other Subsidiary Loan Documents to the contrary notwithstanding, Subsidiary Borrower shall not permit a CFC to consummate an Acquisition of another CFC unless any such Acquisition is a Permitted Cash Acquisition or Permitted Non-Cash Acquisition. 7.14 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any transaction with any Affiliate of Subsidiary Borrower except for transactions that are in the ordinary course of Subsidiary Borrower's business, upon fair and reasonable terms, that are fully disclosed to Lender, and that are no less favorable to Subsidiary Borrower than would be obtained in an arm's length transaction with a non-Affiliate. 7.15 Suspension. Suspend or go out of a substantial portion of its business. 7.16 [Intentionally Omitted]. 7.17 Use of Proceeds. Use the proceeds of the Subsidiary Borrower Advances for any purpose other than (a) on the Closing Date, (i) to repay in full the outstanding principal, accrued interest, and accrued fees and expenses owing to Existing Lender, and (ii) to pay transactional fees, costs, and expenses incurred in connection with this Agreement, the other Subsidiary Loan Documents, and the transactions contemplated hereby and thereby, and (b) thereafter, consistent with the terms and conditions hereof, for its lawful and permitted purposes; provided, however, that Subsidiary Borrower shall not use the proceeds of the Subsidiary Borrower Advances to acquire shares in UK Holding Company or Subsidiary Borrower, any company (as defined by the Companies Act) which is a holding company of the UK Holding Company, Subsidiary Borrower, or any company (as defined in the Companies Act) which is a subsidiary company of the UK Holding Company or Subsidiary Borrower. 7.18 Change in Location of Chief Executive Office; Inventory and Equipment with Bailees. Relocate its registered office to a new location without Subsidiary Borrower providing 30 days prior written notification thereof to Lender and so long as, at the time of such written notification, Subsidiary Borrower provides any filings necessary to perfect and -55-

continue perfected the Lender's Liens and also provides to Lender a Collateral Access Agreement with respect to such new location. Other than in transit Inventory and Equipment of Subsidiary Borrower, the Inventory and Equipment of Subsidiary Borrower shall not at any time now or hereafter be stored with a bailee, warehouseman, or similar party without Lender's prior written consent. 7.19 Securities Accounts. Establish or maintain any Securities Account unless Lender shall have received a Control Agreement in respect of such Securities Account. Subsidiary Borrower agrees to not transfer assets out of any Securities Account; provided, however, that, so long as no Event of Default has occurred and is continuing or would result therefrom, Subsidiary Borrower may use such assets (and the proceeds thereof) to the extent not prohibited by this Agreement. 7.20 Compliance with Covenants of Parent Loan Agreement. Take any action which would cause Parent or the other Borrowers to be in violation of any material term or provision of the Parent Loan Agreement or any other Loan Document to which such Borrower may be a party.

continue perfected the Lender's Liens and also provides to Lender a Collateral Access Agreement with respect to such new location. Other than in transit Inventory and Equipment of Subsidiary Borrower, the Inventory and Equipment of Subsidiary Borrower shall not at any time now or hereafter be stored with a bailee, warehouseman, or similar party without Lender's prior written consent. 7.19 Securities Accounts. Establish or maintain any Securities Account unless Lender shall have received a Control Agreement in respect of such Securities Account. Subsidiary Borrower agrees to not transfer assets out of any Securities Account; provided, however, that, so long as no Event of Default has occurred and is continuing or would result therefrom, Subsidiary Borrower may use such assets (and the proceeds thereof) to the extent not prohibited by this Agreement. 7.20 Compliance with Covenants of Parent Loan Agreement. Take any action which would cause Parent or the other Borrowers to be in violation of any material term or provision of the Parent Loan Agreement or any other Loan Document to which such Borrower may be a party. 8. EVENTS OF DEFAULT. Any one or more of the following events shall constitute an event of default (each, an "Event of Default") under this Agreement: 8.1 If Subsidiary Borrower fails to pay when due and payable or when declared due and payable, all or any portion of the Obligations (whether of principal, interest (including any interest which, but for the provisions of the Bankruptcy Code, would have accrued on such amounts), fees and charges due Lender, reimbursement of Lender Expenses, or other amounts constituting Obligations); 8.2 If Subsidiary Borrower fails to perform, keep, or observe (a) any term, provision, condition, covenant, or agreement (i) contained in Sections 6.2 or 6.3 hereof and such failure or neglect continues for a period of 5 days after the date on which such failure or neglect first occurs, (ii) contained in Sections 6.6 or 6.10 hereof and such failure or neglect continues for a period of 15 days after the date on which such failure or neglect first occurs, or (b) any other term, provision, condition, covenant, or agreement contained in this Agreement or in any of the other Subsidiary Borrower Loan Documents (giving effect to any grace period, cure periods, or required notices, if any, expressly provided for in such other Subsidiary Borrower Loan Documents, in each case, other than any term, provision, condition, covenant, or agreement that is the subject of another provision of this Section 8, in which event such other provision of this Section 8 shall govern); provided, that, during any period of time that any such failure or neglect of the Borrowers referred to in this Section 8.2 exists, even if such failure or neglect is not yet an Event of Default by virtue of the existence of a grace or cure period or the precondition of the giving of a notice, Lender shall not be required to make further Subsidiary Borrower Advances or issue any Letters of Credit; -56-

8.3 If any material portion of Subsidiary Borrower's or any of its Subsidiaries' assets is attached, seized, subjected to a writ or distress warrant, levied upon, or comes into the possession of any third Person; 8.4 If an Insolvency Proceeding is commenced by Subsidiary Borrower or any of its Subsidiaries; 8.5 If an Insolvency Proceeding is commenced against Subsidiary Borrower, or any of its Subsidiaries, and any of the following events occur: (a) Subsidiary Borrower or the Subsidiary consents to the institution of the Insolvency Proceeding against it, (b) the petition commencing the Insolvency Proceeding is not timely controverted, (c) the petition commencing the Insolvency Proceeding is not dismissed within 60 calendar days of the date of the filing thereof; provided, however, that, during the pendency of such period, Lender shall be relieved of its obligation to extend credit hereunder, (d) an interim trustee is appointed to take possession of all or any substantial portion of the properties or assets of, or to operate all or any substantial portion of the business of, Subsidiary Borrower or any of its Subsidiaries, or (e) an order for relief shall have been entered therein; 8.6 If Subsidiary Borrower or any of its Subsidiaries is enjoined, restrained, or in any way prevented by court

8.3 If any material portion of Subsidiary Borrower's or any of its Subsidiaries' assets is attached, seized, subjected to a writ or distress warrant, levied upon, or comes into the possession of any third Person; 8.4 If an Insolvency Proceeding is commenced by Subsidiary Borrower or any of its Subsidiaries; 8.5 If an Insolvency Proceeding is commenced against Subsidiary Borrower, or any of its Subsidiaries, and any of the following events occur: (a) Subsidiary Borrower or the Subsidiary consents to the institution of the Insolvency Proceeding against it, (b) the petition commencing the Insolvency Proceeding is not timely controverted, (c) the petition commencing the Insolvency Proceeding is not dismissed within 60 calendar days of the date of the filing thereof; provided, however, that, during the pendency of such period, Lender shall be relieved of its obligation to extend credit hereunder, (d) an interim trustee is appointed to take possession of all or any substantial portion of the properties or assets of, or to operate all or any substantial portion of the business of, Subsidiary Borrower or any of its Subsidiaries, or (e) an order for relief shall have been entered therein; 8.6 If Subsidiary Borrower or any of its Subsidiaries is enjoined, restrained, or in any way prevented by court order from continuing to conduct all or any material part of its business affairs; 8.7 If a notice of Lien, levy, or assessment is filed of record with respect to Subsidiary Borrower's or any of its Subsidiaries' assets by the United States, or any department, agency, or instrumentality thereof, or by any state, county, municipal, or governmental agency, or if any taxes or debts owing at any time hereafter to any one or more of such entities becomes a Lien, whether choate or otherwise, upon Subsidiary Borrower's or any of its Subsidiaries' assets and the same is not paid before such payment is delinquent; 8.8 If a judgment or other claim becomes a Lien or encumbrance upon any material portion of Subsidiary Borrower's or any of its Subsidiaries' assets; 8.9 If there is a default in any material agreement, including any agreement with any purchase money financier or equipment lessor to which Subsidiary Borrower or any of its Subsidiaries is a party and such default (a) occurs at the final maturity of the obligations thereunder, or (b) results in a right by the other party thereto, irrespective of whether exercised, to accelerate the maturity of Subsidiary Borrower's or its Subsidiaries' obligations thereunder, to terminate such agreement, or to refuse to renew such agreement pursuant to an automatic renewal right therein; 8.10 If any software licensor of Subsidiary Borrower gives notice of its election to terminate any agreement between such Person and Subsidiary Borrower and Subsidiary Borrower does not have a suitable substitute for the licensed software; 8.11 If Subsidiary Borrower or any of its Subsidiaries makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the -57-

payment of the Obligations, except to the extent such payment is permitted by the terms of the subordination provisions applicable to such Indebtedness; 8.12 If any material misstatement or misrepresentation exists now or hereafter in any warranty, representation, statement, or Record made to Lender by Subsidiary Borrower, its Subsidiaries, or any officer, employee, agent, or director of Subsidiary Borrower or any of its Subsidiaries; 8.13 If the obligation of any Guarantor under its guaranty is limited or terminated by operation of law or by such Guarantor thereunder; 8.14 If this Agreement or any other Subsidiary Loan Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien on or security interest in the Collateral covered hereby or thereby; 8.15 Any provision of any Subsidiary Loan Document shall at any time for any reason be declared to be null and

payment of the Obligations, except to the extent such payment is permitted by the terms of the subordination provisions applicable to such Indebtedness; 8.12 If any material misstatement or misrepresentation exists now or hereafter in any warranty, representation, statement, or Record made to Lender by Subsidiary Borrower, its Subsidiaries, or any officer, employee, agent, or director of Subsidiary Borrower or any of its Subsidiaries; 8.13 If the obligation of any Guarantor under its guaranty is limited or terminated by operation of law or by such Guarantor thereunder; 8.14 If this Agreement or any other Subsidiary Loan Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien on or security interest in the Collateral covered hereby or thereby; 8.15 Any provision of any Subsidiary Loan Document shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof shall be contested by Subsidiary Borrower, or a proceeding shall be commenced by Subsidiary Borrower, or by any Governmental Authority having jurisdiction over Subsidiary Borrower, seeking to establish the invalidity or unenforceability thereof, or Subsidiary Borrower shall deny that any Borrower has any liability or obligation purported to be created under any Loan Document; or 8.16 If there is a default in any Loan Document and such default (a) occurs at the final maturity of the obligations thereunder, or (b) results in a right by Lender, irrespective of whether exercised, to accelerate the maturity of the Borrowers' obligations thereunder, to terminate such agreement, or to refuse to renew such agreement pursuant to an automatic renewal right therein. 9. THE LENDER'S RIGHTS AND REMEDIES. 9.1 Rights and Remedies. Upon the occurrence, and during the continuation, of an Event of Default, Lender (at its election but without notice of its election and without demand) may do any one or more of the following, all of which are authorized by Subsidiary Borrower: (a) Declare all Obligations, whether evidenced by this Agreement, by any of the other Subsidiary Loan Documents, or otherwise, immediately due and payable; (b) Cease advancing money or extending credit to or for the benefit of Subsidiary Borrower under this Agreement, under any of the Subsidiary Loan Documents, or under any other agreement between Subsidiary Borrower and Lender; -58-

(c) Terminate this Agreement and any of the other Subsidiary Loan Documents as to any future liability or obligation of Lender, but without affecting any of the Lender's Liens in the Collateral and without affecting the Obligations; (d) Settle or adjust disputes and claims directly with Account Debtors for amounts and upon terms which Lender considers advisable, and in such cases, Lender will credit the Loan Account with only the net amounts received by Lender in payment of such disputed Accounts after deducting all Lender Expenses incurred or expended in connection therewith; (e) Hold, as cash collateral, any and all balances and deposits of Subsidiary Borrower held by Lender, and any amounts received in the Cash Management Accounts, to secure the full and final repayment of all of the Obligations; (f) With respect to any of Subsidiary Borrower's owned or leased premises, Subsidiary Borrower hereby grants Lender a license to enter into possession of such premises and to occupy the same, in accordance with the terms of the relevant signed waiver and consent of real property owners, if any, in favor of Lender, without charge, in order to exercise any of Lender's rights or remedies provided herein, at law, in equity, or otherwise;

(c) Terminate this Agreement and any of the other Subsidiary Loan Documents as to any future liability or obligation of Lender, but without affecting any of the Lender's Liens in the Collateral and without affecting the Obligations; (d) Settle or adjust disputes and claims directly with Account Debtors for amounts and upon terms which Lender considers advisable, and in such cases, Lender will credit the Loan Account with only the net amounts received by Lender in payment of such disputed Accounts after deducting all Lender Expenses incurred or expended in connection therewith; (e) Hold, as cash collateral, any and all balances and deposits of Subsidiary Borrower held by Lender, and any amounts received in the Cash Management Accounts, to secure the full and final repayment of all of the Obligations; (f) With respect to any of Subsidiary Borrower's owned or leased premises, Subsidiary Borrower hereby grants Lender a license to enter into possession of such premises and to occupy the same, in accordance with the terms of the relevant signed waiver and consent of real property owners, if any, in favor of Lender, without charge, in order to exercise any of Lender's rights or remedies provided herein, at law, in equity, or otherwise; (g) Lender shall have all other rights and remedies available to it at law or in equity pursuant to any other Subsidiary Loan Documents; and (h) Any deficiency that exists after disposition of the Personal Property Collateral as provided above will be paid immediately by Subsidiary Borrower. Any excess will be returned, without interest and subject to the rights of third Persons, by Lender to Subsidiary Borrower. 9.2 Remedies Cumulative. The rights and remedies of Lender under this Agreement, the other Subsidiary Loan Documents, and all other agreements shall be cumulative. Lender shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by Lender of one right or remedy shall be deemed an election, and no waiver by Lender of any Event of Default shall be deemed a continuing waiver. No delay by Lender shall constitute a waiver, election, or acquiescence by it. 10. TAXES AND EXPENSES. If Subsidiary Borrower fails to pay any monies (whether taxes, assessments, insurance premiums, or, in the case of leased properties or assets, rents or other amounts payable under such leases) due to third Persons, or fails to make any deposits or furnish any required proof of payment or deposit, all as required under the terms of this Agreement, then, Lender, in its sole discretion and without prior notice to Subsidiary Borrower, may do any or all of the following: (a) make payment of the same or any part thereof, (b) set up such reserves in Subsidiary Borrower's Loan Account as Lender deems necessary to protect Lender from the exposure created by such failure, or (c) in the case of the failure to comply -59-

with Section 6.8 hereof, obtain and maintain insurance policies of the type described in Section 6.8 and take any action with respect to such policies as Lender deems prudent. Any such amounts paid by Lender shall constitute Lender Expenses and any such payments shall not constitute an agreement by Lender to make similar payments in the future or a waiver by Lender of any Event of Default under this Agreement. Lender need not inquire as to, or contest the validity of, any such expense, tax, or Lien and the receipt of the usual official notice for the payment thereof shall be conclusive evidence that the same was validly due and owing. 11. WAIVERS; INDEMNIFICATION. 11.1 Demand; Protest. Subsidiary Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release, compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and guarantees at any time held by Lender on which Subsidiary Borrower may in any way be liable.

with Section 6.8 hereof, obtain and maintain insurance policies of the type described in Section 6.8 and take any action with respect to such policies as Lender deems prudent. Any such amounts paid by Lender shall constitute Lender Expenses and any such payments shall not constitute an agreement by Lender to make similar payments in the future or a waiver by Lender of any Event of Default under this Agreement. Lender need not inquire as to, or contest the validity of, any such expense, tax, or Lien and the receipt of the usual official notice for the payment thereof shall be conclusive evidence that the same was validly due and owing. 11. WAIVERS; INDEMNIFICATION. 11.1 Demand; Protest. Subsidiary Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release, compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and guarantees at any time held by Lender on which Subsidiary Borrower may in any way be liable. 11.2 Lender's Liability for Collateral. Subsidiary Borrower hereby agrees that: (a) so long as Lender complies with its obligations, if any, under the Code, Lender shall not in any way or manner be liable or responsible for: (i) the safekeeping of the Collateral, (ii) any loss or damage thereto occurring or arising in any manner or fashion from any cause, (iii) any diminution in the value thereof, or (iv) any act or default of any carrier, warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of loss, damage, or destruction of the Collateral shall be borne by Subsidiary Borrower. 11.3 Indemnification. Subsidiary Borrower shall pay, indemnify, defend, and hold the Lender-Related Persons, each Participant, and each of their respective officers, directors, employees, agents, and attorneys-in-fact (each, an "Indemnified Person") harmless (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, and damages, and all reasonable attorneys fees and disbursements and other costs and expenses actually incurred in connection therewith (as and when they are incurred and irrespective of whether suit is brought), at any time asserted against, imposed upon, or incurred by any of them (a) in connection with or as a result of or related to the execution, delivery, enforcement, performance, or administration of this Agreement, any of the other Subsidiary Loan Documents, or the transactions contemplated hereby or thereby, and (b) with respect to any investigation, litigation, or proceeding related to this Agreement, any other Subsidiary Loan Document, or the use of the proceeds of the credit provided hereunder (irrespective of whether any Indemnified Person is a party thereto), or any act, omission, event, or circumstance in any manner related thereto (all the foregoing, collectively, the "Indemnified Liabilities"). The foregoing to the contrary notwithstanding, Subsidiary Borrower shall have no obligation to any Indemnified Person under this Section 11.3 with respect to any Indemnified Liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of such Indemnified Person. This provision shall survive the termination of this Agreement and the repayment of the Obligations. If any Indemnified Person makes any -60-

payment to any other Indemnified Person with respect to an Indemnified Liability as to which Subsidiary Borrower was required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by Subsidiary Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH ARE IN WHOLE OR IN PART CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON. 12. NOTICES. Unless otherwise provided in this Agreement, all notices or demands by Subsidiary Borrower or Lender to the other relating to this Agreement or any other Subsidiary Loan Document shall be in writing and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by registered or certified mail (postage prepaid, return receipt requested), overnight courier, electronic mail (at such email addresses as Subsidiary Borrower or Lender, as applicable, may designate to each other in accordance herewith), or telefacsimile to Subsidiary Borrower or to Lender, as the

payment to any other Indemnified Person with respect to an Indemnified Liability as to which Subsidiary Borrower was required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by Subsidiary Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH ARE IN WHOLE OR IN PART CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON. 12. NOTICES. Unless otherwise provided in this Agreement, all notices or demands by Subsidiary Borrower or Lender to the other relating to this Agreement or any other Subsidiary Loan Document shall be in writing and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by registered or certified mail (postage prepaid, return receipt requested), overnight courier, electronic mail (at such email addresses as Subsidiary Borrower or Lender, as applicable, may designate to each other in accordance herewith), or telefacsimile to Subsidiary Borrower or to Lender, as the case may be, at its address set forth below:
If to Subsidiary Borrower:

c/o FUTURELINK CORP. 2 South Point Drive Lake Forest, California 92630 Attn: Ross Vincenti, Esq. Fax No. 949.672.3117 PAUL HASTINGS JANOFSKY & WALKER, LLP 399 Park Avenue, 31st Floor New York, New York 10022 Attn: Tom Pollock, Esq. Fax No. 212.319.4090 FOOTHILL CAPITAL CORPORATION 2450 Colorado Avenue Suite 3000 West Santa Monica, California 90404 Attn: Business Finance Division Manager Fax No. 310.453.7413 BROBECK, PHLEGER & HARRISON LLP 550 South Hope Street, Suite 2100 Los Angeles, CA 90071 Attn: John Francis Hilson, Esq. -61-

with copies to:

If to Lender:

with copies to:

Fax No. 213.745.3345

Lender and Subsidiary Borrower may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other party. All notices or demands sent in accordance with this Section 12, other than notices by Lender in connection with enforcement rights against the Collateral under the provisions of the Code, shall be deemed received on the earlier of the date of actual receipt or 3 Business Days after the deposit thereof in the mail. Subsidiary Borrower acknowledges and agrees that notices sent by Lender in connection with the exercise of enforcement rights against Collateral under the provisions of the Code shall be deemed sent when deposited in the mail or personally delivered, or, where permitted by law, transmitted by telefacsimile or any other method set forth above. 13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER SUBSIDIARY LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER SUBSIDIARY LOAN

Fax No. 213.745.3345

Lender and Subsidiary Borrower may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other party. All notices or demands sent in accordance with this Section 12, other than notices by Lender in connection with enforcement rights against the Collateral under the provisions of the Code, shall be deemed received on the earlier of the date of actual receipt or 3 Business Days after the deposit thereof in the mail. Subsidiary Borrower acknowledges and agrees that notices sent by Lender in connection with the exercise of enforcement rights against Collateral under the provisions of the Code shall be deemed sent when deposited in the mail or personally delivered, or, where permitted by law, transmitted by telefacsimile or any other method set forth above. 13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER SUBSIDIARY LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER SUBSIDIARY LOAN DOCUMENT IN RESPECT OF SUCH OTHER SUBSIDIARY LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. (b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER SUBSIDIARY LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT LENDER'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE LENDER ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. SUBSIDIARY BORROWER AND LENDER WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 13(b). SUBSIDIARY BORROWER AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE SUBSIDIARY LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, -62-

INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. SUBSIDIARY BORROWER AND LENDER REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. 14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS. 14.1 Assignments and Participations. (a) Lender may assign and delegate to one or more assignees (each an "Assignee") all, or any ratable part of all, of the Obligations and the other rights and obligations of Lender hereunder and under the other Subsidiary Loan Documents; and, if required by Lender, Subsidiary Borrower will join with, and shall cause each of the Guarantors to join with, Lender and any Assignee in novating the Obligations under this Agreement and the other

INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. SUBSIDIARY BORROWER AND LENDER REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. 14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS. 14.1 Assignments and Participations. (a) Lender may assign and delegate to one or more assignees (each an "Assignee") all, or any ratable part of all, of the Obligations and the other rights and obligations of Lender hereunder and under the other Subsidiary Loan Documents; and, if required by Lender, Subsidiary Borrower will join with, and shall cause each of the Guarantors to join with, Lender and any Assignee in novating the Obligations under this Agreement and the other Subsidiary Loan Documents provided, however, that Subsidiary Borrower may continue to deal solely and directly with Lender in connection with the interest so assigned to an Assignee until (i) written notice of such assignment, together with payment instructions, addresses, and related information with respect to the Assignee, have been given to Subsidiary Borrower by Lender and the Assignee an appropriate assignment and acceptance agreement. (b) From and after the date that Lender provides Subsidiary Borrower with such written notice and executed assignment and acceptance agreement, (i) the Assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such assignment and acceptance agreement, shall have the assigned and delegated rights and obligations of Lender under the Subsidiary Loan Documents, and (ii) Lender shall, to the extent that rights and obligations (subject to any novation required under applicable law) hereunder and under the other Subsidiary Loan Documents have been assigned and delegated by it pursuant to such assignment and acceptance agreement, relinquish its rights (except with respect to Section 11.3 hereof) and be released from its obligations under this Agreement (and in the case of an assignment and acceptance agreement covering all or the remaining portion of Lender's rights and obligations under this Agreement and the other Subsidiary Loan Documents, Lender shall cease to be a party hereto and thereto), and such assignment shall affect a novation between Subsidiary Borrower and the Assignee. (c) Immediately upon Subsidiary Borrower's receipt of such fully executed assignment and acceptance agreement, this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of the rights and duties of Lender arising therefrom. -63-

(d) Lender may at any time sell to one or more commercial banks, financial institutions, or other Persons not Affiliates of Lender (a "Participant") participating interests in Obligations and the other rights and interests of Lender hereunder and under the other Subsidiary Loan Documents; provided, however, that (i) Lender shall remain the "Lender" for all purposes of this Agreement and the other Subsidiary Loan Documents and the Participant receiving the participating interest in the Obligations and the other rights and interests of Lender hereunder shall not constitute a "Lender" hereunder or under the other Subsidiary Loan Documents and Lender's obligations under this Agreement shall remain unchanged, (ii) Lender shall remain solely responsible for the performance of such obligations, (iii) Subsidiary Borrower and Lender shall continue to deal solely and directly with each other in connection with Lender's rights and obligations under this Agreement and the other Subsidiary Loan Documents, (iv) Lender shall not transfer or grant any participating interest under which the Participant has the right to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Subsidiary Loan Document, except to the extent such amendment to, or consent or waiver with respect to this Agreement or of any other Subsidiary Loan Document would (A) extend the final maturity date of the Obligations hereunder in which such Participant is participating, (B) reduce the interest rate applicable to the Obligations hereunder in which such Participant is participating, (C) release all or a material portion of the Collateral or guaranties (except to the extent expressly provided herein or in any of the Subsidiary Loan Documents) supporting the Obligations hereunder in which such Participant is participating, (D) postpone the payment of, or

(d) Lender may at any time sell to one or more commercial banks, financial institutions, or other Persons not Affiliates of Lender (a "Participant") participating interests in Obligations and the other rights and interests of Lender hereunder and under the other Subsidiary Loan Documents; provided, however, that (i) Lender shall remain the "Lender" for all purposes of this Agreement and the other Subsidiary Loan Documents and the Participant receiving the participating interest in the Obligations and the other rights and interests of Lender hereunder shall not constitute a "Lender" hereunder or under the other Subsidiary Loan Documents and Lender's obligations under this Agreement shall remain unchanged, (ii) Lender shall remain solely responsible for the performance of such obligations, (iii) Subsidiary Borrower and Lender shall continue to deal solely and directly with each other in connection with Lender's rights and obligations under this Agreement and the other Subsidiary Loan Documents, (iv) Lender shall not transfer or grant any participating interest under which the Participant has the right to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Subsidiary Loan Document, except to the extent such amendment to, or consent or waiver with respect to this Agreement or of any other Subsidiary Loan Document would (A) extend the final maturity date of the Obligations hereunder in which such Participant is participating, (B) reduce the interest rate applicable to the Obligations hereunder in which such Participant is participating, (C) release all or a material portion of the Collateral or guaranties (except to the extent expressly provided herein or in any of the Subsidiary Loan Documents) supporting the Obligations hereunder in which such Participant is participating, (D) postpone the payment of, or reduce the amount of, the interest or fees payable to such Participant through Lender, or (E) change the amount or due dates of scheduled principal repayments or prepayments or premiums, and (v) all amounts payable by Subsidiary Borrower hereunder shall be determined as if Lender had not sold such participation, except that, if amounts outstanding under this Agreement are due and unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement. The rights of any Participant only shall be derivative through Lender and no Participant shall have any rights under this Agreement or the other Subsidiary Loan Documents or any direct rights as to Subsidiary Borrower, the Collections, the Collateral, or otherwise in respect of the Obligations. No Participant shall have the right to participate directly in the making of decisions by Lender. (e) In connection with any such assignment or participation or proposed assignment or participation, a Lender may disclose all documents and information which it now or hereafter may have relating to Subsidiary Borrower or Subsidiary Borrower's business. (f) Any other provision in this Agreement notwithstanding, Lender may at any time create a security interest in, or pledge, all or any portion of its rights under and interest in this Agreement in favor of any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury Regulation 31 CFR Section 203.14, and -64-

such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law. (g) Subsidiary Borrower shall be under no obligation to pay any greater amount under this Agreement following an assignment or participation by the Lender of any of its rights or obligations pursuant to Section 14.1 if, in the circumstances existing at the time of such assignment or participation, such greater amount would not have been payable but for the assignment or participation. 14.2 Successors. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that Subsidiary Borrower may not assign this Agreement or any rights or duties hereunder without Lender's prior written consent and any prohibited assignment shall be absolutely void ab initio. No consent to assignment by Lender shall release Subsidiary Borrower from its Obligations. Lender may assign this Agreement and the other Subsidiary Loan Documents and its rights and duties hereunder and thereunder pursuant to Section 14.1 hereof and, except as expressly required pursuant to Section 14.1 hereof, no consent or approval by Subsidiary Borrower is required in connection with any such assignment. 15. AMENDMENTS; WAIVERS.

such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law. (g) Subsidiary Borrower shall be under no obligation to pay any greater amount under this Agreement following an assignment or participation by the Lender of any of its rights or obligations pursuant to Section 14.1 if, in the circumstances existing at the time of such assignment or participation, such greater amount would not have been payable but for the assignment or participation. 14.2 Successors. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that Subsidiary Borrower may not assign this Agreement or any rights or duties hereunder without Lender's prior written consent and any prohibited assignment shall be absolutely void ab initio. No consent to assignment by Lender shall release Subsidiary Borrower from its Obligations. Lender may assign this Agreement and the other Subsidiary Loan Documents and its rights and duties hereunder and thereunder pursuant to Section 14.1 hereof and, except as expressly required pursuant to Section 14.1 hereof, no consent or approval by Subsidiary Borrower is required in connection with any such assignment. 15. AMENDMENTS; WAIVERS. 15.1 Amendments and Waivers. No amendment or waiver of any provision of this Agreement or any other Subsidiary Loan Document, and no consent with respect to any departure by Subsidiary Borrower therefrom, shall be effective unless the same shall be in writing and signed by Lender and Subsidiary Borrower and then any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given 15.2 No Waivers; Cumulative Remedies. No failure by Lender to exercise any right, remedy, or option under this Agreement or, any other Subsidiary Loan Document, or delay by Lender in exercising the same, will operate as a waiver thereof. No waiver by Lender will be effective unless it is in writing, and then only to the extent specifically stated. No waiver by Lender on any occasion shall affect or diminish Lender's rights thereafter to require strict performance by Subsidiary Borrower of any provision of this Agreement. Lender's rights under this Agreement and the other Subsidiary Loan Documents will be cumulative and not exclusive of any other right or remedy that Lender may have. 16. GENERAL PROVISIONS. 16.1 Effectiveness. This Agreement shall be binding and deemed effective when executed by Subsidiary Borrower and Lender. 16.2 Section Headings. Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each Section applies equally to this entire Agreement. -65-

16.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against Lender or Subsidiary Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto. 16.4 Severability of Provisions. Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision. 16.5 Withholding Taxes. (a) All payments made by Subsidiary Borrower hereunder or under any note will be made without setoff, counterclaim, or other defense, except as required by applicable law other than for Taxes (as defined below). All such payments will be made free and clear of, and without deduction or withholding for, any present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction (other than the United States), except as required by applicable law, or by any political

16.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against Lender or Subsidiary Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto. 16.4 Severability of Provisions. Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision. 16.5 Withholding Taxes. (a) All payments made by Subsidiary Borrower hereunder or under any note will be made without setoff, counterclaim, or other defense, except as required by applicable law other than for Taxes (as defined below). All such payments will be made free and clear of, and without deduction or withholding for, any present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction (other than the United States), except as required by applicable law, or by any political subdivision or taxing authority thereof or therein (other than of the United States) with respect to such payments (but excluding, any tax imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein (i) measured by or based on the net income or net profits of Lender, or (ii) to the extent that such tax results from a change in the circumstances of Lender, including a change in the residence, place of organization, or principal place of business of Lender, or a change in the branch or lending office of Lender participating in the transactions set forth herein) and all interest, penalties or similar liabilities with respect thereto (all such non-excluded taxes, levies, imposts, duties, fees, assessments or other charges (including, without limitation, any withholding taxes on any payments made pursuant to this Agreement) being referred to collectively as "Taxes"). If any Taxes are so levied or imposed, Subsidiary Borrower agrees to pay the full amount of such Taxes, and such additional amounts (the "Gross Up Amount") as may be necessary so that every payment of all amounts due under this Agreement or under any note, including any amount paid pursuant to this Section 16.5 after withholding or deduction for or on account of any Taxes, will not be less than the amount provided for herein; provided, however, that Subsidiary Borrower shall not be required to increase any such amounts payable to Lender if the increase in such amount payable results from Lender's own willful misconduct or gross negligence. Subsidiary Borrower will furnish to Lender as promptly as possible after the date the payment of any Taxes is due pursuant to applicable law certified copies of tax receipts evidencing such payment by Subsidiary Borrower. (b) Lender and Subsidiary Borrower shall cooperate in completing any procedural formalities necessary for Subsidiary Borrower to obtain authorization to make its payments to Lender without deduction or withholding for or on account of applicable Taxes due on account of the making of a payment hereunder. If (i) Subsidiary Borrower makes a payment to Lender pursuant to the provisions of this Agreement, (ii) such payment includes an amount attributable to a Gross Up Amount (the "Applicable Gross Up Amount"), and (iii) -66-

Lender subsequently receives a tax credit against, relief or remission for, or repayment of any tax, levy, impost, duty, or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) ("Tax Credit") that Lender determines corresponds to the Applicable Gross Up Amount then Lender shall pay an amount to Subsidiary Borrower equal to the Tax Credit actually received by Lender. 16.6 Amendments in Writing. This Agreement only can be amended in writing signed by Lender and Subsidiary Borrower. 16.7 Counterparts; Telefacsimile Execution. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. The

Lender subsequently receives a tax credit against, relief or remission for, or repayment of any tax, levy, impost, duty, or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same) ("Tax Credit") that Lender determines corresponds to the Applicable Gross Up Amount then Lender shall pay an amount to Subsidiary Borrower equal to the Tax Credit actually received by Lender. 16.6 Amendments in Writing. This Agreement only can be amended in writing signed by Lender and Subsidiary Borrower. 16.7 Counterparts; Telefacsimile Execution. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. The foregoing shall apply to each other Subsidiary Loan Document mutatis mutandis. 16.8 Revival and Reinstatement of Obligations. If the incurrence or payment of the Obligations by Subsidiary Borrower or the transfer to Lender of any property should for any reason subsequently be declared to be void or voidable under any state or federal law relating to creditors' rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances, preferences, transfers at an undervalue, or other voidable or recoverable payments of money or transfers of property (collectively, a "Voidable Transfer"), and if Lender is required to repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the reasonable advice of its counsel, then, as to any such Voidable Transfer, or the amount thereof that Lender is required or elects to repay or restore, and as to all reasonable costs, expenses, and attorneys fees of Lender related thereto, the liability of Subsidiary Borrower automatically shall be revived, reinstated, and restored and shall exist as though such Voidable Transfer had never been made. 16.9 Integration. This Agreement, together with the other Subsidiary Loan Documents, reflects the entire understanding of the parties with respect to the transactions contemplated hereby and shall not be contradicted or qualified by any other agreement, oral or written, before the date hereof. [Signature page to follow.] -67-

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered as of the date first above written. FUTURELINK EUROPE LIMITED, a company organized under the laws of England and Wales
/s/ NIGEL HAWLEY ---------------------------------------Title: Director By:

/s/ YURI PASEA ---------------------------------------Title: Director

By:

FOOTHILL CAPITAL CORPORATION, a California corporation
/s/ WILLIAM SHIAO ---------------------------------------Title: Vice President By:

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered as of the date first above written. FUTURELINK EUROPE LIMITED, a company organized under the laws of England and Wales
By: /s/ NIGEL HAWLEY ---------------------------------------Title: Director

By:

/s/ YURI PASEA ---------------------------------------Title: Director

FOOTHILL CAPITAL CORPORATION, a California corporation
/s/ WILLIAM SHIAO ---------------------------------------Title: Vice President By:

-68-

EXHIBIT S-1 (Form of Subsidiary Borrower Borrowing Base Certificate) [on Subsidiary Borrower's Letterhead] Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 The undersigned, the [chief financial officer] of FutureLink Europe Limited, a corporation organized under the laws of the United Kingdom ("Subsidiary Borrower"), pursuant to Section 6.2 of that certain Loan and Security Agreement, dated as of December 13, 2000 (the "Loan Agreement"), entered into between Subsidiary Borrower and Foothill Capital Corporation, a California corporation ("Lender"), hereby certifies to Lender that the following items, calculated in accordance with the terms and definitions set forth in the Loan Agreement for such items are true and correct, and that Subsidiary Borrower is in compliance with and, after giving effect to any currently requested loans, will be in compliance with the terms, conditions, and provisions of the Loan Agreement. All initially capitalized terms used in this Subsidiary Borrower Borrowing Base Certificate have the meanings set forth in the Loan Agreement unless specifically defined herein. Effective Date of Calculation: ______________________ I. BORROWING BASE CALCULATION (a) Eligible UK Accounts:
(1) Amount of Eligible UK Accounts (as detailed on Schedule A.1 attached hereto and incorporated herein by this reference):

$ -------------

(2) Advance rate against Eligible UK Accounts:

85%

EXHIBIT S-1 (Form of Subsidiary Borrower Borrowing Base Certificate) [on Subsidiary Borrower's Letterhead] Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West Santa Monica, California 90404 The undersigned, the [chief financial officer] of FutureLink Europe Limited, a corporation organized under the laws of the United Kingdom ("Subsidiary Borrower"), pursuant to Section 6.2 of that certain Loan and Security Agreement, dated as of December 13, 2000 (the "Loan Agreement"), entered into between Subsidiary Borrower and Foothill Capital Corporation, a California corporation ("Lender"), hereby certifies to Lender that the following items, calculated in accordance with the terms and definitions set forth in the Loan Agreement for such items are true and correct, and that Subsidiary Borrower is in compliance with and, after giving effect to any currently requested loans, will be in compliance with the terms, conditions, and provisions of the Loan Agreement. All initially capitalized terms used in this Subsidiary Borrower Borrowing Base Certificate have the meanings set forth in the Loan Agreement unless specifically defined herein. Effective Date of Calculation: ______________________ I. BORROWING BASE CALCULATION (a) Eligible UK Accounts:
(1) Amount of Eligible UK Accounts (as detailed on Schedule A.1 attached hereto and incorporated herein by this reference):

$ -------------

(2) Advance rate against Eligible UK Accounts: (3) Item a(1) times Item a(2):

85% $ -------------

(4) Amount, if any, of the Dilution Reserve:

$ -------------

-1(5) Net Eligible UK Accounts (Item a(3) minus Item a(4)):

$ -------------

(b)

Eligible ASP Accounts (1) Amount of Eligible ASP Accounts (as detailed on Schedule A-1 attached hereto and incorporated herein by this reference):

$ --------------

(2) Advance rate against Eligible ASP Accounts: (3) Item b(1) times Item b(2):

85% $ --------------

(5) Net Eligible UK Accounts (Item a(3) minus Item a(4)):

$ -------------

(b)

Eligible ASP Accounts (1) Amount of Eligible ASP Accounts (as detailed on Schedule A-1 attached hereto and incorporated herein by this reference):

$ --------------

(2) Advance rate against Eligible ASP Accounts: (3) Item b(1) times Item b(2):

85% $ --------------

(4) Amount, if any, of the ASP Dilution Reserve:

$ --------------

(5) Net Eligible ASP Accounts (Item b(3) minus Item b(4)):

$ --------------

(c)

Eligible Accounts (Item a(5) plus Item b(5))

$ --------------

(d)

Amount of Subsidiary Borrower's Collections with $ respect to Accounts for the immediately preceding 45 day period:

$ -------------$ --------------

(e)

The lesser of Items c and d =

(f)

Aggregate amount of reserves, if any, established by Lender under Section 2.1(b) of the Loan Agreement: Item e minus Item f =

$ -------------$ --------------

16.10 II. AVAILABILITY CALCULATION (a) Maximum Permitted Advances (i) Maximum Revolver Amount $5,000,000, less the amount by which Domestic Revolver Usage exceeds $25,000,000

-2(ii) Letter of Credit Usage $ --------------

Item a(i) minus Item a(ii) =

$ --------------

(b)

Advances permitted under Borrowing Base (i) Borrowing Base (from Section I) $ --------------

(ii)

Letter of Credit Usage

$ --------------

Item a(i) minus Item a(ii) =

$ --------------

(b)

Advances permitted under Borrowing Base (i) Borrowing Base (from Section I) $ -------------$ -------------$ --------------

(ii)Letter of Credit Usage:

Item b(i) minus Item b(ii) =

(c)

Availability (i) Permitted Advances (the lesser of item a and item b):

$ --------------

(ii) Aggregate amount of outstanding Advances:

$ --------------

Item c(i) minus Item c(ii) =

$ --------------

[Remainder of page intentionally left blank.] -3-

The undersigned hereby certifies that all of the foregoing is true and correct as of the effective date of the calculations set forth above and that such calculations have been made in accordance with the requirements of the Loan Agreement. FUTURELINK EUROPE LIMITED, a corporation organized under the laws of the England and Wales, as Subsidiary Borrower By: Title: -4-

SCHEDULE A.1 (ELIGIBLE UK ACCOUNTS) [] (ELIGIBLE ASP ACCOUNTS) []

The undersigned hereby certifies that all of the foregoing is true and correct as of the effective date of the calculations set forth above and that such calculations have been made in accordance with the requirements of the Loan Agreement. FUTURELINK EUROPE LIMITED, a corporation organized under the laws of the England and Wales, as Subsidiary Borrower By: Title: -4-

SCHEDULE A.1 (ELIGIBLE UK ACCOUNTS) [] (ELIGIBLE ASP ACCOUNTS) []

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule P-1 PERMITTED LIENS None. 1

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 2.7(a) CASH MANAGEMENT BANK National Westminster Bank plc P.O. Box 5651 Newbury Berkshire RG14 5GP United Kingdom 2

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital

SCHEDULE A.1 (ELIGIBLE UK ACCOUNTS) [] (ELIGIBLE ASP ACCOUNTS) []

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule P-1 PERMITTED LIENS None. 1

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 2.7(a) CASH MANAGEMENT BANK National Westminster Bank plc P.O. Box 5651 Newbury Berkshire RG14 5GP United Kingdom 2

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.5 LOCATIONS OF INVENTORY AND EQUIPMENT FutureLink Europe Limited 2 Old Bath Road Newbury Berkshire RG14 1QL United Kingdom 3

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule P-1 PERMITTED LIENS None. 1

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 2.7(a) CASH MANAGEMENT BANK National Westminster Bank plc P.O. Box 5651 Newbury Berkshire RG14 5GP United Kingdom 2

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.5 LOCATIONS OF INVENTORY AND EQUIPMENT FutureLink Europe Limited 2 Old Bath Road Newbury Berkshire RG14 1QL United Kingdom 3

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.7 CHIEF EXECUTIVE OFFICE; FEIN FutureLink Europe Limited. The Chestnuts 2 Old Bath Road Newbury, Berkshire England RG14 1QL

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 2.7(a) CASH MANAGEMENT BANK National Westminster Bank plc P.O. Box 5651 Newbury Berkshire RG14 5GP United Kingdom 2

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.5 LOCATIONS OF INVENTORY AND EQUIPMENT FutureLink Europe Limited 2 Old Bath Road Newbury Berkshire RG14 1QL United Kingdom 3

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.7 CHIEF EXECUTIVE OFFICE; FEIN FutureLink Europe Limited. The Chestnuts 2 Old Bath Road Newbury, Berkshire England RG14 1QL VAT: 724 5381 37 Company Number: 3159433 4

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (b)

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.5 LOCATIONS OF INVENTORY AND EQUIPMENT FutureLink Europe Limited 2 Old Bath Road Newbury Berkshire RG14 1QL United Kingdom 3

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.7 CHIEF EXECUTIVE OFFICE; FEIN FutureLink Europe Limited. The Chestnuts 2 Old Bath Road Newbury, Berkshire England RG14 1QL VAT: 724 5381 37 Company Number: 3159433 4

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (b) CAPITALIZATION OF SUBSIDIARY BORROWER KNS Holdings Limited has 500,002 ordinary shares of Pound Sterling1 each issued and outstanding, all of which are held by KNS Holdings Limited. 5

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (c) CAPITALIZATION OF SUBSIDIARY BORROWERS' SUBSIDIARY None.

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.7 CHIEF EXECUTIVE OFFICE; FEIN FutureLink Europe Limited. The Chestnuts 2 Old Bath Road Newbury, Berkshire England RG14 1QL VAT: 724 5381 37 Company Number: 3159433 4

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (b) CAPITALIZATION OF SUBSIDIARY BORROWER KNS Holdings Limited has 500,002 ordinary shares of Pound Sterling1 each issued and outstanding, all of which are held by KNS Holdings Limited. 5

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (c) CAPITALIZATION OF SUBSIDIARY BORROWERS' SUBSIDIARY None. 6

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.10 LITIGATION In March 2000, a former employee filed a claim against FutureLink Europe Limited with the Employment Tribunal, alleging unfair dismissal and sexual discrimination. The claim is expected to be heard by the Tribunal before June 2001. No fixed amount has been claimed by the claimant however the claimant has offered to withdraw the claim in consideration of a payment of Pound Sterling40,000 by FutureLink Europe Limited which offer has been rejected by FutureLink Europe Limited. The claim is not covered by insurance. 7

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (b) CAPITALIZATION OF SUBSIDIARY BORROWER KNS Holdings Limited has 500,002 ordinary shares of Pound Sterling1 each issued and outstanding, all of which are held by KNS Holdings Limited. 5

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (c) CAPITALIZATION OF SUBSIDIARY BORROWERS' SUBSIDIARY None. 6

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.10 LITIGATION In March 2000, a former employee filed a claim against FutureLink Europe Limited with the Employment Tribunal, alleging unfair dismissal and sexual discrimination. The claim is expected to be heard by the Tribunal before June 2001. No fixed amount has been claimed by the claimant however the claimant has offered to withdraw the claim in consideration of a payment of Pound Sterling40,000 by FutureLink Europe Limited which offer has been rejected by FutureLink Europe Limited. The claim is not covered by insurance. 7

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.14 ENVIRONMENTAL MATTERS None. 8

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.16

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.8 (c) CAPITALIZATION OF SUBSIDIARY BORROWERS' SUBSIDIARY None. 6

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.10 LITIGATION In March 2000, a former employee filed a claim against FutureLink Europe Limited with the Employment Tribunal, alleging unfair dismissal and sexual discrimination. The claim is expected to be heard by the Tribunal before June 2001. No fixed amount has been claimed by the claimant however the claimant has offered to withdraw the claim in consideration of a payment of Pound Sterling40,000 by FutureLink Europe Limited which offer has been rejected by FutureLink Europe Limited. The claim is not covered by insurance. 7

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.14 ENVIRONMENTAL MATTERS None. 8

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.16 INTELLECTUAL PROPERTY None. 9

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.18 DEMAND DEPOSIT ACCOUNTS

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.10 LITIGATION In March 2000, a former employee filed a claim against FutureLink Europe Limited with the Employment Tribunal, alleging unfair dismissal and sexual discrimination. The claim is expected to be heard by the Tribunal before June 2001. No fixed amount has been claimed by the claimant however the claimant has offered to withdraw the claim in consideration of a payment of Pound Sterling40,000 by FutureLink Europe Limited which offer has been rejected by FutureLink Europe Limited. The claim is not covered by insurance. 7

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.14 ENVIRONMENTAL MATTERS None. 8

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.16 INTELLECTUAL PROPERTY None. 9

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.18 DEMAND DEPOSIT ACCOUNTS National Westminster Bank plc
Current Account Number Branch Sort Code Number Branch Sort Code Number Branch Sort Code Number Branch Code

Business Account

US Dollar Account

Receivables Account

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.14 ENVIRONMENTAL MATTERS None. 8

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.16 INTELLECTUAL PROPERTY None. 9

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.18 DEMAND DEPOSIT ACCOUNTS National Westminster Bank plc
Current Account Number Branch Sort Code Number Branch Sort Code Number Branch Sort Code Number Branch Code Number Branch Code Number Branch Code Number Branch Code

Business Account

US Dollar Account

Receivables Account

Receivables Account US Dollar Point to Point

Account

10

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.20

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.16 INTELLECTUAL PROPERTY None. 9

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.18 DEMAND DEPOSIT ACCOUNTS National Westminster Bank plc
Current Account Number Branch Sort Code Number Branch Sort Code Number Branch Sort Code Number Branch Code Number Branch Code Number Branch Code Number Branch Code

Business Account

US Dollar Account

Receivables Account

Receivables Account US Dollar Point to Point

Account

10

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.20 PERMITTED INDEBTEDNESS
Capital Leases Compaq Financial Services 6 Blackrock Business Par Carysfort Avenue Blackrock Co Dublin Ireland

Obligation as of October 31, 2000

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.18 DEMAND DEPOSIT ACCOUNTS National Westminster Bank plc
Current Account Number Branch Sort Code Number Branch Sort Code Number Branch Sort Code Number Branch Code Number Branch Code Number Branch Code Number Branch Code

Business Account

US Dollar Account

Receivables Account

Receivables Account US Dollar Point to Point

Account

10

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.20 PERMITTED INDEBTEDNESS
Capital Leases Compaq Financial Services 6 Blackrock Business Par Carysfort Avenue Blackrock Co Dublin Ireland

Obligation as of October 31, 2000
Short Term Long Term Total 129,726 GBP 242,779 GBP ----------372,505 GBP

11

EXHIBIT 10.77 DATED 14 DECEMBER 2000

Disclosure Schedules to Loan and Security Agreement between FutureLink Europe Limited. and Foothill Capital Corporation Schedule 5.20 PERMITTED INDEBTEDNESS
Capital Leases Compaq Financial Services 6 Blackrock Business Par Carysfort Avenue Blackrock Co Dublin Ireland

Obligation as of October 31, 2000
Short Term Long Term Total 129,726 GBP 242,779 GBP ----------372,505 GBP

11

EXHIBIT 10.77 DATED 14 DECEMBER 2000 FUTURELINK EUROPE LIMITED AND KNS HOLDINGS LIMITED (as the Charging Companies) and FOOTHILL CAPITAL CORPORATION (as Lender)

DEBENTURE

BROBECK HALE AND DORR Park Gate 25 Milton Park Oxford OX14 4SH Tel: +44 (0)1235 823000 Fax: +44 (0)1235 823030

EXHIBIT 10.77 DATED 14 DECEMBER 2000 FUTURELINK EUROPE LIMITED AND KNS HOLDINGS LIMITED (as the Charging Companies) and FOOTHILL CAPITAL CORPORATION (as Lender)

DEBENTURE

BROBECK HALE AND DORR Park Gate 25 Milton Park Oxford OX14 4SH Tel: +44 (0)1235 823000 Fax: +44 (0)1235 823030

TABLE OF CONTENTS
Clause Page 1. DEFINITIONS AND INTERPRETATION 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. COVENANT TO PAY CHARGING CLAUSE TITLE DOCUMENTS AND SECURITIES COLLECTION OF RECEIVABLES NEGATIVE PLEDGE AND OTHER RESTRICTIONS FURTHER ASSURANCE CONTINUING SECURITY GENERAL COVENANTS INSURANCE COVENANTS COVENANTS RELATING TO INTELLECTUAL PROPERTY PROPERTY COVENANTS AND CONSOLIDATION OF MORTGAGES POWERS OF SALE, LEASING AND ACCEPTING SURRENDERS OPENING OF NEW ACCOUNTS

1 7 8 12 14 14 15 16 16 17 18 19 19 20

TABLE OF CONTENTS
Clause Page 1. DEFINITIONS AND INTERPRETATION 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. COVENANT TO PAY CHARGING CLAUSE TITLE DOCUMENTS AND SECURITIES COLLECTION OF RECEIVABLES NEGATIVE PLEDGE AND OTHER RESTRICTIONS FURTHER ASSURANCE CONTINUING SECURITY GENERAL COVENANTS INSURANCE COVENANTS COVENANTS RELATING TO INTELLECTUAL PROPERTY PROPERTY COVENANTS AND CONSOLIDATION OF MORTGAGES POWERS OF SALE, LEASING AND ACCEPTING SURRENDERS OPENING OF NEW ACCOUNTS APPOINTMENT AND POWERS OF A RECEIVER POWER OF ATTORNEY OTHER POWERS EXERCISABLE BY THE LENDER APPLICATION OF MONEY RECEIVED BY THE LENDER OR A RECEIVER COSTS AND INTEREST ON OVERDUE AMOUNTS SET OFF TRANSFER DISCLOSURE PERPETUITY PERIODS FORBEARANCE AND SEVERABILITY VARIATIONS AND CONSENTS

1 7 8 12 14 14 15 16 16 17 18 19 19 20 20 24 25 25 26 27 27 27 28 28 28

26. 27. 28. 29. 30. 31.

SERVICE OF DEMANDS AND NOTICES COUNTERPARTS ADJUSTMENT OF ACCOUNT PROVISO FOR REDEMPTION AND RELEASES SECURITY TRUSTEESHIP GOVERNING LAW AND SUBMISSION TO JURISDICTION

29 29 29 30 30 30

THE FIRST SCHEDULE The Charging Companies THE SECOND SCHEDULE 32

26. 27. 28. 29. 30. 31.

SERVICE OF DEMANDS AND NOTICES COUNTERPARTS ADJUSTMENT OF ACCOUNT PROVISO FOR REDEMPTION AND RELEASES SECURITY TRUSTEESHIP GOVERNING LAW AND SUBMISSION TO JURISDICTION

29 29 29 30 30 30

THE FIRST SCHEDULE The Charging Companies THE SECOND SCHEDULE The Properties THE THIRD SCHEDULE Collection Account Side Letters THE FOURTH SCHEDULE The Patents and Trade Marks 39 34 33 32

THIS DEBENTURE made the fourteenth day of December 2000 BETWEEN: (1) FUTURELINK EUROPE LIMITED a company incorporated under the laws of England and Wales with registered number 03159433, whose registered office is at 19th Floor, Tower 42, International Financial Centre, 25 Old Broad Street, London EC2N 1HQ ("FUTURELINK"); (2) KNS HOLDINGS LIMITED a company incorporated under the laws of England and Wales with registered number 03471603 whose registered office is at 19th Floor, Tower 42, International Financial Centre, 25 Old Broad Street, London EC2N 1HQ ("KNS") (Details of KNS and FutureLink are set out in the First Schedule. They are together referred to as the "CHARGING COMPANIES" and each individually as a "CHARGING COMPANY"); (3) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal place of business at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404 (the "LENDER"); WITNESSES AS FOLLOWS: 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS: In this Debenture, words or expressions defined in the Loan Agreement (as defined below) shall, unless otherwise defined below, bear the same meaning in this Debenture and, in addition, in this Debenture (unless the context otherwise requires) the following expressions have the following meanings: "ACCOUNT DEBTORS" bears the meaning set out in the Loan Agreement; "ASSETS" means all the undertakings, property, assets, rights and revenues of the Charging Companies whatsoever, present or future, wherever situated in the world and includes each or any of them; "BUSINESS DAY" means any day that is not a Saturday, Sunday or other day on which banks are generally open for business (other than a day on which banks are only open for business in Euros) in California];

THIS DEBENTURE made the fourteenth day of December 2000 BETWEEN: (1) FUTURELINK EUROPE LIMITED a company incorporated under the laws of England and Wales with registered number 03159433, whose registered office is at 19th Floor, Tower 42, International Financial Centre, 25 Old Broad Street, London EC2N 1HQ ("FUTURELINK"); (2) KNS HOLDINGS LIMITED a company incorporated under the laws of England and Wales with registered number 03471603 whose registered office is at 19th Floor, Tower 42, International Financial Centre, 25 Old Broad Street, London EC2N 1HQ ("KNS") (Details of KNS and FutureLink are set out in the First Schedule. They are together referred to as the "CHARGING COMPANIES" and each individually as a "CHARGING COMPANY"); (3) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal place of business at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404 (the "LENDER"); WITNESSES AS FOLLOWS: 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS: In this Debenture, words or expressions defined in the Loan Agreement (as defined below) shall, unless otherwise defined below, bear the same meaning in this Debenture and, in addition, in this Debenture (unless the context otherwise requires) the following expressions have the following meanings: "ACCOUNT DEBTORS" bears the meaning set out in the Loan Agreement; "ASSETS" means all the undertakings, property, assets, rights and revenues of the Charging Companies whatsoever, present or future, wherever situated in the world and includes each or any of them; "BUSINESS DAY" means any day that is not a Saturday, Sunday or other day on which banks are generally open for business (other than a day on which banks are only open for business in Euros) in California]; "CHARGED PROPERTY" means any assets charged, secured or assigned, whether in law or in equity, to the Lender pursuant to this Debenture; "COLLECTION ACCOUNT" has the meaning given to it by clause 5.1 (Treatment of Receivables); "THIS DEBENTURE" means this Guarantee and Debenture; "DEFAULT RATE" means the rate specified in Clause 2.6(c)(i) of the Loan Agreement; "DEFAULT" has the meaning given to it in the Loan Agreement; "EMPLOYEE LIFE ASSURANCE POLICIES" means all assurance policies relating to accident or permanent health taken out for the purpose of benefiting any employee or his dependents to

the extent that either Charging Company is legally obliged to pay out the benefit of such policies to the relevant employees or their dependents; "EVENT OF DEFAULT" has the meaning given to it in the Loan Agreement; "FLOATING CHARGE ASSETS" means Assets for the time being comprised within a floating charge created under Clause 3.2(xiii); "GROUP" means together the Principal Borrower and its Subsidiaries and "GROUP COMPANY" means any

the extent that either Charging Company is legally obliged to pay out the benefit of such policies to the relevant employees or their dependents; "EVENT OF DEFAULT" has the meaning given to it in the Loan Agreement; "FLOATING CHARGE ASSETS" means Assets for the time being comprised within a floating charge created under Clause 3.2(xiii); "GROUP" means together the Principal Borrower and its Subsidiaries and "GROUP COMPANY" means any one or more of them; "HOLDING COMPANY" means a parent undertaking within the meaning of Section 258 of the Companies Act 1985; "INDEBTEDNESS" includes any obligation in any currency, whether incurred as principal of borrower, debtor or surety, for the payment or repayment of money, whether present or future, actual or contingent; "INTELLECTUAL PROPERTY RIGHTS" means, in relation to each Charging Company, all patents and trade marks (including but not limited to the Patents and Trade Marks), service marks (and all goodwill associated with them), all rights in passing off, all brand and trade names, all copyrights (including copyrights in computer software) and rights in the nature of copyright, semiconductor topography rights, design rights and registered designs, utility models, all documented trade secrets and know-how and all other intellectual property rights now or in the future owned or enjoyed by each Charging Company, including the right to apply for and all applications for the protection of any such rights in any part of the world and the benefit of all agreements, licences and permissions now or in the future entered into or enjoyed by the Charging Company relating to the use or exploitation of any such rights and includes each or any of them and "INTELLECTUAL PROPERTY RIGHT" shall be construed accordingly; "LAND" includes freehold and leasehold land in England and Wales and immovable property in Scotland and in each case all buildings and structures upon and all things affixed or annexed to Land (including trade and tenants' fixtures); "LIEN" has the meaning given to it in the Loan Agreement; "LOAN AGREEMENT" means the loan agreement to be made between, amongst others, FutureLink as Subsidiary Borrower (as defined therein) and Foothill Capital Corporation (as lender) (as amended, supplemented and/or restated from time to time, including in relation to an increase in the facilities provided thereunder); "SUBSIDIARY LOAN DOCUMENTS" has the meaning given to it in the Loan Agreement; "PATENTS" means the patents and trade marks listed in the Fourth Schedule; "PERMITTED LIEN" has the meaning given to it in the Loan Agreement; "PRINCIPAL" means any Group Company insofar only as it owes money or has incurred liabilities to the Lender; "PRINCIPAL BORROWER" means FutureLink Corp., a Delaware corporation;

"PROPERTIES" means the freehold, leasehold or immovable properties listed in the Second Schedule "RECEIVABLES" means all sums of money receivable by either Charging Company now or in the future consisting of or payable under or derived from any of its Assets; "RECEIVER" means any receiver and manager or receivers and managers appointed under clause 16.1

"PROPERTIES" means the freehold, leasehold or immovable properties listed in the Second Schedule "RECEIVABLES" means all sums of money receivable by either Charging Company now or in the future consisting of or payable under or derived from any of its Assets; "RECEIVER" means any receiver and manager or receivers and managers appointed under clause 16.1 (Appointment of Receiver) and (where the context requires or permits) includes any substituted receiver and manager or receivers and managers; "SECURED SUMS" means all money and liabilities covenanted and/or guaranteed to be paid or discharged or indemnified by the Charging Companies to the Lender under clause 2.1 (Covenant to Pay) or 2.2 (Indemnity); "SECURITIES" means all stocks, shares, debentures and loan stocks issued by any company or person and all other investments (whether or not marketable) now or in the future owned at law or in equity by either Charging Company, including all interests in investment funds and all rights and benefits arising and all money payable in respect of any of them, whether by way of conversion, redemption, bonus, option, dividend, interest or otherwise, and including all Securities owned by a Charging Company in any other company and including in particular the 500,002 Ordinary Shares of Foothill owned by KNS representing 100% of the share capital of Foothill; "SUBSIDIARY" means a subsidiary undertaking within the meaning of Section 258 of the Companies Act 1985; "TRADEMARKS" means the trademarks listed in the Fourth Schedule; "UK GUARANTY" bears the meaning given to it in the Loan Agreement; "WRITING" includes telex, facsimile transmission and any other mode of representing or reproducing words in a legible and non-transitory form, except in relation to any certificate, notice or other document which is expressly required by this Debenture to be signed, and "WRITTEN" has a corresponding meaning. 1.2 INTERPRETATION: In this Debenture, unless the context otherwise requires: (a) words denoting the singular number only shall also include the plural number and vice versa; words denoting the masculine gender only shall also include the feminine gender; words denoting persons only shall include corporations, partnerships and unincorporated associations; (b) references to clauses, paragraphs and Schedules are to be construed as references to clauses, paragraphs and Schedules of this Debenture; (c) references to any party shall, where relevant, be deemed to be references to or to include, as appropriate, their respective successors or permitted assigns; (d) references in this Debenture to this Debenture or any other document include references to this Debenture or such other document as varied, supplemented, restated and/or replaced in any manner from time to time and/or any document which varies, supplements, restates and/or replaces it;

(e) references to "INCLUDING" shall not be construed restrictively but shall be construed as meaning "including, without prejudice to the generality of the foregoing"; (f) references to moneys, obligations and liabilities due, owing or incurred under the Subsidiary Loan Documents shall include moneys, obligations and liabilities due, owing or incurred in respect of any extensions or increases in the amount of the facilities provided for therein or the obligations and liabilities imposed thereunder; (g) expressions defined in the Companies Act 1985 shall have the same meanings in this Debenture, except that the expression "company" shall include a body corporate established outside Great Britain and except where

(e) references to "INCLUDING" shall not be construed restrictively but shall be construed as meaning "including, without prejudice to the generality of the foregoing"; (f) references to moneys, obligations and liabilities due, owing or incurred under the Subsidiary Loan Documents shall include moneys, obligations and liabilities due, owing or incurred in respect of any extensions or increases in the amount of the facilities provided for therein or the obligations and liabilities imposed thereunder; (g) expressions defined in the Companies Act 1985 shall have the same meanings in this Debenture, except that the expression "company" shall include a body corporate established outside Great Britain and except where expressions are defined in this Debenture or the context otherwise requires; (h) any reference to any statute or any section of any statute shall be deemed to include reference to any statutory modification or re-enactment of it for the time being in force; (i) references to trade marks, patents, service marks or applications therefor or to brand names and trade names or any intellectual property rights shall include, where the context permits, the equivalent in other jurisdictions; and (j) the limitation on liability conferred by section 6(2) of the Law of Property (Miscellaneous Provisions) Act 1994 shall not apply to the covenants for title implied on the part of the Charging Companies. 1.3 HEADINGS: Headings in this Debenture are inserted for convenience and shall not affect its interpretation. 2. COVENANT TO PAY 2.1 COVENANT TO PAY: Each Charging Company hereby covenants that it will on demand in writing made to it by the Lender pay or discharge to the Lender all money and liabilities now or in the future due, owing or incurred to the Lender by that Charging Company under or pursuant to the Subsidiary Loan Documents as and when the same fall due for payment, whether on or after such demand, whether actually or contingently, whether solely or jointly with any other person, and whether as principal, guarantor, surety and whether on any current or other account or in any manner whatsoever including all interest, commission, fees, charges, costs and expenses which the Lender may in the course of its business properly charge or incur in respect of the Charging Company or its affairs and so that interest shall be computed and compounded to the date of payment or discharge in accordance with the Subsidiary Loan Documents or other document under which the liability arises or was incurred or, if no such rate or rates are specified, at the Default Rate (after as well as before any demand or judgement). 2.2 INDEMNITY: Each Charging Company further agrees as a separate and independent primary obligation to indemnify the Lender on demand in writing made to it by the Lender for and against any loss, cost, expenses or liability of any kind incurred as a result of any of the obligations hereby guaranteed by such Charging Company being or becoming void, unenforceable or ineffective against a Principal for any reason whatsoever whether known to the Lender or not and for all other amounts expressed to be guaranteed but which are not recovered from a Charging Company on the footing of a guarantee for any reason whatsoever.

2.3 If so directed by the Lender but not otherwise KNS shall claim or prove in FutureLink's liquidation for the whole or any part of the money due or owing to KNS from FutureLink under a right to reclaim any sum claimed against KNS under the UK Guaranty or any other sum due in any manner whatever and the benefit of such proof and of all money received by KNS in respect of it shall be held on trust for the Lender and applied in reduction of the Secured Sums. 2.4 DEMANDS FROM THE LENDER: The making of one demand under this Debenture will not preclude the Lender from making any further demands. The Lender may only make a demand under this Debenture for repayment of the Secured Sums following the occurrence and during the continuance of a Default or an Event of Default or if otherwise entitled to do so under the Loan Agreement 2.5 THIRD PARTIES: No demand may be made under this Debenture in respect of sums due, owing or incurred under the Subsidiary Loan Documents except to the extent that the Lender has become entitled to make

2.3 If so directed by the Lender but not otherwise KNS shall claim or prove in FutureLink's liquidation for the whole or any part of the money due or owing to KNS from FutureLink under a right to reclaim any sum claimed against KNS under the UK Guaranty or any other sum due in any manner whatever and the benefit of such proof and of all money received by KNS in respect of it shall be held on trust for the Lender and applied in reduction of the Secured Sums. 2.4 DEMANDS FROM THE LENDER: The making of one demand under this Debenture will not preclude the Lender from making any further demands. The Lender may only make a demand under this Debenture for repayment of the Secured Sums following the occurrence and during the continuance of a Default or an Event of Default or if otherwise entitled to do so under the Loan Agreement 2.5 THIRD PARTIES: No demand may be made under this Debenture in respect of sums due, owing or incurred under the Subsidiary Loan Documents except to the extent that the Lender has become entitled to make such demand under the relevant Loan Document, but any third party dealing with the Lender or any Receiver appointed under this Debenture shall not be concerned to see or enquire as to the validity of any demand under this Debenture. 2.6 Subject to any provision to the contrary in the Subsidiary Loan Documents all sums payable by the Charging Companies under this Debenture shall be paid without any set off, counterclaim, withholding or deduction whatsoever unless required by law in which event the Charging Company making the payment will simultaneously with making the relevant payment under this Debenture pay to the Lender such additional amount as will result in the receipt by the Lender of the full amount which would otherwise have been receivable and will supply the Lender promptly with evidence satisfactory to the Lender that the Charging Company has accounted to the relevant authority for the sum withheld or deducted. 3. CHARGING CLAUSE 3.1 CHARGING CLAUSE: Each Charging Company with full title guarantee (but subject to any Permitted Liens) hereby charges to the Lender as security for the payment or discharge of all Secured Sums: (a) By way of legal mortgage all rights, title, estate and other interests of such Charging Company in each of the Properties referred to in the Second Schedule; (b) (i) By way of first fixed charge all right title estate and other interests of such Charging Company in the Properties not effectively mortgaged under clause 3.1(a); (ii) by way of first fixed charge, all plant and machinery of such Charging Company and all related spare parts, fuels, equipment and tools now or in the future vested in or held by or on behalf of the Charging Company and not charged in paragraph (a) and all rights and interests of such Charging Company under all present and future agreements for the purchase, maintenance or use of plant and machinery;

(iii) by way of first fixed charge, all rental and other income and all debts and claims now or in the future due or owing to such Charging Company under or in connection with any lease, agreement or licence relating to Land; (iv) by way of first fixed charge, all Securities relating to any Subsidiary which such Charging Company may from time to time have and all other Securities belonging to such Charging Company; (v) by way of first fixed charge, all contracts and policies of insurance and assurance (or any interest therein) now or in the future held by such Charging Company and all rights and interests of the Charging Company in every such contract and policy (including the benefit of all claims arising and all money payable under such contracts and policies) (but excluding Employee Life Assurance Policies); (vi) by way of first fixed charge, all the present and future goodwill and uncalled capital from time to time of such Charging Company;

(iii) by way of first fixed charge, all rental and other income and all debts and claims now or in the future due or owing to such Charging Company under or in connection with any lease, agreement or licence relating to Land; (iv) by way of first fixed charge, all Securities relating to any Subsidiary which such Charging Company may from time to time have and all other Securities belonging to such Charging Company; (v) by way of first fixed charge, all contracts and policies of insurance and assurance (or any interest therein) now or in the future held by such Charging Company and all rights and interests of the Charging Company in every such contract and policy (including the benefit of all claims arising and all money payable under such contracts and policies) (but excluding Employee Life Assurance Policies); (vi) by way of first fixed charge, all the present and future goodwill and uncalled capital from time to time of such Charging Company; (vii) by way of first fixed charge, all Intellectual Property Rights of such Charging Company capable of being validly charged by way of fixed charge and the benefit of any present or future agreement or licence relating to such rights; (viii) by way of first fixed charge, all book and other debts now or in the future owing to such Charging Company and all rights and claims of such Charging Company against third parties, present and future, capable of being satisfied by the payment of money (except rights and claims effectively charged under the preceding provisions of this clause 3.1) with the benefit of any security or guarantees of any nature whatsoever now or at any time enjoyed, held or owned by such Charging Company; (ix) by way of first fixed charge, the benefit of all negotiable instruments, guarantees, bonds, debentures, legal or equitable charges and all other security, reservation of proprietary rights, rights of tracing, unpaid vendor's liens and all other rights and remedies now or in the future available to such Charging Company whether as security for any Receivable or for the performance by any third party of any obligation now or in the future owed to such Charging Company or otherwise; (x) by way of first fixed charge, all money at any time standing to the credit of any Collection Account relating to such Charging Company, including the proceeds of all its Receivables, which proceeds shall, for the avoidance of doubt, on payment into such Collection Account, cease to be subject to the charges contained in the preceding provisions of this clause 3.1 but shall be subject to the fixed charge contained in this paragraph (x); (xi) by way of first fixed charge, all money at any time standing to the credit of any realisation account relating to such Charging Company; (xii) by way of first fixed charge, all money at any time standing to the credit of any other bank account relating to such Charging Company; and (xiii) by way of first floating charge, all Assets now or in the future owned by such Charging Company except to the extent that such Assets are for the time

being effectively charged by any fixed charge contained in the preceding provisions of this clause 3.1 or validly assigned under clause 3.2, including any Assets comprised within a charge which is reconverted under clause 3.7 (Decrystallisation of Floating Charge); but in each case so that such Charging Company shall not (save if and to the extent permitted by the Loan Agreement) create any Lien over any Floating Charge Asset (whether having priority over, or ranking pari passu with or subject to, this floating charge) or take any other step referred to in clause 6(a) (Negative Pledge and other Restrictions) with respect to any Floating Charge Asset and such Charging Company shall not, without the prior written consent of the Lender, sell, transfer, part with or dispose of any Floating Charge Asset except by way of sale in the ordinary course of its business or as permitted under the Loan Agreement. 3.2 ASSIGNMENT OF RIGHTS: Each Charging Company with full title guarantee hereby assigns by way of security (but subject to any Permitted Liens) in favour of the Lender (but subject to the right of the Charging

being effectively charged by any fixed charge contained in the preceding provisions of this clause 3.1 or validly assigned under clause 3.2, including any Assets comprised within a charge which is reconverted under clause 3.7 (Decrystallisation of Floating Charge); but in each case so that such Charging Company shall not (save if and to the extent permitted by the Loan Agreement) create any Lien over any Floating Charge Asset (whether having priority over, or ranking pari passu with or subject to, this floating charge) or take any other step referred to in clause 6(a) (Negative Pledge and other Restrictions) with respect to any Floating Charge Asset and such Charging Company shall not, without the prior written consent of the Lender, sell, transfer, part with or dispose of any Floating Charge Asset except by way of sale in the ordinary course of its business or as permitted under the Loan Agreement. 3.2 ASSIGNMENT OF RIGHTS: Each Charging Company with full title guarantee hereby assigns by way of security (but subject to any Permitted Liens) in favour of the Lender (but subject to the right of the Charging Company to redeem such assignment upon the full payment or discharge of all Secured Sums): (a) the benefit to each Charging Company of all rights and claims to which such Charging Company is now or may in the future become entitled in relation to the Properties including (but without limitation) all rights and claims of such Charging Company against all persons who now are or who at any time have been or may become lessees, sub-lessees, licensees or occupiers of the whole or any part or parts of the Properties and all guarantors and sureties for the obligations of any such person; (b) the benefit to each Charging Company of all guarantees, warranties and representations given or made by, and any rights or remedies to which such Charging Company is now or may in the future be entitled against, all or any professional advisers and contractors in relation to any of their Properties and the manufacturers, suppliers or installers of all plant, machinery, fixtures, fittings or other items now or from time to time in the buildings erected or to be erected on any of the Properties and any other person now or from time to time under contract with or under a duty to the Charging Company; (c) the benefit of all rights and claims to which the Charging Company is now or in the future entitled under or in respect of any joint venture, partnership or similar arrangement or agreement insofar as they are capable of being assigned by way of security and such assignment does not breach the terms of such agreement or arrangement; and (d) the benefit of all rights and claims to which such Charging Company is now or in the future entitled under or in respect of any joint venture, partnership or similar arrangement or agreement insofar as they are capable of being assigned by way of security and such assignment does not breach the terms of such agreement or arrangement. The Charging Companies covenant to join with the Lender in giving notice of the assignments contained in clause 3.2 to all other relevant parties and to procure an acknowledgement of such notice from them. If for any reason the assignment of any of the Assets or bank accounts under clause 3.2 is found to be ineffective and/or if any sums payable in respect of such Assets are received by a Charging

Company, the Charging Company shall hold the benefit of such Assets or bank accounts with any such sums received by it or held on such bank account in trust for the Lender and shall account to the Lender for or otherwise apply all such sums as the Lender may direct and shall otherwise at its own cost take such action and execute such documents as the Lender may require. 3.3 CRYSTALLISATION OF FLOATING CHARGE: The floating charge created by each Charging Company in clause 3.1 (b) (Charging Clause) may be crystallised into a fixed charge by notice in writing given at any time as regards any Asset which the Lender may consider to be in jeopardy or which is in danger of seizure by the Lender to such Charging Company and (whether or not a Default or on Event of Default has occurred) may at any time appoint a Receiver thereof. Such crystallisation shall take effect over such Floating Charge Assets or class or classes of Floating Charge Assets as shall be specified in the notice. If no Floating Charge Assets are so specified, it shall take effect over all Floating Charge Assets of such Charging Company.

Company, the Charging Company shall hold the benefit of such Assets or bank accounts with any such sums received by it or held on such bank account in trust for the Lender and shall account to the Lender for or otherwise apply all such sums as the Lender may direct and shall otherwise at its own cost take such action and execute such documents as the Lender may require. 3.3 CRYSTALLISATION OF FLOATING CHARGE: The floating charge created by each Charging Company in clause 3.1 (b) (Charging Clause) may be crystallised into a fixed charge by notice in writing given at any time as regards any Asset which the Lender may consider to be in jeopardy or which is in danger of seizure by the Lender to such Charging Company and (whether or not a Default or on Event of Default has occurred) may at any time appoint a Receiver thereof. Such crystallisation shall take effect over such Floating Charge Assets or class or classes of Floating Charge Assets as shall be specified in the notice. If no Floating Charge Assets are so specified, it shall take effect over all Floating Charge Assets of such Charging Company. 3.4 AUTOMATIC CRYSTALLISATION: (a) Without prejudice to any rule of law which may have a similar effect, if either Charging Company, without the Lender's prior written consent, resolves to take or takes any step to charge (whether by way of fixed or floating charge) or otherwise creates any Lien (other than any Permitted Lien) over (or to create a trust over) any of its Floating Charge Assets or to dispose of any such Floating Charge Assets except by way of sale or other disposition in the ordinary course of such Charging Company's business (or as permitted by the Loan Agreement); or (b) if any person resolves to take or takes any step to levy any distress, execution, sequestration or other process against any Floating Charge Asset relating to a liability of such Charging Company; or (c) if a Default or Event of Default takes place or if any of the Secured Sums become due and outstanding prior to their stated maturity; then the floating charge created by clause 3.1 (b) (Charging Clause) shall be automatically crystallised (without the necessity of notice) into a fixed charge over such Floating Charge Assets instantly on the occurrence of such event. 3.5 FLOATING CHARGE ASSETS ACQUIRED AFTER CRYSTALLISATION: Except as otherwise stated in any notice given under clause 3.3 (Crystallisation of Floating Charge) or unless such notice relates to all Floating Charge Assets, Floating Charge Assets acquired by either Charging Company after crystallisation has occurred under clause 3.3 (Crystallisation of Floating Charge) or 3.4 (Automatic Crystallisation) shall continue to be subject to the floating charge created by clause 3.1(b) (Charging Clause), so that the crystallisation shall be effective only as to its Floating Charge Assets in existence at the date of crystallisation. 3.6 DECRYSTALLISATION OF FLOATING CHARGE: Any charge by either Charging Company which has crystallised under clause 3.3 (Crystallisation of Floating Charge) or 3.4 (Automatic Crystallisation) may, by notice in writing given at any time by the Lender to such Charging Company, be reconverted into a floating charge in relation to the Assets or class or classes of Assets specified in such notice. 3.7 PRIORITY OF FIXED SECURITY: Any mortgage, fixed charge or other fixed security whenever and however created by the Charging Companies and subsisting in favour of the Lender shall

(save as the Lender may otherwise declare at or after the time of its

(save as the Lender may otherwise declare at or after the time of its creation) have priority over the floating charge created by clause 3.1 (b)(xiii) (Charging Clause). 3.8 DEBENTURE TO HAVE PRIORITY: Any debentures, mortgages or charges (fixed or floating) created in the future by either Charging Company (except those in favour of the Lender) shall be expressed to be subject to this Debenture and shall rank in order of priority behind the charges created by this Debenture. CONSENTS REQUIRED FOR CHARGES OVER INTELLECTUAL PROPERTY RIGHTS: The Charging Companies shall use all reasonable endeavours promptly to obtain any consent required for: (a) the creation of a fixed charge over any interest in Intellectual Property Rights material to the business operated by any Group Company otherwise excluded under clause 3.1 (Charging Clause) and to produce to the Lender a copy of each consent forthwith upon receipt thereof; and the creation of an assignment of its rights and claims under any joint venture, partnership or similar arrangement or agreement otherwise excluded under Clause 3.2 (Assignment of Rights).

3.9

(a)

3.10

CHARGES OVER RECEIVABLES TO INCLUDE INTRA-GROUP RECEIVABLES: It is hereby agreed, for the avoidance of doubt, that the fixed charges given by the Charging Companies over their Receivables under clause 3.1 (Charging Clause) shall apply to all Receivables owing to such Charging Company by any other Group Company. TITLE DOCUMENTS AND SECURITIES DEPOSIT OF TITLE DEEDS AND OTHER DOCUMENTS: Except as otherwise expressly agreed in writing by the Lender, the Charging Companies shall: (a) deposit with the Lender, and the Lender shall be entitled to retain, all deeds and documents of title relating to all its Assets charged by way of fixed charge under clause 3.1 (Charging Clause) (including policies of insurance and assurance); and execute and deliver to the Lender such documents and transfers and give such instructions and perform such other acts as the Lender may reasonably require at any time to constitute or perfect an equitable or legal charge (at the Lender's option) over its registered Securities or a pledge over its bearer Securities.

4 4.1

(a)

4.2

SECURITIES: (a) Unless and until the occurrence of a Default or an Event of Default and for so long as it is continuing or the Lender otherwise directs in any case: (1) all voting and other rights attaching to Securities charged under this Debenture shall continue to be exercised by the Charging Companies for so long as they remain their registered owner and each Charging Company shall not permit any person other than such Charging Company, the Lender or the Lender's nominee to be registered as holder of any Securities or any part thereof; and if Securities of the Charging Company charged under this Debenture are registered in the name of the Lender or the Lender's nominee, all

(2)

voting and other rights attaching to them shall be exercised by the Lender or the Lender's nominee in accordance with instructions in writing from time to time received from such Charging Company,

voting and other rights attaching to them shall be exercised by the Lender or the Lender's nominee in accordance with instructions in writing from time to time received from such Charging Company, provided that such Charging Company undertakes not to give any instructions to exercise any voting or other rights in a way which might reasonably be expected to prejudice the value of the Securities or otherwise jeopardise the security created by this Debenture, and in the absence of any such instructions, the nominee shall refrain from exercising any such rights. (b) The Charging Companies shall be entitled to receive and retain all dividends, distributions and other monies paid on or derived from the Securities to the extent permitted by the Loan Agreement. After a Default or an Event of Default occurs and for so long as such Default or Event of Default is continuing, the Lender shall be entitled to: (1) receive and retain all dividends, distributions and other monies paid on the Securities to the extent permitted by the Subsidiary Loan Documents; and exercise or direct the exercise of the voting rights attached to any Securities which comprise part of the Charged Property in such manner as it considers fit.

(c)

(2)

The Charging Companies shall after such time: (aa) comply, or procure the compliance, with any directions of the Lender in respect of the exercise of the voting rights attached to such Securities; and if the Lender so requires by notice to a Charging Company, immediately deliver to the Lender a form of proxy or other authority (in each case, in such form as the Lender shall reasonably require) appointing such person as the Lender shall select as proxy of such Charging Company or, as the case may be, its nominee or otherwise enabling such person as the Lender shall select to exercise such voting rights as shall be specified (whether generally or specifically) in the relevant notice.

(bb)

4.3

PAYMENT OF COSTS ON SECURITIES: Unless the Lender otherwise agrees, the Charging Companies shall duly and promptly pay all costs, calls, instalments or other payments which from time to time become due in respect of any Securities. COLLECTION OF RECEIVABLES TREATMENT OF RECEIVABLES: The Charging Companies shall collect and realise all Receivables in the ordinary and usual course of its business on behalf of the Lender and shall request in writing and shall otherwise take all reasonable steps to ensure that Receivables are paid into such account or accounts as the Lender may direct from time to time (together, the "COLLECTION ACCOUNT") all money which they may receive in respect of the Receivables immediately on receipt. The Charging Companies shall, pending such payment, hold all money so received upon trust for the Lender and in accordance with the Lender's instructions

5. 5.1

from time to time. The Charging Companies shall procure that any bank which maintains a Collection Account shall hold all credit balances thereon to the order of the Lender. The Charging Companies shall procure that the authorised signatories of the Collection Account shall at all times be such persons as Lender shall direct and no other persons shall

from time to time. The Charging Companies shall procure that any bank which maintains a Collection Account shall hold all credit balances thereon to the order of the Lender. The Charging Companies shall procure that the authorised signatories of the Collection Account shall at all times be such persons as Lender shall direct and no other persons shall have authority to operate the Collection Account. 5.2 PRESERVATION OF CHARGES: The Charging Companies shall procure that each bank which holds a Collection Account into which it is required to pay its Receivables shall enter into such collection account agreements as the Lender may require under the terms of the Loan Agreement and shall not modify such arrangements without the Lender's prior written consent. In the event that the Lender does not require a Charging Company to enter into any specific form of collection account agreement, such Charging Company shall instead promptly give notice to any bank or financial institution (other than Lender) with which it holds a Collection Account in the form set out in the Third Schedule and use all reasonable endeavours to ensure that the relevant bank or financial institution acknowledges such notice in the prescribed form. PRESERVATION OF CHARGES UPON FACTORING: If Lender releases, waives or postpones its rights in respect of any Receivables for the purpose of enabling either Charging Company to factor or discount them to a third party, the charges created by this Debenture shall in all other respects remain in full force and effect. In particular, all amounts becoming due to a Charging Company from the third party and any Receivables re-assigned, or due to be re-assigned, by the third party to the relevant Charging Company shall be subject to the relevant fixed charge created by clause 3.1 (Charging Clause), subject only to any defences or rights of set-off which the third party may have against such Charging Company. DELIVERY OF PARTICULARS OF RECEIVABLES: The Charging Company shall deliver to Lender such particulars as to the amount and nature of its Receivables as Lender may from time to time reasonably require taking into account the requirements of the Loan Agreement. NEGATIVE PLEDGE AND OTHER RESTRICTIONS Neither Charging Company shall, without the prior written consent of the Lender or save as otherwise permitted under the Subsidiary Loan Documents (and, for the avoidance of doubt, with the exception of any Permitted Liens): (a) create, or agree or attempt to create, or permit to subsist, any Lien of any kind (including any security conferring power to convert a floating charge into a fixed charge in relation to any Asset) or any trust over any of its Assets or permit any lien (other than a lien arising by operation of law in the ordinary course of its business) to arise or subsist over any such Assets; sell, or agree to sell, assign, lease, license or sub-license, or grant any interest in, or otherwise part with possession of, dispose of, or cease to control, any of its Charged Property, or the right to receive or be paid the proceeds arising on disposal of the same or purport to do any such act (save that, unless otherwise prohibited by the Loan Agreement, it may deal with its Floating Charge Assets in the ordinary course of its business) or allow any third party to do any such thing; do or cause or permit to be done anything which may in any way materially depreciate, jeopardise or otherwise prejudice the market value or collateral value of Securities or the rights of Lender hereunder in respect of such Securities; or

5.3

5.4

6

(b)

(c)

(d)

dispose of the equity of redemption in respect of any Charged Property.

7.

FURTHER ASSURANCE To the extent required to comply with the Loan Agreement or any of the other Subsidiary Loan Documents, the Charging Companies shall, and shall

(d)

dispose of the equity of redemption in respect of any Charged Property.

7.

FURTHER ASSURANCE To the extent required to comply with the Loan Agreement or any of the other Subsidiary Loan Documents, the Charging Companies shall, and shall procure that their Subsidiaries shall, on demand by Lender in writing, execute and deliver to Lender at the cost of such Charging Company and in such form as Lender may reasonably require: (a) a fixed charge over any interest, not capable of being charged by way of legal mortgage, in any Land now or in the future belonging to such Charging Company; a legal assignment or other fixed security over all or any of its Intellectual Property Rights and a fixed charge over its Receivables or claims or the accounts into which Receivables have or are to be paid and, following the occurrence of a Default or Event of Default which is continuing, unless Lender otherwise agrees, shall give a legal assignment of its Receivables and/or give notice to the relevant debtor or account holding bank in such form as Lender has previously approved; without prejudice to clause 4.2 (Voting Rights), a legal charge over all or any of its Securities; a chattel mortgage over such of its chattels, plant, machinery, computers and/or other equipment of such Charging Company as Lender may reasonably specify; at any time whilst a Default or Event of Default is continuing or the security over such Floating Charge Assets is in jeopardy or such Floating Charge Assets are in danger of seizure, a fixed charge or other fixed security over any of its Floating Charge Assets; where any of its Assets (other than land) are situated outside England and Wales, such fixed security under the law of the place where the Asset is situated as the Lender may reasonably require; a notice to any third party of any of the charges or assignments contained in this Debenture; and such other documents as Lender may reasonably require further to secure the payment of the Secured Sums, or to perfect or protect this Debenture or facilitate its realisation on the exercise of the Lender's rights thereunder, or to vest title to any Asset in itself or its nominee or any purchaser and to register such security or title in any applicable register, in each case consistent with the jurisdiction in which such asset is situate with such legal opinions (if any) as the Lender may reasonably require from lawyers acceptable to it in relation to such new or additional charge or other security.

(b)

(c)

(d)

(e)

(f)

(g)

(h)

8.

CONTINUING SECURITY This Debenture shall be a continuing security to the Lender, notwithstanding any intermediate payment or settlement of account or any other matter whatever, and shall be in addition to and shall not prejudice or be prejudiced by any right of lien, set-off, combination or other rights exercisable by the Lender as bankers against any Group Company or any Lien, guarantee, indemnity and/or negotiable instrument now or in the future held by the Lender.

9. 9.1

GENERAL COVENANTS FutureLink will request in writing and otherwise take reasonable steps to ensure that all of its Account Debtors forward payment of the amounts owed by them directly to a Cash Management Bank and will comply with its other obligations set out in clause 2.7 of the Loan Agreement.

9. 9.1

GENERAL COVENANTS FutureLink will request in writing and otherwise take reasonable steps to ensure that all of its Account Debtors forward payment of the amounts owed by them directly to a Cash Management Bank and will comply with its other obligations set out in clause 2.7 of the Loan Agreement. NOTIFICATION OF ACQUISITION OF ASSETS: The Charging Companies shall at all times immediately notify the Lender in writing of any acquisition by either of them of any interest or right in or to any Land or any Intellectual Property Rights material to the operation of any Group Company's business. NEGATIVE COVENANTS REGARDING RECEIVABLES: Save as permitted by the Loan Agreement, neither Charging Company shall, without the prior written consent of the Lender (and other than to offer trade credit in the ordinary course of its business, charge, factor, assign, postpone, subordinate, set off, release, compound, settle, cease to collect or waive its rights of action in connection with any of its Receivables, do or omit to do anything which is likely materially to delay or prejudice the full recovery of its Receivables or otherwise deal with its Receivables save than by collecting in and realising the same (to the extent required to do so under clause 5.1 (Treatment of Receivables) and paying the proceeds into the Collection Account. NOTIFICATION OF ACQUISITION OF LAND: The Charging Companies covenant with the Lender to notify the Lender of any agreement proposed or made by it (whether now subsisting or made hereafter) for the acquisition by it or any person on its behalf of any Land, or any estate or interest in any Land; INSURANCE COVENANTS COVENANT TO INSURE: FutureLink shall ensure, that its insurance is such that the insurance covenants contained in clause 6.8 of the Loan Agreement are complied with. INSURANCE POLICIES: Foothill shall effect such insurances in the joint names of the Lender and the Group Company concerned (or, if that is not possible or required under the terms of the Loan Agreement, shall cause the interest of the Lender to be noted on such insurance policies) and use all reasonable endeavours to ensure that each such insurance policy contains a mortgagee's protection payee clause in such form as the Lender (acting reasonably) may require and a loss payee clause (which shall provide that all moneys payable under such insurance policies shall be paid to the Lender which shall alone be entitled to give good discharge or shall otherwise be in such form as the Lender shall reasonably require). PAYMENT OF PREMIUMS: The Charging Companies shall ensure that all premium and other payments necessary for effecting or maintaining such insurances are made punctually and promptly after demand (and in any event within 7 days) produce to the Lender details of the policies and the receipts for such payments and, if default shall at any time be made by a Charging Company or Group Company in effecting or maintaining the insurance required to be maintained under this clause 10 or producing any such receipt to the Lender promptly after demand or depositing any policy with the Lender pursuant to clause 4.1 (Deposit of Title Deeds and other Documents), the Lender may take out or renew such insurances in such sums and on such terms as the Lender may think expedient and all money so expended by the Lender shall be recoverable by the Lender under clause 19 (Costs and Interest on Overdue Amounts).

9.2

9.3

9.4

10. 10.1

10.2

10.3

10.4

PERMITTED USES AND ACTS: Neither Charging Company shall do or omit or permit to be done anything which may render any policy of insurance to be rendered void or voidable. INSURANCE BROKER'S UNDERTAKING: The Charging Companies shall use all reasonable endeavours to procure that each relevant insurer or, at the Lender option, such Charging Company's or Group Company's insurance broker, undertakes in writing to the Lender: (a) that if a Charging Company or Group Company defaults in the

10.5

10.4

PERMITTED USES AND ACTS: Neither Charging Company shall do or omit or permit to be done anything which may render any policy of insurance to be rendered void or voidable. INSURANCE BROKER'S UNDERTAKING: The Charging Companies shall use all reasonable endeavours to procure that each relevant insurer or, at the Lender option, such Charging Company's or Group Company's insurance broker, undertakes in writing to the Lender: (a) that if a Charging Company or Group Company defaults in the payment of any premium or fails to renew any such insurance, as soon as such default or non-renewal comes to the insurer's knowledge, to advise the Lender and (pending receipt of instructions from the Lender) to keep the Lender's interest in such insurance in force up to the full sum insured and for the same risks (subject to the premium for any such period of extended cover being payable); to advise the Lender of any proposed termination, expiry, cancellation or material alteration of any insurance policy at least 30 days before such cancellation is due to take effect; that if the insurance cover is to be reduced or any insured risks are to be restricted, to advise the Lender at least 30 days before such reduction or restriction is due to take effect; to advise the Lender of any act or omission or any event which comes to the knowledge of the insurer or the broker (as the case may be) and which would be reasonably likely to invalidate or render unenforceable the insurance in whole or in part and to agree that no breach of any terms of any such insurance or failure to give notice of an event giving rise to a claim by such Charging Company or Group Company will invalidate any such insurance in whole or in part as regards the Lender and the Lender shall not be liable for any relevant premium (which shall be for the account of the Charging Company or Group Company concerned).

10.5

(b)

(c)

(d)

10.6

APPLICATION OF INSURANCE PROCEEDS: All moneys received by a Charging Company, Group Company or the Lender on any policies of insurance relating to any Charged Property shall be applied in the manner specified in clause 6.8 of the Loan Agreement and, if any moneys payable under any policies of insurance are paid to a Charging Company or Group Company, Charging Company shall procure that such moneys will be held on trust pending their application for such purposes. COVENANTS RELATING TO INTELLECTUAL PROPERTY INTELLECTUAL PROPERTY COVENANTS: The Charging Companies shall, during the continuance of this security, unless the Lender otherwise agrees in writing, ensure, so far as it is able, that the covenants in relation to Intellectual Property Rights contained in the Subsidiary Loan Documents are complied with and in addition shall: (a) not assign, transfer, license or agree to licence (other than any non-exclusive licence granted in the ordinary course of its business and consistent with its past practice) any Intellectual Property Right material to the operation of the business of any Group Company (a "MATERIAL INTELLECTUAL PROPERTY RIGHT") or any interest therein or permit any third party to use any Material Intellectual Property Rights except for any licences which are in existence at the date of this Debenture and have been assigned to the Lender;

11. 11.1

(b)

not alter any specification for which any Material Intellectual Property Right has been registered or give its consent to the registration by any third party of any trade mark the same as or confusingly similar to any Material Intellectual Property Right charged under this Debenture; where reasonably practicable to do so, diligently commence and prosecute all proceedings as may be necessary to prevent infringement or as applicable the continued infringement of all

(c)

(b)

not alter any specification for which any Material Intellectual Property Right has been registered or give its consent to the registration by any third party of any trade mark the same as or confusingly similar to any Material Intellectual Property Right charged under this Debenture; where reasonably practicable to do so, diligently commence and prosecute all proceedings as may be necessary to prevent infringement or as applicable the continued infringement of all Material Intellectual Property Rights belonging to such Charging Company; and not without the Lender's consent use the Lender's name or join the Lender to any proceedings relating to the infringement of any Material Intellectual Property Rights.

(c)

(d)

11.2

THE LENDER AS AUTHORISED AGENT: The Charging Companies hereby appoint the Lender as their authorised agent and hereby irrevocably authorises the Lender: (a) if such Charging Company shall during the continuance of this Debenture make default in carrying out any of its obligations under clause 11.1 (Intellectual Property Covenants), to effect such filings, registrations, renewals, payments and notifications at the Trade Marks Registry or Patent Registry or otherwise as shall be necessary to give effect to clause 11.1 (Intellectual Property Covenants) or carry out such acts or things at the expense of such Charging Company as shall be necessary to protect the Lender's interest hereunder or to protect or maintain the Intellectual Property Rights in question or any of them; and to apply for the particulars of this Deed and of the Lender's interest in the Intellectual Property Rights and any other or future trade marks or patents or trade mark applications or patent applications or similar Intellectual Property Rights registered or to be registered in the United Kingdom in the name of such Charging Company to be made on the Register of Trade Marks or the Register of Patents or any similar register and hereby agrees to execute all documents and forms required to enable such particulars to be entered on such registers.

(b)

12. 12.1

PROPERTY COVENANTS AND CONSOLIDATION OF MORTGAGES The Secured Sums shall be deemed for the purpose of all powers implied by statute to have become due and payable within the meaning of Section 101 of the Law of Property Act 1925 immediately on the execution of this Debenture and Sections 109 (restricting the power to appoint a receiver) and 93 of the Law of Property Act (restricting the right of consolidation) shall not apply to this Debenture. PARTING WITH POSSESSION: NEITHER Charging Company shall part with possession (except on the determination of any lease, tenancy or licence granted to the Charging Company) of any Properties or share the occupation of them with any other person, or agree to do so, without the prior written consent of the Lender. POWERS OF SALE, LEASING AND ACCEPTING SURRENDERS STATUTORY POWER OF SALE TO ARISE ON ENFORCEMENT: Section 103 of the Law of Property Act 1925 shall not apply to this Debenture, but the statutory power of sale (as varied or extended by this Debenture) shall (as between the Lender and a purchaser from the Lender) arise on, and be exercisable at any time after, the execution of this Debenture. However, the Lender shall not exercise such power of sale until the payment of all or part of the Secured Sums has

12.2

13. 13.1

been demanded, or a Receiver has been appointed, but this provision shall not affect a purchaser or require him to ask whether a demand or appointment has been made. 13.2 The Charging Companies shall neither exercise the powers of leasing or accepting surrenders or leases conferred upon a mortgagor in possession

been demanded, or a Receiver has been appointed, but this provision shall not affect a purchaser or require him to ask whether a demand or appointment has been made. 13.2 The Charging Companies shall neither exercise the powers of leasing or accepting surrenders or leases conferred upon a mortgagor in possession by Sections 99 and 100 of the Law of Property Act 1925 nor any other powers of leasing, surrendering or accepting surrenders of leases vested in a Charging Company nor shall a Charging Company confer on any person any contractual licence to occupy or any other right or interest in any of the Properties or grant any licence or consent to assign, underlet or part with possession or occupation of the whole or any part of them without the prior written consent of the Lender. In granting its consent the Lender shall be entitled to require that an order be obtained under Section 38(4) of the Landlord and Tenant Act 1954 (as amended) excluding the security of tenure provisions of the act as a pre-condition to the granting of any lease. POWER OF THE LENDER TO GRANT LEASES: The statutory powers of sale, leasing and accepting surrenders under the Law of Property Act 1925 exercisable by the Lender by virtue of this Debenture are extended so as to authorise the Lender (whether in its own name or that of a Charging Company) to accept any surrenders of any lease or vary the terms of any lease as the Lender may see fit or to grant a lease or leases of or any options in respect of any Charged Property vested in a Charging Company or in which it has an interest, with such rights relating to other such Charged Property, and containing such covenants on the part of such Charging Company, and generally on such terms and conditions, as the Lender shall think fit. THE LENDER MAY SEVER FIXTURES: The statutory power of sale exercisable by the Lender is extended so as to authorise the Lender to sever any fixtures from the Properties or Land and sell them separately. THIRD PARTIES NOT TO BE CONCERNED WITH VALIDITY OF DEMAND: No person dealing in good faith and for value with the Lender or any Receiver, its agents or brokers, shall be concerned to enquire whether this Debenture has become enforceable, or whether any power exercised or purported to be exercised has become exercisable, or whether any Secured Sums remain due upon this Debenture, or as to the necessity or expediency of any stipulations and conditions subject to which the sale of any Assets shall be made, or otherwise as to the propriety or regularity of the sale of any Asset, or to see to the application of any money paid to the Lender or such Receiver, or its agents or brokers, and each such dealing shall be deemed to be within the powers hereby conferred and to be valid and effective accordingly. OPENING OF NEW ACCOUNTS RULING OFF OF ACCOUNTS: On receiving notice that a Charging Company has encumbered or disposed of any of its Assets (other than as permitted under the Loan Agreement), the Lender may rule off such Charging Company's account or accounts and open a new account or accounts with such Charging Company. CREDITS NOT TO REDUCE INDEBTEDNESS OF CHARGING COMPANY: If the Lender does not open a new account or accounts immediately on receipt of such notice, it shall nevertheless be treated as if it had done so at the time when it received such notice and as from that time all payments made by such Charging Company to the Lender shall be treated as having been credited to such new account or accounts and shall not operate to reduce the amount owing from such Charging Company to the Lender at the time when it received such notice.

13.3

13.4

13.5

14. 14.1

14.2

15.

APPOINTMENT AND POWERS OF A RECEIVER

15.1

APPOINTMENT OF RECEIVER: At any time: (a) after the security constituted by this Debenture has become enforceable; or

15.1

APPOINTMENT OF RECEIVER: At any time: (a) after the security constituted by this Debenture has become enforceable; or

(b) if Charging Company so requests in writing at any time; or (c) after failure by a Charging Company to pay any Secured Sum due from it on the due date for payment; or (d) following the occurrence and during the continuance of a Default or an Event of Default; or (notwithstanding the terms of any other agreement between a Charging Company and the Lender), after a proposal has been made for a voluntary arrangement or a petition has been presented for the compulsory winding up of a Charging Company or an administration order in relation to a Charging Company pursuant to Part I or II of the Insolvency Act 1986 or any equivalent event occurs under any applicable law; or (e) if at any time the Lender shall be of the reasonable opinion that any material part of the Charged Property is in imminent danger of seizure, distress or other legal process; the Lender may appoint by writing any person or persons duly qualified to be receiver, receiver and manager or administrative receiver of all or any part of the Assets of the relevant Charging Company.
15.2 POWERS OF RECEIVERS (JOINT AND SEVERAL OR SEVERAL): Where more than one Receiver is appointed, they shall have power to act separately unless the Lender shall in the appointment specify to the contrary. REMUNERATION OF RECEIVERS: The Lender may from time to time determine the remuneration of the Receiver. POWER OF THE LENDER TO REMOVE RECEIVER: The Lender may (subject to Section 45 of the Insolvency Act 1986) remove the Receiver from all or any of the Assets of which he is the Receiver. FURTHER APPOINTMENT: Such an appointment shall not preclude: (a) The Lender from making any subsequent appointment of a Receiver over all or any of the Assets over which a Receiver has not previously been appointed by the Lender or has been removed or otherwise ceased to act; or a Receiver, while continuing to act, consenting to the appointment of an additional Receiver to act with him.

15.3

15.4

15.5

(b)

15.6

STATUS OF RECEIVER: The Receiver of a Charging Company shall be the agent of that Charging Company (which shall be solely liable for his acts, defaults and remuneration) unless and until such Charging Company goes into liquidation, after which he shall act as principal, and shall not in either case become the agent of the Lender. POWERS OF RECEIVER: The Receiver of a Charging Company shall have and be entitled to exercise in relation to the relevant Charging Company all the powers set out in the Law of

15.7

Property Act 1925 and Schedule 1 to the Insolvency Act 1986 (whether or not the Receiver is in fact an administrative receiver) and, if the Receiver is an administrative receiver, in addition to all other powers exercisable by an administrative receiver by virtue of the Insolvency Act 1986 and, in particular, by way of addition and without limiting such powers (and without prejudice to the powers of the Lender), the Receiver shall have power: (a) to take possession of, collect and get in all or any part of the Assets of the Charging Company concerned and to take and defend any proceedings (including proceedings for its winding up or proceedings by way of arbitration) in its name or otherwise as he shall think fit;

Property Act 1925 and Schedule 1 to the Insolvency Act 1986 (whether or not the Receiver is in fact an administrative receiver) and, if the Receiver is an administrative receiver, in addition to all other powers exercisable by an administrative receiver by virtue of the Insolvency Act 1986 and, in particular, by way of addition and without limiting such powers (and without prejudice to the powers of the Lender), the Receiver shall have power: (a) to take possession of, collect and get in all or any part of the Assets of the Charging Company concerned and to take and defend any proceedings (including proceedings for its winding up or proceedings by way of arbitration) in its name or otherwise as he shall think fit; to comply with and perform all or any of the acts, matters, omissions or things covenanted to be done or omitted by the Charging Company concerned under this Debenture; to sell by public auction or private contract or let all or any part of the Charged Property and to let on hire lease, surrender and accept surrenders of leases and tenancies, grant rights, licences, options or easements or exchange all or any part of, and otherwise deal with or dispose of and exercise all rights, powers and discretions incidental to the ownership of, any of the Charged Property in the name of and on behalf of the Charging Company concerned or otherwise concur in doing any of the foregoing in such manner and generally on such terms and conditions and for such consideration (whether in cash, debentures or other obligations, shares, stocks, securities or other valuable consideration and whether payable by a lump sum or by instalments) as he may think fit and carry out any such sale by conveying by deed or transferring in the name and on behalf of the Charging Company concerned or otherwise, and so that plant machinery and other fixtures and fittings may be severed and sold separately from the premises containing them, and the Receiver may apportion any rent and the performance of any obligations; to repair, decorate, furnish, maintain, alter, improve, renew or add to the Charged Property or any part of it as he shall think fit and effect, maintain, renew or increase indemnity insurance and other insurances and obtain bonds; to appoint or dismiss managers, agents, officers, employees, servants, builders or workmen and employ professional advisers and others at such salaries or for such remuneration as he may think fit; to perform, repudiate, rescind, vary or enter into any arrangement or compromise any contracts or agreements which he may consider expedient; to settle, arrange, compromise and submit to arbitration any accounts, claims, questions or disputes whatsoever which may arise in connection with the business of such Charging Company or any of the Charged Property or in any way relating to the security constituted by this Debenture and bring, prosecute, defend, enforce, compromise, submit to and discontinue any actions, suits, arbitrations or proceedings whatsoever whether civil or criminal; to use the name of such Charging Company in the exercise of all or any of the powers conferred by this Debenture; to exercise or permit such Charging Company or any nominee of the Charging Company to exercise any powers or rights incidental to the ownership of the Charged

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

Property or any part of it in such manner as he may think fit; (j) to give valid receipts for all monies and execute all discharges, assurances and things which may be proper or desirable for realising the Security Assets or any part of them;

Property or any part of it in such manner as he may think fit; (j) to give valid receipts for all monies and execute all discharges, assurances and things which may be proper or desirable for realising the Security Assets or any part of them; to carry on or concur in carrying on the business of the Charging Company and raise money or others without security or on the security of all or any of its Assets; to sell or concur in selling (where necessary with the leave of a court), lease or concur in leasing, licence or concur in licensing, grant options over and, without the need to observe any of the provisions of Section 99 and 100 of the Law of Property Act 1925, let or concur in letting and to terminate or to accept surrenders of leases, licences or tenancies of all or any of the Assets of such Charging Company in such manner and generally on such terms and conditions as he shall think fit in his absolute and unfettered discretion and any such sale or disposition may be for cash, debentures, securities or other valuable consideration (in each case payable in a lump sum or by instalments) and to carry any such transactions into effect in the name of and on behalf of such Charging Company; to promote the formation of a Subsidiary or Subsidiaries of such Charging Company with a view to such Subsidiary or Subsidiaries purchasing, leasing, licensing or otherwise acquiring interests in all or any of the Assets of such Charging Company on such terms as the Receiver thinks fit; to arrange for the purchase, lease, licence or acquisition of all or any Assets of such Charging Company by any such Subsidiary on a basis whereby the consideration may be for cash, shares, debentures, loan stock, convertible loan stock or other securities, shares of profits or sums calculated by reference to profits or turnover or royalties or licence fees or otherwise, whether or not secured on the assets of such Subsidiary and whether or not such consideration is payable or receivable in a lump sum or by instalments over such period as the Receiver may think fit; to arrange for such Subsidiary or Subsidiaries to trade or cease to trade as the Receiver may think fit from time to time; to sever any fixtures from the Properties or Land of which they form part; to exercise all voting and other rights attaching to Securities owned by such Charging Company; to make any arrangement or compromise with the Lender as he shall think fit; to make and effect all repairs, renewals and improvements to the Assets of such Charging Company and to effect, renew or increase insurances on such terms and against such risks as he shall think fit; to appoint managers, officers and agents for the above purposes at such salaries as the Receiver may determine; to call up all or any portion of the uncalled capital of such Charging Company; to redeem any prior Lien and to settle and pass the accounts of the Lien, and any

(k)

(l)

(m)

(n)

(o)

(p)

(q)

(r)

(s)

(t)

(u)

(v)

accounts so settled and passed shall (subject to any manifest error) be conclusive and binding on such Charging Company and the money so paid shall be deemed an expense properly incurred by the Receiver; (w) to pay the proper administrative charges of the Lender in

accounts so settled and passed shall (subject to any manifest error) be conclusive and binding on such Charging Company and the money so paid shall be deemed an expense properly incurred by the Receiver; (w) to pay the proper administrative charges of the Lender in respect of time spent by their agents and employees in dealing with matters raised by the Receiver or relating to the receivership of such Charging Company; to commence and/or complete any building operations upon any Land or Properties of such Charging Company and to apply for and obtain any planning permissions, building regulation consents or licences in each case as he may in his absolute discretion think fit;

(x)

(y) to vary the terms of the leases of any Land or Properties; (z) to take all steps necessary to effect all registrations, renewals, applications and notifications as the Receiver in his discretion thinks prudent to maintain in force or protect any of such Charging Company's Intellectual Property Rights; and (aa) to do all such other acts and things as may be considered by the Receiver to be incidental or conducive to any of the above matters or powers or otherwise incidental or conducive to the preservation, improvement or realisation of any or all of the relevant Assets.
15.8 THIRD PARTIES: Neither the Lender nor the Receiver shall be liable to account as mortgagee in possession or otherwise for any money not actually received by it or him respectively. POWER OF ATTORNEY POWER OF ATTORNEY: The Charging Companies by way of security hereby irrevocably appoint the Lender (whether or not a Receiver has been appointed) and any Receiver separately the attorney of each Charging Company (with full power to appoint substitutes and to delegate) for such Charging Company, in its name and on its behalf, and as its act and deed or otherwise, at any time during the continuance of a Default or Event of Default to: (a) execute and deliver and otherwise perfect any agreement, assurance, deed, instrument or document; or perform any act;

16. 16.1

(b)

which may be required of such Charging Company under this Debenture, or may be deemed by such attorney necessary or desirable for any purpose of this Debenture or to enhance or perfect the security intended to be constituted by it or to convey or transfer legal ownership of any Assets or in exercise of all or any powers, authorities and discretions conferred by or pursuant to this Debenture or by the Law of Property Act 1925 on the Lender or any Receiver. 16.2 RATIFICATION: Without prejudice contained in clause 16.1 (Power hereby covenant with the Lender required so to do such Charging to the generality of the provisions of Attorney), the Charging Companies and separately with any Receiver that if Company will ratify and confirm:

(a)

all transactions entered into by it or (as the case may be) them at its or (as the case may be) their instance in the proper exercise of its or (as the case may be) their powers in accordance with this Debenture; and all transactions entered into by it or (as the case may be) them in signing, sealing, delivering and otherwise perfecting any assignment, mortgage, charge, security, deed, assurance, document or act as aforesaid;

(b)

(a)

all transactions entered into by it or (as the case may be) them at its or (as the case may be) their instance in the proper exercise of its or (as the case may be) their powers in accordance with this Debenture; and all transactions entered into by it or (as the case may be) them in signing, sealing, delivering and otherwise perfecting any assignment, mortgage, charge, security, deed, assurance, document or act as aforesaid;

(b)

and the Charging Companies irrevocably acknowledge and agree that such power of attorney is (inter alia) given to the Lender, or, as the case may be, the Receiver, or both, to secure the performance of the obligations owed to him or them by each such Charging Company. 17. 17.1 OTHER POWERS EXERCISABLE BY THE LENDER THE LENDER MAY EXERCISE RECEIVER'S POWERS: All powers of the Receiver conferred by this Debenture may be exercised by the Lender following demand by the Lender whether as attorney of a Charging Company or otherwise and whether or not the Receiver shall have been appointed and so that clause 15.7(v) (Powers of Receiver) shall be read and construed as if the words "be charged on the Assets of such Charging Company" were substituted for the words "be deemed an expense properly incurred by the Receiver". THE LENDER EMPOWERED TO RECEIVE BOOK DEBTS: The Lender or any manager or officer of the Lender is hereby irrevocably empowered: (a) to receive all book debts and other debts and claims which may be assigned to the Lender pursuant to clause 7 (Further Assurance); and on payment to give an effectual discharge for them and on non-payment (whilst a Default or Event of Default is continuing, at its discretion or otherwise in accordance with the instructions of the relevant Charging Company) to take and institute (if the Lender in its sole discretion so decides) all steps and proceedings either in the name of the relevant assignor or in the name of the Lender for their recovery and also to agree accounts and to make allowances and to give time to any surety. The relevant assignor hereby undertakes to ratify and confirm whatever the Lender or any manager or officer of the Lender shall do or purport to do under this clause 17.

17.2

(b)

17.3

EXCLUSION OF THE LENDER'S LIABILITY: Neither the Lender, nor any of its agents, managers or officers, shall have any liability or responsibility to either Charging Company arising out of the exercise or non-exercise of the rights conferred on it by this clause 17. THE LENDER NOT OBLIGED TO TAKE ACTION RELATING TO BOOK DEBTS: The Lender shall not be obliged to make any enquiry as to the sufficiency of any sums received by it in respect of any book debts or other debt or claim so assigned to it or to make any claim or take any other action to collect in or enforce them.

17.4

18.

APPLICATION OF MONEY RECEIVED BY THE LENDER OR A RECEIVER

18.1

APPLICATION OF RECOVERIES: Any money received under the powers conferred by this Debenture shall, subject to the discharge of any prior-ranking claims but without prejudice to

the rights of the Lender to recover any shortfall from a Charging Company, be paid or applied in the following order of priority: (a) in satisfaction of all costs, charges and expenses incurred, and payments made, by the Lender and/or the Receiver, and of the remuneration of the Receiver; in or towards satisfaction of the Secured Sums in the manner

(b)

the rights of the Lender to recover any shortfall from a Charging Company, be paid or applied in the following order of priority: (a) in satisfaction of all costs, charges and expenses incurred, and payments made, by the Lender and/or the Receiver, and of the remuneration of the Receiver; in or towards satisfaction of the Secured Sums in the manner applicable under the Loan Agreement; and as to the surplus (if any), to the person or persons entitled to it.

(b)

(c)

18.2

SUSPENSE ACCOUNT: The Lender may, in its absolute discretion on or at any time or times after demand and pending the payment to the Lender of the whole of the Secured Sums, place and keep to the credit of a separate or suspense account bearing interest at a commercial rate any money received, recovered or realised by the Lender by virtue of this Debenture for so long and in such manner as the Lender may determine without any intermediate obligation to apply it in or towards the discharge of any Secured Sum.

19.

COSTS AND INTEREST ON OVERDUE AMOUNTS

19.1

INDEMNITY: All costs, charges and liabilities (including all professional fees and disbursements and value added tax and/or any similar tax) and all other sums paid or incurred by the Lender and/or any Receiver under or in connection with this Debenture or the Group Companies' affairs shall be recoverable (on a full indemnity basis) as a debt payable on demand from both Charging Companies, may be debited without notice to any account of either Charging Company, shall bear interest accordingly and shall be charged on the Assets of both Charging Companies. The Charging Companies shall indemnify the Lender against all and any costs, charges and expenses arising: (a) out of any of the property charged or purported to be charged pursuant to clause 3 (Charging Clause) or clause 7 (Further Assurance) referable to it infringing or allegedly infringing any third party rights; and in relation to any proceedings referable to a Charging Company brought against the Lender or to which the Lender may be joined whether as plaintiff or defendant which relate to any of such Charged Property.

(b)

19.2

TYPES OF COSTS RECOVERABLE: Without prejudice to the generality of clause 19.1 (Indemnity), the costs recoverable by the Lender and/or any Receiver under this Debenture shall to the extent the same are recoverable under the Loan Agreement include: (a) all costs properly incurred by the Lender in preparing and administering this Debenture or perfecting the security created by it; all costs (whether or not allowable on a taxation by the court) of all proceedings for the enforcement of this Debenture or for the recovery or attempted recovery of the Secured Sums; all money properly expended and all costs arising out of the exercise of any power, right or discretion conferred by this Debenture; and

(b)

(c)

(d)

all costs and losses arising from any default by a Charging Company in the payment when due of any Secured Sums or the performance of its obligations under this Debenture.

19.3

OVERDUE AMOUNTS: Any overdue amounts secured by this Debenture shall carry interest at the rate and in accordance with the terms contained in the Loan Agreement in relation to overdue sums or such other rate as may

(d)

all costs and losses arising from any default by a Charging Company in the payment when due of any Secured Sums or the performance of its obligations under this Debenture.

19.3

OVERDUE AMOUNTS: Any overdue amounts secured by this Debenture shall carry interest at the rate and in accordance with the terms contained in the Loan Agreement in relation to overdue sums or such other rate as may be agreed between the Charging Companies and the Lender. In each case, such interest shall accrue on a day to day basis to the date of repayment in full and, if unpaid, shall be compounded on the terms so agreed (or in the absence of such agreed terms) with monthly rests on the Lender's usual monthly interest days. Interest shall continue to be charged and compounded on this basis after, as well as before, any demand or judgment. CURRENCY INDEMNITY: Moneys received or held by the Lender pursuant to this Debenture may from time to time after demand has been made be converted into such currency as the Lender considers necessary or desirable to discharge the Secured Sums in that currency at such rate of exchange as may be applicable under the Loan Agreement or, if none, the then prevailing spot rate of exchange of Wells Fargo Bank, N.A or any successor thereto (as conclusively determined by the Lender) for purchasing the currency to be acquired with the existing currency.

19.4

20.

SET-OFF (a) The Lender may apply any money standing to the credit of the Charging Companies with the Lender in any currency upon any account or otherwise (in any country and whether or not in the relevant Charging Company's name) in or towards satisfaction of any Secured Sums at any time after a Default or an Event of Default has occurred without notice to such Charging Company and may set off, combine or consolidate all or any of such money with all or such part of the Secured Sums as the Lender may select (whether presently payable or not) and the Lender may purchase with any such money any other currency required to effect such combination. The Charging Companies each irrevocably authorise the Lender in its name and at its expense to perform such acts and sign such documents as may be required to give effect to any set-off or transfer pursuant to clause 20(a), including the purchase with the money standing to the credit of any such account of such other currencies as may be necessary to effect such set-off or transfer. The foregoing provisions of this clause shall be in addition to and without prejudice to such rights of set-off, combination, consolidation, lien and other rights whatsoever conferred on the Lender by law.

(b)

(c)

21.

TRANSFER The Lender may at any time transfer all or any part of its rights in relation to this Debenture and the Secured Sums to any person or otherwise grant an interest in them to any person.

22.

DISCLOSURE

The Charging Companies each irrevocably authorise the Lender, at its discretion, at any time or from time to time, to disclose any information concerning the Charging Companies, this Debenture and the

Secured Sums: (a) to any Affiliate of the Lender; and

The Charging Companies each irrevocably authorise the Lender, at its discretion, at any time or from time to time, to disclose any information concerning the Charging Companies, this Debenture and the

Secured Sums: (a) to any Affiliate of the Lender; and (b) to any actual or prospective transferee or grantee referred to in clause 21 (Transfer). The above authority is without prejudice to any obligation of the Lender to make disclosure imposed by law. 23. PERPETUITY PERIODS The perpetuity period applicable to the trusts hereby constituted shall be 80 years. 24. FORBEARANCE AND SEVERABILITY
24.1 NO WAIVERS: All rights, powers and privileges under this Debenture shall continue in full force and effect, regardless of the Lender exercising, delaying in exercising or omitting to exercise any of them. INVALIDITY AND SEVERABILITY: (a) None of the covenants and guarantees given and none of the charges created by the Charging Companies under this Debenture shall be avoided or invalidated by reason only of any other of such covenant or covenants, guarantees or charges being invalid or unenforceable. Any provision of this Debenture which for any reason is or becomes illegal, invalid or unenforceable shall be ineffective only to the extent of such illegality, invalidity and unenforceability, without invalidating the remaining provisions of this Debenture.

24.2

(b)

25. VARIATIONS AND CONSENTS
25.1 VARIATIONS IN WRITING: No variation of this Debenture shall be considered valid and as constituting part of this Debenture, unless such variation shall have been made in writing and signed by the Lender and the Charging Companies. VARIATION: The expression "variation" shall include any variation, supplement, extension, deletion or replacement however effected. CONDITIONAL CONSENTS: Save as otherwise expressly specified in this Debenture or the Loan Agreement, any consent of the Lender may be given absolutely or on any terms and subject to any conditions as the Lender may determine in its entire discretion.

25.2

25.3

26.

SERVICE OF DEMANDS AND NOTICES

26.1

NOTICES TO COMPANIES: A demand for payment or any other communication to be given to a Charging Company under this Debenture may be made or given by any manager or officer of the Lender and must be in writing addressed to such Charging Company and served on it at the address for service of such Charging Company stated in the First Schedule or to the address last notified to the Lender by the Charging Company or its existing or last known place of business (or, if more than one, any one of such places), or by facsimile transmission to the facsimile number stated in the First Schedule or to the facsimile number last notified to the Lender by the Charging Company or by any other form of electronic communication which may be available.

26.

SERVICE OF DEMANDS AND NOTICES

26.1

NOTICES TO COMPANIES: A demand for payment or any other communication to be given to a Charging Company under this Debenture may be made or given by any manager or officer of the Lender and must be in writing addressed to such Charging Company and served on it at the address for service of such Charging Company stated in the First Schedule or to the address last notified to the Lender by the Charging Company or its existing or last known place of business (or, if more than one, any one of such places), or by facsimile transmission to the facsimile number stated in the First Schedule or to the facsimile number last notified to the Lender by the Charging Company or by any other form of electronic communication which may be available. NOTICES TO LENDER: Any communication to be given to the Lender under this Debenture must be given to the Lender in writing served on it at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404 (marked for the attention of the Business Finance Division Manager), or by facsimile to facsimile number 001 310 453 7413 or the address last notified to either Charging Company by the Lender in writing. DEEMED SERVICE: A notice or demand shall be deemed to be duly served on

26.2

26.3

a Charging Company: (a) if delivered by hand, at the time of actual delivery; (b) if transmitted by facsimile, at the time the facsimile transmission report (or other appropriate evidence) confirming that the facsimile has been transmitted to the addressee is received by the sender; and/or (c) if sent by first class prepaid post, at noon on the third Business Day following the day of posting and shall be effective even if it is misdelivered or returned undelivered; provided that, where delivery or transmission occurs after 6.00 pm in the place of receipt of delivery on a Business Day or on a day which is not a Business Day, service shall be deemed to occur at 9.00 am in the place of receipt of delivery on the next Business Day. In proving such service on the Charging Companies it shall be sufficient to prove that personal delivery was made or that the envelope containing the communication was correctly addressed and posted or that a facsimile transmission report (or other appropriate evidence) was obtained that the facsimile had been transmitted to the addressee.
26.4 SERVICE ON LENDER: Any communication to the Lender shall be deemed to have been given only on actual receipt by it.

27.

COUNTERPARTS This Debenture may be executed by the parties in any number of copies, all of which taken together shall constitute a single Debenture.

28.

ADJUSTMENT OF ACCOUNT

If the state of account between the Lender and a Charging Company by reference to which any Secured Sums are calculated for the purposes of this Debenture requires adjustment at any time because of any claim made against the Lender by an officeholder (within the meaning of Section 234 of the Insolvency Act 1986) then, notwithstanding any other provision of this Debenture: (a) that Charging Company's liability to the Lender will be correspondingly adjusted; and the Lender may treat any release or settlement made by it with that Charging Company before any such adjustment is required as

(b)

If the state of account between the Lender and a Charging Company by reference to which any Secured Sums are calculated for the purposes of this Debenture requires adjustment at any time because of any claim made against the Lender by an officeholder (within the meaning of Section 234 of the Insolvency Act 1986) then, notwithstanding any other provision of this Debenture: (a) that Charging Company's liability to the Lender will be correspondingly adjusted; and the Lender may treat any release or settlement made by it with that Charging Company before any such adjustment is required as being of no effect; and the Lender may recover from that Charging Company such sum as will place the Lender in the same position as if such release or settlement had not been made.

(b)

(c)

If any claim is made against the Lender under any insolvency law with reference to this Debenture, the Lender may agree the claim or settle it on any terms it chooses without asking for the Charging Company's agreement. If the Lender does agree or settle such claim, the Charging Company concerned will be liable under this Debenture as if a court order had been made containing the terms which the Lender agreed or settled. The relevant Charging Company will be responsible for all costs and expenses which the Lender properly incurs in defending such a claim.

29.

PROVISO FOR REDEMPTION AND RELEASES Following payment and discharge in full of the Secured Sums to be paid or discharged by a Charging Company under this Debenture or if a Charging Company wishes to dispose of an Asset charged by way of fixed charge under this Debenture where such disposal is permitted under this Debenture the Lender will, at the request and cost of the Charging Companies, execute a release and reassignment of all or the relevant part of the security given by such Charging Company comprised in this Debenture in such form as the Charging Company may reasonably require.

30.

SECURITY TRUSTEESHIP The Lender shall not have (or be deemed to have) any obligation to, or trust or fiduciary relationship with, any person other than any for which specific provision is made in any Relevant Document or the Loan Agreement.

31. 31.1

GOVERNING LAW AND SUBMISSION TO JURISDICTION GOVERNING LAW: This Debenture shall be governed by and construed in all respects in accordance with English law. SUBMISSION TO JURISDICTION: (a) The Charging Companies irrevocably submit for the benefit of the Lender to the non-exclusive jurisdiction of the courts of England for the purpose of hearing and determining any dispute arising out of this Debenture. For the purpose of enforcement of any judgement against its assets, without prejudice to any other permitted mode of service, the Charging Companies agree that service of any writ, notice or other document for the purpose of any proceedings in such courts

31.2

(b)

shall be duly served upon it if delivered or sent by registered post to such Charging Company at the address for notices specified in Clause 26 (Service of Demands and Notices) or such other address in England or Wales as such Charging Company may notify from time to time to the Lender. (c) The Charging Companies irrevocably agree not to claim that any such court is not a convenient or appropriate forum and agree that a judgment in proceedings brought in such courts shall be

shall be duly served upon it if delivered or sent by registered post to such Charging Company at the address for notices specified in Clause 26 (Service of Demands and Notices) or such other address in England or Wales as such Charging Company may notify from time to time to the Lender. (c) The Charging Companies irrevocably agree not to claim that any such court is not a convenient or appropriate forum and agree that a judgment in proceedings brought in such courts shall be conclusive and binding upon them and may be enforced in any other jurisdiction.

31.3

FREEDOM OF CHOICE: The submission to the jurisdiction of the courts referred to in Clause 31.2 (Submission to Jurisdiction) shall not (and shall not be construed so as to) limit the right of the Lender to take proceedings against either Charging Company in the courts of any country in which such Charging Company has assets or in any other court of competent jurisdiction nor shall the taking of proceedings in any one or more jurisdictions preclude the taking of proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by applicable law.

THIS DEBENTURE has been executed by each Charging Company as a Deed and signed by the Lender but shall only be treated as having been executed and delivered to take effect on the day and year first above written.

CHARGORS
EXECUTED and DELIVERED as a Deed by KNS HOLDINGS LIMITED (pursuant to a resolution of its Board of Directors) acting by: ) ) ) ) )

Director Director

/s/ NIGEL HAWLEY /s/ YURI PASEA

OR BY ITS ATTORNEY

EXECUTED and DELIVERED as a Deed by FUTURELINK EUROPE LIMITED (pursuant to a resolution of its Board of Directors) acting by:

) ) ) )

Director Director

/s/ NIGEL HAWLEY /s/ YURI PASEA

OR BY ITS ATTORNEY

LENDER
SIGNED by for and on behalf of FOOTHILL CAPITAL CORPORATION /s/ WILLIAM SHIAO ) ) )

CHARGORS
EXECUTED and DELIVERED as a Deed by KNS HOLDINGS LIMITED (pursuant to a resolution of its Board of Directors) acting by: ) ) ) ) )

Director Director

/s/ NIGEL HAWLEY /s/ YURI PASEA

OR BY ITS ATTORNEY

EXECUTED and DELIVERED as a Deed by FUTURELINK EUROPE LIMITED (pursuant to a resolution of its Board of Directors) acting by:

) ) ) )

Director Director

/s/ NIGEL HAWLEY /s/ YURI PASEA

OR BY ITS ATTORNEY

LENDER
SIGNED by for and on behalf of FOOTHILL CAPITAL CORPORATION /s/ WILLIAM SHIAO ) ) )

THE FIRST SCHEDULE THE CHARGING COMPANIES
NAME OF CHARGING COMPANY -----------------------KNS HOLDINGS LIMITED REGISTERED NUMBER ----------------03471603 ADDRESS FOR SERVICE AND FAX OR TELEX NUMBER ------------------------------------------KNS Holdings Limited C/o FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL Fax: 01635 38578 Attention: Company Secretary/Chief Financial Officer With copies to: Paul Hastings Janofsky & Walker Tower 42 25 Old Broad Street London EC2N 1HQ Fax: 0207 628 4444 Re: KNS Holdings Limited

THE FIRST SCHEDULE THE CHARGING COMPANIES
NAME OF CHARGING COMPANY -----------------------KNS HOLDINGS LIMITED REGISTERED NUMBER ----------------03471603 ADDRESS FOR SERVICE AND FAX OR TELEX NUMBER ------------------------------------------KNS Holdings Limited C/o FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL Fax: 01635 38578 Attention: Company Secretary/Chief Financial Officer With copies to: Paul Hastings Janofsky & Walker Tower 42 25 Old Broad Street London EC2N 1HQ Fax: 0207 628 4444 Re: KNS Holdings Limited FUTURELINK EUROPE LIMITED 03159433 FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL Fax: 01635 38578 Attention: Company Secretary/Chief Financial Officer With copies to: Paul Hastings Janofsky & Walker Tower 42 25 Old Broad Street London EC2N 1HQ Fax: 0207 628 4444 Re: FutureLink Europe Limited

THE SECOND SCHEDULE THE PROPERTIES PREMISES DEMISED BY AND MORE PARTICULARLY DESCRIBED IN AN UNDERLEASE DATED 9 FEBRUARY BETWEEN (1) TARMAC HEAVY BUILDING MATERIALS UK LIMITED, AND (20 KERRIDGE COMPUTER COMPANY LIMITED AND SHORTLY KNOWN AS 2 OLD BATH ROAD, NEWBURY

THE THIRD SCHEDULE COLLECTION ACCOUNT SIDE LETTERS

THE SECOND SCHEDULE THE PROPERTIES PREMISES DEMISED BY AND MORE PARTICULARLY DESCRIBED IN AN UNDERLEASE DATED 9 FEBRUARY BETWEEN (1) TARMAC HEAVY BUILDING MATERIALS UK LIMITED, AND (20 KERRIDGE COMPUTER COMPANY LIMITED AND SHORTLY KNOWN AS 2 OLD BATH ROAD, NEWBURY

THE THIRD SCHEDULE COLLECTION ACCOUNT SIDE LETTERS [*FORM OF NOTICE TO BE SERVED BY BOTH OF THE CHARGING COMPANIES TO BANK HOLDING THE COLLECTION ACCOUNT TOGETHER WITH THE FORM OF ACKNOWLEDGEMENT REQUIRED FROM THAT BANK*] To: [ ] [*branch address*] For the attention of [ ] [* date *] We refer to the debenture (the "DEBENTURE") dated on or around the date of this notice and made between ourselves (1) and Foothill Capital Corporation (as the Lender as defined in the Debenture) (2). We each hereby give you notice that pursuant to the Debenture we, with full title guarantee, have charged by way of first fixed charge to the Lender all our rights, title and interest in and to all sums which may at any time be standing to the credit of the accounts listed in the table below, which were opened by us in your books and any other accounts which we may open in your books (the "COLLECTION ACCOUNTS" and each one of them a "COLLECTION ACCOUNT").
COMPANY/ACCOUNT DESCRIPTION --------------------------COLLECTION ACCOUNT NUMBER ------------------------BANK SORT CODE --------------

In connection therewith and by way of security for the Secured Sums (as defined in the Debenture) we hereby irrevocably and unconditionally instruct and authorise you (notwithstanding any previous instructions whatsoever which we may have given you to the contrary): (a) to disclose to the Lender without any reference to or further authority from us and without any enquiry by you as to the justification for such disclosure, such information relating to the Collection Accounts or any other accounts opened by us in your books (the "ACCOUNTS"), the amount from time to time standing to the credit thereof and the debts represented thereby as the Lender may, at any time and from time to time, request you to disclose to it; and (b) unless the Lender so authorises you, not to permit withdrawals from the Collection Accounts and to hold all moneys from time to time standing to the credit of the Collection Accounts to the order of the Lender and pay all or any part of those moneys to the Lender (or as it may direct) promptly following receipt of written instructions from the Lender to that effect.

The arrangements and authorisations contained in this letter may not be modified without the Lender's consent. [The Lender by countersigning this letter permits you to debit outstanding charges due to you by the Charging

THE THIRD SCHEDULE COLLECTION ACCOUNT SIDE LETTERS [*FORM OF NOTICE TO BE SERVED BY BOTH OF THE CHARGING COMPANIES TO BANK HOLDING THE COLLECTION ACCOUNT TOGETHER WITH THE FORM OF ACKNOWLEDGEMENT REQUIRED FROM THAT BANK*] To: [ ] [*branch address*] For the attention of [ ] [* date *] We refer to the debenture (the "DEBENTURE") dated on or around the date of this notice and made between ourselves (1) and Foothill Capital Corporation (as the Lender as defined in the Debenture) (2). We each hereby give you notice that pursuant to the Debenture we, with full title guarantee, have charged by way of first fixed charge to the Lender all our rights, title and interest in and to all sums which may at any time be standing to the credit of the accounts listed in the table below, which were opened by us in your books and any other accounts which we may open in your books (the "COLLECTION ACCOUNTS" and each one of them a "COLLECTION ACCOUNT").
COMPANY/ACCOUNT DESCRIPTION --------------------------COLLECTION ACCOUNT NUMBER ------------------------BANK SORT CODE --------------

In connection therewith and by way of security for the Secured Sums (as defined in the Debenture) we hereby irrevocably and unconditionally instruct and authorise you (notwithstanding any previous instructions whatsoever which we may have given you to the contrary): (a) to disclose to the Lender without any reference to or further authority from us and without any enquiry by you as to the justification for such disclosure, such information relating to the Collection Accounts or any other accounts opened by us in your books (the "ACCOUNTS"), the amount from time to time standing to the credit thereof and the debts represented thereby as the Lender may, at any time and from time to time, request you to disclose to it; and (b) unless the Lender so authorises you, not to permit withdrawals from the Collection Accounts and to hold all moneys from time to time standing to the credit of the Collection Accounts to the order of the Lender and pay all or any part of those moneys to the Lender (or as it may direct) promptly following receipt of written instructions from the Lender to that effect.

The arrangements and authorisations contained in this letter may not be modified without the Lender's consent. [The Lender by countersigning this letter permits you to debit outstanding charges due to you by the Charging Company for operation of the Collection Accounts from the Collection Account.] This letter shall be governed by and construed in accordance with the laws of England. Please confirm your acknowledgement of the terms of this Notice by signing the acknowledgements set out at the foot of the enclosed duplicate hereof and by returning the same to legal adviser to the Lender, Brobeck Hale and Dorr, and to Foothill Capital Corporation at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404 (marked for the attention of Business Finance Division Manager).
Signed by: acting by: [CHARGING COMPANY]

The arrangements and authorisations contained in this letter may not be modified without the Lender's consent. [The Lender by countersigning this letter permits you to debit outstanding charges due to you by the Charging Company for operation of the Collection Accounts from the Collection Account.] This letter shall be governed by and construed in accordance with the laws of England. Please confirm your acknowledgement of the terms of this Notice by signing the acknowledgements set out at the foot of the enclosed duplicate hereof and by returning the same to legal adviser to the Lender, Brobeck Hale and Dorr, and to Foothill Capital Corporation at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404 (marked for the attention of Business Finance Division Manager).
Signed by: acting by: Signed by: acting by [CHARGING COMPANY]

FOOTHILL CAPITAL CORPORATION

To:

[ ] For the attention of: [ ]

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404

For the attention of: Business Finance Division Manager We, , hereby acknowledge receipt of a notice of charge from Foothill Capital Corporation of which the attached is a copy (the "Notice of Charge"). We confirm that: (a) we accept the instructions and authorisations contained in the Notice of Assignment; (b) we have not received notice of any other assignment of or charge over or other third party right in the book debts and other monetary debts and claims described or any interest therein and will notify you if we do receive notice; and (c) we will hold all moneys standing to the credit of the Collection Accounts to the order of the Lender and we will not exercise any right to combine accounts or any rights of set-off, counterclaim or lien or any similar rights in relation to the moneys standing to the credit of the Collection Accounts or the other Accounts (except for the netting of credit and debt balances pursuant to any current account netting arrangements previously approved in writing by the Lender). Signed by for and on behalf of [name of Account Bank]

[TO BE TYPED ON THE HEADED NOTEPAPER OF THE LENDER] To: The Directors

To:

[ ] For the attention of: [ ]

Foothill Capital Corporation 2450 Colorado Avenue, Suite 3000 West, Santa Monica, California 90404

For the attention of: Business Finance Division Manager We, , hereby acknowledge receipt of a notice of charge from Foothill Capital Corporation of which the attached is a copy (the "Notice of Charge"). We confirm that: (a) we accept the instructions and authorisations contained in the Notice of Assignment; (b) we have not received notice of any other assignment of or charge over or other third party right in the book debts and other monetary debts and claims described or any interest therein and will notify you if we do receive notice; and (c) we will hold all moneys standing to the credit of the Collection Accounts to the order of the Lender and we will not exercise any right to combine accounts or any rights of set-off, counterclaim or lien or any similar rights in relation to the moneys standing to the credit of the Collection Accounts or the other Accounts (except for the netting of credit and debt balances pursuant to any current account netting arrangements previously approved in writing by the Lender). Signed by for and on behalf of [name of Account Bank]

[TO BE TYPED ON THE HEADED NOTEPAPER OF THE LENDER] To: The Directors [Charging Companies] [Date] Dear Sirs COLLECTION ACCOUNT LETTER We refer to the guarantee and debenture of [date] (the "DEBENTURE") granted by FutureLink Europe Limited and KNS Holdings Limited (the "CHARGING COMPANIES") to ourselves as the Lender (as defined in the Debenture). 1. The terms defined in the Debenture shall, where the context so admits, have the same meanings in this letter. 2. We refer in particular to the following provisions of the Debenture: (a) by sub-clause 3.1(b)(viii) (Charging Clause), the Charging Companies created first fixed charges over book and other debts and monetary claims (present and future); (b) by sub-clause 3.1(b)(x) and 3.1(b)(xii) (Charging Clause), the Charging Companies created first fixed

[TO BE TYPED ON THE HEADED NOTEPAPER OF THE LENDER] To: The Directors [Charging Companies] [Date] Dear Sirs COLLECTION ACCOUNT LETTER We refer to the guarantee and debenture of [date] (the "DEBENTURE") granted by FutureLink Europe Limited and KNS Holdings Limited (the "CHARGING COMPANIES") to ourselves as the Lender (as defined in the Debenture). 1. The terms defined in the Debenture shall, where the context so admits, have the same meanings in this letter. 2. We refer in particular to the following provisions of the Debenture: (a) by sub-clause 3.1(b)(viii) (Charging Clause), the Charging Companies created first fixed charges over book and other debts and monetary claims (present and future); (b) by sub-clause 3.1(b)(x) and 3.1(b)(xii) (Charging Clause), the Charging Companies created first fixed charges over any cash balances standing to the credit of any bank account relating to each Charging Company, including the proceeds of book debts and other debts and claims charged pursuant to sub-clause 3.1(b)(viii) (Charging Clause) of the Debenture; and (c) by sub-clause 5.1 (Treatment of Receivables), the Charging Companies are required to pay into such account as the Lender nominates, pursuant to this letter, all debts and claims charged by it pursuant to the Debenture. 3. In accordance with sub-clause 5.1 (Treatment of Receivables) of the Debenture, we set out below details of the Charging Companies' operating account which is to be their Collection Account for the purposes of the Debenture and hereby require that the Charging Company pays into its Collection Account all moneys which it may henceforth receive in respect of Receivables and other debts and claims charged by the Debenture until further instructed by us to the contrary.

COMPANY/ACCOUNT DESCRIPTION ---------------------------

COLLECTION ACCOUNT NUMBER -------------------------

BANK SORT CODE --------------

4. [We confirm that you may continue to operate all bank accounts in the ordinary course of business without seeking any further consent from us provided that we shall be entitled to terminate this authority by notice in writing to you at any time but it is not our present intention to terminate such authority unless and until a Default or an Event of Default occurs which is continuing.] Please sign and return the enclosed copy of this letter to indicate your agreement to its terms. Yours faithfully For and on behalf of FOOTHILL CAPITAL CORPORATION We hereby acknowledge and agree to the foregoing terms of this letter. For and on behalf of

COMPANY/ACCOUNT DESCRIPTION ---------------------------

COLLECTION ACCOUNT NUMBER -------------------------

BANK SORT CODE --------------

4. [We confirm that you may continue to operate all bank accounts in the ordinary course of business without seeking any further consent from us provided that we shall be entitled to terminate this authority by notice in writing to you at any time but it is not our present intention to terminate such authority unless and until a Default or an Event of Default occurs which is continuing.] Please sign and return the enclosed copy of this letter to indicate your agreement to its terms. Yours faithfully For and on behalf of FOOTHILL CAPITAL CORPORATION We hereby acknowledge and agree to the foregoing terms of this letter. For and on behalf of FUTURELINK EUROPE LIMITED Dated: For and on behalf of KNS Holdings Limited Dated:

THE FOURTH SCHEDULE THE PATENTS AND TRADE MARKS PATENTS AND PATENT APPLICATIONS None TRADE MARKS AND TRADE MARK APPLICATIONS (IF ANY)
MARK ---KNS COUNTRY ------UK APPLICATION NO -------------REGISTRATION NO --------------2202357 REGISTERED PROPRIETOR --------------------FutureLink Europe Limited

EXHIBIT 10.78 GENERAL CONTINUING GUARANTY THIS GENERAL CONTINUING GUARANTY ("Guaranty"), dated as of December 13, 2000, is executed and delivered by FUTURELINK CORP., a Delaware corporation ("Parent") and each of Parent's Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, each a "Guarantor" and collectively, the "Guarantors"), in favor of FOOTHILL CAPITAL CORPORATION, a California corporation ("Guarantied Party"), in light of the following: WHEREAS, FutureLink Europe Limited, a corporation organized under the laws of the England and Wales ("Debtor") and Guarantied Party are, contemporaneously herewith, entering into the Loan Agreement; and

THE FOURTH SCHEDULE THE PATENTS AND TRADE MARKS PATENTS AND PATENT APPLICATIONS None TRADE MARKS AND TRADE MARK APPLICATIONS (IF ANY)
MARK ---KNS COUNTRY ------UK APPLICATION NO -------------REGISTRATION NO --------------2202357 REGISTERED PROPRIETOR --------------------FutureLink Europe Limited

EXHIBIT 10.78 GENERAL CONTINUING GUARANTY THIS GENERAL CONTINUING GUARANTY ("Guaranty"), dated as of December 13, 2000, is executed and delivered by FUTURELINK CORP., a Delaware corporation ("Parent") and each of Parent's Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, each a "Guarantor" and collectively, the "Guarantors"), in favor of FOOTHILL CAPITAL CORPORATION, a California corporation ("Guarantied Party"), in light of the following: WHEREAS, FutureLink Europe Limited, a corporation organized under the laws of the England and Wales ("Debtor") and Guarantied Party are, contemporaneously herewith, entering into the Loan Agreement; and WHEREAS, in order to induce Guarantied Party to extend financial accommodations to Debtor pursuant to the Loan Agreement, and in consideration thereof, and in consideration of any loans or other financial accommodations heretofore or hereafter extended by Guarantied Party to Debtor, whether pursuant to the Loan Agreement or otherwise, each Guarantor has agreed to guaranty the Guarantied Obligations. NOW, THEREFORE, in consideration of the foregoing, each Guarantor hereby agrees, in favor of Guarantied Party, as follows: 1. Definitions and Construction. (a) Definitions. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement. The following terms, as used in this Guaranty, shall have the following meanings: "Debtor" has the meaning set forth in the recitals to this Guaranty. "Guarantied Obligations" shall mean: (a) the due and punctual payment of the principal of, and interest (including, any and all interest which, but for the application of the provisions of the Bankruptcy Code, would have accrued on such amounts) on, any and all premium on, and any and all fees, costs, and expenses incurred in connection with or on the Indebtedness owed by Debtor to Guarantied Party pursuant to the terms of the Subsidiary Loan Documents; and (b) the due and punctual payment of all other present or future Indebtedness owing by Debtor to Guarantied Party. "Guarantied Party" shall have the meaning set forth in the preamble to this Guaranty. "Guarantor" shall have the meaning set forth in the preamble to this Guaranty. 1

EXHIBIT 10.78 GENERAL CONTINUING GUARANTY THIS GENERAL CONTINUING GUARANTY ("Guaranty"), dated as of December 13, 2000, is executed and delivered by FUTURELINK CORP., a Delaware corporation ("Parent") and each of Parent's Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, each a "Guarantor" and collectively, the "Guarantors"), in favor of FOOTHILL CAPITAL CORPORATION, a California corporation ("Guarantied Party"), in light of the following: WHEREAS, FutureLink Europe Limited, a corporation organized under the laws of the England and Wales ("Debtor") and Guarantied Party are, contemporaneously herewith, entering into the Loan Agreement; and WHEREAS, in order to induce Guarantied Party to extend financial accommodations to Debtor pursuant to the Loan Agreement, and in consideration thereof, and in consideration of any loans or other financial accommodations heretofore or hereafter extended by Guarantied Party to Debtor, whether pursuant to the Loan Agreement or otherwise, each Guarantor has agreed to guaranty the Guarantied Obligations. NOW, THEREFORE, in consideration of the foregoing, each Guarantor hereby agrees, in favor of Guarantied Party, as follows: 1. Definitions and Construction. (a) Definitions. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement. The following terms, as used in this Guaranty, shall have the following meanings: "Debtor" has the meaning set forth in the recitals to this Guaranty. "Guarantied Obligations" shall mean: (a) the due and punctual payment of the principal of, and interest (including, any and all interest which, but for the application of the provisions of the Bankruptcy Code, would have accrued on such amounts) on, any and all premium on, and any and all fees, costs, and expenses incurred in connection with or on the Indebtedness owed by Debtor to Guarantied Party pursuant to the terms of the Subsidiary Loan Documents; and (b) the due and punctual payment of all other present or future Indebtedness owing by Debtor to Guarantied Party. "Guarantied Party" shall have the meaning set forth in the preamble to this Guaranty. "Guarantor" shall have the meaning set forth in the preamble to this Guaranty. 1

"Guaranty" shall have the meaning set forth in the preamble to this Guaranty. "Indebtedness" shall mean any and all obligations, indebtedness, or liabilities of any kind or character owed by Debtor to Guarantied Party and arising directly or indirectly out of or in connection with the Loan Agreement or the other Subsidiary Loan Documents, including all such obligations, indebtedness, or liabilities, whether for principal, interest (including any and all interest which, but for the application of the provisions of the Bankruptcy Code, would have accrued on such amounts), premium, reimbursement obligations, fees, costs, expenses (including attorneys fees), or indemnity obligations, whether heretofore, now, or hereafter made, incurred, or created, whether voluntarily or involuntarily made, incurred, or created, whether secured or unsecured (and if secured, regardless of the nature or extent of the security), whether absolute or contingent, liquidated or unliquidated, or determined or indeterminate, whether Debtor is liable individually or jointly with others, and whether recovery is or hereafter becomes barred by any statute of limitations or otherwise becomes unenforceable for any reason whatsoever, including any act or failure to act by Guarantied Party. "Loan Agreement" shall mean that certain Loan Agreement, dated as of December 13, 2000, entered into between Debtor and Guarantied Party.

"Guaranty" shall have the meaning set forth in the preamble to this Guaranty. "Indebtedness" shall mean any and all obligations, indebtedness, or liabilities of any kind or character owed by Debtor to Guarantied Party and arising directly or indirectly out of or in connection with the Loan Agreement or the other Subsidiary Loan Documents, including all such obligations, indebtedness, or liabilities, whether for principal, interest (including any and all interest which, but for the application of the provisions of the Bankruptcy Code, would have accrued on such amounts), premium, reimbursement obligations, fees, costs, expenses (including attorneys fees), or indemnity obligations, whether heretofore, now, or hereafter made, incurred, or created, whether voluntarily or involuntarily made, incurred, or created, whether secured or unsecured (and if secured, regardless of the nature or extent of the security), whether absolute or contingent, liquidated or unliquidated, or determined or indeterminate, whether Debtor is liable individually or jointly with others, and whether recovery is or hereafter becomes barred by any statute of limitations or otherwise becomes unenforceable for any reason whatsoever, including any act or failure to act by Guarantied Party. "Loan Agreement" shall mean that certain Loan Agreement, dated as of December 13, 2000, entered into between Debtor and Guarantied Party. (b) Construction. Unless the context of this Guaranty clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the part includes the whole, the terms "include" and "including" are not limiting, and the term "or" has the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and other similar terms refer to this Guaranty as a whole and not to any particular provision of this Guaranty. Any reference in this Guaranty to any of the following documents includes any and all alterations, amendments, restatements, extensions, modifications, renewals, or supplements thereto or thereof, as applicable: the Loan Agreement; this Guaranty; and the other Subsidiary Loan Documents. Neither this Guaranty nor any uncertainty or ambiguity herein shall be construed or resolved against Guarantied Party or any Guarantor, whether under any rule of construction or otherwise. On the contrary, this Guaranty has been reviewed by each Guarantor, Guarantied Party, and their respective counsel, and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of Guarantied Party and each Guarantor. 2. Guarantied Obligations. Each Guarantor jointly and severally hereby irrevocably and unconditionally guaranties to Guarantied Party, as and for its own debt, until final and indefeasible payment thereof has been made, (a) the payment of the Guarantied Obligations, in each case when and as the same shall become due and payable, whether at maturity, pursuant to a mandatory prepayment requirement, by acceleration, or otherwise; it being the intent of each Guarantor that the guaranty set forth herein shall be a guaranty of payment and not a guaranty of collection; and (b) the punctual and faithful performance, 2

keeping, observance, and fulfillment by Debtor of all of the agreements, conditions, covenants, and obligations of Debtor contained in the Loan Agreement, and under each of the other Subsidiary Loan Documents. 3. Continuing Guaranty. This Guaranty includes Guarantied Obligations arising under successive transactions continuing, compromising, extending, increasing, modifying, releasing, or renewing the Guarantied Obligations, changing the interest rate, payment terms, or other terms and conditions thereof, or creating new or additional Guarantied Obligations after prior Guarantied Obligations have been satisfied in whole or in part. To the maximum extent permitted by law, each Guarantor hereby waives any right to revoke this Guaranty as to future Indebtedness. If such a revocation is effective notwithstanding the foregoing waiver, each Guarantor acknowledges and agrees that (a) no such revocation shall be effective until written notice thereof has been received by Guarantied Party, (b) no such revocation shall apply to any Guarantied Obligations in existence on such date (including any subsequent continuation, extension, or renewal thereof, or change in the interest rate, payment terms, or other terms and conditions thereof), (c) no such revocation shall apply to any Guarantied Obligations made or created after such date to the extent made or created pursuant to a legally binding commitment of Guarantied Party in existence on the date of such revocation, (d) no payment by such Guarantor, Debtor, or from any other source, prior to the date of such revocation shall reduce the maximum obligation of such Guarantor hereunder, and (e) any payment by Debtor or from any source other than such Guarantor subsequent to the date of such

keeping, observance, and fulfillment by Debtor of all of the agreements, conditions, covenants, and obligations of Debtor contained in the Loan Agreement, and under each of the other Subsidiary Loan Documents. 3. Continuing Guaranty. This Guaranty includes Guarantied Obligations arising under successive transactions continuing, compromising, extending, increasing, modifying, releasing, or renewing the Guarantied Obligations, changing the interest rate, payment terms, or other terms and conditions thereof, or creating new or additional Guarantied Obligations after prior Guarantied Obligations have been satisfied in whole or in part. To the maximum extent permitted by law, each Guarantor hereby waives any right to revoke this Guaranty as to future Indebtedness. If such a revocation is effective notwithstanding the foregoing waiver, each Guarantor acknowledges and agrees that (a) no such revocation shall be effective until written notice thereof has been received by Guarantied Party, (b) no such revocation shall apply to any Guarantied Obligations in existence on such date (including any subsequent continuation, extension, or renewal thereof, or change in the interest rate, payment terms, or other terms and conditions thereof), (c) no such revocation shall apply to any Guarantied Obligations made or created after such date to the extent made or created pursuant to a legally binding commitment of Guarantied Party in existence on the date of such revocation, (d) no payment by such Guarantor, Debtor, or from any other source, prior to the date of such revocation shall reduce the maximum obligation of such Guarantor hereunder, and (e) any payment by Debtor or from any source other than such Guarantor subsequent to the date of such revocation shall first be applied to that portion of the Guarantied Obligations as to which the revocation is effective and which are not, therefore, guarantied hereunder, and to the extent so applied shall not reduce the maximum obligation of Guarantor hereunder. 4. Performance Under this Guaranty. In the event that Debtor fails to make any payment of any Guarantied Obligations, on or before the due date thereof, or if Debtor shall fail to perform, keep, observe, or fulfill any other obligation referred to in clause (b) of Section 2 hereof in the manner provided in the Loan Agreement or the other Subsidiary Loan Documents, as applicable, each Guarantor immediately shall cause such payment to be made or each of such obligations to be performed, kept, observed, or fulfilled. 5. Primary Obligations. This Guaranty is a primary and original obligation of each Guarantor, is not merely the creation of a surety relationship, and is an absolute, unconditional, and continuing guaranty of payment and performance which shall remain in full force and effect without respect to future changes in conditions. Each Guarantor agrees that it is directly, jointly and severally with any other guarantor of the Guarantied Obligations, liable to Guarantied Party, that the obligations of Guarantor hereunder are independent of the obligations of Debtor or any other guarantor, and that a separate action may be brought against each Guarantor, whether such action is brought against Debtor or any other guarantor or whether Debtor or any other guarantor is joined in such action. Each Guarantor agrees that its liability hereunder shall be immediate and shall not be contingent upon the exercise or enforcement by Guarantied Party of whatever remedies it may have against Debtor or any other guarantor, or the enforcement of any lien or realization upon any 3

security Guarantied Party may at any time possess. Each Guarantor agrees that any release which may be given by Guarantied Party to Debtor or any other guarantor shall not release such Guarantor. Each Guarantor consents and agrees that Guarantied Party shall be under no obligation to marshal any property or assets of Debtor or any other guarantor in favor of such Guarantor, or against or in payment of any or all of the Guarantied Obligations. 6. Waivers. (a) To the fullest extent permitted by applicable law, each Guarantor hereby waives: (i) notice of acceptance hereof; (ii) notice of any loans or other financial accommodations made or extended under the Loan Agreement, or the creation or existence of any Guarantied Obligations; (iii) notice of the amount of the Guarantied Obligations, subject, however, to such Guarantor's right to make inquiry of Guarantied Party to ascertain the amount of the Guarantied Obligations at any reasonable time; (iv) notice of any adverse change in the financial condition of Debtor or of any other fact that might increase such Guarantor's risk hereunder; (v) notice of presentment for payment, demand, protest, and notice thereof as to any instrument among the Subsidiary Loan Documents; (vi) notice of any Default or Event of Default under the Loan Agreement; and (vii) all other notices (except if such notice is specifically required to be given to such Guarantor under this Guaranty or any other

security Guarantied Party may at any time possess. Each Guarantor agrees that any release which may be given by Guarantied Party to Debtor or any other guarantor shall not release such Guarantor. Each Guarantor consents and agrees that Guarantied Party shall be under no obligation to marshal any property or assets of Debtor or any other guarantor in favor of such Guarantor, or against or in payment of any or all of the Guarantied Obligations. 6. Waivers. (a) To the fullest extent permitted by applicable law, each Guarantor hereby waives: (i) notice of acceptance hereof; (ii) notice of any loans or other financial accommodations made or extended under the Loan Agreement, or the creation or existence of any Guarantied Obligations; (iii) notice of the amount of the Guarantied Obligations, subject, however, to such Guarantor's right to make inquiry of Guarantied Party to ascertain the amount of the Guarantied Obligations at any reasonable time; (iv) notice of any adverse change in the financial condition of Debtor or of any other fact that might increase such Guarantor's risk hereunder; (v) notice of presentment for payment, demand, protest, and notice thereof as to any instrument among the Subsidiary Loan Documents; (vi) notice of any Default or Event of Default under the Loan Agreement; and (vii) all other notices (except if such notice is specifically required to be given to such Guarantor under this Guaranty or any other Subsidiary Loan Documents to which such Guarantor is a party) and demands to which such Guarantor might otherwise be entitled. (b) To the fullest extent permitted by applicable law, each Guarantor waives the right by statute or otherwise to require Guarantied Party to institute suit against Debtor or to exhaust any rights and remedies which Guarantied Party has or may have against Debtor. In this regard, each Guarantor agrees that it is bound to the payment of each and all Guarantied Obligations, whether now existing or hereafter arising, as fully as if such Guarantied Obligations were directly owing to Guarantied Party by such Guarantor. Each Guarantor further waives any defense arising by reason of any disability or other defense (other than the defense that the Guarantied Obligations shall have been fully and finally performed and indefeasibly paid in full in cash) of Debtor or by reason of the cessation from any cause whatsoever of the liability of Debtor in respect thereof. (c) To the fullest extent permitted by applicable law, each Guarantor hereby waives: (i) any rights to assert against Guarantied Party any defense (legal or equitable), set-off, counterclaim, or claim which such Guarantor may now or at any time hereafter have against Debtor or any other party liable to Guarantied Party; (ii) any defense, setoff, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of the Guarantied Obligations or any security therefor; (iii) any defense arising by reason of any claim or defense based upon an election of remedies by Guarantied Party including any defense based upon an election of remedies by Guarantied Party under the provisions of Sections 580d and 726 of the California Code of Civil Procedure, or any similar law of California or any other jurisdiction; (iv) the benefit of any statute of limitations affecting such Guarantor's liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation of 4

any statute of limitations applicable to the Guarantied Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor's liability hereunder. (d) Until such time as all of the Guarantied Obligations have been fully, finally, and indefeasibly paid in full in cash: (i) each Guarantor hereby waives and postpones any right of subrogation such Guarantor has or may have as against Debtor with respect to the Guarantied Obligations; (ii) in addition, each Guarantor hereby waives and postpones any right to proceed against Debtor or any other Person, now or hereafter, for contribution, indemnity, reimbursement, or any other suretyship rights and claims (irrespective of whether direct or indirect, liquidated or contingent), with respect to the Guarantied Obligations; and (iii) in addition, each Guarantor also hereby waives and postpones any right to proceed or to seek recourse against or with respect to any property or asset of Debtor. (e) [intentionally omitted] (f) [intentionally omitted]

any statute of limitations applicable to the Guarantied Obligations shall similarly operate to defer or delay the operation of such statute of limitations applicable to such Guarantor's liability hereunder. (d) Until such time as all of the Guarantied Obligations have been fully, finally, and indefeasibly paid in full in cash: (i) each Guarantor hereby waives and postpones any right of subrogation such Guarantor has or may have as against Debtor with respect to the Guarantied Obligations; (ii) in addition, each Guarantor hereby waives and postpones any right to proceed against Debtor or any other Person, now or hereafter, for contribution, indemnity, reimbursement, or any other suretyship rights and claims (irrespective of whether direct or indirect, liquidated or contingent), with respect to the Guarantied Obligations; and (iii) in addition, each Guarantor also hereby waives and postpones any right to proceed or to seek recourse against or with respect to any property or asset of Debtor. (e) [intentionally omitted] (f) [intentionally omitted] (g) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH IN THIS GUARANTY, EACH GUARANTOR HEREBY WAIVES, TO THE MAXIMUM EXTENT SUCH WAIVER IS PERMITTED BY LAW, ANY AND ALL BENEFITS OR DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA CIVIL CODE Sections 2799, 2808, 2809, 2810, 2815, 2819, 2820, 2821, 2822, 2838, 2839, 2845, 2847, 2848, 2849, AND 2850, CALIFORNIA CODE OF CIVIL PROCEDURE Sections 580a, 580b, 580c, 580d, AND 726, AND CHAPTER 2 OF TITLE 14 OF THE CALIFORNIA CIVIL CODE. (h) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH IN THIS GUARANTY, EACH GUARANTOR WAIVES ALL RIGHTS AND DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY THE GUARANTIED PARTY, EVEN THOUGH THAT ELECTION OF REMEDIES, SUCH AS A NONJUDICIAL FORECLOSURE WITH RESPECT TO SECURITY FOR A GUARANTIED OBLIGATION, HAS DESTROYED SUCH GUARANTOR'S RIGHTS OF SUBROGATION AND REIMBURSEMENT AGAINST THE DEBTOR BY THE OPERATION OF SECTION 580d OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR OTHERWISE. 7. Releases. Each Guarantor consents and agrees that, without notice to or by such Guarantor and without affecting or impairing the obligations of such Guarantor hereunder, Guarantied Party may, by action or inaction, compromise or settle, extend the period of duration or the time for the payment, or discharge the performance of, or may refuse to, or otherwise not enforce, or may, by action or inaction, release all or any one or more parties to, any one or more of the terms and provisions of the Loan Agreement or any of the other Subsidiary Loan Documents or may grant other indulgences to Debtor in respect thereof, or may amend or modify in any manner and at any time (or from time to time) any 5

one or more of the Loan Agreement or any of the other Subsidiary Loan Documents, or may, by action or inaction, release or substitute any other guarantor, if any, of the Guarantied Obligations, or may enforce, exchange, release, or waive, by action or inaction, any security for the Guarantied Obligations or any other guaranty of the Guarantied Obligations, or any portion thereof. 8. No Election. Guarantied Party shall have the right to seek recourse against each Guarantor to the fullest extent provided for herein and no election by Guarantied Party to proceed in one form of action or proceeding, or against any party, or on any obligation, shall constitute a waiver of Guarantied Party's right to proceed in any other form of action or proceeding or against other parties unless Guarantied Party has expressly waived such right in writing. Specifically, but without limiting the generality of the foregoing, no action or proceeding by Guarantied Party under any document or instrument evidencing the Guarantied Obligations shall serve to diminish the liability of any Guarantor under this Guaranty except to the extent that Guarantied Party finally and unconditionally shall have realized indefeasible payment by such action or proceeding.

one or more of the Loan Agreement or any of the other Subsidiary Loan Documents, or may, by action or inaction, release or substitute any other guarantor, if any, of the Guarantied Obligations, or may enforce, exchange, release, or waive, by action or inaction, any security for the Guarantied Obligations or any other guaranty of the Guarantied Obligations, or any portion thereof. 8. No Election. Guarantied Party shall have the right to seek recourse against each Guarantor to the fullest extent provided for herein and no election by Guarantied Party to proceed in one form of action or proceeding, or against any party, or on any obligation, shall constitute a waiver of Guarantied Party's right to proceed in any other form of action or proceeding or against other parties unless Guarantied Party has expressly waived such right in writing. Specifically, but without limiting the generality of the foregoing, no action or proceeding by Guarantied Party under any document or instrument evidencing the Guarantied Obligations shall serve to diminish the liability of any Guarantor under this Guaranty except to the extent that Guarantied Party finally and unconditionally shall have realized indefeasible payment by such action or proceeding. 9. Indefeasible Payment. The Guarantied Obligations shall not be considered indefeasibly paid for purposes of this Guaranty unless and until all payments to Guarantied Party are no longer subject to any right on the part of any person whomsoever, including a Guarantor, a Guarantor as a debtor in possession, or any trustee (whether appointed under the Bankruptcy Code or otherwise) of such Guarantor's assets to invalidate or set aside such payments or to seek to recoup the amount of such payments or any portion thereof, or to declare same to be fraudulent or preferential. In the event that, for any reason, all or any portion of such payments to Guarantied Party is set aside or restored, whether voluntarily or involuntarily, after the making thereof, the obligation or part thereof intended to be satisfied thereby shall be revived and continued in full force and effect as if said payment or payments had not been made and Guarantor shall be liable for the full amount Guarantied Party is required to repay plus any and all costs and expenses (including reasonable attorneys fees) paid by Guarantied Party in connection therewith. 10. Financial Condition of Debtor. Each Guarantor represents and warrants to Guarantied Party that it is currently informed of the financial condition of Debtor and of all other circumstances which a diligent inquiry would reveal and which bear upon the risk of nonpayment of the Guarantied Obligations. Each Guarantor further represents and warrants to Guarantied Party that it has read and understands the terms and conditions of the Loan Agreement and the other Subsidiary Loan Documents. Each Guarantor hereby covenants that it will continue to keep itself informed of Debtor's financial condition, the financial condition of other guarantors, if any, and of all other circumstances which bear upon the risk of nonpayment or nonperformance of the Guarantied Obligations. 11. Payments; Application. All payments to be made hereunder by each Guarantor shall be made in lawful money of the United States of America at the time of payment, shall be made in immediately available funds, and shall be made without deduction (whether for taxes or otherwise) or offset. All payments made by Guarantor hereunder shall 6

be applied as follows: first, to all reasonable costs and expenses (including reasonable attorneys fees) incurred by Guarantied Party in enforcing this Guaranty or in collecting the Guarantied Obligations; second, to all accrued and unpaid interest, premium, if any, and fees owing to Guarantied Party constituting Guarantied Obligations; and third, to the balance of the Guarantied Obligations. 12. Attorneys Fees and Costs. Each Guarantor agrees to pay, on demand, all reasonable attorneys fees and all other reasonable costs and expenses which may be incurred by Guarantied Party in the enforcement of this Guaranty or in any way arising out of, or consequential to the protection, assertion, or enforcement of the Guarantied Obligations (or any security therefor), irrespective of whether suit is brought. 13. Notices. Unless otherwise specifically provided in this Guaranty, any notice or other communication relating to this Guaranty shall be made in care of Debtor in accordance with the terms of the Loan Agreement. 14. Cumulative Remedies. No remedy under this Guaranty, under the Loan Agreement, or any other Subsidiary Loan Document is intended to be exclusive of any other remedy, but each and every remedy shall be cumulative

be applied as follows: first, to all reasonable costs and expenses (including reasonable attorneys fees) incurred by Guarantied Party in enforcing this Guaranty or in collecting the Guarantied Obligations; second, to all accrued and unpaid interest, premium, if any, and fees owing to Guarantied Party constituting Guarantied Obligations; and third, to the balance of the Guarantied Obligations. 12. Attorneys Fees and Costs. Each Guarantor agrees to pay, on demand, all reasonable attorneys fees and all other reasonable costs and expenses which may be incurred by Guarantied Party in the enforcement of this Guaranty or in any way arising out of, or consequential to the protection, assertion, or enforcement of the Guarantied Obligations (or any security therefor), irrespective of whether suit is brought. 13. Notices. Unless otherwise specifically provided in this Guaranty, any notice or other communication relating to this Guaranty shall be made in care of Debtor in accordance with the terms of the Loan Agreement. 14. Cumulative Remedies. No remedy under this Guaranty, under the Loan Agreement, or any other Subsidiary Loan Document is intended to be exclusive of any other remedy, but each and every remedy shall be cumulative and in addition to any and every other remedy given under this Guaranty, under the Loan Agreement, or any other Subsidiary Loan Document, and those provided by law. No delay or omission by Guarantied Party to exercise any right under this Guaranty shall impair any such right nor be construed to be a waiver thereof. No failure on the part of Guarantied Party to exercise, and no delay in exercising, any right under this Guaranty shall operate as a waiver thereof; nor shall any single or partial exercise of any right under this Guaranty preclude any other or further exercise thereof or the exercise of any other right. 15. Severability of Provisions. Any provision of this Guaranty which is prohibited or unenforceable under applicable law shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof. 16. Entire Agreement; Amendments. This Guaranty constitutes the entire agreement among Guarantors and Guarantied Party pertaining to the subject matter contained herein. This Guaranty may not be altered, amended, or modified, nor may any provision hereof be waived or noncompliance therewith consented to, except by means of a writing executed by each Guarantor and Guarantied Party. Any such alteration, amendment, modification, waiver, or consent shall be effective only to the extent specified therein and for the specific purpose for which given. No course of dealing and no delay or waiver of any right or default under this Guaranty shall be deemed a waiver of any other, similar or dissimilar, right or default or otherwise prejudice the rights and remedies hereunder. 17. Successors and Assigns. This Guaranty shall be binding upon each Guarantor and its successors and assigns and shall inure to the benefit of the successors and assigns of Guarantied Party; provided, however, no Guarantor shall assign this Guaranty or delegate any of its duties hereunder without Guarantied Party's prior written consent and any unconsented to assignment shall be absolutely void. In the event of any assignment or other 7

transfer of rights by Guarantied Party, the rights and benefits herein conferred upon Guarantied Party shall automatically extend to and be vested in such assignee or other transferee. 18. No Third Party Beneficiary. This Guaranty is solely for the benefit of Guarantied Party and its successors and assigns and may not be relied on by any other Person. 19. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER THE VALIDITY OF THIS GUARANTY, ITS CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH

transfer of rights by Guarantied Party, the rights and benefits herein conferred upon Guarantied Party shall automatically extend to and be vested in such assignee or other transferee. 18. No Third Party Beneficiary. This Guaranty is solely for the benefit of Guarantied Party and its successors and assigns and may not be relied on by any other Person. 19. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER THE VALIDITY OF THIS GUARANTY, ITS CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS GUARANTY SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, OR AT THE SOLE OPTION OF GUARANTIED PARTY, IN ANY OTHER COURT IN WHICH GUARANTIED PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH GUARANTOR AND GUARANTIED PARTY WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 19. EACH GUARANTOR AND GUARANTIED PARTY HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH GUARANTOR AND GUARANTIED PARTY REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. [signature page follows] 8

IN WITNESS WHEREOF, the undersigned has executed and delivered this Guaranty as of the date first written above. FUTURELINK CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK MICRO VISIONS CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

IN WITNESS WHEREOF, the undersigned has executed and delivered this Guaranty as of the date first written above. FUTURELINK CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK MICRO VISIONS CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK ASYNC CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK PLEASANTON CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK MADISON CORP., a Delaware corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

FUTURELINK VSI CORP., a Maryland corporation
By: /s/ COREY E. FISCHER ------------------------------------Title: Vice President

9

KNS HOLDINGS LIMITED, a corporation organized under the laws of the England
By: /s/ NIGEL HAWLEY ------------------------------------Title: Director

KNS HOLDINGS LIMITED, a corporation organized under the laws of the England
By: /s/ NIGEL HAWLEY ------------------------------------Title: Director

By: /s/ YURI PASEA ------------------------------------Title: Director

10

EXHIBIT 10.79 DATED 14 December 2000 FUTURELINK CORP. (as the Chargor) and FOOTHILL CAPITAL CORPORATION (in its capacity as Lender)

SHARE CHARGE

TABLE OF CONTENTS
CLAUSE PAGE 1. DEFINITIONS AND INTERPRETATION ....................................... 1 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. COVENANT TO PAY ...................................................... CHARGING CLAUSE ...................................................... DOCUMENTS AND VOTING RIGHTS .......................................... NEGATIVE PLEDGE AND OTHER RESTRICTIONS ............................... FURTHER ASSURANCE .................................................... CONTINUING SECURITY .................................................. POWERS OF SALE ....................................................... OPENING OF NEW ACCOUNTS .............................................. ENFORCEMENT .......................................................... POWER OF ATTORNEY .................................................... APPLICATION OF MONEY RECEIVED ........................................ COSTS AND INTEREST ON OVERDUE AMOUNTS ................................ SET-OFF .............................................................. 4 4 5 7 7 8 9 9 9 10 11 11 13

EXHIBIT 10.79 DATED 14 December 2000 FUTURELINK CORP. (as the Chargor) and FOOTHILL CAPITAL CORPORATION (in its capacity as Lender)

SHARE CHARGE

TABLE OF CONTENTS
CLAUSE PAGE 1. DEFINITIONS AND INTERPRETATION ....................................... 1 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. COVENANT TO PAY ...................................................... CHARGING CLAUSE ...................................................... DOCUMENTS AND VOTING RIGHTS .......................................... NEGATIVE PLEDGE AND OTHER RESTRICTIONS ............................... FURTHER ASSURANCE .................................................... CONTINUING SECURITY .................................................. POWERS OF SALE ....................................................... OPENING OF NEW ACCOUNTS .............................................. ENFORCEMENT .......................................................... POWER OF ATTORNEY .................................................... APPLICATION OF MONEY RECEIVED ........................................ COSTS AND INTEREST ON OVERDUE AMOUNTS ................................ SET-OFF .............................................................. TRANSFER ............................................................. DISCLOSURE ........................................................... FORBEARANCE AND SEVERABILITY ......................................... VARIATIONS AND CONSENTS .............................................. SERVICE OF DEMANDS AND NOTICES ....................................... COUNTERPARTS ......................................................... ADJUSTMENT OF ACCOUNT ................................................ REPRESENTATIONS AND WARRANTIES ....................................... GOVERNING LAW AND SUBMISSION TO JURISDICTION ......................... 4 4 5 7 7 8 9 9 9 10 11 11 13 13 13 14 14 14 15 15 16 17

TABLE OF CONTENTS
CLAUSE PAGE 1. DEFINITIONS AND INTERPRETATION ....................................... 1 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. COVENANT TO PAY ...................................................... CHARGING CLAUSE ...................................................... DOCUMENTS AND VOTING RIGHTS .......................................... NEGATIVE PLEDGE AND OTHER RESTRICTIONS ............................... FURTHER ASSURANCE .................................................... CONTINUING SECURITY .................................................. POWERS OF SALE ....................................................... OPENING OF NEW ACCOUNTS .............................................. ENFORCEMENT .......................................................... POWER OF ATTORNEY .................................................... APPLICATION OF MONEY RECEIVED ........................................ COSTS AND INTEREST ON OVERDUE AMOUNTS ................................ SET-OFF .............................................................. TRANSFER ............................................................. DISCLOSURE ........................................................... FORBEARANCE AND SEVERABILITY ......................................... VARIATIONS AND CONSENTS .............................................. SERVICE OF DEMANDS AND NOTICES ....................................... COUNTERPARTS ......................................................... ADJUSTMENT OF ACCOUNT ................................................ REPRESENTATIONS AND WARRANTIES ....................................... GOVERNING LAW AND SUBMISSION TO JURISDICTION ......................... 4 4 5 7 7 8 9 9 9 10 11 11 13 13 13 14 14 14 15 15 16 17

24.

THIRD PARTIES ........................................................

18 19 19 20 20

THE FIRST SCHEDULE ........................................................ Securities ................................................................ THE SECOND SCHEDULE ....................................................... The Chargor ...............................................................

24.

THIRD PARTIES ........................................................

18 19 19 20 20

THE FIRST SCHEDULE ........................................................ Securities ................................................................ THE SECOND SCHEDULE ....................................................... The Chargor ...............................................................

THIS SHARE CHARGE is made the 14 December 2000 BETWEEN: (1) FUTURELINK CORP., a Delaware corporation incorporated under the laws of Delaware with its principal place of business at 2 South Point Drive, Lake Forest, California 92630 (the "CHARGOR"); and (2) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal place of business at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, Los Angeles California 90404 USA as Lender (as defined in the Loan Agreement referred to below). WITNESSES as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS: In this Share Charge, words or expressions defined in the Loan Agreement (as defined below) shall, unless otherwise defined below, bear the same meaning in this Share Charge and, in addition, in this Share Charge (unless the context otherwise requires) the following expressions have the following meanings: "BUSINESS DAY" means a day on which banks generally are open for business (other than a day on which banks are only open for business in Euros) in California (excluding Saturdays, Sundays and bank or public holidays in those places); "CHARGED PROPERTY" means all Investments from time to time charged in favour of, or assigned to, the Lender by or pursuant to this Share Charge; "DEFAULT" has the meaning given to it in the Loan Agreement; "EVENT OF DEFAULT" has the meaning given to it in the Loan Agreement; "GROUP" means together the Chargor and its subsidiaries from time to time and "GROUP Company" means any of such entities; "INVESTMENTS" means: (a) the Securities; (b) all stocks, shares or other securities, rights, monies or other property (together the "DERIVATIVE ASSETS") accruing, offered, issued or otherwise derived at any time by way of bonus, redemption, exchange, purchase, substitution, conversion, preference, option or otherwise in respect of any of the Securities or in respect of any stocks, shares or other securities, 1

rights, monies or other property previously accruing, offered or issued as mentioned in this paragraph (b); and

THIS SHARE CHARGE is made the 14 December 2000 BETWEEN: (1) FUTURELINK CORP., a Delaware corporation incorporated under the laws of Delaware with its principal place of business at 2 South Point Drive, Lake Forest, California 92630 (the "CHARGOR"); and (2) FOOTHILL CAPITAL CORPORATION, a Californian corporation with its principal place of business at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, Los Angeles California 90404 USA as Lender (as defined in the Loan Agreement referred to below). WITNESSES as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 DEFINITIONS: In this Share Charge, words or expressions defined in the Loan Agreement (as defined below) shall, unless otherwise defined below, bear the same meaning in this Share Charge and, in addition, in this Share Charge (unless the context otherwise requires) the following expressions have the following meanings: "BUSINESS DAY" means a day on which banks generally are open for business (other than a day on which banks are only open for business in Euros) in California (excluding Saturdays, Sundays and bank or public holidays in those places); "CHARGED PROPERTY" means all Investments from time to time charged in favour of, or assigned to, the Lender by or pursuant to this Share Charge; "DEFAULT" has the meaning given to it in the Loan Agreement; "EVENT OF DEFAULT" has the meaning given to it in the Loan Agreement; "GROUP" means together the Chargor and its subsidiaries from time to time and "GROUP Company" means any of such entities; "INVESTMENTS" means: (a) the Securities; (b) all stocks, shares or other securities, rights, monies or other property (together the "DERIVATIVE ASSETS") accruing, offered, issued or otherwise derived at any time by way of bonus, redemption, exchange, purchase, substitution, conversion, preference, option or otherwise in respect of any of the Securities or in respect of any stocks, shares or other securities, 1

rights, monies or other property previously accruing, offered or issued as mentioned in this paragraph (b); and (c) all dividends, interest and other distributions paid or payable in respect of or deriving from any of the Securities or the Derivative Assets or deriving from any investment of any such dividends, interest or other income provided however that the Investments shall at no time exceed 65% of the entire issued ordinary share capital of KNS Holdings Limited; "LENDER" shall have the meaning given to it in the Loan Agreement and shall include (where the context permits or requires) any successor, assignee or transferee lender permitted under the Loan Agreement; "LIEN" means any lien, mortgage, charge, standard security, pledge, hypothecation, security trust, assignment by

rights, monies or other property previously accruing, offered or issued as mentioned in this paragraph (b); and (c) all dividends, interest and other distributions paid or payable in respect of or deriving from any of the Securities or the Derivative Assets or deriving from any investment of any such dividends, interest or other income provided however that the Investments shall at no time exceed 65% of the entire issued ordinary share capital of KNS Holdings Limited; "LENDER" shall have the meaning given to it in the Loan Agreement and shall include (where the context permits or requires) any successor, assignee or transferee lender permitted under the Loan Agreement; "LIEN" means any lien, mortgage, charge, standard security, pledge, hypothecation, security trust, assignment by way of security, or any other security interest whatsoever, howsoever created or arising or any other agreement or arrangement, having the commercial effect of conferring security and any agreement to enter into, create or establish any of the foregoing; "LOAN AGREEMENT" means the Loan Agreement of even date herewith between Futurelink Europe Limited as Subsidiary Borrower and the Lender; "SUBSIDIARY LOAN DOCUMENTS" has the meaning given to it in the Loan Agreement; "PERMITTED LIEN" has the meaning given to it in the Loan Agreement; "SECURED SUMS" means all money and liabilities covenanted to be paid or discharged by the Chargor to the Lender under Clause 2.1 (Covenant to Pay); "SECURITIES" means the securities described in the First Schedule and all other stocks, shares or other securities or investments now or in the future owned at law or in equity by the Chargor constituting 65% of the issued share capital of KNS Holdings Limited; and "UNITED KINGDOM" and "UK" means the United Kingdom of Great Britain and Northern Ireland. 1.2 INTERPRETATION: In this Share Charge, unless the context otherwise requires: (a) words denoting the singular number only shall include the plural number also and vice versa; words denoting the masculine gender only shall also include the feminine gender; words denoting persons only shall include corporations, partnerships and unincorporated associations; (b) references to clauses, paragraphs and Schedules are to be construed as references to clauses, paragraphs and Schedules of this Share Charge; 2

(c) references to any party shall, where relevant, be deemed to be references to or to include, as appropriate, their respective successors or permitted assigns; (d) references in this Share Charge to this Share Charge or any other document include references to this Share Charge or such other document as varied, supplemented, restated and/or replaced in any manner from time to time and/or any document which varies, supplements, restates and/or replaces it; (e) references to "INCLUDING" and "IN PARTICULAR" shall not be construed restrictively but shall be construed as meaning "including, without prejudice to the generality of the foregoing" and "in particular, but without prejudice to the generality of the foregoing" respectively; (f) references to moneys, obligations and liabilities due, owing or incurred under the Subsidiary Loan Documents shall include money, obligations and liabilities due, owing or incurred in respect of any extensions or increases in

(c) references to any party shall, where relevant, be deemed to be references to or to include, as appropriate, their respective successors or permitted assigns; (d) references in this Share Charge to this Share Charge or any other document include references to this Share Charge or such other document as varied, supplemented, restated and/or replaced in any manner from time to time and/or any document which varies, supplements, restates and/or replaces it; (e) references to "INCLUDING" and "IN PARTICULAR" shall not be construed restrictively but shall be construed as meaning "including, without prejudice to the generality of the foregoing" and "in particular, but without prejudice to the generality of the foregoing" respectively; (f) references to moneys, obligations and liabilities due, owing or incurred under the Subsidiary Loan Documents shall include money, obligations and liabilities due, owing or incurred in respect of any extensions or increases in the amount of the facilities provided for therein or the obligations and liabilities imposed thereunder; (g) expressions defined in the Companies Act 1985 shall have the same meanings in this Share Charge, except that the expression "COMPANY" shall include a body corporate established outside Great Britain; (h) any reference to any statute or any section of any statute shall be deemed to include reference to any statutory modification or re-enactment of it for the time being in force; (i) the limitation on liability conferred by section 6(2) of the Law of Property (Miscellaneous Provisions) Act 1994 shall not apply to the covenants for title implied on the part of the Chargor by its execution and delivery of this Share Charge; (j) references to "LAW" shall include any present or future common law, statute, statutory instrument, treaty, regulation, directive, order, decree, other legislative measure, code, circular, notice, demand, or injunction binding on the persons to whom it is directed to comply; (k) a "PERSON" includes any person, individual, firm, company, corporation, government, state or agency of a state or any undertaking (within the meaning of Section 259(1) of the Companies Act 1985) or other association, organisation, trust or agency (whether or not having separate legal personality) or any two or more of the foregoing; (l) "WINDING-UP" of any person includes its dissolution and/or termination and/or any equivalent or analogous proceedings under the law of any 3

jurisdiction in which the person concerned is incorporated, registered, established or carries on business or to which that person is subject; (m) reference to "WRITING" include any telex and facsimile transmission legibly received, except, unless the Lender otherwise agrees, in relation to any certificate, forecast, report, notice, resolution or other document which is expressly required by this Agreement to be signed, and "WRITTEN" has corresponding meaning; and (n) a time of day is a reference to London time, unless otherwise stated. 1.3 INDEX AND HEADINGS: The index to and the headings in this Share Charge are inserted for convenience and shall not affect its interpretation. 2. COVENANT TO PAY 2.1 COVENANT TO PAY: The Chargor hereby covenants that it will, on demand in writing made to it by the Lender, pay or discharge to the Lender all money and liabilities now or in the future due, owing or incurred to the Lender pursuant to the Subsidiary Loan Documents by the Chargor as and when the same fall due for payment, whether on or after such demand, whether actually or contingently, whether solely or jointly with any other

jurisdiction in which the person concerned is incorporated, registered, established or carries on business or to which that person is subject; (m) reference to "WRITING" include any telex and facsimile transmission legibly received, except, unless the Lender otherwise agrees, in relation to any certificate, forecast, report, notice, resolution or other document which is expressly required by this Agreement to be signed, and "WRITTEN" has corresponding meaning; and (n) a time of day is a reference to London time, unless otherwise stated. 1.3 INDEX AND HEADINGS: The index to and the headings in this Share Charge are inserted for convenience and shall not affect its interpretation. 2. COVENANT TO PAY 2.1 COVENANT TO PAY: The Chargor hereby covenants that it will, on demand in writing made to it by the Lender, pay or discharge to the Lender all money and liabilities now or in the future due, owing or incurred to the Lender pursuant to the Subsidiary Loan Documents by the Chargor as and when the same fall due for payment, whether on or after such demand, whether actually or contingently, whether solely or jointly with any other person, whether as principal or surety and whether or not a Lender was an original party to the relevant transactions, including all interest accrued thereon and all commission, fees, charges, costs and expenses which the Lender may in the course of their business properly charge or incur in respect of the Chargor or its affairs or for the Lender to enforce its rights hereunder (to the extent the Lender is entitled to recover the same under the Subsidiary Loan Documents) and so that interest shall be computed and compounded in accordance with the Subsidiary Loan Documents (after as well as before any demand or judgment). 2.2 DEMANDS FROM THE LENDER: The making of one demand under this Share Charge will not preclude the Lender from making any further demands. 3. CHARGING CLAUSE 3.1 CHARGING CLAUSE: The Chargor with full title guarantee hereby charges to the Lender as security for the payment or discharge of all Secured Sums by way of first fixed charge, all the Chargor's interest in the Investments. 3.2 PROVISO FOR REDEMPTION: On irrevocable and unconditional payment and discharge of all the Secured Sums by the Chargor and upon the Lender being under no further obligation to provide financial accommodation to the Group pursuant to the Subsidiary Loan Documents, the Lender will at the request and cost of the Chargor execute such documents (or procure that its nominees execute such documents) as the Chargor may reasonably request which may be required to discharge the security created by this Share Charge. 4

4. DOCUMENTS AND VOTING RIGHTS 4.1 DEPOSIT OF DOCUMENTS: Except as otherwise expressly agreed in writing by the Lender, the Chargor shall: (a) upon executing this Share Charge and, in relation to after acquired Charged Property, within 30 Business Days of receipt by the Chargor of the relevant documents of title, deposit with the Lender, and the Lender shall be entitled to retain all stock and share certificates and other documents evidencing, or documents of title relating to, the Charged Property together with stock transfer forms (or equivalent instruments of transfer), with the name of the transferee, the consideration and the date left blank, but otherwise duly completed and executed by the person in whose name such certificate or document is, on the basis that the Lender (or its nominee) shall be entitled to hold such certificates, documents, power off attorney and stock transfer forms (or equivalent instruments of transfer) until the Secured Sums have been irrevocably and unconditionally discharged in full (in accordance with Clause 3.2 (Proviso for Redemption)) and shall be entitled at any time to complete (pursuant to its powers in Clause 11 (Power of Attorney)) the stock transfer forms (or equivalent instruments of transfer) on

4. DOCUMENTS AND VOTING RIGHTS 4.1 DEPOSIT OF DOCUMENTS: Except as otherwise expressly agreed in writing by the Lender, the Chargor shall: (a) upon executing this Share Charge and, in relation to after acquired Charged Property, within 30 Business Days of receipt by the Chargor of the relevant documents of title, deposit with the Lender, and the Lender shall be entitled to retain all stock and share certificates and other documents evidencing, or documents of title relating to, the Charged Property together with stock transfer forms (or equivalent instruments of transfer), with the name of the transferee, the consideration and the date left blank, but otherwise duly completed and executed by the person in whose name such certificate or document is, on the basis that the Lender (or its nominee) shall be entitled to hold such certificates, documents, power off attorney and stock transfer forms (or equivalent instruments of transfer) until the Secured Sums have been irrevocably and unconditionally discharged in full (in accordance with Clause 3.2 (Proviso for Redemption)) and shall be entitled at any time to complete (pursuant to its powers in Clause 11 (Power of Attorney)) the stock transfer forms (or equivalent instruments of transfer) on behalf of the Lender in favour of itself or such other person as it shall select; and (b) execute and deliver to the Lender such documents and transfers and give such instructions and perform such other acts as the Lender may reasonably require at any time to constitute or perfect an equitable or legal charge (at the Lender's option) over registered Securities or Derivative Assets or a pledge over bearer Securities or Derivative Assets, including any Securities or Derivative Assets which the Chargor elects to hold in any paperless transfer and settlement system or held in a clearing system. 4.2 VOTING RIGHTS: (a) Unless and until a Default or an Event of Default occurs and is continuing: (i) all voting and other rights attaching to any Charged Property shall continue to be exercised by the Chargor for so long as it remains the registered owner and the Chargor shall not permit any person other than itself or a reputable paperless transfer and settlement or clearing system, the Lender or the Lender's nominee to be registered as holder of any Charged Property; and (ii) if Securities charged under this Share Charge are registered in the name of the Lender or its nominee, all voting and other rights attaching to them shall be exercised by the Lender or its nominee 5

in accordance with instructions in writing from time to time received from the Chargor; provided that the Chargor shall not exercise such voting rights in a manner which adversely affects the validity or enforceability of the security created by this Share Charge or would result in the Lender or its nominee incurring any cost or expense or being subject to any liability unless previously indemnified to its satisfaction. (b) Unless a Default or an Event of Default occurs and is continuing, the Chargor shall be entitled to receive and retain all dividends, distributions and other monies paid on or derived from the Charged Property. (c) After a Default or an Event of Default occurs and for so long as such an Event of Default is continuing, the Lender shall be entitled to: (i) receive and retain all dividends, distributions and other monies paid on the Charged Property; and (ii) exercise or direct the exercise of the voting rights attached to any of the Charged Property in such manner as it considers fit. The Chargor shall after such time: (A) comply, or procure the compliance, with any directions of the Lender in respect of the exercise of the voting rights attached to such Investments; and

in accordance with instructions in writing from time to time received from the Chargor; provided that the Chargor shall not exercise such voting rights in a manner which adversely affects the validity or enforceability of the security created by this Share Charge or would result in the Lender or its nominee incurring any cost or expense or being subject to any liability unless previously indemnified to its satisfaction. (b) Unless a Default or an Event of Default occurs and is continuing, the Chargor shall be entitled to receive and retain all dividends, distributions and other monies paid on or derived from the Charged Property. (c) After a Default or an Event of Default occurs and for so long as such an Event of Default is continuing, the Lender shall be entitled to: (i) receive and retain all dividends, distributions and other monies paid on the Charged Property; and (ii) exercise or direct the exercise of the voting rights attached to any of the Charged Property in such manner as it considers fit. The Chargor shall after such time: (A) comply, or procure the compliance, with any directions of the Lender in respect of the exercise of the voting rights attached to such Investments; and (B) if the Lender so requires by notice to the Chargor, immediately deliver to the Lender a form of proxy or other authority (in each case, in such form as the Lender shall reasonably require) appointing such person as the Lender shall select as proxy of the Chargor or, as the case may be, its nominee or otherwise enabling such person as the Lender shall select to exercise such voting rights as shall be specified (whether generally or specifically) in the relevant notice. 4.3 PAYMENT OF COSTS ON SECURITIES: The Chargor shall duly and promptly pay all costs, instalments or other payments which from time to time become due in respect of any Charged Property. In the case of any default by the Chargor in this respect the Lender may, if it thinks fit, make any such payments on behalf of the Chargor, in which event any sums so paid shall be reimbursed on demand by the Chargor to the Lender and until reimbursed shall bear interest in accordance with Clause 13.3 (Overdue Amounts) and shall be secured on the Charged Property. 4.4 COLLECTION OF DISTRIBUTIONS: At any time following the registration of the Securities or Derivative Assets in the name of the Lender or its nominee in accordance with Clause 4.2(a), the Lender shall not be under any duty to ensure 6

that any dividends, distributions or other monies payable in respect of the Securities or Derivative Assets are duly or promptly paid or received by it or its nominee, or to verify that the correct amounts are paid or received, or to take any action in connection with the taking up of any (or any offer of any) stocks, shares, rights, monies or other property paid, distributed, accruing or offered at any time by way of interest, dividend, redemption, bonus, rights, preference, option, warrant or otherwise on, or in respect of or in substitution for, any of the Securities. 4.5 MAINTENANCE OF LEGAL VALIDITY: The Chargor shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws and regulations of its jurisdiction of incorporation and England and Wales to enable it lawfully to enter into and perform its obligations under this Share Charge and to ensure the legality, validity, enforceability or admissibility in evidence in its jurisdiction of incorporation and England and Wales of this Share Charge. 5. NEGATIVE PLEDGE AND OTHER RESTRICTIONS The Chargor shall not, without the prior written consent of the Lender (save as otherwise permitted by any Loan Document): (a) create, or agree or attempt to create, or permit to arise or subsist, any lien of any kind (save for Permitted

that any dividends, distributions or other monies payable in respect of the Securities or Derivative Assets are duly or promptly paid or received by it or its nominee, or to verify that the correct amounts are paid or received, or to take any action in connection with the taking up of any (or any offer of any) stocks, shares, rights, monies or other property paid, distributed, accruing or offered at any time by way of interest, dividend, redemption, bonus, rights, preference, option, warrant or otherwise on, or in respect of or in substitution for, any of the Securities. 4.5 MAINTENANCE OF LEGAL VALIDITY: The Chargor shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws and regulations of its jurisdiction of incorporation and England and Wales to enable it lawfully to enter into and perform its obligations under this Share Charge and to ensure the legality, validity, enforceability or admissibility in evidence in its jurisdiction of incorporation and England and Wales of this Share Charge. 5. NEGATIVE PLEDGE AND OTHER RESTRICTIONS The Chargor shall not, without the prior written consent of the Lender (save as otherwise permitted by any Loan Document): (a) create, or agree or attempt to create, or permit to arise or subsist, any lien of any kind (save for Permitted Liens) or any trust over any of the Charged Property; (b) sell, transfer, assign or otherwise dispose of any of the Charged Property or the equity of redemption in respect of the Charged Property; or (c) do or cause or permit to be done anything which may in any way materially depreciate, jeopardise or otherwise materially prejudice the market value or collateral value of the Charged Property or the rights of the Lender hereunder. 6. FURTHER ASSURANCE To the extent required to comply with the Loan Agreement, the Chargor shall, promptly following demand by the Lender in writing, execute and deliver to the Lender at the cost of the Chargor and in such form as the Lender may reasonably require, such other documents as the Lender may reasonably require to secure the payment of the Secured Sums, or to perfect or protect this Share Charge or facilitate its realisation or the exercise of the Lender's rights thereunder, or following a Default or an Event of Default which is continuing, to vest title to any Charged Property in itself or its nominee or any purchaser and/or to create a legal mortgage over the Securities or Derivative Assets and to register such security or title in any applicable register in each case consistent with the jurisdiction in which such asset is situate and/or to facilitate the realisation of this security or the Lender's rights under this Share Charge. 7

7. CONTINUING SECURITY 7.1 CONTINUING SECURITY: This Share Charge shall be a continuing security, notwithstanding any intermediate payment or settlement of account or any other matter whatever, and shall be in addition to and shall not prejudice or be prejudiced by any right of Lien, set-off or other rights exercisable by the Lender or the Lender as banker against any Group Company or any Lien, guarantee, indemnity and/or negotiable instrument now or in the future held by the Lender. The Lender shall not be bound to enforce any other Lien before enforcing the security created by this Share Charge. Section 93 of the Law of Property Act 1925 shall not apply to this Share Charge. 7.2 SUBROGATION: During the continuance of this Share Charge: (a) any rights of the Chargor, by reason of the performance of any of its obligations under this Share Charge, the enforcement of any of the charges contained herein or any action taken pursuant to any rights of any person conferred by or pursuant to this Share Charge or by law (so far as they relate to any of the Charged Property, the Lender as the person entitled to any of the charges contained herein, any receiver or any delegate of the

7. CONTINUING SECURITY 7.1 CONTINUING SECURITY: This Share Charge shall be a continuing security, notwithstanding any intermediate payment or settlement of account or any other matter whatever, and shall be in addition to and shall not prejudice or be prejudiced by any right of Lien, set-off or other rights exercisable by the Lender or the Lender as banker against any Group Company or any Lien, guarantee, indemnity and/or negotiable instrument now or in the future held by the Lender. The Lender shall not be bound to enforce any other Lien before enforcing the security created by this Share Charge. Section 93 of the Law of Property Act 1925 shall not apply to this Share Charge. 7.2 SUBROGATION: During the continuance of this Share Charge: (a) any rights of the Chargor, by reason of the performance of any of its obligations under this Share Charge, the enforcement of any of the charges contained herein or any action taken pursuant to any rights of any person conferred by or pursuant to this Share Charge or by law (so far as they relate to any of the Charged Property, the Lender as the person entitled to any of the charges contained herein, any receiver or any delegate of the Chargor): (i) to be indemnified by any person; or (ii) to prove in respect of any liability in the winding-up of any person; or (iii) to take the benefit of or enforce any security interest or guarantees or to exercise any rights of contribution, (all such rights the "SUBROGATION RIGHTS") shall be exercised and enforced by the Chargor in such manner and on such terms, and only in such manner and on such terms, as the Lender may require (and, without limitation, the Lender shall be entitled to require the Chargor not to exercise or enforce any Subrogation Rights); (b) any amount received by the Chargor as a result of any exercise of any Subrogation Rights shall be held in trust for and immediately paid to the Lender; Provided that no Subrogation Rights shall arise or exist, which if they did exist would constitute a right to be indemnified by, to prove in the winding-up of, to take the benefit of any Lien or guarantee granted by, or to exercise any rights of contribution against, KNS Holdings Limited, and the Chargor waives all its entitlement and rights to or in respect of any such Subrogation Rights. 8

8. POWERS OF SALE 8.1 STATUTORY POWER OF SALE TO ARISE ON ENFORCEMENT: Section 103 of the Law of Property Act 1925 shall not apply to this Share Charge, but the statutory power of sale (as varied and extended by this Share Charge) shall (as between the Lender and a purchaser from the Lender), and the statutory power of appointing a receiver of the Charged Property (or the income thereof) shall, arise immediately on the execution of this Share Charge without the restrictions contained in the Law of Property Act 1925 as to the giving of notice or otherwise. However, the Lender shall not exercise such powers until the non-payment of all or part of the Secured Sums following a demand in accordance with the relevant Loan Document or a receiver has been appointed, but this provision shall not affect a purchaser or require him to ask whether a demand or appointment has been made. 8.2 THIRD PARTIES NOT TO BE CONCERNED WITH VALIDITY OF DEMAND: No person dealing in good faith and for value with the Lender, its agents or brokers, shall be concerned to enquire whether this Share Charge has become enforceable, or whether any power exercised or purported to be exercised has become exercisable, or whether any Secured Sums remain due upon this Share Charge or have been validly demanded, or as to the necessity or expediency of any stipulations and conditions subject to which the sale of any Charged Property shall be made, or otherwise as to the propriety or regularity of the sale of any Charged Property, or to see to the application of any money paid to the Lender, or its agents or brokers, and each such dealing shall be

8. POWERS OF SALE 8.1 STATUTORY POWER OF SALE TO ARISE ON ENFORCEMENT: Section 103 of the Law of Property Act 1925 shall not apply to this Share Charge, but the statutory power of sale (as varied and extended by this Share Charge) shall (as between the Lender and a purchaser from the Lender), and the statutory power of appointing a receiver of the Charged Property (or the income thereof) shall, arise immediately on the execution of this Share Charge without the restrictions contained in the Law of Property Act 1925 as to the giving of notice or otherwise. However, the Lender shall not exercise such powers until the non-payment of all or part of the Secured Sums following a demand in accordance with the relevant Loan Document or a receiver has been appointed, but this provision shall not affect a purchaser or require him to ask whether a demand or appointment has been made. 8.2 THIRD PARTIES NOT TO BE CONCERNED WITH VALIDITY OF DEMAND: No person dealing in good faith and for value with the Lender, its agents or brokers, shall be concerned to enquire whether this Share Charge has become enforceable, or whether any power exercised or purported to be exercised has become exercisable, or whether any Secured Sums remain due upon this Share Charge or have been validly demanded, or as to the necessity or expediency of any stipulations and conditions subject to which the sale of any Charged Property shall be made, or otherwise as to the propriety or regularity of the sale of any Charged Property, or to see to the application of any money paid to the Lender, or its agents or brokers, and each such dealing shall be deemed to be within the powers hereby conferred and to be valid and effective accordingly. 9. OPENING OF NEW ACCOUNTS 9.1 RULING OFF OF ACCOUNTS: On receiving notice that the Chargor has encumbered or disposed of any of the Charged Property, the Lender may rule off such Chargor's account or accounts and open a new account or accounts in the name of the Chargor. 9.2 CREDITS NOT TO REDUCE INDEBTEDNESS OF CHARGOR: If the Lender does not open a new account or accounts immediately on receipt of such notice, it shall nevertheless be treated as if it had done so at the time when it received such notice and as from that time all payments made by the Chargor to the Lender shall be treated as having been credited to such new account or accounts and shall not operate to reduce the amount owing from the Chargor to the Lender at the time when it received such notice. 10. ENFORCEMENT 10.1 STATUTORY POWERS: The powers conferred on mortgagees or receivers by the Law of Property Act 1925 and the Insolvency Act 1986 shall apply to the security constituted by this Share Charge except insofar as they are expressly or impliedly excluded and where there is ambiguity or conflict between the powers contained 9

in such statutes, in which case those powers contained in this Share Charge shall prevail. 10.2 LIABILITY OF LENDER: Neither the Lender nor any receiver or delegate shall be liable to account as mortgagee in possession or otherwise for any money not actually received by it. 10.3 REDEMPTION OF PRIOR CHARGES: The Lender at any time following the security constituted by this Share Charge becoming enforceable may redeem any and all prior Liens on or relating to the Charged Property or any part thereof or procure the transfer of such Liens to itself and may settle and pass the accounts of the person or persons entitled to the prior Liens. Any account so settled and passed shall be conclusive and binding on the Chargor. 10.4 RIGHTS OF LENDER: All or any of the rights which are conferred by this Share Charge (either expressly or impliedly) upon a receiver may be exercised after the Share Charge becomes enforceable by the Lender irrespective of whether the Lender shall have taken possession or appointed a receiver of the Charged Property. 11. POWER OF ATTORNEY

in such statutes, in which case those powers contained in this Share Charge shall prevail. 10.2 LIABILITY OF LENDER: Neither the Lender nor any receiver or delegate shall be liable to account as mortgagee in possession or otherwise for any money not actually received by it. 10.3 REDEMPTION OF PRIOR CHARGES: The Lender at any time following the security constituted by this Share Charge becoming enforceable may redeem any and all prior Liens on or relating to the Charged Property or any part thereof or procure the transfer of such Liens to itself and may settle and pass the accounts of the person or persons entitled to the prior Liens. Any account so settled and passed shall be conclusive and binding on the Chargor. 10.4 RIGHTS OF LENDER: All or any of the rights which are conferred by this Share Charge (either expressly or impliedly) upon a receiver may be exercised after the Share Charge becomes enforceable by the Lender irrespective of whether the Lender shall have taken possession or appointed a receiver of the Charged Property. 11. POWER OF ATTORNEY 11.1 POWER OF ATTORNEY: The Chargor by way of security hereby irrevocably appoints the Lender (whether or not a receiver has been appointed), and any receiver separately, as the attorney of the Chargor (with full power to appoint substitutes and to delegate), in its name and on its behalf, and as its act and deed or otherwise, at any time during the continuance of a Default or Event of Default to: (a) execute and deliver and otherwise perfect any agreement, assurance, deed, instrument or document; or (b) perform any act; which may be required of the Chargor under this Share Charge, or may be deemed necessary by such attorney, acting reasonably, for any purpose of this Share Charge or to enhance or perfect the security intended to be constituted by it or following a Default or an Event of Default, to convey or transfer legal ownership of any of the Charged Property (including the completion of the stock transfer forms referred to in Clause 4.1 (Deposit of Documents)). 11.2 RATIFICATION: The Chargor undertakes, if so required, to ratify and confirm all acts done and transactions entered into by any attorney appointed under Clause 11.1 (Power of Attorney) in the proper exercise of its powers in accordance with this Share Charge. 11.3 DELEGATION: The Lender may delegate by power of attorney or in any other manner all or any of the powers, authorities and discretions which are for the time being exercisable by the Lender under this Share Charge to any person or persons 10

which it shall think fit and on such terms and conditions as it shall think fit (including power to sub-delegate) without liability for any act or omission by such delegate. 12. APPLICATION OF MONEY RECEIVED 12.1 APPLICATION OF RECOVERIES: Any money received under the powers conferred by this Share Charge shall, subject to the discharge of any prior-ranking claims, be paid or applied in the following order of priority: (a) in satisfaction of all costs, charges and expenses incurred, and payments made by the Lender in connection with the exercise of its rights under this Share Charge (including any costs, charges and expenses incidental to the appointment of a receiver and the exercise of a receiver's rights and all remuneration payable to a receiver or liabilities of a receiver); (b) in or towards satisfaction of the Secured Sums in the manner applicable under the Subsidiary Loan

which it shall think fit and on such terms and conditions as it shall think fit (including power to sub-delegate) without liability for any act or omission by such delegate. 12. APPLICATION OF MONEY RECEIVED 12.1 APPLICATION OF RECOVERIES: Any money received under the powers conferred by this Share Charge shall, subject to the discharge of any prior-ranking claims, be paid or applied in the following order of priority: (a) in satisfaction of all costs, charges and expenses incurred, and payments made by the Lender in connection with the exercise of its rights under this Share Charge (including any costs, charges and expenses incidental to the appointment of a receiver and the exercise of a receiver's rights and all remuneration payable to a receiver or liabilities of a receiver); (b) in or towards satisfaction of the Secured Sums in the manner applicable under the Subsidiary Loan Documents; and (c) as to the surplus (if any), to the person or persons entitled to it. 12.2 SUSPENSE ACCOUNT: The Lender may, in its absolute discretion on or at any time or times pending the payment to the Lender of the whole of the Secured Sums, place and keep to the credit of a separate or suspense account, bearing interest, any money received, recovered or realised by the Lender by virtue of this Share Charge in such manner as the Lender may determine without any obligation to apply it in or towards the discharge of any Secured Sum. That amount may be kept there (with any interest earned being credited to that account) until the Lender is satisfied that all the Secured Sums have been discharged in full and that all facilities which might give rise to Secured Sums have terminated. 13. COSTS AND INTEREST ON OVERDUE AMOUNTS 13.1 INDEMNITY: All costs, charges and liabilities (including all properly incurred professional fees and disbursements and value added tax and/or any similar tax) and all other sums paid or incurred by the Lender under or in connection with this Share Charge or the Subsidiary Loan Documents, shall be recoverable (on a full indemnity basis) as a debt payable on demand from the Chargor, may be debited following non-payment of such sum(s) by the Chargor when due, or, if relevant, when demanded, without notice to any account of the Chargor, shall bear interest in accordance with the provisions of the Subsidiary Loan Documents and shall be charged on the Charged Property. The Chargor shall indemnify the Lender against all properly incurred costs, charges and expenses arising out of any proceedings referable to the Chargor brought against the Lender or to which the Lender may be a party whether as plaintiff or defendant or otherwise and which relate to any Charged Property. All amounts paid by the Chargor under this Share Charge shall be paid free and clear of any deduction or withholding on account of tax or any other amount (save to the extent required by law) and free of any set-off or 11

counterclaim or otherwise. If the Chargor is required to make any deduction or withholding by law on any sum paid or payable by it to the Lender under this Share Charge the sum payable by the Chargor in respect of which the deduction or withholding is required shall be increased to the extent necessary to ensure that the Lender receives on the due date and retains (free of any liability in respect of such deduction or withholding) a net sum equal to the sum it would have received and retained had no such deduction or withholding been required or made. 13.2 TYPES OF COSTS RECOVERABLE: The costs recoverable by the Lender under this Share Charge shall include: (a) all costs properly incurred in preparing and administering this Share Charge or perfecting the security created by it; (b) all costs (whether or not allowable on a taxation by the court) of all proceedings for the enforcement of this

counterclaim or otherwise. If the Chargor is required to make any deduction or withholding by law on any sum paid or payable by it to the Lender under this Share Charge the sum payable by the Chargor in respect of which the deduction or withholding is required shall be increased to the extent necessary to ensure that the Lender receives on the due date and retains (free of any liability in respect of such deduction or withholding) a net sum equal to the sum it would have received and retained had no such deduction or withholding been required or made. 13.2 TYPES OF COSTS RECOVERABLE: The costs recoverable by the Lender under this Share Charge shall include: (a) all costs properly incurred in preparing and administering this Share Charge or perfecting the security created by it; (b) all costs (whether or not allowable on a taxation by the court) of all proceedings for the enforcement of this Share Charge or for the recovery or attempted recovery of the Secured Sums; (c) all money properly expended and all properly incurred costs arising out of the exercise of any power, right or discretion conferred by this Share Charge; and (d) all costs and losses arising from any default by the Chargor in the payment when due of any Secured Sums or the performance of its obligations under this Share Charge. 13.3 OVERDUE AMOUNTS: Any overdue amounts secured by this Share Charge shall carry interest at the rate and in accordance with the terms contained in the Subsidiary Loan Documents in relation to overdue sums provided under Section 2.6(c) of the Loan Agreement or at such other rate agreed between the Chargor and the Lender from time to time. In each case, such interest shall accrue on a day to day basis to the date of repayment in full and, if unpaid, shall be compounded on the terms so agreed (or in the absence of such agreed terms with monthly rests on the Lender's usual monthly interest days). Interest shall continue to be charged and compounded on this basis after as well as before any demand or judgment. 13.4 CURRENCY INDEMNITY: (a) Moneys received or held by the Lender pursuant to this Share Charge may, from time to time after demand has been made, be converted into such currency as the Lender considers necessary or desirable to discharge the Secured Sums in that currency at such rate of exchange as may be applicable under the Loan Agreement or, if there is none, the prevailing spot rate of exchange of Wells Fargo Bank, N.A. or any successor thereto (as conclusively determined by the Lender in accordance with the Loan Agreement) for purchasing the currency to be acquired with the existing currency. 12

(b) No payment to the Lender (whether under any judgment or court order or otherwise) shall discharge the obligation or liability in respect of which it was made unless and until the Lender shall have received payment in full in the currency in which such obligation or liability was incurred, and to the extent that the amount of any such payment shall on actual conversion into such currency fall short of such obligation or liability expressed in that currency, the Lender shall have a further separate cause of action against the Chargor and shall be entitled to enforce this security to recover the amount of the shortfall. To the extent that the amount of any such payment shall on actual conversion into such currency exceed such obligation or liability expressed in that currency, the Lender shall repay that excess to the Chargor. 14. SET-OFF (a) The Lender may at any time or times during the continuance of a Default or an Event of Default retain any money standing to the credit of the Chargor in any currency upon any account or otherwise (in any country and whether or not in the Chargor's name) as cover for any Secured Sums and at any time after a Default or an Event of Default without notice to the Chargor, and may set off, combine and/or consolidate all or any of such money

(b) No payment to the Lender (whether under any judgment or court order or otherwise) shall discharge the obligation or liability in respect of which it was made unless and until the Lender shall have received payment in full in the currency in which such obligation or liability was incurred, and to the extent that the amount of any such payment shall on actual conversion into such currency fall short of such obligation or liability expressed in that currency, the Lender shall have a further separate cause of action against the Chargor and shall be entitled to enforce this security to recover the amount of the shortfall. To the extent that the amount of any such payment shall on actual conversion into such currency exceed such obligation or liability expressed in that currency, the Lender shall repay that excess to the Chargor. 14. SET-OFF (a) The Lender may at any time or times during the continuance of a Default or an Event of Default retain any money standing to the credit of the Chargor in any currency upon any account or otherwise (in any country and whether or not in the Chargor's name) as cover for any Secured Sums and at any time after a Default or an Event of Default without notice to the Chargor, and may set off, combine and/or consolidate all or any of such money with all or such part of the Secured Sums as the Lender may select (whether presently payable or not), and purchase with any such money any other currency required to effect such combination. (b) The Chargor irrevocably authorises the Lender in its name and at its expense to perform such acts and sign such documents as may be required to give effect to any set-off or transfer pursuant to Clause 14(a), including the purchase with the money standing to the credit of any such account of such other currencies as may be necessary to effect such set off or transfer. (c) The foregoing provisions of this clause shall be in addition to and without prejudice to such rights of set off, combination, consolidation, lien and other rights whatsoever conferred on the Lender by law. 15. TRANSFER The Lender may transfer all or any part of its rights in relation to this Share Charge and the Secured Sums or otherwise grant an interest in them to any person to which they are entitled to make such a transfer under the Loan Agreement. 16. DISCLOSURE The Chargor irrevocably authorises the Lender, at its discretion, at any time or from time to time, to disclose any information concerning the Chargor, this Share Charge and the Secured Sums to any prospective transferee or grantee referred to in Clause 15 (Transfer), subject to such person undertaking to the Chargor, in manner, form and substance reasonably satisfactory to such Chargor, to keep such information confidential. Both 13

Lender and any prospective transferee or grantee shall be entitled to diclose such information to their professional advisers. The above authority is without prejudice to any obligation of the Lender to make disclosure imposed by law. 17. FORBEARANCE AND SEVERABILITY 17.1 NO WAIVERS: All rights, powers and privileges under this Share Charge shall continue in full force and effect, regardless of the Lender exercising, delaying in exercising or omitting to exercise any of them. 17.2 INVALIDITY AND SEVERABILITY: (a) None of the covenants and guarantees given and none of the charges created by the Chargor under this Share Charge shall be avoided or invalidated by reason only of one other or more of such covenants, guarantees or charges being invalid or unenforceable.

Lender and any prospective transferee or grantee shall be entitled to diclose such information to their professional advisers. The above authority is without prejudice to any obligation of the Lender to make disclosure imposed by law. 17. FORBEARANCE AND SEVERABILITY 17.1 NO WAIVERS: All rights, powers and privileges under this Share Charge shall continue in full force and effect, regardless of the Lender exercising, delaying in exercising or omitting to exercise any of them. 17.2 INVALIDITY AND SEVERABILITY: (a) None of the covenants and guarantees given and none of the charges created by the Chargor under this Share Charge shall be avoided or invalidated by reason only of one other or more of such covenants, guarantees or charges being invalid or unenforceable. (b) Any provision of this Share Charge which for any reason is or becomes illegal, invalid or unenforceable shall be ineffective only to the extent of such illegality, invalidity and unenforceability, without invalidating the remaining provisions of this Share Charge or the effectiveness of any provisions of this Share Charge under the laws of any jurisdiction. 18. VARIATIONS AND CONSENTS 18.1 VARIATIONS IN WRITING: No variation of this Share Charge shall be considered valid and as constituting part of this Share Charge, unless such variation shall have been made in writing and signed by the Lender and the Chargor. 18.2 VARIATION: The expression "variation" shall include any variation, supplement, extension, deletion or replacement however effected. 18.3 CONDITIONAL CONSENTS: Save as otherwise expressly specified in this Share Charge or the Loan Agreement, any consent of the Lender may be given absolutely or on any terms and subject to any conditions as the Lender may determine in its entire discretion. 19. SERVICE OF DEMANDS AND NOTICES 19.1 NOTICES TO THE CHARGOR: A demand for payment or any other communication to be given to the Chargor under this Share Charge may be made or given by any manager or officer of the Lender and must be in writing addressed to the Chargor served on it at the address for service of the Chargor stated in the Second Schedule, or to the address last notified to the Lender by the Chargor, or by facsimile transmission to the facsimile number stated in the Second Schedule, or 14

to the facsimile number last notified to the Lender by the Chargor or by any other form of electronic communication which may be available. 19.2 NOTICES TO LENDER: Any communication to be given to the Lender under this Share Charge must be given to the Lender in writing served on it at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, Los Angeles California 90404 USA (marked for the attention of Business Finance Division Manager) or by facsimile to facsimile number 00 1 310 453 7413 or the address or facsimile number last notified to the Chargor by the Lender in writing. 19.3 DEEMED SERVICE: A notice or demand shall be deemed to be duly served on the Chargor: (a) if delivered by hand, at the time of actual delivery;

to the facsimile number last notified to the Lender by the Chargor or by any other form of electronic communication which may be available. 19.2 NOTICES TO LENDER: Any communication to be given to the Lender under this Share Charge must be given to the Lender in writing served on it at 2450 Colorado Avenue, Suite 3000 West, Santa Monica, Los Angeles California 90404 USA (marked for the attention of Business Finance Division Manager) or by facsimile to facsimile number 00 1 310 453 7413 or the address or facsimile number last notified to the Chargor by the Lender in writing. 19.3 DEEMED SERVICE: A notice or demand shall be deemed to be duly served on the Chargor: (a) if delivered by hand, at the time of actual delivery; (b) if transmitted by facsimile, at the time the facsimile transmission report (or other appropriate evidence) confirming that the facsimile has been transmitted to the addressee is received by the sender; or (c) if sent by first class prepaid post, at noon on the third Business Day (or if sent by airmail, the fifth Business Day) following the day of posting and shall be effective even if it is misdelivered or returned undelivered; provided that, where delivery or transmission occurs after 6.00 pm in the place of delivery on a Business Day or on a day which is not a Business Day, service shall be deemed to occur at 9.00 am in the place of delivery on the next Business Day. In proving such service, it shall be sufficient to prove that personal delivery was made or that the envelope containing the communication was correctly addressed and posted or that a facsimile transmission report (or other appropriate evidence) was obtained that the facsimile had been transmitted to the addressee. 19.4 SERVICE ON LENDER: Any communication to the Lender shall be deemed to have been given only on actual receipt by it. 20. COUNTERPARTS This Share Charge may be executed by the parties in any number of copies, all of which taken together shall constitute a single Share Charge. 21. ADJUSTMENT OF ACCOUNT If the statement of account between the Lender and the Chargor by reference to which any Secured Sums are calculated for the purposes of this Share Charge requires adjustment at any time because of any claim made against the Lender by an officeholder (within the meaning of Section 234 of the Insolvency Act 1986) then, notwithstanding any other provision of this Share Charge: 15

(a) the Chargor's liability to the Lender will be correspondingly adjusted; (b) the Lender may treat any release or settlement made by it with the Chargor before any such adjustment is required as being of no effect; and (c) the Lender may recover from the Chargor such sum as will place the Lender in the same position as if such release or settlement had not been made. If any claim is made against the Lender under any insolvency law with reference to this Share Charge, the Lender may agree the claim or settle it on any terms it chooses without asking for the Chargor's agreement. If the Lender does agree or settle such claim, the Chargor will be liable under this Share Charge as if a court order had been made containing the terms which the Lender agreed or settled. The Chargor will be responsible for all costs and expenses which the Lender properly incur in defending such a claim.

(a) the Chargor's liability to the Lender will be correspondingly adjusted; (b) the Lender may treat any release or settlement made by it with the Chargor before any such adjustment is required as being of no effect; and (c) the Lender may recover from the Chargor such sum as will place the Lender in the same position as if such release or settlement had not been made. If any claim is made against the Lender under any insolvency law with reference to this Share Charge, the Lender may agree the claim or settle it on any terms it chooses without asking for the Chargor's agreement. If the Lender does agree or settle such claim, the Chargor will be liable under this Share Charge as if a court order had been made containing the terms which the Lender agreed or settled. The Chargor will be responsible for all costs and expenses which the Lender properly incur in defending such a claim. 22. REPRESENTATIONS AND WARRANTIES 22.1 REPRESENTATIONS AND WARRANTIES: The Chargor represents and warrants to the Lender that: (a) the Chargor is the sole, absolute and beneficial owner of the Charged Property, that no person save the Chargor has any right or interest of any sort whatsoever in or to the Charged Property and that there are no agreements or arrangements (including any restrictions on transfer or rights of pre-emption) affecting the Charged Property which would in any way fetter the rights of the Chargor under this Share Charge; (b) the Securities are duly authorised, validly issued and fully paid and there are no monies or liabilities outstanding in respect of any of the Securities; (c) the Securities constitute 65% of the entire issued ordinary share capital of KNS Holdings Limited, and constitute 65% of all of the shares in KNS Holdings Limited owned legally or beneficially by the Chargor; (c) the transfer of the Securities or the charge over the Securities, each as contemplated by this Share Charge, is not prohibited by the constitutional documents of the Chargor; (d) the Chargor is validly incorporated under the laws of the state of Delaware, USA and has the power and authority to enter into, perform and deliver this Share Charge and the arrangements contemplated hereby; (e) this Share Charge constitutes its legal, valid and binding obligations, enforceable (subject to the paragraph below) in accordance with its terms; (f) in any proceedings taken in its jurisdiction of incorporation in relation to this Share Charge, the choice of English law as the governing law of this Share Charge and any judgment obtained in England will be recognised and enforced; 16

(g) the Chargor has not taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against it for its winding-up, dissolution, administration or re-organisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of it or of any or all of its assets or revenues; (h) its execution of this Share Charge and exercise of its rights and performance of its obligations hereunder will not result in the existence of nor oblige it to create any Lien over all or any of its present or future revenues or assets otherwise than as contemplated hereby; and (i) its execution of this Share Charge constitutes, and its exercise of its rights and performance of its obligations hereunder will constitute, private and commercial acts done and performed for private and commercial purposes. 22.2 TIMES OF MAKING REPRESENTATIONS AND WARRANTIES: The representations and warranties

(g) the Chargor has not taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against it for its winding-up, dissolution, administration or re-organisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of it or of any or all of its assets or revenues; (h) its execution of this Share Charge and exercise of its rights and performance of its obligations hereunder will not result in the existence of nor oblige it to create any Lien over all or any of its present or future revenues or assets otherwise than as contemplated hereby; and (i) its execution of this Share Charge constitutes, and its exercise of its rights and performance of its obligations hereunder will constitute, private and commercial acts done and performed for private and commercial purposes. 22.2 TIMES OF MAKING REPRESENTATIONS AND WARRANTIES: The representations and warranties set out in Clause 22.1 (Representations and Warranties): (a) will survive the execution of each Loan Document and each drawdown under the Loan Agreement; and (b) are made on the date hereof and are deemed to be repeated in accordance with Section 3.3(a) (Conditions Precedent to all Extensions of Credit) of the Loan Agreement with reference to the facts and circumstances then existing. 23. GOVERNING LAW AND SUBMISSION TO JURISDICTION 23.1 GOVERNING LAW: Any dispute, controversy, proceedings or claim of whatever nature arising out of or relating to, or breach of, this Share Charge shall be governed by and this Share Charge shall be construed in all respects in accordance with English law. 23.2 SUBMISSION TO JURISDICTION: (a) The Chargor irrevocably submits for the benefit of the Lender to the non-exclusive jurisdiction of the courts of England for the purpose of hearing and determining any proceedings arising out of this Share Charge. (b) The Chargor hereby designates, appoints and empowers FutureLink Europe Limited at The Chestnuts, 2 Old Bath Road, Newbury, Berkshire RG14 1QL, (or such other address in England as it may notify to the Lender), marked for the attention of the company secretary, as its process service agent to accept service of process in England in any proceedings, and agrees that failure by such agent to give notice of such service of process to the Chargor shall not impair or affect the validity of such 17

service or any judgment based on it. If the appointment ceases to be effective in respect of the Chargor, the Chargor shall immediately appoint a further person in England to accept service of process on its behalf in England and, if it fails to make such appointment within 15 days, the Lender shall be entitled to appoint such person by notice to the Chargor. (c) The Chargor irrevocably agrees not to claim that any such court is not a convenient or appropriate forum and agrees that a judgment in proceedings brought in such courts shall be conclusive and binding upon them and may be enforced in any other jurisdiction. 23.3 FREEDOM OF CHOICE: The submission to the jurisdiction of the courts referred to in Clause 23.2 (Submission to Jurisdiction) shall not (and shall not be construed so as to) limit the right of the Lender to take proceedings against the Chargor in the courts of any country in which the Chargor has assets or in any other court of competent jurisdiction nor shall the taking of proceedings in any one or more jurisdictions preclude the taking of proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by applicable law. 23.4 TRIAL BY JURY: Each of the parties to this Share Charge waives trial by jury in any proceedings arising

service or any judgment based on it. If the appointment ceases to be effective in respect of the Chargor, the Chargor shall immediately appoint a further person in England to accept service of process on its behalf in England and, if it fails to make such appointment within 15 days, the Lender shall be entitled to appoint such person by notice to the Chargor. (c) The Chargor irrevocably agrees not to claim that any such court is not a convenient or appropriate forum and agrees that a judgment in proceedings brought in such courts shall be conclusive and binding upon them and may be enforced in any other jurisdiction. 23.3 FREEDOM OF CHOICE: The submission to the jurisdiction of the courts referred to in Clause 23.2 (Submission to Jurisdiction) shall not (and shall not be construed so as to) limit the right of the Lender to take proceedings against the Chargor in the courts of any country in which the Chargor has assets or in any other court of competent jurisdiction nor shall the taking of proceedings in any one or more jurisdictions preclude the taking of proceedings in any other jurisdiction (whether concurrently or not) if and to the extent permitted by applicable law. 23.4 TRIAL BY JURY: Each of the parties to this Share Charge waives trial by jury in any proceedings arising out of or related to this Share Charge whether arising before or at any time after the date of this Share Charge. 24. THIRD PARTIES Save as expressly provided herein, a person who is not a party to this Share Charge has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or enjoy the benefit of this Share Charge. THIS SHARE CHARGE has been executed by the Chargor as a Deed and signed by the Lender but shall only be treated as having been executed and delivered to take effect on the day and year first above written. 18

THE FIRST SCHEDULE SECURITIES 13,371,428 ordinary shares of nominal value L0.01 each of KNS Holdings Limited (a company incorporated under the laws of England and Wales and registered with company number 3471603). 19

THE SECOND SCHEDULE THE CHARGOR
NAME OF CHARGOR --------------Futurelink Corp CHIEF EXECUTIVE OFFICE --------------------------------2 South Point Drive, Lake Forest, California 92630 ADDRESS FOR SERVICE AND FAX OR TELEX NUMBER ------------------------------------------Attention: Ross Vincenti FuturelLink Corp. 2 South Point Drive Lake Forest California 92630 Facsimile: 949 672 3117 address and fax number for service in the United Kingdom: c/o Company Secretary/Chief Financial Officer c/o FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL

THE FIRST SCHEDULE SECURITIES 13,371,428 ordinary shares of nominal value L0.01 each of KNS Holdings Limited (a company incorporated under the laws of England and Wales and registered with company number 3471603). 19

THE SECOND SCHEDULE THE CHARGOR
NAME OF CHARGOR --------------Futurelink Corp CHIEF EXECUTIVE OFFICE --------------------------------2 South Point Drive, Lake Forest, California 92630 ADDRESS FOR SERVICE AND FAX OR TELEX NUMBER ------------------------------------------Attention: Ross Vincenti FuturelLink Corp. 2 South Point Drive Lake Forest California 92630 Facsimile: 949 672 3117 address and fax number for service in the United Kingdom: c/o Company Secretary/Chief Financial Officer c/o FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL

20

CHARGOR
EXECUTED and DELIVERED as a Deed by FUTURELINK CORP. (pursuant to a resolution of its board of directors) acting by: ) ) ) ) /s/ COREY E. FISCHER ----------------------------------------(Authorised Officer)

----------------------------------------(Authorised Officer)

LENDER
SIGNED by for and on behalf of FOOTHILL CAPITAL CORPORATION as Lender ) ) ) ) /s/ WILLIAM SHIAO ----------------------------------------(Authorised Officer)

THE SECOND SCHEDULE THE CHARGOR
NAME OF CHARGOR --------------Futurelink Corp CHIEF EXECUTIVE OFFICE --------------------------------2 South Point Drive, Lake Forest, California 92630 ADDRESS FOR SERVICE AND FAX OR TELEX NUMBER ------------------------------------------Attention: Ross Vincenti FuturelLink Corp. 2 South Point Drive Lake Forest California 92630 Facsimile: 949 672 3117 address and fax number for service in the United Kingdom: c/o Company Secretary/Chief Financial Officer c/o FutureLink Europe Limited The Chestnuts 2 Old Bath Road Newbury Berkshire RG14 1QL

20

CHARGOR
EXECUTED and DELIVERED as a Deed by FUTURELINK CORP. (pursuant to a resolution of its board of directors) acting by: ) ) ) ) /s/ COREY E. FISCHER ----------------------------------------(Authorised Officer)

----------------------------------------(Authorised Officer)

LENDER
SIGNED by for and on behalf of FOOTHILL CAPITAL CORPORATION as Lender ) ) ) ) /s/ WILLIAM SHIAO ----------------------------------------(Authorised Officer)

21

EXHIBIT 10.80 SECURITY AGREEMENT This SECURITY AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, among FOOTHILL CAPITAL CORPORATION, a California corporation ("Secured Party"), FUTURELINK

CHARGOR
EXECUTED and DELIVERED as a Deed by FUTURELINK CORP. (pursuant to a resolution of its board of directors) acting by: ) ) ) ) /s/ COREY E. FISCHER ----------------------------------------(Authorised Officer)

----------------------------------------(Authorised Officer)

LENDER
SIGNED by for and on behalf of FOOTHILL CAPITAL CORPORATION as Lender ) ) ) ) /s/ WILLIAM SHIAO ----------------------------------------(Authorised Officer)

21

EXHIBIT 10.80 SECURITY AGREEMENT This SECURITY AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, among FOOTHILL CAPITAL CORPORATION, a California corporation ("Secured Party"), FUTURELINK CORP., a Delaware corporation ("Parent") and each of its Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, each a "Debtor" and collectively, jointly and severally, the "Debtors"). WHEREAS, Borrower and Secured Party are, contemporaneously herewith, entering into the Loan Agreement; WHEREAS, Parent indirectly owns one hundred percent (100%) of the issued and outstanding stock of Borrower; and WHEREAS, Debtors and certain other Persons identified therein have executed that certain General Continuing Guaranty, of even date herewith, in favor of Secured Party (the "Guaranty"), respecting certain obligations of Borrower owing to Secured Party under the Loan Agreement; WHEREAS, each Debtor desires to secure its obligations under the Subsidiary Loan Documents to which it is party by granting to Secured Party security interests in the Collateral as set forth herein; and WHEREAS, each Debtor will benefit by virtue of the loan from Secured Party to Borrower. NOW THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and each intending to be bound hereby, Secured Party and each Debtor agree as follows: 1. DEFINITIONS AND CONSTRUCTION.

EXHIBIT 10.80 SECURITY AGREEMENT This SECURITY AGREEMENT (this "Agreement"), is entered into as of December 13, 2000, among FOOTHILL CAPITAL CORPORATION, a California corporation ("Secured Party"), FUTURELINK CORP., a Delaware corporation ("Parent") and each of its Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent, each a "Debtor" and collectively, jointly and severally, the "Debtors"). WHEREAS, Borrower and Secured Party are, contemporaneously herewith, entering into the Loan Agreement; WHEREAS, Parent indirectly owns one hundred percent (100%) of the issued and outstanding stock of Borrower; and WHEREAS, Debtors and certain other Persons identified therein have executed that certain General Continuing Guaranty, of even date herewith, in favor of Secured Party (the "Guaranty"), respecting certain obligations of Borrower owing to Secured Party under the Loan Agreement; WHEREAS, each Debtor desires to secure its obligations under the Subsidiary Loan Documents to which it is party by granting to Secured Party security interests in the Collateral as set forth herein; and WHEREAS, each Debtor will benefit by virtue of the loan from Secured Party to Borrower. NOW THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and each intending to be bound hereby, Secured Party and each Debtor agree as follows: 1. DEFINITIONS AND CONSTRUCTION. 1.1. Definitions. All capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement. As used in this Agreement, the following terms shall have the following definitions: "Accounts" means all of each Debtor's now owned or hereafter acquired right, title, and interest with respect to "accounts" (as that term is defined in the Code), and any and all supporting obligations in respect thereof. "Agreement" means this Security Agreement and any extensions, riders, supplements, notes, amendments, or modifications to or in connection with this Security Agreement.

"Borrower" means FutureLink Europe Limited, a corporation organized under the laws of England and Wales. "Collateral" means each of the following: the Accounts; Debtor's Books; the Equipment; the General Intangibles; the Inventory; the Investment Property; the Negotiable Collateral; any money, or other assets of each Debtor which now or hereafter come into the possession, custody, or control of Secured Party; and the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the Collateral, and any and all Accounts, Debtor's Books, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, money, deposit accounts, or other tangible or intangible property resulting from the sale, exchange, collection, or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof. "Debtor's Books" means each Debtor's now owned or hereafter acquired books and records (including all of its Records indicating, summarizing, or evidencing its assets (including the Collateral) or liabilities, all of its Records relating to its business operations or financial condition, and all of its goods or General Intangibles related to such information). "Debtor" and "Debtors" are defined in the preamble to this Agreement.

"Borrower" means FutureLink Europe Limited, a corporation organized under the laws of England and Wales. "Collateral" means each of the following: the Accounts; Debtor's Books; the Equipment; the General Intangibles; the Inventory; the Investment Property; the Negotiable Collateral; any money, or other assets of each Debtor which now or hereafter come into the possession, custody, or control of Secured Party; and the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the Collateral, and any and all Accounts, Debtor's Books, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, money, deposit accounts, or other tangible or intangible property resulting from the sale, exchange, collection, or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof. "Debtor's Books" means each Debtor's now owned or hereafter acquired books and records (including all of its Records indicating, summarizing, or evidencing its assets (including the Collateral) or liabilities, all of its Records relating to its business operations or financial condition, and all of its goods or General Intangibles related to such information). "Debtor" and "Debtors" are defined in the preamble to this Agreement. "Equipment" means all of each Debtor's now owned or hereafter acquired right, title, and interest with respect to equipment, machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), tools, parts, goods (other than consumer goods, farm products, or Inventory), wherever located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing. "Event of Default" has the meaning ascribed to it in Section 6. "General Intangibles" means all of each Debtor's now owned or hereafter acquired right, title, and interest with respect to general intangibles (including payment intangibles, contract rights, rights to payment, rights arising under common law, statutes, or regulations, choses or things in action, goodwill, patents, trade names, trademarks, servicemarks, copyrights, blueprints, drawings, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, infringement claims, computer programs, information contained on computer disks or tapes, software, literature, reports, catalogs, money, deposit accounts, insurance premium rebates, tax refunds, and tax refund claims), and any and all supporting obligations in respect thereof, and any other personal property other than goods, Accounts, Investment Property, and Negotiable Collateral. "Guaranty" has the meaning set forth in the recitals to this Agreement. -2-

"Indebtedness" means (a) all obligations of a Person for borrowed money, (b) all obligations of a Person evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations of a Person in respect of letters of credit, bankers acceptances, interest rate swaps, or other financial products, (c) all obligations of a Person under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of a Person, irrespective of whether such obligation or liability is assumed, (e) all obligations of a Person for the deferred purchase price of assets (other than trade debt incurred in the ordinary course of a Person's business and repayable in accordance with customary trade practices), and (f) any obligation of a Person guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse to a Person) any obligation of any other Person. "Inventory" means all each Debtor's now owned or hereafter acquired right, title, and interest with respect to inventory, including goods held for sale or lease or to be furnished under a contract of service, goods that are leased by such Debtor as lessor, goods that are furnished by such Debtor under a contract of service, and raw materials, work in process, or materials used or consumed in such Debtor's business. "Investment Property" means all of each Debtor's now owned or hereafter acquired right, title, and interest with

"Indebtedness" means (a) all obligations of a Person for borrowed money, (b) all obligations of a Person evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations of a Person in respect of letters of credit, bankers acceptances, interest rate swaps, or other financial products, (c) all obligations of a Person under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of a Person, irrespective of whether such obligation or liability is assumed, (e) all obligations of a Person for the deferred purchase price of assets (other than trade debt incurred in the ordinary course of a Person's business and repayable in accordance with customary trade practices), and (f) any obligation of a Person guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse to a Person) any obligation of any other Person. "Inventory" means all each Debtor's now owned or hereafter acquired right, title, and interest with respect to inventory, including goods held for sale or lease or to be furnished under a contract of service, goods that are leased by such Debtor as lessor, goods that are furnished by such Debtor under a contract of service, and raw materials, work in process, or materials used or consumed in such Debtor's business. "Investment Property" means all of each Debtor's now owned or hereafter acquired right, title, and interest with respect to "investment property" as that term is defined in the Code, and any and all supporting obligations in respect thereof. "Loan Agreement" means that certain Loan Agreement, dated as of even date herewith, between Borrower and Secured Party. "Negotiable Collateral" means all of each Debtor's now owned and hereafter acquired right, title, and interest with respect to letters of credit, letter of credit rights, instruments, promissory notes, drafts, documents, and chattel paper (including electronic chattel paper and tangible chattel paper), and any and all supporting obligations in respect thereof. "Secured Obligations" shall mean all liabilities, obligations, or undertakings owing by each Debtor to Secured Party of any kind or description arising out of or outstanding under, advanced or issued pursuant to, or evidenced by the Guaranty, the other Subsidiary Loan Documents, or this Agreement, irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, voluntary or involuntary, whether now existing or hereafter arising, and including all interest (including interest that accrues after the filing of a case under the Bankruptcy Code) and any and all costs, fees (including reasonable attorneys fees), and expenses which Debtor is required to pay pursuant to any of the foregoing, by law, or otherwise. "Secured Party's Liens" means the Liens granted by each Debtor to Secured Party under this Agreement or the other Subsidiary Loan Documents. -3-

1.2. Code. Any terms used in this Agreement which are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein. 1.3. Construction. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term "including" is not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Section, subsection, clause, schedule, and exhibit references are to this Agreement unless otherwise specified. Any reference in this Agreement or in any of the other Subsidiary Loan Documents to this Agreement or any of the other Subsidiary Loan Documents shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, and supplements, thereto and thereof, as applicable. In the event of a direct conflict between the terms and provisions of this Agreement and the Loan Agreement, it is the intention of the parties hereto that both such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of the Loan Agreement shall control and govern; provided, however, that the inclusion herein of additional obligations on the

1.2. Code. Any terms used in this Agreement which are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein. 1.3. Construction. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term "including" is not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or." The words "hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Section, subsection, clause, schedule, and exhibit references are to this Agreement unless otherwise specified. Any reference in this Agreement or in any of the other Subsidiary Loan Documents to this Agreement or any of the other Subsidiary Loan Documents shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, and supplements, thereto and thereof, as applicable. In the event of a direct conflict between the terms and provisions of this Agreement and the Loan Agreement, it is the intention of the parties hereto that both such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of the Loan Agreement shall control and govern; provided, however, that the inclusion herein of additional obligations on the part of a Debtor and supplemental rights and remedies in favor of Secured Party, in each case in respect of the Collateral, shall not be deemed a conflict with the Loan Agreement. 1.4. Schedules and Exhibits. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference. 2. CREATION OF SECURITY INTEREST. 2.1. Grant of Security Interest. Each Debtor hereby grants to Secured Party a continuing security interest in all currently existing and hereafter acquired or arising Collateral in order to secure the Secured Obligations. Secured Party's security interests in the Collateral shall attach to all Collateral without further act on the part of Secured Party or such Debtor. Anything contained in this Agreement or any other Subsidiary Loan Document to the contrary notwithstanding, except to the extent permitted in the Parent Loan Agreement, no Debtor has authority, express or implied, to dispose of any item or portion of the Collateral. 2.2. Negotiable Collateral. In the event that any Collateral, including proceeds, is evidenced by or consists of Negotiable Collateral, and if and to the extent that perfection or priority of Secured Party's security interest is dependent on or enhanced by possession, each Debtor, immediately upon the request of Secured Party, shall endorse and deliver physical possession of such Negotiable Collateral to Secured Party. 2.3. Collection of Accounts, General Intangibles, Negotiable Collateral. At any time after the occurrence and during the continuation of an Event of -4-

Default, Secured Party or Secured Party's designee may (a) notify Account Debtors of each Debtor that the Accounts, chattel paper, or General Intangibles have been assigned to Secured Party or that Secured Party has a security interest therein, or (b) collect the Accounts, chattel paper, or General Intangibles directly and charge the collection costs and expenses to Borrower's Loan Account. Each Debtor agrees that it will hold in trust for Secured Party, as Secured Party's trustee, any Collections that it receives and immediately will deliver said Collections to Secured Party or a Cash Management Bank in their original form as received by such Debtor. 2.4. Delivery of Additional Documentation Required. At any time upon the request of Secured Party, each Debtor shall execute and deliver to Secured Party, any and all financing statements, original financing statements in lieu of continuation statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title, and all other documents (the "Additional Documents") that Secured Party may request in its Permitted Discretion, in form and substance satisfactory to Secured Party, to perfect and continue perfected or better perfect the Secured Party's Liens in the Collateral (whether now owned or hereafter arising or acquired), to create and perfect Liens in favor of Secured Party in any Real Property acquired after the date hereof, and in order to fully consummate all of the transactions contemplated hereby and under the other Subsidiary Loan Documents. To the maximum extent permitted by applicable law, each Debtor authorizes Secured Party to

Default, Secured Party or Secured Party's designee may (a) notify Account Debtors of each Debtor that the Accounts, chattel paper, or General Intangibles have been assigned to Secured Party or that Secured Party has a security interest therein, or (b) collect the Accounts, chattel paper, or General Intangibles directly and charge the collection costs and expenses to Borrower's Loan Account. Each Debtor agrees that it will hold in trust for Secured Party, as Secured Party's trustee, any Collections that it receives and immediately will deliver said Collections to Secured Party or a Cash Management Bank in their original form as received by such Debtor. 2.4. Delivery of Additional Documentation Required. At any time upon the request of Secured Party, each Debtor shall execute and deliver to Secured Party, any and all financing statements, original financing statements in lieu of continuation statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title, and all other documents (the "Additional Documents") that Secured Party may request in its Permitted Discretion, in form and substance satisfactory to Secured Party, to perfect and continue perfected or better perfect the Secured Party's Liens in the Collateral (whether now owned or hereafter arising or acquired), to create and perfect Liens in favor of Secured Party in any Real Property acquired after the date hereof, and in order to fully consummate all of the transactions contemplated hereby and under the other Subsidiary Loan Documents. To the maximum extent permitted by applicable law, each Debtor authorizes Secured Party to execute any such Additional Documents in such Debtor's name and authorizes Secured Party to file such executed Additional Documents in any appropriate filing office. In addition, on such periodic basis as Secured Party shall require, each Debtor shall (a) provide Secured Party with a report of all new patentable, copyrightable, or trademarkable materials acquired or generated by such Debtor during the prior period, (b) cause all patents, copyrights, and trademarks acquired or generated by such Debtor that are not already the subject of a registration with the appropriate filing office (or an application therefor diligently prosecuted) to be registered with such appropriate filing office in a manner sufficient to impart constructive notice of such Debtor's ownership thereof, and (c) cause to be prepared, executed, and delivered to Secured Party supplemental schedules to the applicable Subsidiary Loan Documents to identify such patents, copyrights, and trademarks as being subject to the security interests created thereunder. 2.5. Power of Attorney. Each Debtor hereby irrevocably makes, constitutes, and appoints Secured Party (and any of Secured Party's officers, employees, or agents designated by Secured Party) as such Debtor's true and lawful attorney, with power to: (a) if such Debtor refuses to, or fails timely to execute and deliver any of the documents described in Section 2.4, sign the name of such Debtor on any of the documents described in Section 2.4; (b) at any time that an Event of Default has occurred and is continuing, sign such Debtor's name on any invoice or bill of lading relating to the Collateral, drafts against Account Debtors, or notices to Account Debtors; (c) send requests for verification of Accounts; (d) endorse such Debtor's name on any Collection item that may come into Secured Party's possession; (e) at any time that an Event of Default has occurred and is continuing, make, settle, and adjust all claims under such Debtor's policies of insurance and make all determinations and decisions with respect to such policies of insurance; and (f) at -5-

any time that an Event of Default has occurred and is continuing, settle and adjust disputes and claims respecting the Accounts, chattel paper, or General Intangibles directly with Account Debtors, for amounts and upon terms which Secured Party determines to be reasonable, and Secured Party may cause to be executed and delivered any documents and releases which Secured Party determines to be necessary. The appointment of Secured Party as each Debtor's attorney, and each and every one of Secured Party's rights and powers, being coupled with an interest, is irrevocable until all of the Secured Obligations have been fully and finally repaid and performed and Secured Party's obligation to extend credit under the Loan Agreement is terminated. 2.6. Right to Inspect. Secured Party (through any of its officers, employees, or agents) shall have the right, from time to time hereafter to inspect each Debtor's Debtor's Books and to check, test, and appraise the Collateral in order to verify each Debtor's financial condition or the amount, quality, value, condition of, or any other matter relating to, the Collateral. 3. [INTENTIONALLY OMITTED] 4. [INTENTIONALLY OMITTED]

any time that an Event of Default has occurred and is continuing, settle and adjust disputes and claims respecting the Accounts, chattel paper, or General Intangibles directly with Account Debtors, for amounts and upon terms which Secured Party determines to be reasonable, and Secured Party may cause to be executed and delivered any documents and releases which Secured Party determines to be necessary. The appointment of Secured Party as each Debtor's attorney, and each and every one of Secured Party's rights and powers, being coupled with an interest, is irrevocable until all of the Secured Obligations have been fully and finally repaid and performed and Secured Party's obligation to extend credit under the Loan Agreement is terminated. 2.6. Right to Inspect. Secured Party (through any of its officers, employees, or agents) shall have the right, from time to time hereafter to inspect each Debtor's Debtor's Books and to check, test, and appraise the Collateral in order to verify each Debtor's financial condition or the amount, quality, value, condition of, or any other matter relating to, the Collateral. 3. [INTENTIONALLY OMITTED] 4. [INTENTIONALLY OMITTED] 5. [INTENTIONALLY OMITTED] 6. EVENTS OF DEFAULT. Any one or more of the following events shall constitute an event of default (each, an "Event of Default") under this Agreement: (a) The occurrence of an Event of Default (as defined in the Loan Agreement); (b) If a Debtor fails or neglects to perform, keep, or observe, in any material respect, any term, provision, condition, covenant, or agreement contained in this Agreement or in the Guaranty, or in any other present or future agreement between a Debtor and Secured Party; (c) If any material portion of a Debtor's assets is attached, seized, subjected to a writ or distress warrant, levied upon, or comes into the possession of any third Person; (d) If a notice of Lien, levy, or assessment is filed of record with respect to any of a Debtor's assets by the United States, or any department, agency, or instrumentality thereof, or by any state, county, municipal, or governmental agency, or if any taxes or debts owing at any time hereafter to any one or more of such entities becomes a Lien, whether choate or otherwise, upon any of such Debtor's assets and the same is not paid before such payment is delinquent; -6-

(e) If a judgment or other claim becomes a Lien or encumbrance upon any material portion of a Debtor's properties or assets; (f) If there is a default in any material agreement to which a Debtor is a party and such default (i) occurs at the final maturity of the obligations thereunder, or (ii) results in a right by the other party thereto, irrespective of whether exercised, to accelerate the maturity of such Debtor's obligations thereunder, to terminate such agreement, or to refuse to renew such agreement pursuant to an automatic renewal right therein; (g) If Debtor makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the payment of the Secured Obligations, except to the extent such payment is permitted by the terms hereof and by the subordination provisions applicable to such Indebtedness; (h) If any misstatement or misrepresentation exists now or hereafter in any warranty, representation, statement, or Record made to Secured Party by a Debtor or any officer, employee, agent, or director of a Debtor, or if any such warranty or representation is withdrawn; or

(e) If a judgment or other claim becomes a Lien or encumbrance upon any material portion of a Debtor's properties or assets; (f) If there is a default in any material agreement to which a Debtor is a party and such default (i) occurs at the final maturity of the obligations thereunder, or (ii) results in a right by the other party thereto, irrespective of whether exercised, to accelerate the maturity of such Debtor's obligations thereunder, to terminate such agreement, or to refuse to renew such agreement pursuant to an automatic renewal right therein; (g) If Debtor makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the payment of the Secured Obligations, except to the extent such payment is permitted by the terms hereof and by the subordination provisions applicable to such Indebtedness; (h) If any misstatement or misrepresentation exists now or hereafter in any warranty, representation, statement, or Record made to Secured Party by a Debtor or any officer, employee, agent, or director of a Debtor, or if any such warranty or representation is withdrawn; or (i) If this Agreement or any other Subsidiary Loan Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien on or security interest in the Collateral covered hereby or thereby. 7. SECURED PARTY'S RIGHTS AND REMEDIES. 7.1. Rights and Remedies. Upon the occurrence of an Event of Default, the security hereby constituted shall become enforceable and, in addition to all other rights and remedies available to Secured Party as provided hereafter, Secured Party may, at its election, without notice of its election and without demand, do any one or more of the following, all of which are authorized by each Debtor: (a) Proceed directly and at once, without notice, against each Debtor to collect and recover the full amount or any portion of the Secured Obligations, without first proceeding against Borrower, or against any security or collateral for the Secured Obligations; (b) Without notice to any Debtor and regardless of the acceptance of any security or collateral for the payment hereof, appropriate and apply toward the payment of the Secured Obligations (i) any indebtedness due or to become due from Secured Party to a Debtor and (ii) any moneys, credits or other property belonging to a Debtor at any time held by or coming into the possession of Secured Party; (c) May exercise in respect of the Collateral, in addition to other rights and remedies provided for herein and the Guaranty or otherwise available to it, all the -7-

rights and remedies available to it at law (including those of a secured party under the Code) or in equity; (d) Settle or adjust disputes and claims directly with Account Debtors for amounts and upon terms which Secured Party considers advisable, and in such cases, Secured Party will credit Borrower's Loan Account with only the net amounts received by Secured Party in payment of such disputed Accounts after deducting all Lender Expenses incurred or expended in connection therewith; (e) Cause each Debtor to hold all returned Inventory in trust for Secured Party, segregate all returned Inventory from all other property of such Debtor or in such Debtor's possession and conspicuously label said returned Inventory as the property of Secured Party; (f) Without notice or demand upon any Debtor, make such payments and do such acts as Secured Party considers necessary or reasonable to protect its security interest in the Collateral. each Debtor agrees to assemble the Collateral if Secured Party so requires, and to make the Collateral available to Secured Party as Secured Party may designate. Each Debtor authorizes Secured Party to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or

rights and remedies available to it at law (including those of a secured party under the Code) or in equity; (d) Settle or adjust disputes and claims directly with Account Debtors for amounts and upon terms which Secured Party considers advisable, and in such cases, Secured Party will credit Borrower's Loan Account with only the net amounts received by Secured Party in payment of such disputed Accounts after deducting all Lender Expenses incurred or expended in connection therewith; (e) Cause each Debtor to hold all returned Inventory in trust for Secured Party, segregate all returned Inventory from all other property of such Debtor or in such Debtor's possession and conspicuously label said returned Inventory as the property of Secured Party; (f) Without notice or demand upon any Debtor, make such payments and do such acts as Secured Party considers necessary or reasonable to protect its security interest in the Collateral. each Debtor agrees to assemble the Collateral if Secured Party so requires, and to make the Collateral available to Secured Party as Secured Party may designate. Each Debtor authorizes Secured Party to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any encumbrance, charge, or lien which in Secured Party's determination appears to be prior or superior to its security interest and to pay all expenses incurred in connection therewith. With respect to any of a Debtor's owned premises, such Debtor hereby grants Secured Party a license to enter into possession of such premises and to occupy the same, without charge, for up to one hundred twenty (120) days in order to exercise any of Secured Party's rights or remedies provided herein, at law, in equity, or otherwise; (g) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell (in the manner provided for herein) the Collateral. Secured Party is hereby granted a license or other right to use, without charge, each Debtor's labels, patents, copyrights, rights of use of any name, trade secrets, trade names, trademarks, service marks, and advertising matter, or any property of a similar nature, as it pertains to the Collateral, in completing production of advertising for sale and selling any Collateral, and Debtor's rights under all licenses and all franchise agreements shall inure to Secured Party's benefit; (h) Sell all or any part of the Collateral at either a public or private sale, or both, by way of one or more contracts or transactions, for cash or on terms, in such manner and at such places (including a Debtor's premises) as Secured Party determines is commercially reasonable. It is not necessary that the Collateral be present at any such sale; (i) Secured Party shall give notice of the disposition of the Collateral as follows: -8-

(i) Secured Party shall give the applicable Debtor a notice in writing of the time and place of public sale, or, if the sale is a private sale or some other disposition other than a public sale is to be made of the Collateral, then the time on or after which the private sale or other disposition is to be made; and (ii) The notice shall be personally delivered or mailed, postage prepaid, to the applicable Debtor as provided in Section 10, at least 10 days before the earliest time of disposition set forth in the notice; no notice needs to be given prior to the disposition of any portion of the Collateral that is perishable or threatens to decline speedily in value or that is of a type customarily sold on a recognized market; (j) Secured Party may credit bid and purchase at any public sale; (k) Secured Party may seek the appointment of a receiver or keeper to take possession of all or any portion of the Collateral or to operate same and, to the maximum extent permitted by law, may seek the appointment of such a receiver without the requirement of prior notice or a hearing; (l) Secured Party shall have all other rights and remedies available at law or in equity or pursuant to any other Subsidiary Loan Document; and (m) Any deficiency that exists after disposition of the Collateral as provided above will be paid immediately by

(i) Secured Party shall give the applicable Debtor a notice in writing of the time and place of public sale, or, if the sale is a private sale or some other disposition other than a public sale is to be made of the Collateral, then the time on or after which the private sale or other disposition is to be made; and (ii) The notice shall be personally delivered or mailed, postage prepaid, to the applicable Debtor as provided in Section 10, at least 10 days before the earliest time of disposition set forth in the notice; no notice needs to be given prior to the disposition of any portion of the Collateral that is perishable or threatens to decline speedily in value or that is of a type customarily sold on a recognized market; (j) Secured Party may credit bid and purchase at any public sale; (k) Secured Party may seek the appointment of a receiver or keeper to take possession of all or any portion of the Collateral or to operate same and, to the maximum extent permitted by law, may seek the appointment of such a receiver without the requirement of prior notice or a hearing; (l) Secured Party shall have all other rights and remedies available at law or in equity or pursuant to any other Subsidiary Loan Document; and (m) Any deficiency that exists after disposition of the Collateral as provided above will be paid immediately by the Debtors. Any excess will be returned, without interest and subject to the rights of third Persons, by Secured Party to the applicable Debtor. 7.2. Remedies Cumulative. Secured Party's rights and remedies under this Agreement, the Subsidiary Loan Documents, and all other agreements shall be cumulative. Secured Party shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by Secured Party of one right or remedy shall be deemed an election, and no waiver by Secured Party of any Event of Default on a Debtor's part shall be deemed a continuing waiver. No delay by Secured Party shall constitute a waiver, election, or acquiescence by it. 8. TAXES AND EXPENSES REGARDING THE COLLATERAL. If a Debtor fails to pay any monies (whether taxes, rents, assessments, insurance premiums, or, in the case of leased properties or assets, rents or other amounts payable under such leases) due to third Persons, or fails to make any deposits or furnish any required proof of payment or deposit, all as required under the terms of this Agreement, then, Secured Party, in its sole discretion and without prior notice to any Debtor, may do any or all of the following: (a) make payment of the same or any part thereof; (b) set up such reserves in Borrower's Loan Account as Secured Party deems necessary to protect Secured Party from the exposure -9-

created by such failure; or (c) in the case of the failure to comply with Section obtain and maintain insurance policies insuring such Debtor's ownership and use of the Collateral, and take any action with respect to such policies as Secured Party deems prudent. Any amounts paid or deposited by Secured Party shall constitute Lender Expenses, shall immediately become additional Secured Obligations, shall bear interest at the applicable rate described in the Subsidiary Loan Document, and shall be secured by the Collateral. Any payments made by Secured Party shall not constitute an agreement by Secured Party to make similar payments in the future or a waiver by Secured Party of any Event of Default under this Agreement. Secured Party need not inquire as to, or contest the validity of, any such expense, tax, security interest, encumbrance, or lien and the receipt of the usual official notice for the payment thereof shall be conclusive evidence that the same was validly due and owing. Secured Party shall use its best efforts to provide notice to each Debtor of any action taken by it under this Section 8. 9. WAIVERS; INDEMNIFICATION. 9.1. Demand; Protest; etc. To the extent permitted by law, each Debtor waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees at any time held by Secured Party on which such Debtor may in any way be liable.

created by such failure; or (c) in the case of the failure to comply with Section obtain and maintain insurance policies insuring such Debtor's ownership and use of the Collateral, and take any action with respect to such policies as Secured Party deems prudent. Any amounts paid or deposited by Secured Party shall constitute Lender Expenses, shall immediately become additional Secured Obligations, shall bear interest at the applicable rate described in the Subsidiary Loan Document, and shall be secured by the Collateral. Any payments made by Secured Party shall not constitute an agreement by Secured Party to make similar payments in the future or a waiver by Secured Party of any Event of Default under this Agreement. Secured Party need not inquire as to, or contest the validity of, any such expense, tax, security interest, encumbrance, or lien and the receipt of the usual official notice for the payment thereof shall be conclusive evidence that the same was validly due and owing. Secured Party shall use its best efforts to provide notice to each Debtor of any action taken by it under this Section 8. 9. WAIVERS; INDEMNIFICATION. 9.1. Demand; Protest; etc. To the extent permitted by law, each Debtor waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees at any time held by Secured Party on which such Debtor may in any way be liable. 9.2. Secured Party's Liability for Collateral. So long as Secured Party complies with its obligations, if any, under Section 9207 of the Code, Secured Party shall not in any way or manner be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage thereto occurring or arising in any manner or fashion from any cause; (c) any diminution in the value thereof; or (d) any act or default of any carrier, warehouseman, bailee, forwarding agency, or other Person. All risk of loss, damage, or destruction of the Collateral shall be borne by the Debtors. 9.3. Indemnification. Each Debtor agrees to defend, indemnify, save, and hold Secured Party and its officers, employees, and agents harmless against: (a) all obligations, demands, claims, and liabilities claimed or asserted by any other Person, and (b) all losses (including attorneys fees and disbursements) in any way suffered, incurred, or paid by Secured Party as a result of or in any way arising out of, following, or consequential to transactions with Borrower or any Debtor, whether under this Agreement, the other Subsidiary Loan Documents or otherwise, but excluding any obligations, demands, claims, liabilities, and losses caused by Secured Party's gross negligence or willful misconduct. This provision shall survive the termination of this Agreement. 10. NOTICES. All notices and other communications hereunder to Secured Party shall be in writing and shall be mailed, sent or delivered in accordance with the Loan Agreement and all notices and other communications hereunder to a Debtor shall be -10-

in writing and shall be mailed, sent or delivered in care of Borrower in accordance with the Loan Agreement. 11. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. THE VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA OR, AT THE SOLE OPTION OF SECURED PARTY, IN ANY OTHER COURT IN WHICH SECURED PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH DEBTOR AND SECURED PARTY WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 11. EACH DEBTOR AND SECURED PARTY HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY

in writing and shall be mailed, sent or delivered in care of Borrower in accordance with the Loan Agreement. 11. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER. THE VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA OR, AT THE SOLE OPTION OF SECURED PARTY, IN ANY OTHER COURT IN WHICH SECURED PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH DEBTOR AND SECURED PARTY WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 11. EACH DEBTOR AND SECURED PARTY HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH DEBTOR AND SECURED PARTY REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. 12. DESTRUCTION OF DEBTOR'S DOCUMENTS. All documents, schedules, agings, or other papers delivered to Secured Party may be destroyed or otherwise disposed of by Secured Party four (4) months after they are delivered to or received by Secured Party, unless the applicable Debtor requests, in writing, the return of said documents, schedules or other papers and makes arrangements, at such Debtor's expense, for their return. 13. GENERAL PROVISIONS. 13.1. Effectiveness. This Agreement shall be binding and deemed effective when executed by each Debtor and accepted and executed by Secured Party. -11-

13.2. Successors and Assigns. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that no Debtor may assign this Agreement or any rights or duties hereunder without Secured Party's prior written consent and any prohibited assignment shall be absolutely void. No consent to an assignment by Secured Party shall release a Debtor from its Secured Obligations. Secured Party may assign this Agreement and its rights and duties hereunder and no consent or approval by any Debtor is required in connection with any such assignment. Secured Party reserves the right to sell, assign, transfer, negotiate, or grant participations in all or any part of, or any interest in Secured Party's rights and benefits hereunder. In connection therewith, Secured Party may disclose all documents and information which Secured Party now or hereafter may have relating to the Debtors or the Debtors' business. To the extent that Secured Party assigns its rights and obligations to a third Person, Secured Party thereafter shall be released from such assigned obligations to each Debtor and such assignment shall effect a novation between the Debtors and such third Person. 13.3. Section Headings. Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each section applies equally to this entire Agreement. 13.4. Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Secured Party or any Debtor, whether under any rule of construction or otherwise. On the

13.2. Successors and Assigns. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that no Debtor may assign this Agreement or any rights or duties hereunder without Secured Party's prior written consent and any prohibited assignment shall be absolutely void. No consent to an assignment by Secured Party shall release a Debtor from its Secured Obligations. Secured Party may assign this Agreement and its rights and duties hereunder and no consent or approval by any Debtor is required in connection with any such assignment. Secured Party reserves the right to sell, assign, transfer, negotiate, or grant participations in all or any part of, or any interest in Secured Party's rights and benefits hereunder. In connection therewith, Secured Party may disclose all documents and information which Secured Party now or hereafter may have relating to the Debtors or the Debtors' business. To the extent that Secured Party assigns its rights and obligations to a third Person, Secured Party thereafter shall be released from such assigned obligations to each Debtor and such assignment shall effect a novation between the Debtors and such third Person. 13.3. Section Headings. Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each section applies equally to this entire Agreement. 13.4. Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Secured Party or any Debtor, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of all parties hereto. 13.5. Severability of Provisions. Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision. 13.6. Amendments in Writing. This Agreement can only be amended by a writing signed by Secured Party and each Debtor. 13.7. Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. 13.8. Revival and Reinstatement of Obligations. If the incurrence or payment of the Secured Obligations by a Debtor or the transfer by a Debtor to Secured -12-

Party of any property of a Debtor should for any reason subsequently be declared to be void or voidable under any state or federal law relating to creditors' rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances, preferences, and other voidable or recoverable payments of money or transfers of property (collectively, a "Voidable Transfer"), and if Secured Party is required to repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the reasonable advice of its counsel, then, as to any such Voidable Transfer, or the amount thereof that Secured Party is required or elects to repay or restore, and as to all reasonable costs, expenses, and attorneys fees of Secured Party related thereto, the liability of the Debtors automatically shall be revived, reinstated, and restored and shall exist as though such Voidable Transfer had never been made. [signature page follows] -13-

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first

Party of any property of a Debtor should for any reason subsequently be declared to be void or voidable under any state or federal law relating to creditors' rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances, preferences, and other voidable or recoverable payments of money or transfers of property (collectively, a "Voidable Transfer"), and if Secured Party is required to repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the reasonable advice of its counsel, then, as to any such Voidable Transfer, or the amount thereof that Secured Party is required or elects to repay or restore, and as to all reasonable costs, expenses, and attorneys fees of Secured Party related thereto, the liability of the Debtors automatically shall be revived, reinstated, and restored and shall exist as though such Voidable Transfer had never been made. [signature page follows] -13-

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written. FUTURELINK CORP., a Delaware corporation
By: /s/ Corey E. Fischer Title: Vice President

FUTURELINK MICRO VISIONS CORP., a Delaware corporation
By: /s/ Corey E. Fischer Title: Vice President FUTURELINK ASYNC CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK PLEASANTON CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK MADISON CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK VSI CORP., a Maryland corporation By: /s/ Corey E. Fischer Title: Vice President FOOTHILL CAPITAL CORPORATION, a California corporation By: /s/ Corey E. Fischer Title: Vice President

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written. FUTURELINK CORP., a Delaware corporation
By: /s/ Corey E. Fischer Title: Vice President

FUTURELINK MICRO VISIONS CORP., a Delaware corporation
By: /s/ Corey E. Fischer Title: Vice President FUTURELINK ASYNC CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK PLEASANTON CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK MADISON CORP., a Delaware corporation By: /s/ Corey E. Fischer Title: Vice President FUTURELINK VSI CORP., a Maryland corporation By: /s/ Corey E. Fischer Title: Vice President FOOTHILL CAPITAL CORPORATION, a California corporation By: /s/ Corey E. Fischer Title: Vice President

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EXHIBIT 10.81 SUMMARY OF TERMS OF EMPLOYMENT RELATIONSHIP WITH HOWARD E. TAYLOR In December 2000, we agreed on the basic terms of an employment relationship with Howard E. Taylor, our President and Chief Executive Officer. Mr. Taylor will receive an annual base salary of $325,000, and a discretionary annual performance bonus consisting of up to $250,000 in cash and a performance based option to purchase 200,000 shares of our common stock at an exercise price of $0.81 per share. In addition, we granted Mr. Taylor an option to acquire 2,500,000 shares of our common stock at an exercise price of $0.81 per share. Two million of the shares vest in eight quarterly increments commencing on January 1, 2001. The remaining 500,000 shares will vest on January 1, 2004. Mr. Taylor's employment agreement will be an at-will agreement and either party will be able to terminate the agreement at any time. Pequot Capital Management, Inc., which

EXHIBIT 10.81 SUMMARY OF TERMS OF EMPLOYMENT RELATIONSHIP WITH HOWARD E. TAYLOR In December 2000, we agreed on the basic terms of an employment relationship with Howard E. Taylor, our President and Chief Executive Officer. Mr. Taylor will receive an annual base salary of $325,000, and a discretionary annual performance bonus consisting of up to $250,000 in cash and a performance based option to purchase 200,000 shares of our common stock at an exercise price of $0.81 per share. In addition, we granted Mr. Taylor an option to acquire 2,500,000 shares of our common stock at an exercise price of $0.81 per share. Two million of the shares vest in eight quarterly increments commencing on January 1, 2001. The remaining 500,000 shares will vest on January 1, 2004. Mr. Taylor's employment agreement will be an at-will agreement and either party will be able to terminate the agreement at any time. Pequot Capital Management, Inc., which beneficially owns more than 5% of our common stock, and is one of our largest stockholders, has agreed to pay Mr. Taylor a signing bonus in connection with his employment with us, in the amount of $650,000, to be paid in two equal installments on each of January 1, 2001 and April 1, 2001.

EXHIBIT 10.82 THIS AGREEMENT made effective the 3rd day of January, 2000. BETWEEN: FUTURELINK CORP., a corporation incorporated pursuant to the laws of the State of Delaware, with its head office in Irvine, California

(hereinafter referred to as the "Company") - and RICHARD M. WHITE, an individual resident in Toronto, Ontario

(hereinafter referred to as the "Executive") WHEREAS the Executive has agreed to serve as the Company's Vice-President, Administration as of January 3, 2000; AND WHEREAS the Company and the Executive have agreed that the employment of the Executive by the Company will be in accordance with the provisions of this Agreement; NOW THEREFORE, for and in consideration of the sum of $10.00 now paid by each party to the other party (the receipt and sufficiency of which is hereby acknowledged by each of the parties hereto) and the mutual covenants and agreements hereinafter contained, the parties hereto covenant and agree, each with the other, as follows: 1. DEFINITIONS 1.1 In addition to the terms defined elsewhere in this Agreement, the following terms shall have the following meanings: "COMMON SHARES" means the shares of the Company's common stock which are entitled to one vote per share at any meeting of the shareholders of the Company; "COMPENSATION" means the salary and all benefits which the Executive is receiving or entitled to at the time

EXHIBIT 10.82 THIS AGREEMENT made effective the 3rd day of January, 2000. BETWEEN: FUTURELINK CORP., a corporation incorporated pursuant to the laws of the State of Delaware, with its head office in Irvine, California

(hereinafter referred to as the "Company") - and RICHARD M. WHITE, an individual resident in Toronto, Ontario

(hereinafter referred to as the "Executive") WHEREAS the Executive has agreed to serve as the Company's Vice-President, Administration as of January 3, 2000; AND WHEREAS the Company and the Executive have agreed that the employment of the Executive by the Company will be in accordance with the provisions of this Agreement; NOW THEREFORE, for and in consideration of the sum of $10.00 now paid by each party to the other party (the receipt and sufficiency of which is hereby acknowledged by each of the parties hereto) and the mutual covenants and agreements hereinafter contained, the parties hereto covenant and agree, each with the other, as follows: 1. DEFINITIONS 1.1 In addition to the terms defined elsewhere in this Agreement, the following terms shall have the following meanings: "COMMON SHARES" means the shares of the Company's common stock which are entitled to one vote per share at any meeting of the shareholders of the Company; "COMPENSATION" means the salary and all benefits which the Executive is receiving or entitled to at the time of Change of Control, including but not limited to bonuses, stock options, pension benefits, medical plan benefits, vacation pay and any insurance premiums paid by the Company for the Executive; "PERSON" includes an individual, a partnership, a corporation and any other entity or association; "TERMINATION DATE" means: (a) the effective date that the Executive's employment with the Company is terminated by the Company without just cause; or

2 (b) the date that the Executive provides to the Company written notice of election to treat the Executive's employment as terminated; and "THIS AGREEMENT" and the terms such as "HEREOF", "HEREIN" and similar expressions mean this Agreement, as amended, supplemented or modified in writing from time to time.

2 (b) the date that the Executive provides to the Company written notice of election to treat the Executive's employment as terminated; and "THIS AGREEMENT" and the terms such as "HEREOF", "HEREIN" and similar expressions mean this Agreement, as amended, supplemented or modified in writing from time to time. 2. VICE-PRESIDENT, ADMINISTRATION The Company agrees to employ the Executive during the term of the Agreement as Vice President, Administration of the Company and its various North American subsidiaries, with power and authority to oversee, develop and implement processes the Administration and Facilities Management of the Company and its affiliates and to undertake such other duties as may from time to time be assigned to or vested in the Executive by the Board of Directors of the Company, subject always to the control and direction of the Board of Directors of the Company. The Executive agrees, during the term of this Agreement, to devote the majority of the Executive's working time, attention and abilities to the business and affairs of the Company and to serve the Company faithfully and use the Executive's best efforts to promote the interests of the Company. The Executive shall be free to assume nonexecutive and non-management roles with other organizations, but shall provide the Company with notice of such other commitments. 3. REMUNERATION (a) The Company agrees to pay the Executive a base salary of ONE HUNDRED FORTY THOUSAND DOLLARS (US$140,000.00) per annum. The Company agrees to review the Executive's base salary annually (such review to be completed by January 31st of each year of this Agreement) and agrees that following each such review, the then current base salary may be increased to reflect the Executive's performance, the Company's performance and other relevant factors; (b) In addition to the foregoing, the Company shall pay to the Executive an Annual Performance Bonus of up to FORTY PERCENT (40%) to equal FIFTY-SIX THOUSAND DOLLARS (US$56,000.00) per annum. The Annual Performance Bonus shall be based on the Executive's performance, the Company's performance and other relevant factors, and the Annual Performance Bonus shall be based on four separate three month intervals (the "Bonus Intervals"), being January 1 to March 31, April 1 to June 30, July 1 to September 30 and October 1 to December 31, hereafter; (c) eligibility for stock options as may be granted from time to time by the Company's publicly traded parent, FutureLink Corp, a Delaware corporation;

3 4. BENEFITS 4.1 The Executive shall be entitled to participate in the Company's employee benefits plan as may be in effect at any given time, subject to satisfying any insurability requirements established by the carriers that provide the benefits. 5. EXPENSES 5.1 The Company agrees that during the term of this Agreement the Executive shall be reimbursed by the Company for all travelling and other expenses actually and properly incurred by the Executive in connection with the Executive's duties hereunder. The Executive shall furnish to the Company statements and vouchers for all such expenses in accordance with the Company's reimbursement policy as established from time to time; and 5.2 Relocation of Employee. The Company and Executive acknowledge and agree that Executive was initially hired to work for the Company's wholly-owned Canadian subsidiary, FutureLink Distribution Corp., in Calgary,

3 4. BENEFITS 4.1 The Executive shall be entitled to participate in the Company's employee benefits plan as may be in effect at any given time, subject to satisfying any insurability requirements established by the carriers that provide the benefits. 5. EXPENSES 5.1 The Company agrees that during the term of this Agreement the Executive shall be reimbursed by the Company for all travelling and other expenses actually and properly incurred by the Executive in connection with the Executive's duties hereunder. The Executive shall furnish to the Company statements and vouchers for all such expenses in accordance with the Company's reimbursement policy as established from time to time; and 5.2 Relocation of Employee. The Company and Executive acknowledge and agree that Executive was initially hired to work for the Company's wholly-owned Canadian subsidiary, FutureLink Distribution Corp., in Calgary, Alberta, Canada and has subsequently agreed to relocate to the Company's offices in Irvine, California. In connection with Executive's relocation to Irvine, California, the Company has agreed to reimburse Executive for his relocation expenses for up to $39,200 in after-tax U.S. dollars (as determined by the Company), following Company's receipt of documentation of such expenses that is satisfactory to Company. Notwithstanding the foregoing, if Executive is terminated by Company without just cause prior to January 31, 2002, then Company shall reimburse Executive for up to $39,200 in after-tax U.S. dollars for any expenses incurred by Executive to relocate back to Canada, following Company's receipt of documentation of such expenses that is satisfactory to Company. 6. VACATION 6.1 During each year of the term of this Agreement the Executive shall be entitled to four (4) weeks vacation provided that the timing of such vacation in any year is subject to the reasonable direction of the Board of Directors of the Company. 7. CONFIDENTIALITY, NON-COMPETITION AND NON-SOLICITATION 7.1 The Executive agrees as a condition of the Executive's employment hereunder to execute the Confidentiality and Non-Competition Agreement which is attached hereto as Schedule "A".

4 8. TERM AND TERMINATION OF AGREEMENT 8.1 Subject to the provisions of Section 12 hereof pertaining to a termination for just cause, this Agreement shall continue and remain in full force until terminated by either the Company or the Executive in accordance with the provisions outlined below. 8.2 The Executive has the right to terminate this Agreement and the Executive's employment hereunder by providing the Company with written notice which shall provide for a termination date which is effective one month after the giving of the notice. The Executive shall receive the remuneration, benefits and expenses contemplated by this Agreement and any options to acquire Common Stock which may have vested up to and including the effective termination date and the Executive will not be entitled to any other remuneration, reimbursement or payment whatsoever. 8.3 The Company has the right to terminate this Agreement and the Executive's employment hereunder at any time without just cause by providing the Executive with written notice setting forth the Termination Date and the Company shall, at the same time, do the following: (a) pay to the Executive within one month following the Termination Date, or at such other time as is mutually agreed upon between the Company and the Executive, a settlement payment equal to the total of:

4 8. TERM AND TERMINATION OF AGREEMENT 8.1 Subject to the provisions of Section 12 hereof pertaining to a termination for just cause, this Agreement shall continue and remain in full force until terminated by either the Company or the Executive in accordance with the provisions outlined below. 8.2 The Executive has the right to terminate this Agreement and the Executive's employment hereunder by providing the Company with written notice which shall provide for a termination date which is effective one month after the giving of the notice. The Executive shall receive the remuneration, benefits and expenses contemplated by this Agreement and any options to acquire Common Stock which may have vested up to and including the effective termination date and the Executive will not be entitled to any other remuneration, reimbursement or payment whatsoever. 8.3 The Company has the right to terminate this Agreement and the Executive's employment hereunder at any time without just cause by providing the Executive with written notice setting forth the Termination Date and the Company shall, at the same time, do the following: (a) pay to the Executive within one month following the Termination Date, or at such other time as is mutually agreed upon between the Company and the Executive, a settlement payment equal to the total of: (i) an amount equal to the product of the monthly base salary to which the Executive was entitled at the Termination Date multiplied by the number of months within the Notice Period (as defined in Section 8.3(b) and (c) below); plus (ii) an amount equal to the product of the Company's monthly premium contributions paid on behalf of the Executive immediately prior to the Termination Date relating to the Company's employee benefits plan multiplied by the number of months within the Notice Period; plus (iii) an amount equal to the most recent Annual Performance Bonus paid by the Company to the Executive prior to the Termination Date conditional upon the said payment of the most recent bonus having been made within the period of twelve (12) months immediately prior to the Termination Date; (b) In the event the Company terminates the Executive's employment without just cause, in the first year of Executive's employment, the Company will give Executive 12 months notice (the "Notice Period") of the termination of Executive's employment, or the Company shall pay a Severance Payment as defined above in lieu of such notice;

5 The Executive acknowledges that other than the foregoing notice or Severance Payment, Executive will not be entitled to any further compensation or notice arising out of the termination without just cause by the Company of Executive's employment; (c) Just Cause for the termination of employment means that should Executive commit improper acts as defined by law such as non-performance of duties, dishonesty, theft or breach of confidentiality, the Company will be able to terminate Executive's employment without notice or severance in lieu of notice; (d) In the event that the Company pays severance in lieu of notice any stock options held by Executive that would have vested during the period beginning on the Termination Date and ending on the date which falls at the end of the Notice Period (the "Severance Date") shall automatically vest and become exercisable until the expiration of a period of time after the Severance Date that is equal to the period of time after the date of a termination during which such options would be exercisable under the applicable Stock Option Agreement (the "Option Agreement"). The Company hereby agrees that it will amend the terms of the Option Agreement, if necessary or required, in order to allow for the foregoing. The Company agrees that it make all reasonable efforts to obtain the agreement required by any exchange or regulatory authorities to amend the term of the Option Agreement if such agreement requires, to allow for the foregoing. In the event that the Company is unable to obtain the required

5 The Executive acknowledges that other than the foregoing notice or Severance Payment, Executive will not be entitled to any further compensation or notice arising out of the termination without just cause by the Company of Executive's employment; (c) Just Cause for the termination of employment means that should Executive commit improper acts as defined by law such as non-performance of duties, dishonesty, theft or breach of confidentiality, the Company will be able to terminate Executive's employment without notice or severance in lieu of notice; (d) In the event that the Company pays severance in lieu of notice any stock options held by Executive that would have vested during the period beginning on the Termination Date and ending on the date which falls at the end of the Notice Period (the "Severance Date") shall automatically vest and become exercisable until the expiration of a period of time after the Severance Date that is equal to the period of time after the date of a termination during which such options would be exercisable under the applicable Stock Option Agreement (the "Option Agreement"). The Company hereby agrees that it will amend the terms of the Option Agreement, if necessary or required, in order to allow for the foregoing. The Company agrees that it make all reasonable efforts to obtain the agreement required by any exchange or regulatory authorities to amend the term of the Option Agreement if such agreement requires, to allow for the foregoing. In the event that the Company is unable to obtain the required regulatory or exchange approval as aforesaid, then the Company agrees to compensate the Executive for the value of the said unvested share options based on the difference between the exercise price of such options and the market value of the Company's shares on the Termination Date, (based on the closing trading price on the date prior to the Termination Date), such payment to be made in cash in conjunction with all other payments due under this subsection 8.3; (e) If such current market price does not exceed the exercise price, no compensation is payable by either party with respect to the Option Agreement; and (F) The Company shall provide, at the Company's expense, relocation and financial counseling to the Executive at a cost not to exceed $10,000.00 with the Executive having the right, in the Executive's sole and absolute discretion, to receive payment of $10,000.00 in lieu of the said relocation and financial counseling services. 8.4 The employment of the Executive by the Company shall be deemed to be terminated by the Company pursuant to subsection 8.3 hereof if the Company unilaterally changes the terms of the employment relationship such that the Executive does not continue to be employed by the Company at a level of responsibility or a level of

6 Compensation at least commensurate with the Executive's existing level of responsibility and Compensation immediately prior to the said change and the Executive elects in a written notice to the Company to treat the Executive's employment as being terminated as a result of either such reduction with the said termination being effective as at the date of the said written notice. 8.5 Change of Control. In the event that a Change of Control (defined as meaning any of the following events: (i) consummation of any merger or consolidation of the Company in which the Company is not the continuing or surviving corporation and the shareholders of the Company immediately prior to such merger or consolidation own less than 51% of the surviving company; or (ii) consummation of any sale, lease, exchange, or other transfer, in one transaction or a series of related transactions, of all or substantially all of the Company's assets, other than a transfer of the Company's assets to a majority-owned subsidiary corporation; or (iii) a change in ownership of 60% or more of the Company's then outstanding capital stock, in one or more of a series of related transactions occurring within a period of four (4) months, in which one or more persons acting acquires 60% or more of the Company's then outstanding capital stock, occurs and in the further event that: (a) The Executive's employment with the Company is terminated by the Company other than for "just cause" as that term is defined under this agreement within six (6) months of the date of a Change of Control; or (b) The Executive does not continue to be employed by the Company at a level of responsibility or a level of compensation at least commensurate with the Executive's existing level of responsibility and compensation

6 Compensation at least commensurate with the Executive's existing level of responsibility and Compensation immediately prior to the said change and the Executive elects in a written notice to the Company to treat the Executive's employment as being terminated as a result of either such reduction with the said termination being effective as at the date of the said written notice. 8.5 Change of Control. In the event that a Change of Control (defined as meaning any of the following events: (i) consummation of any merger or consolidation of the Company in which the Company is not the continuing or surviving corporation and the shareholders of the Company immediately prior to such merger or consolidation own less than 51% of the surviving company; or (ii) consummation of any sale, lease, exchange, or other transfer, in one transaction or a series of related transactions, of all or substantially all of the Company's assets, other than a transfer of the Company's assets to a majority-owned subsidiary corporation; or (iii) a change in ownership of 60% or more of the Company's then outstanding capital stock, in one or more of a series of related transactions occurring within a period of four (4) months, in which one or more persons acting acquires 60% or more of the Company's then outstanding capital stock, occurs and in the further event that: (a) The Executive's employment with the Company is terminated by the Company other than for "just cause" as that term is defined under this agreement within six (6) months of the date of a Change of Control; or (b) The Executive does not continue to be employed by the Company at a level of responsibility or a level of compensation at least commensurate with the Executive's existing level of responsibility and compensation immediately prior to the Change of Control and the Executive elects in a written notice to the Company within six (6) months of the date of a Change of Control to treat the Executive's employment as being terminated as a result of either such reduction with the termination of Executive's employment being effective as of the date such written notice is delivered to the Company, then the Company agrees to:

7 (i) Accelerate the vesting dates pursuant to any and all stock option agreements outstanding between the Executive and the Company (the "Option Agreements") granting Executive right for a period of ninety (90) days commencing on the Voluntary Termination Date to purchase that number of shares for which options have been granted which are not yet vested or exercised, irrespective of whether or not the vesting requirements set forth in the Company's Stock Option Plan or the Option Agreement have been satisfied. The "Voluntary Termination Date" shall be the date upon which Executive provides the notice described in Section 8.5(b) of this Agreement. Any Option Agreement and any and all rights the Executive has or may have pursuant to any Option Agreement shall terminate and otherwise be extinguished on the date 90 days following the Voluntary Termination Date. In the event that any of the terms of such option are not ascertainable or in the event that applicable securities legislation precludes the acceleration of the vesting dates in the manner described herein, the Company agrees to compensate the Executive by way of a cash payment with that amount of money which the Executive would have been entitled to if he had exercised any such option on the Voluntary Termination Date at the price pursuant to the Option Agreement and sold the securities on The Nasdaq Stock Market or other markets on which the Company's common stock is listed for trading. The price used to determine such cash payment shall be based upon the weighted average trading price of the Company's common stock during the last five days preceding the Voluntary Termination Date. In the event the foregoing cannot be determined, then the market price shall be established by a qualified independent valuator approved by the independent members of the Board of Directors of the Company. In the further event that such weighted average trading price or current market price does not exceed the exercise price, no amount shall be payable by the Company under this Section. 9. RELEASE 9.1 In the event of termination; in consideration of the above payments to the Executive and the additional provisions of this Agreement, the Executive agrees to tender the Executive's immediate resignation in a form satisfactory to the Company acting reasonably and forever release and discharge the Company from any and all obligations to pay any further amounts or benefits to the Executive with respect to the Executive's employment or the termination thereof. 10 TIME OF ESSENCE

7 (i) Accelerate the vesting dates pursuant to any and all stock option agreements outstanding between the Executive and the Company (the "Option Agreements") granting Executive right for a period of ninety (90) days commencing on the Voluntary Termination Date to purchase that number of shares for which options have been granted which are not yet vested or exercised, irrespective of whether or not the vesting requirements set forth in the Company's Stock Option Plan or the Option Agreement have been satisfied. The "Voluntary Termination Date" shall be the date upon which Executive provides the notice described in Section 8.5(b) of this Agreement. Any Option Agreement and any and all rights the Executive has or may have pursuant to any Option Agreement shall terminate and otherwise be extinguished on the date 90 days following the Voluntary Termination Date. In the event that any of the terms of such option are not ascertainable or in the event that applicable securities legislation precludes the acceleration of the vesting dates in the manner described herein, the Company agrees to compensate the Executive by way of a cash payment with that amount of money which the Executive would have been entitled to if he had exercised any such option on the Voluntary Termination Date at the price pursuant to the Option Agreement and sold the securities on The Nasdaq Stock Market or other markets on which the Company's common stock is listed for trading. The price used to determine such cash payment shall be based upon the weighted average trading price of the Company's common stock during the last five days preceding the Voluntary Termination Date. In the event the foregoing cannot be determined, then the market price shall be established by a qualified independent valuator approved by the independent members of the Board of Directors of the Company. In the further event that such weighted average trading price or current market price does not exceed the exercise price, no amount shall be payable by the Company under this Section. 9. RELEASE 9.1 In the event of termination; in consideration of the above payments to the Executive and the additional provisions of this Agreement, the Executive agrees to tender the Executive's immediate resignation in a form satisfactory to the Company acting reasonably and forever release and discharge the Company from any and all obligations to pay any further amounts or benefits to the Executive with respect to the Executive's employment or the termination thereof. 10 TIME OF ESSENCE 10.1 Time shall be of the essence in this Agreement and all amendments hereto.

8 11 SUBSEQUENT EMPLOYMENT 11.1 The Executive shall not be bound in any manner whatsoever to rebate to the Company nor to forgive any claim against the Company with respect to any amounts or benefits payable hereunder in the event of the Executive's subsequent reemployment in any manner whatsoever. 12 TERMINATION FOR CAUSE 12.1 Notwithstanding the other provisions of this Agreement, the Company shall be entitled to terminate this Agreement and Executive's employment hereunder forthwith for just cause without any further notice or payment in lieu of notice. In the event of such termination for just cause, the other provisions of this Agreement shall not apply. 13 PRIOR AGREEMENTS/ENTIRE AGREEMENT 13.5 It is acknowledged and agreed by the Company and the Executive that this Agreement, including the attached Schedule, constitutes the entire agreement between the parties and that any and all prior agreements, written or verbal, express or implied, between the parties relating to or in any way connected with the employment of the Executive by the Company are hereby rendered null and void and are superseded by the terms of this Agreement. 13.6 In the event of a conflict between this Agreement and any agreement between the Executive and Company

8 11 SUBSEQUENT EMPLOYMENT 11.1 The Executive shall not be bound in any manner whatsoever to rebate to the Company nor to forgive any claim against the Company with respect to any amounts or benefits payable hereunder in the event of the Executive's subsequent reemployment in any manner whatsoever. 12 TERMINATION FOR CAUSE 12.1 Notwithstanding the other provisions of this Agreement, the Company shall be entitled to terminate this Agreement and Executive's employment hereunder forthwith for just cause without any further notice or payment in lieu of notice. In the event of such termination for just cause, the other provisions of this Agreement shall not apply. 13 PRIOR AGREEMENTS/ENTIRE AGREEMENT 13.5 It is acknowledged and agreed by the Company and the Executive that this Agreement, including the attached Schedule, constitutes the entire agreement between the parties and that any and all prior agreements, written or verbal, express or implied, between the parties relating to or in any way connected with the employment of the Executive by the Company are hereby rendered null and void and are superseded by the terms of this Agreement. 13.6 In the event of a conflict between this Agreement and any agreement between the Executive and Company concerning the Company's grant of stock options to the Executive, the provisions of this Agreement shall prevail. 14 APPLICABLE LAWS 14.1 This Agreement shall be construed in accordance with the laws in effect in the Province of Ontario and the parties hereto hereby attorn to the Courts of the Province of Ontario and, if applicable, the Federal Courts of Canada. 15 FURTHER ASSURANCES 15.1 Each of the parties shall from time to time and at all times do all such further acts and execute and deliver all such further deeds and documents as shall be reasonably required in order to fully perform the terms of this Agreement. 16 ENUREMENT 16.1 This Agreement shall enure to the benefit of and be binding upon the parties and their respective heirs, executors, administrators, successors and assigns.

9 17 NOTICE 17.1 Any notice or other instrument which may be required or permitted to be delivered or served on the other party hereto shall be sufficiently given to or served on such party if in writing and delivered by hand in a sealed envelope addressed to such party and left, during normal business hours, at the following addresses: (a) if to the Executive: Richard M. White 68 Wimbleton Road Toronto, Ontario M9A 3S1

9 17 NOTICE 17.1 Any notice or other instrument which may be required or permitted to be delivered or served on the other party hereto shall be sufficiently given to or served on such party if in writing and delivered by hand in a sealed envelope addressed to such party and left, during normal business hours, at the following addresses: (a) if to the Executive: Richard M. White 68 Wimbleton Road Toronto, Ontario M9A 3S1 (b) if to the Company: FutureLink Corp. and FutureLink Distribution Corp. 300, 250-6th Avenue S.W. Calgary, Alberta T2P 3H7 Attention: Philip R. Ladouceur, C.E.O. Either the Company or the Executive may, by notice delivered in accordance with this section, change the address for notices set out above. IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first above written. FUTURELINK CORP.
Per: /s/ PHILIP R. LADOUCEUR --------------------------Philip R. Ladouceur Chief Executive Officer

SIGNED, SEALED AND DELIVERED in the presence of:
/s/ NIRA M. PATEL ----------------------Witness /s/ RICHARD M. WHITE -----------------------------RICHARD M. WHITE

EXHIBIT 15.1 December 11, 2000 The Board of Directors and Stockholders FutureLink Corp. We are aware of the inclusion in the Registration Statement (Form SB-2) of FutureLink Corp. for the registration of approximately 60,000,000 shares of its common stock of our report dated August 30, 1999 relating to the unaudited financial statements of CN Networks, Inc. as of September 30, 1998 and 1999 and for the nine months then ended.
/s/ MORELAND & DAVIS

EXHIBIT 15.1 December 11, 2000 The Board of Directors and Stockholders FutureLink Corp. We are aware of the inclusion in the Registration Statement (Form SB-2) of FutureLink Corp. for the registration of approximately 60,000,000 shares of its common stock of our report dated August 30, 1999 relating to the unaudited financial statements of CN Networks, Inc. as of September 30, 1998 and 1999 and for the nine months then ended.
/s/ MORELAND & DAVIS -------------------Moreland & Davis

EXHIBIT 15.2 [M. JEVAHIRIAN & CO. LETTERHEAD] December 11, 2000 The Board of Directors and Stockholders FutureLink Corp. We are aware of the inclusion in the Registration Statement (Form SB-2) of FutureLink Corp. for the registration of approximately 60,000,000 shares of its common stock of our report dated February 3, 2000 relating to the unaudited combined financial statements of ASYNC TECHNOLOGIES, INC. and ASYNC TECHNICAL INSTITUTE, INC. as of September 30, 1998 and 1999 and for the nine months then ended.
/s/ M. JEVAHIRIAN & CO. -------------------------------M. Jevahirian & Co.

EX-21.0 LIST OF SUBSIDIARIES We currently have the following wholly-owned subsidiaries: 1. FutureLink Micro Visions Corp., a Delaware corporation, doing business as FutureLink 2. FutureLink Pleasanton Corp., a Delaware corporation, doing business as FutureLink 3. FutureLink Async Corp., a Delaware corporation, doing business as FutureLink 4. FutureLink VSI Corp., a Maryland corporation, doing business as FutureLink 5. FutureLink Madison Corp., a Delaware corporation, doing business as FutureLink 6. FutureLink Canada Corp., an Alberta corporation, doing business as FutureLink

EXHIBIT 15.2 [M. JEVAHIRIAN & CO. LETTERHEAD] December 11, 2000 The Board of Directors and Stockholders FutureLink Corp. We are aware of the inclusion in the Registration Statement (Form SB-2) of FutureLink Corp. for the registration of approximately 60,000,000 shares of its common stock of our report dated February 3, 2000 relating to the unaudited combined financial statements of ASYNC TECHNOLOGIES, INC. and ASYNC TECHNICAL INSTITUTE, INC. as of September 30, 1998 and 1999 and for the nine months then ended.
/s/ M. JEVAHIRIAN & CO. -------------------------------M. Jevahirian & Co.

EX-21.0 LIST OF SUBSIDIARIES We currently have the following wholly-owned subsidiaries: 1. FutureLink Micro Visions Corp., a Delaware corporation, doing business as FutureLink 2. FutureLink Pleasanton Corp., a Delaware corporation, doing business as FutureLink 3. FutureLink Async Corp., a Delaware corporation, doing business as FutureLink 4. FutureLink VSI Corp., a Maryland corporation, doing business as FutureLink 5. FutureLink Madison Corp., a Delaware corporation, doing business as FutureLink 6. FutureLink Canada Corp., an Alberta corporation, doing business as FutureLink 7. KNS Holdings Limited, a U.K. corporation, which wholly owns FutureLink Europe Limited, a U.K. corporation 8. 3045207 Nova Scotia Company, a Nova Scotia unlimited liability company which wholly owns 1423280 Ontario Inc., an Ontario corporation

EXHIBIT 23.2 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the references to our firm under the captions "Selected Consolidated Financial Data" and "Experts" and to the use of our report dated March 14, 2000, except for Note 13, as to which the date is April 29, 2000, Note 16, as to which the date is June 29, 2000, and Note 1, as to which the date is December 15, 2000, in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP

EX-21.0 LIST OF SUBSIDIARIES We currently have the following wholly-owned subsidiaries: 1. FutureLink Micro Visions Corp., a Delaware corporation, doing business as FutureLink 2. FutureLink Pleasanton Corp., a Delaware corporation, doing business as FutureLink 3. FutureLink Async Corp., a Delaware corporation, doing business as FutureLink 4. FutureLink VSI Corp., a Maryland corporation, doing business as FutureLink 5. FutureLink Madison Corp., a Delaware corporation, doing business as FutureLink 6. FutureLink Canada Corp., an Alberta corporation, doing business as FutureLink 7. KNS Holdings Limited, a U.K. corporation, which wholly owns FutureLink Europe Limited, a U.K. corporation 8. 3045207 Nova Scotia Company, a Nova Scotia unlimited liability company which wholly owns 1423280 Ontario Inc., an Ontario corporation

EXHIBIT 23.2 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the references to our firm under the captions "Selected Consolidated Financial Data" and "Experts" and to the use of our report dated March 14, 2000, except for Note 13, as to which the date is April 29, 2000, Note 16, as to which the date is June 29, 2000, and Note 1, as to which the date is December 15, 2000, in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Orange County, California

December 15, 2000

EXHIBIT 23.3 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated January 28, 2000, with respect to the financial statements of Vertical Software, Inc. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP

MCLEAN, VIRGINIA

EXHIBIT 23.2 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the references to our firm under the captions "Selected Consolidated Financial Data" and "Experts" and to the use of our report dated March 14, 2000, except for Note 13, as to which the date is April 29, 2000, Note 16, as to which the date is June 29, 2000, and Note 1, as to which the date is December 15, 2000, in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Orange County, California

December 15, 2000

EXHIBIT 23.3 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated January 28, 2000, with respect to the financial statements of Vertical Software, Inc. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP

MCLEAN, VIRGINIA

December 15, 2000

EXHIBIT 23.4 [JOEL E. SAMMET & CO. LETTERHEAD] December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 14, 2000, with respect to the financial statements of MICROLAN SYSTEMS, INC. "DBA" MADISON TECHNOLOGY GROUP, MADISON CONSULTING RESOURCES, INC. and MADISON CONSULTING RESOURCES NJ, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000. Very truly yours, JOEL E. SAMMETT & CO.
/s/ FRANKLIN M. JACOBSON

FM/lg

EXHIBIT 23.3 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated January 28, 2000, with respect to the financial statements of Vertical Software, Inc. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP

MCLEAN, VIRGINIA

December 15, 2000

EXHIBIT 23.4 [JOEL E. SAMMET & CO. LETTERHEAD] December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 14, 2000, with respect to the financial statements of MICROLAN SYSTEMS, INC. "DBA" MADISON TECHNOLOGY GROUP, MADISON CONSULTING RESOURCES, INC. and MADISON CONSULTING RESOURCES NJ, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000. Very truly yours, JOEL E. SAMMETT & CO.
/s/ FRANKLIN M. JACOBSON

FM/lg

EXHIBIT 23.5 Consent of Ernst & Young LLP, Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated November 17, 1999, with respect to the financial statements of Executive LAN Management, Inc., dba Micro Visions, included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Orange County, California

December 15, 2000

EXHIBIT 23.4 [JOEL E. SAMMET & CO. LETTERHEAD] December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 14, 2000, with respect to the financial statements of MICROLAN SYSTEMS, INC. "DBA" MADISON TECHNOLOGY GROUP, MADISON CONSULTING RESOURCES, INC. and MADISON CONSULTING RESOURCES NJ, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000. Very truly yours, JOEL E. SAMMETT & CO.
/s/ FRANKLIN M. JACOBSON

FM/lg

EXHIBIT 23.5 Consent of Ernst & Young LLP, Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated November 17, 1999, with respect to the financial statements of Executive LAN Management, Inc., dba Micro Visions, included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Orange County, California

December 15, 2000

EXHIBIT 23.6 Consent of Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated August 30, 1999 with respect to the financial statements of CN Networks dba Computer Networks included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corporation dated December 19, 2000.
/s/ Moreland & Davis Alameda County, California

December 11, 2000

EXHIBIT 23.5 Consent of Ernst & Young LLP, Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated November 17, 1999, with respect to the financial statements of Executive LAN Management, Inc., dba Micro Visions, included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Orange County, California

December 15, 2000

EXHIBIT 23.6 Consent of Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated August 30, 1999 with respect to the financial statements of CN Networks dba Computer Networks included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corporation dated December 19, 2000.
/s/ Moreland & Davis Alameda County, California

December 11, 2000

EXHIBIT 23.7 [M. JEVAHIRIAN & CO. LETTERHEAD] Consent of M. Jevahirian & Co., Independent Auditors December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 3, 2000, with respect to the combined financial statements of ASYNC TECHNOLOGIES, INC. and ASYNC TECHNICAL INSTITUTE, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ M. Jevahirian & Co. ----------------------------M. Jevahirian & Co.

EXHIBIT 23.8

EXHIBIT 23.6 Consent of Independent Auditors We consent to the reference to our firm under the caption "Experts" and to the use of our report dated August 30, 1999 with respect to the financial statements of CN Networks dba Computer Networks included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corporation dated December 19, 2000.
/s/ Moreland & Davis Alameda County, California

December 11, 2000

EXHIBIT 23.7 [M. JEVAHIRIAN & CO. LETTERHEAD] Consent of M. Jevahirian & Co., Independent Auditors December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 3, 2000, with respect to the combined financial statements of ASYNC TECHNOLOGIES, INC. and ASYNC TECHNICAL INSTITUTE, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ M. Jevahirian & Co. ----------------------------M. Jevahirian & Co.

EXHIBIT 23.8 [ERNST & YOUNG LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated March 28, 2000, with respect to the financial statements of KNS Holdings Limited included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Reading, England

December 15, 2000

EXHIBIT 23.7 [M. JEVAHIRIAN & CO. LETTERHEAD] Consent of M. Jevahirian & Co., Independent Auditors December 11, 2000 We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 3, 2000, with respect to the combined financial statements of ASYNC TECHNOLOGIES, INC. and ASYNC TECHNICAL INSTITUTE, INC. included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ M. Jevahirian & Co. ----------------------------M. Jevahirian & Co.

EXHIBIT 23.8 [ERNST & YOUNG LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated March 28, 2000, with respect to the financial statements of KNS Holdings Limited included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Reading, England

December 15, 2000

EXHIBIT 23.8 [ERNST & YOUNG LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the use of our report dated March 28, 2000, with respect to the financial statements of KNS Holdings Limited included in the Registration Statement (Form SB-2) and related Prospectus of FutureLink Corp. dated December 19, 2000.
/s/ ERNST & YOUNG LLP Reading, England

December 15, 2000


								
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