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                                                                    Exhibit 10.1

                         REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT is made as of the 27th day of January,
1999, by and between:

            Bahman Koohestani, an individual residing in the
            Province of Ontario ("Bahman")

                                    - and -

            Anthony Davis, an individual resident in the Province
            of Ontario ("Davis")

                                    - and -

            Robert Gayle, an individual resident in the Province
            of Ontario ("Gayle")

                                    - and -

            John Mah, an individual resident in the Province of
            Ontario ("Mah")

                                    - and -

            Sean Maurik, an individual resident in the Province of
            Ontario ("Maurik")

                                    - and -

            John Foresi, an individual resident in the Province of
            Ontario ("Foresi")
                                    - and -

            Ron Schreiber, an individual resident in the State of
            New York ("Schreiber")

                                    - and -

            Jordan Levy, an individual resident in the State of
            New York ("Levy")
                                    - and -

            Delano Technology Corporation, a corporation governed
            by the laws of Ontario (the "Corporation")

                                    - and -





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            Tofino Venture Capital Inc., a corporation governed by
            the laws of Barbados ("Tofino")

                                    - and -

            XDL Delano Holdings Inc., a corporation governed by
            the laws of Ontario ("XDL")

and any other persons who, after the date of this Agreement, acquire Shares in
the capital of the Corporation and sign counterparts to this Agreement (the
"Additional Shareholders")


     WHEREAS the parties to this Agreement are parties to the Amended and
Restated Shareholders' Agreement dated the date hereof relating to the
Corporation (the "Shareholders' Agreement"), which supersedes a previously
executed agreement among the shareholders of the Corporation pursuant to which
the parties thereto were granted certain registration rights; and

     AND WHEREAS, in connection with the execution and delivery of the
Shareholders' Agreement, the parties desire to enter into this Agreement to set
out the registration rights of certain shareholders of the Corporation;

     NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

DEFINITIONS

1.   For purposes of this Agreement:

      (a)  "1933 ACT" means the United States Securities Act of 1933, as
           amended.

      (b)  "APPROVED UNDERWRITER" has the meaning given to such term in
           Section 5 of this Agreement.

      (c)  "APPROVED UNDERWRITER AMOUNT" has the meaning given to such
           term in Section 4 of this Agreement.

      (d)  "AS IF CONVERTED TO SHARES BASIS" means that, for the purpose
           of determining a percentage of outstanding Shares, all convertible
           preference shares in the capital of the Corporation are deemed to be
           converted to Shares in accordance with their terms, all shares in
           the capital of the Corporation held in escrow are deemed to be
           released therefrom, and all Option Pool Shares, whether or not they
           are subject to an option grant and whether or not they are already
           issued, are deemed to be issued.

      (e)  "DEMAND REGISTRATION" has the meaning given to such term in
           Section 2 of this Agreement.





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      (f)  "DEMAND RIGHTS" shall mean the rights of any shareholder of the
            Corporation to require the Corporation to register or qualify
            Shares for distribution to the public.

      (g)  "ELECTING HOLDER" has the meaning given to such term in
           Section 2 of this Agreement.

      (h)  "ELIGIBLE HOLDER" shall mean each of (A) XDL; and (B) Other
           Shareholders individually or collectively owning Registrable Shares
           to which are attached not less than 50% of the votes that may be
           cast to elect the directors of the Corporation (on an as if
           converted to Shares basis).

      (i)  "ELIGIBLE JURISDICTION" shall mean, as of a particular date,
           any jurisdiction in which Shares were registered or qualified for
           distribution to the public pursuant to the initial public offering
           of the Shares and any other jurisdiction in which the Shares are
           listed for trading on a securities exchange.

      (j)  "EXCHANGE ACT" means the United States Exchange Act of 1934.

      (k)  "FILING" shall mean any document provided to any securities
           regulatory authority or made generally available to the shareholders
           of the Corporation in connection with a registration, qualification
           or offering of Shares.

      (l)  "HOLDER" shall mean any holder of Registrable Shares.

      (m)  "INDEMNIFIED PARTY" has the meaning given to such term in
           Section 15 of this Agreement.

      (n)  "INDEMNIFYING PARTY" has the meaning given to such term in
           Section 15 of this Agreement.

      (o)  "LOSSES" has the meaning given to such term in Section 13 of
           this Agreement.

      (p)  "OPTION POOL SHARES" means shares in the capital of the
           Corporation issuable pursuant to the Corporation's stock option plan
           for directors, officers, consultants and employees of the
           Corporation in accordance with the terms and conditions of the
           Shareholders' Agreement.

      (q)  "OTHER SHAREHOLDERS" means, collectively, Bahman, Davis,
           Gayle, Mah, Maurik, Foresi, Schreiber, Tofino, Levy and the
           Additional Shareholders, if any, and their respective permitted
           transferees in accordance with the terms and conditions of the
           Shareholders' Agreement.

      (r)  "OTHER SHAREHOLDER REGISTRABLE SHARES" means any Shares now
           held by Other Shareholders and any Shares issued in respect of other
           shares of the Corporation held by Other Shareholders, including in
           respect of share dividends or pre-





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           emptive rights; provided however, that any Registrable Share shall
           cease to be a Registrable Share when:

            (A)  a receipt for a prospectus qualifying such
                 Registrable Share for public distribution has been obtained
                 from the Ontario Securities Commission and such Registrable
                 Share has been disposed of pursuant to such prospectus; or

            (B)  a registration statement covering such
                 Registrable Share has been declared effective under the1933
                 Act by the SEC and such Registrable Share has been disposed of
                 pursuant to such effective registration statement.

      (s)  "REGISTRABLE SHARES" means all XDL Registrable Shares and
           Other Shareholder Registrable Shares.

      (t)  "REGISTRATION FILING" has the meaning given to such term in
           Section 9 of this Agreement.

      (u)  "RELATED OFFERING" has the meaning given to such term in
           Section 9 of this Agreement.

      (v)  "REQUESTING HOLDER" has the meaning given to such term in
           Section 2 of this Agreement.

      (w)  "SEC" means the U.S. Securities and Exchange Commission.

      (x)  "SHARES" means common shares in the capital of the
           Corporation.

      (y)  "XDL REGISTRABLE SHARES" means any Shares now held by XDL and
           any Shares issued in respect of other shares of the Corporation held
           by XDL, including in respect of share dividends or pre-emptive
           rights; provided however, that any Registrable Share shall cease to
           be a Registrable Share when:

            (A)  a receipt for a prospectus qualifying such
                 Registrable Share for public distribution has been obtained
                 from the Ontario Securities Commission and such Registrable
                 Share has been disposed of pursuant to such prospectus; or

            (B)  a registration statement covering such
                 Registrable Share has been declared effective under the 1933
                 Act by the SEC and such Registrable Share has been disposed of
                 pursuant to such effective registration statement.






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DEMAND REGISTRATION

2.    Request for Demand Registration - Subject to Sections 3 and 6 of this
      Agreement, any Eligible Holder or Eligible Holders may, in respect of
      Registrable Shares held by them, collectively initiate a total of three
      requests at any time after 120 days from the date of any initial public
      offering of the Shares for the registration or qualification of
      Registrable Shares in any Eligible Jurisdiction.  Each of the
      registrations and/or qualifications under this Section 2 that satisfies
      the requirements set forth in Section 3 of this Agreement shall be
      referred to hereof as a "Demand Registration"; provided that a single
      registration or qualification shall constitute a single Demand
      Registration for purposes of Section 2(b) of this Agreement, even if more
      than one Eligible Holder includes Registrable Shares in such registration
      or qualification.  Each Eligible Holder requesting a Demand Registration
      shall be referred to hereof as a "Requesting Holder".

      (a)  Each request for a Demand Registration shall be in writing
           and shall specify the number of the Registrable Shares proposed to
           be sold, the intended method of disposition and the jurisdictions in
           which registration and/or qualification is desired, provided that
           only Eligible Jurisdictions may be selected.

      (b)  Subject to section 6 of this Agreement, within 10 days after
           the receipt of such a request from a Requesting Holder or group of
           Requesting Holders, the Corporation shall give notice thereof to the
           other Holders.  The Corporation shall include in such registration
           and/or qualification any Registrable Shares that any other Holder
           (an "Electing Holder") requests be included, provided that the
           Corporation receives such request within 15 days after the
           Corporation delivers its notice pursuant to this paragraph (b) of
           this Section.  Subject to Section 4 of this Agreement, the
           Corporation shall be entitled to include in any offering made
           pursuant to a Demand Registration, authorized but unissued Shares or
           Shares held by shareholders other than the Holders; provided,
           however, that such inclusion shall be permitted only to the extent
           that it is pursuant and subject to the terms of any underwriting
           agreement or arrangements entered into by the Requesting Holder(s)
           (it being understood that to the extent that any offering made
           pursuant to a Demand Registration is not an underwritten offering no
           such inclusion of authorized but unissued Shares or Shares held by
           shareholders other than the Holders shall be permitted without the
           consent of the Requesting Holders); and provided further, however,
           that no Shares held by shareholders other than the Holders shall be
           entitled to be included unless such shareholders shall agree in
           writing to pay their expenses referred to in Section 8 of this
           Agreement.

      (c)  Subject to Section 6 of this Agreement, no later than 45 days
           after receipt of a request for a Demand Registration, the
           Corporation shall file with the SEC a registration statement
           relating to the sale of Registrable Shares by the Holder(s) on Form
           F-3 if such Form is available, and otherwise on such form as is
           available to the Corporation or a prospectus with those Canadian
           jurisdictions designated by the Holder pursuant to this Section and
           thereafter the Corporation shall use its best efforts (A) to cause
           the registration statement or prospectus, as the case may be, to
           become effective or filed in final form as promptly as practicable
           and to





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            remain effective for the periods specified in Section 3 of this
            Agreement and (B) to cause such Registrable Shares to be registered
            or qualified for distribution to the public in accordance with
            applicable securities laws (including, for greater certainty,
            applicable blue sky laws of applicable United States jurisdictions)
            and to remain effective for the periods specified in Section 3 of
            this Agreement.

     Notwithstanding anything to the contrary in this Agreement, Requesting
     Holders may initiate more than three requests for a Demand Registration if
     the Corporation is able to utilize a short-form registration statement or
     prospectus, and proposed registrations or qualifications which are, for any
     reason, not completed shall not be considered to be one of the three
     requests allocated to each Eligible Holder pursuant to this Section.

3.   Effective Demand Registration.  A registration requested pursuant to
     Section 2 of this Agreement shall not count as one of the Demand
     Registrations to which the particular Requesting Holder(s) is or are
     entitled unless: (i) such registration statement is declared effective and
     remains effective until the earlier of (A) the date by which all of the
     Registrable Shares covered by such registration statement have been
     disposed of pursuant to such registration statement, and (B) 45 days, in
     the case of an underwritten offering, or 90 days, in the case of any other
     offering, after the effective date of such registration statement; and
     (ii) at least 50% of the Registrable Shares which such Requesting
     Holder(s) had specified in its request under subparagraph 2(a) of this
     Agreement have been registered or qualified under the resulting
     registration statement or prospectus, as applicable, following the
     determination of the Approved Underwriter Amount under Section 4 of this
     Agreement.

4.   Demand Underwriting Procedures.  If the Requesting Holder(s) so elect,
     the offering pursuant to such Demand Registration shall be in the form of
     an underwritten offering and the managing underwriter selected for such
     offering shall be the Approved Underwriter selected in accordance with
     Section 5 of this Agreement.  In such event, if the Approved Underwriter
     advises the Corporation in writing that, in its opinion, the aggregate
     amount of securities requested to be included in such offering by the
     Requesting Holders, the Electing Holders and the Corporation is
     sufficiently large as to have a material adverse effect on the success of
     such offering, then only the aggregate number of Registrable Shares that
     in the opinion of the Approved Underwriter may be sold without any
     material adverse effect on the success of such offering (the "Approved
     Underwriter Amount") shall be included, and

      (a)  if the number of Registrable Shares to be included is greater
           than the Approved Underwriter Amount, then each of the Holders shall
           be entitled, in priority to the inclusion of other Shares in the
           offering, to have included Registrable Shares sufficient for them to
           receive proceeds (net of underwriting discounts or commissions)
           equal to the total amount of cash invested by them in the
           Corporation;





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      (b)  to the extent that the number of Registrable Shares to be included
           by the Holders under clause (a) above is less than the Approved
           Underwriter Amount, each of the Holders will be entitled to include
           additional Registrable Shares equal to their respective pro rata
           portion (on the basis of the number of Registrable Shares proposed
           to be registered by each Holder) of the remaining balance of up to
           the lessor of the Approved Underwriter Amount and the total number
           of Registrable Shares proposed to be registered by all Holders; and

      (c)  to the extent that the total of the foregoing Registrable
           Shares is less than the balance of the Approved Underwriter Amount
           remaining, the Corporation shall be entitled to include, in its
           discretion, unissued Shares to be issued for its own account or
           Shares held by shareholders other than the Holders.

     The calculation of proceeds for purposes of clauses (a) and (b) of this
     Section shall be cumulative from one registration to another such that
     from and after the completion of any registration or qualification
     providing the Requesting and Electing Holders with receipt of all of
     their respective amounts specified in clauses (a) and (b) of this
     Section, the provisions of clauses (a) and (b) shall no longer be
     applicable.

5.   Selection of Underwriters.  If any requested Demand Registration is in
     the form of an underwritten offering, the Requesting Holder(s) shall
     select and retain an investment banking firm to be the approved
     underwriter (the "Approved Underwriter"); provided that such firm shall be
     reasonably acceptable to the Corporation.  In the event of an underwritten
     offering pursuant to a Demand Registration, the Corporation shall enter
     into an underwriting agreement in customary form reasonably satisfactory
     to the Corporation with the Approved Underwriter and shall use its best
     efforts to cooperate with the Approved Underwriter in the carrying out of
     such offering, including, without limitation, making whatever requests are
     appropriate, supplying whatever information is appropriate and otherwise
     using its best efforts to obtain all legal opinions, auditor's consents
     and comfort letters and experts' cooperation as may be necessary or
     desirable.

6.   Limitations on Demand Registrations.  The Corporation shall not be
     required to cause a Demand Registration to be effected or to take any
     other action pursuant to Section 2 of this Agreement:

      (a)  within a period of 180 days after the effective date of any
           registration statement of the Corporation (other than a "shelf"
           registration statement pursuant to Rule 415 under the 1933 Act or
           relating to any employee stock option or stock purchase or similar
           plan or relating to any dividend reinvestment plan) under the 1933
           Act or the date of any receipt for a prospectus of the Corporation
           issued under the Canadian securities laws, in either case covering
           securities of or convertible into the same class as any Registrable
           Shares, if prohibited by the underwriting or agency agreement
           relating to distribution of Shares pursuant to the initial public
           offering of the Shares (or such longer period as required by such
           underwriting or agency agreement);






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      (b)  if the Corporation provides notice to the Requesting Holder(s)
           within 30 days of the request for a Demand Registration that the
           Corporation is actively engaged in pursuing a firmly underwritten
           public offering of Shares in which the Holders may include
           Registrable Shares pursuant to Section 9 or 10 of this Agreement;

      (c)  if the Corporation provides to the Requesting Holders a
           certificate signed by the Chief Executive Officer of the Corporation
           stating that, in the good faith judgment of the Corporation's Board
           of Directors, it would not be in the best interests of the
           Corporation and its shareholders for a prospectus or registration
           statement (as applicable) to be filed at such time and it is
           therefore appropriate to defer the filing of such prospectus or
           registration statement, in which case the Corporation may direct
           that such request for a Demand Registration be delayed for a period
           not in excess of 90 days, provided that such right to delay a
           request may be exercised by the Corporation no more than once in any
           twelve month period; or

      (d)  prior to such time as the Shares have been accepted for
           trading by The Toronto Stock Exchange, the Montreal Exchange, the
           New York Stock Exchange or the Nasdaq Stock Market Inc. for trading
           through either the Nasdaq SmallCap Market or the Nasdaq National
           Market.

7.   Demand Registration Expenses Borne by Corporation.  Except as provided in
     Section 8 of this Agreement, and except as the Requesting Holders and
     Electing Holders may agree pursuant to the provisions of Section 6 of this
     Agreement, all fees and expenses arising out of any Demand Registration
     and any offering related thereto shall be borne by the Corporation,
     including, without limitation, (a) all registration and filing fees; (b)
     the fees and expenses of the Corporation's compliance with applicable
     securities laws including U.S. blue sky laws as applicable (including
     reasonable fees and disbursements of counsel); (c) printing expenses; (d)
     the fees and disbursements of counsel for the Corporation and one separate
     counsel retained by the Holders; (e) the fees and expenses for independent
     certified public accountants, underwriters and other persons retained in
     connection with such registration, qualification or offering; (f) fees of
     transfer agents and registrars; and (g) messenger and delivery expenses.
     In addition, the Corporation shall pay its internal expenses (including,
     without limitation, all salaries and expenses of its officers and
     employees performing legal or accounting duties), the expense of any
     annual audit or quarterly review, the expense of any liability insurance
     obtained by the Corporation, and the expenses and fees for listing or
     authorizing for quotation the securities to be registered on each
     securities exchange or other trading facility on which Shares are then
     listed or quoted.

8.   Demand Registration Expenses Borne by Holders.  Each Requesting and
     Electing Holder shall pay any underwriting discounts and commissions
     attributable to its Registrable Shares, the fees and disbursements of any
     second or other additional separate counsel or other advisors retained by
     the Holder and all of its internal expenses incurred in connection with
     any registration, qualification or offering (including, without
     limitation,





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    all salaries and expenses of any officers or employees of such Holder
    performing legal or accounting duties).

PIGGY-BACK REGISTRATION

9.   Inclusion in Registration. If the Corporation determines (whether on its
     own initiative or pursuant to the exercise of Demand Rights by a
     shareholder other than a Holder) to file a prospectus under any of the
     Canadian securities laws and/or a registration statement under the 1933
     Act (any such prospectus or registration statement and any preliminary
     prospectus or other preliminary filing related thereto a "Registration
     Filing") covering any Shares, other than a Registration Filing relating to
     an employee stock option, stock purchase or similar plan or relating to
     any dividend reinvestment plan, or any Registration Filing on Form F-4 or
     S-4 (or any successor form), the Corporation shall:

      (a)  within 30 days prior to the initial filing of any
           Registration Filing, deliver to each Holder a written notice
           thereof, describing such Registration Filing and any related public
           offering (a "Related Offering"), including a list of the
           jurisdictions in which the Corporation intends to attempt to qualify
           the Shares under the applicable Canadian provincial or U.S. state
           securities laws and, if applicable, the minimum and maximum proposed
           offering price; and

      (b)  include in such Registration Filing (and any related
           qualification under blue sky laws or other compliance) and in any
           Related Offering, on the same terms (as applicable) as apply to all
           other Shares included thereof, all Registrable Shares specified in
           any written request made by a Holder within 15 days after receipt of
           such written notice from the Corporation, except as set forth in
           Section 11 of this Agreement.  Such written request may specify all
           or a part of the Holder's Registrable Shares.

10.  Piggy-Back Underwriting Procedures.  If the Corporation arranges for a
     Related Offering that is underwritten and the managing underwriter of such
     Related Offering advises the Corporation in writing that, in its opinion,
     the aggregate number of Shares requested to be included in such Related
     Offering is sufficiently large so as to have a material adverse effect on
     the success of such Related Offering, then the Corporation shall include:

      (a)  if the registration or qualification related to such offering
           was initiated pursuant to the exercise of Demand Rights by a
           shareholder or shareholders other than the Holders, first, any
           Shares that such shareholder(s) proposed to register and/or qualify
           for sale, and, second, additional Shares to the extent of the number
           of such Shares that the Corporation is so advised can be sold in (or
           during the time of) such Related Offering without having such
           adverse effect in the following priority:  (i) any Shares proposed
           to be registered and/or qualified for sale by the Corporation for
           its own account and all Registrable Shares proposed to be registered
           by the Holders, pro rata among such parties, provided that the
           relative priorities among the Holders shall follow the procedures
           set out in Section 4 of





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           this Agreement, if applicable (on the basis of the number of Shares
           proposed to be registered by the Corporation and each Holder); and
           (ii) any Shares proposed to be registered and/or qualified for sale
           by shareholders other than the shareholder(s) initially making the
           demand for registration and the Holders; or

      (b)  if the registration or qualification related to such offering
           was initiated by the Corporation and not pursuant to the exercise of
           Demand Rights, first, any Shares that the Corporation proposed to
           register and/or qualify for sale for its own account, and, second,
           additional Shares to the extent of the number of such Shares that
           the Corporation is so advised can be sold in (or during the time of)
           such Related Offering without having such adverse effect in the
           following priority:  (i) all Registrable Shares proposed to be
           registered and/or qualified for sale by the Holders, pro rata among
           the Holders (on the basis of the number of shares proposed to be
           registered by each Holder), provided that the relative priorities
           among the Holders shall first follow the procedures set out in
           Section 4 of this Agreement, if applicable; and (ii) any Shares
           proposed to be registered and/or qualified by other shareholders.

11.  Piggy-Back Registration Expenses Borne by Corporation.  Except as
     provided in Section 13 of this Agreement, the Corporation shall bear all
     fees, costs and expenses of any registration, qualification or offering
     that is not part of a Demand Registration, including, without limitation,
     (a) all registration and filing fees; (b) the fees and expenses of the
     Corporation's compliance with securities or U.S. blue sky laws and/or any
     Canadian equivalent as applicable (including reasonable fees and
     disbursements of counsel); (c) printing expenses; (d) the fees and
     disbursements of counsel for the Corporation and one separate counsel
     retained by the selling shareholders for each registration, qualification
     and offering, and the fees and expenses for independent certified public
     accountants, underwriters and other persons retained by the Corporation in
     connection with such Registration Filing; (e) fees of transfer agents and
     registrars; and (f) messenger and delivery expenses.  In addition, the
     Corporation shall pay its internal expenses (including, without
     limitation, all salaries and expenses of its officers and employees
     performing legal or accounting duties), the expense of any annual audit or
     quarterly review, the expense of any liability insurance obtained by the
     Corporation, and the expenses and fees for listing or authorizing for
     quotation the securities to be registered on each securities exchange or
     other trading facility on which Shares are then listed or quoted.

12.  Piggy-Back Registration Expenses Borne by Holders.  Each Holder shall pay
     any underwriting discounts and commissions attributable to its Shares, the
     fees and disbursements of any second or other additional separate counsel
     or other advisors retained by the Holder and all of its internal expenses
     incurred in connection with any registration, qualification or offering
     (including, without limitation, all salaries and expenses of any officers
     or employees of such Holder performing legal or accounting duties but
     excluding fees and expenses of counsel that are payable by the Corporation
     pursuant to Section 11 of this Agreement).





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INDEMNIFICATION; CONTRIBUTION

13.  Indemnification by the Corporation.  In the event of any proposed
     registration, qualification or offering of Shares, the Corporation agrees
     to indemnify and hold harmless (i) each Holder, each of such Holder's
     officers, directors, partners, employees, and each of such Holder's legal
     counsel and other agents and advisers, independent accountants, if any;
     (ii) each person controlling any such persons within the meaning of
     Section 15 of the 1933 Act or Section 20 of the Exchange Act; and (iii)
     each underwriter, if any, and each person who controls any underwriter
     within the meaning of Section 15 of the 1933 Act or Section 20 of the
     Exchange Act, from and against any and all losses, claims, damages,
     liabilities and expenses (including reasonable costs of investigation, any
     legal and any other expenses reasonably incurred in connection with
     investigating, preparing or defending any such claim, loss, damage,
     liability or action, and any of the foregoing incurred in settlement of
     any litigation, commenced or threatened) (collectively "Losses") arising
     out of or based upon (i) any untrue statement or alleged untrue statement
     of a material fact contained in any Filing in connection with or any
     prospectus, offering circular or other document incidental to any
     registration, qualification or offering or any omission or alleged
     omission to state thereof a material fact required to be stated thereof or
     necessary to make the statements thereof not misleading; (ii) any
     violation by the Corporation of any rule or regulation promulgated under
     any Canadian or U. S. securities law applicable to the Corporation and
     relating to action or inaction by the Corporation in connection with any
     registration, qualification or compliance required hereunder; or (iii) the
     Corporation's breach of any representation, warranty, covenant or
     agreement contained in this Agreement; provided, however, that the
     Corporation shall not be liable to a Holder for any Losses to the extent
     that such Losses resulted directly from any untrue statement or alleged
     untrue statement of a material fact, or any omission or alleged omission
     to state a material fact required to be stated or necessary to make the
     statements made not misleading, in each case in any material furnished in
     writing by such Holder expressly for use in a Filing in connection with
     any registration, qualification or offering covering such Holder's Shares.

14.  Indemnification by Holders.  Each Holder agrees severally and not jointly
     to indemnify and hold harmless the Corporation, its officers, directors,
     employees, legal counsel and other agents and advisers and each person, if
     any, who controls the Corporation within the meaning of either Section 15
     of the 1933 Act or Section 20 of the Exchange Act and each underwriter, if
     any, and each person who controls any underwriter within the meaning of
     Section 15 of the 1933 Act or Section 20 of the Exchange Act for any
     Losses, to the extent that such Losses resulted directly from an untrue
     statement or alleged untrue statement of a material fact, or any omission
     or alleged omission to state a material fact required to be stated or
     necessary to make the statements made not misleading, in each case in any
     material furnished in writing by such Holder expressly for use in a Filing
     in connection with any registration, qualification or offering covering
     its Shares, but only to the extent of the net sale proceeds actually
     received by such Holder in connection with the applicable offering.





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15.  Contribution.  If the indemnification provided for in this Sections 14
     and 15 of this Agreement is held by a court of competent jurisdiction to
     be unavailable to any party entitled to indemnification under the terms
     of Sections 14 and 15 of this Agreement (an "Indemnified Party") in
     respect of any Losses referred to hereof, then the party or parties
     responsible for such indemnification under the terms of Sections 14 and
     15 of this Agreement (an "Indemnifying Party"), in lieu of indemnifying
     such Indemnified Party, shall contribute to the amount paid or payable by
     such Indemnified Party as a result of such Losses in the following
     manner:  as between the Indemnifying Party on the one hand and the
     Indemnified Party on the other, in such proportion as is appropriate to
     reflect the relative fault of the Indemnifying Party on the one hand and
     the Indemnified Party on the other in connection with the statements or
     omissions which resulted in such Losses, as well as any other relevant
     equitable considerations.  The relative fault of the Indemnifying Party
     on the one hand and the Indemnified Party on the other shall be
     determined by reference to, among other things, whether the untrue or
     alleged untrue statement of a material fact or the omission or alleged
     omission to state a material fact relates to information supplied by such
     party, and the party's relative intent, knowledge, access to information
     and opportunity to correct or prevent such statement or omission;
     provided, however, that in no event shall the obligation of any party to
     contribute under this Section 16 exceed the amount that such party would
     have been obligated to pay by way of indemnification if the
     indemnification provided for under Sections 14 and 15 of this Agreement
     had not been held to be unavailable; and provided that no person guilty
     of fraudulent misrepresentation (within the meaning of subsection 11(f)
     of the 1933 Act) shall be entitled to contribution from any person who
     was not guilty of such fraudulent misrepresentation.

16.  Survival.  The indemnity and contribution agreements contained in
     Sections 14, 15 and 16 of this Agreement shall remain operative and in
     full force and effect with respect to any sales or other distributions of
     Shares made pursuant to any Filing in connection with any registration,
     qualification or offering regardless of (a) any termination of this
     Agreement, (b) any investigation made by or on behalf of any Indemnified
     Party or by or on behalf of the Corporation, and (c) the consummation of
     the sale or successive resale of the Shares.

17.
18.
19.

OTHER EXEMPTIONS; FILING REPORTS

20.  Rule 144A; Rule 144; Other Exemptions.  For so long as any Holder holds
     Registrable Shares, the Corporation agrees that it shall take such action
     as any Holder may reasonably request (including, but not limited to,
     providing promptly any information required under Rules 144 and 144A under
     the 1933 Act, including without limitation, providing promptly to any such
     Holder and any prospective purchaser of such Registrable Shares, the
     information required by Rule 144(c) or Rule 144A(d)(4) under the 1933
     Act), all to the extent required from time to time to enable such Holders
     to sell such Registrable





<PAGE>   13

                                     - 13 -




     Shares without registration under the 1933 Act within the limitation of
     the exemptions provided by (i) Rule 144 or Rule 144A (if available with
     respect to resales of such Registrable Shares) under the 1933 Act, as
     such rules may be amended from time to time, or (ii) any other rules or
     regulations now existing or hereafter adopted by the SEC; provided,
     however, that the Corporation's obligations under this Section 18 shall
     terminate at such time as all Shares held by the Holders may be sold
     pursuant to Rule 144(k) without regard to the requirements of Rule
     144(c).

21.  Reporting Obligations.  The Corporation agrees that it shall file in a
     timely manner any reports required to be filed by it under applicable
     Canadian or U.S. securities laws in connection with any registered
     securities or previous public distributions of its securities.

REPRESENTATION OF THE CORPORATION

22.  Existing Demand Rights.  The Corporation hereby represents and warrants
     to the Holders that except for the Demand Rights granted in this
     Agreement, no party holds any Demand Rights, whether currently exercisable
     or contingent on the occurrence of any event or on the passage of time,
     with respect to the Corporation.

TERM

23.  Term.  This Agreement, including without limitation the representations,
     warranties and covenants contained hereof, shall become effective on the
     date first set out above and continue in full force and effect and be
     binding upon the Corporation and the Shareholders unaffected by any
     subsequent disposition of the Registrable Shares for a period of three
     years from the earlier of: (a) the date on which the Corporation first
     obtains a final receipt from the OSC for a prospectus qualifying the
     distribution of Shares in Ontario; or (b) the date on which any
     registration statement filed by the Corporation to register Shares in the
     United States is declared effective by the SEC.

GENERAL

24.  Governing Law.  This Agreement shall be governed by and construed in
     accordance with the laws of the Province of Ontario and the federal laws
     of Canada applicable in Ontario.

25.  Assignment.  The rights of each Holder under this Agreement may be
     assigned by such Holder in connection with the transfer of the Shares and
     subject to assumption by the assignee in writing of the corresponding
     obligations hereunder.  Except as expressly otherwise provided in this
     Agreement, none of the parties hereto may assign any rights or benefits
     under this Agreement, including the benefit of any representation,
     warranty or covenant, without the prior written consent of the
     Corporation, in the case of an assignment by a Holder, or of Holders of
     not less than 67% of the Registrable Shares then outstanding, in the case
     of an assignment by the Corporation.

26.  Time.  Time is of the essence in this Agreement.






<PAGE>   14

                                     - 14 -




27.  Notices.  Unless otherwise provided hereof, any notice or other
     communication to a party under this Agreement may be made, given or
     served by hand delivery, by facsimile or by registered mail postage
     prepaid and addressed to the parties at their respective addresses and
     facsimile numbers maintained in the records of the Corporation.  Any
     notice or other communication delivered personally shall be deemed to
     have been given or made at the time of such delivery.  Any written notice
     or other communication delivered by facsimile shall be deemed to have
     been given or made on the first business day following such delivery.
     Any notice or other communication mailed by registered mail shall be
     deemed to have been given or made on the fifth business day following its
     mailing; provided that in the event of a postal strike affecting mail
     delivery, any notice by mail shall be deemed to have been given when
     actually received.  Each party may change its address for service at any
     time by providing notice in writing of such change to each other party in
     accordance herewith.

28.  Entire Agreement.  This Agreement constitutes the entire agreement
     between the parties and supersedes all previous negotiations,
     communications, agreements or understandings between the parties in any
     way relating to the subject matter of this Agreement.

29.  Further Assurances.  Each party hereto will execute, deliver and
     undertake such other documents, transfers, deeds, assurances and
     procedures as are in the opinion of counsel for the Corporation necessary
     for the purpose of giving effect to or completing the transactions
     contemplated by this Agreement.

30.  Execution in Counterparts and by Facsimile.  This Agreement may be
     executed in counterparts (which may be delivered by facsimile), each of
     which shall be deemed to be an original and all of which together shall be
     deemed to form one and the same document.

31.  No Waiver - No failure or delay on the part of any party in exercising
     any right, power or remedy provided under this Agreement shall operate as
     a waiver thereof except as expressly otherwise provided in this Agreement;
     nor shall any single or partial exercise of any such right, power or
     remedy preclude any other or further exercise thereof or the exercise of
     any other right, power or remedy provided under this Agreement.

     IN WITNESS WHEREOF the parties hereto have executed this Agreement on the
date first written above.


                                        ________________________________________
                                        BAHMAN KOOHESTANI


                                        ________________________________________
                                        ANTHONY DAVIS





<PAGE>   15

                                     - 15 -





                                        ________________________________________
                                        ROBERT GAYLE


                                        ________________________________________
                                        JOHN MAH


                                        ________________________________________
                                        SEAN MAURIK


                                        ________________________________________
                                        JOHN FORESI


                                        ________________________________________
                                        RON SCHREIBER


                                        ________________________________________
                                        JORDAN LEVY


                                       DELANO TECHNOLOGY CORPORATION

                                        By:  ___________________________________
                                             Name:
                                             Title:


                                        XDL DELANO HOLDINGS INC.

                                        By:  ___________________________________
                                             Name:
                                             Title:


                                        TOFINO VENTURE CAPITAL INC.

                                        By:  ___________________________________
                                             Name:
                                             Title:

     The undersigned hereby execute a counterpart to this Agreement as of
     February 1, 1999 to become parties as Additional Shareholders, as
     contemplated by this Agreement.


                                        BLUE SKY CAPITAL CORPORATION

                                        By:  ___________________________________
                                             Name:
                                             Title:


                                        ________________________________________
                                        TODD FINCH