LOAN AGREEMENT
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<S>               <C>           <C>            <C>            <C>             <C>          <C>
 PRINCIPAL    LOAN DATE   MATURITY   LOAN NO.   CALL  COLLATERAL  ACCOUNT      OFFICER  INITIALS
$2,500,000.00 09-30-1999 07-31-2000 1101700001 RE-NEW            LINE OF CRED  HPP
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REFERENCES  IN THE SHADED  AREA ARE FOR  LENDER'S  USE ONLY AND DO NOT LIMIT THE
APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN OR ITEM.
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BORROWER:ION Networks, Inc.(TIN: 22-2413505)  LENDER: UNITED NATIONAL BANK
         21 Meridian Road                             1130 ROUTE 22 EAST
         Edison, NJ 08820                             PO BOX 6000
                                                      BRIDGEWATER, NJ 08807-0010



THIS LOAN AGREEMENT between ION Networks,  Inc. ("Borrower") and UNITED NATIONAL
BANK  ("Lender")  is made and executed on the  following  terms and  conditions.
Borrower  has  received  prior  commercial  loans from  Lender or has applied to
Lender  for a  commercial  loan or loans  and  other  financial  accommodations,
including  those which may be described  on any exhibit or schedule  attached to
this Agreement. All such loans and financial  accommodations,  together with all
future loans and financial  accommodations from Lender to Borrower, are referred
to in this Agreement individually as the "Loan" and collectively as the "Loans."
Borrower  understands and agrees that: (a) in granting,  renewing,  or extending
any Loan,  Lender is relying upon Borrower's  representations,  warranties,  and
agreements,  as set forth in this  Agreement;  (b) the  granting,  renewing,  or
extending  of any Loan by Lender at all times shall be subject to Lender's  sole
judgment  and  discretion;  and (c) all such  Loans  shall be and  shall  remain
subject to the following terms and conditions of this Agreement.

TERM.  This  Agreement  shall be effective as of September  30, 1999,  and shall
continue  thereafter  until all  indebtedness  of  Borrower  to Lender  has been
performed in full and the parties terminate this Agreement in writing.

DEFINITIONS.  The following words shall have the following meanings when used in
this  Agreement.  Terms not otherwise  defined in this Agreement  shall have the
meanings attributed to such terms in the Uniform Commercial Code. All references
to dollar  amounts  shall mean amounts in lawful  money of the United  States of
America.

         Agreement. The word "Agreement" means this Loan Agreement, as this Loan
         Agreement may be amended or modified  from time to time,  together with
         all exhibits and schedules attached to this Loan Agreement from time to
         time.

         Account. The word "Account" means a trade account,  account receivable,
         or other right to payment for goods sold or services  rendered owing to
         Borrower (or to a third party grantor acceptable to Lender).

         Account  Debtor.  The words "Account  Debtor" mean the person or entity
         obligated upon an Account.

         Advance.  The word "Advance"  means a disbursement  of Loan funds under
         this Agreement.

         Borrower.  The  word  "Borrower"  means  ION  Networks,  Inc.  The word
         "Borrower"  also  includes,   as  applicable,   all   subsidiaries  and
         affiliates  of  Borrower  as  provided  below in the  paragraph  titled
         "Subsidiaries" and Affiliates."

         Borrowing  Base.  The words  "Borrowing  Base" mean,  as  determined by
         Lender  from  time to time,  the  lesser of (a)  $2,500,000.00;  or (b)
         75.000% of the aggregate amount of Eligible Accounts.

         Business Day. The words  "Business Day" mean a day on which  commercial
         banks are open for business in the State of New Jersey.

         CERCLA.  The  word  "CERCLA"  means  the  Comprehensive   Environmental
         Response, Compensation, and Liability Act of 1980, as amended.

         Cash Flow.  The words  "Cash  Flow" mean net income  after  taxes,  and
         exclusive of  extraordinary  gains and income,  plus  depreciation  and
         amortization.

         Collateral. The word "Collateral" means and includes without limitation
         all  property  and assets  granted as  collateral  security for a Loan,
         whether  real  or  personal  property,   whether  granted  directly  or
         indirectly,  whether granted now or in the future,  and whether granted
         in  the  form  of  a  security  interest,   mortgage,  deed  of  trust,
         assignment,  pledge,  chattel mortgage,  chattel trust,  factor's lien,
         equipment trust, conditional sale, trust receipt, lien, charge, lien or
         title retention contract,  lease or consignment  intended as a security
         device,  or any other  security or lien  interest  whatsoever,  whether
         created by law, contract, or otherwise.  The word "Collateral" includes
         without limitation all collateral described below in the section titled
         "COLLATERAL."

         Debt.  The word "Debt" means all of  Borrower's  liabilities  excluding
         Subordinated Debt.

         Eligible Accounts. The words "Eligible Accounts" mean, at any time, all
         of  Borrower's  Accounts  which contain  selling  terms and  conditions
         acceptable to Lender.  The net amount of any Eligible  Account  against
         which  Borrower  may  borrow  shall  exclude  all  returns,  discounts,
         credits,  and  offsets of any  nature.  Unless  otherwise  agreed to by
         Lender in writing, Eligible Accounts do not include:

                  (a)    Accounts with respect to which the Account Debtor Is an
                         officer, an employee or agent of Borrower.

                  (b)    Accounts with respect to which the Account  Debtor is a
                         subsidiary  of,  or  affiliated   with  or  related  to
                         Borrower or its shareholders, officers, or directors.

                  (c)    Accounts  with  respect  to which  goods are  placed on
                         consignment,  guaranteed sale, or other terms by reason
                         of which  the  payment  by the  Account  Debtor  may be
                         conditional.

                  (d)    Accounts  with  respect  to  which  Borrower  is or may
                         become  liable to the Account  Debtor for goods sold or
                         services rendered by the Account Debtor to Borrower.

                  (e)    Accounts which are subject to dispute,  counterclaim,
                         or setoff.

                  (f)    Accounts  with respect to which the goods have not been
                         shipped or  delivered,  or the  services  have not been
                         rendered, to the Account Debtor.

                  (g)    Accounts  with  respect  to which  Lender,  in its sole
                         discretion,  deems the  creditworthiness  or  financial
                         condition of the Account Debtor to be unsatisfactory.

                  (h)    Accounts of any Account Debtor who has filed or has had
                         filed  against  it  a  petition  in  bankruptcy  or  an
                         application for relief under any provision of any state
                         or federal bankruptcy,  insolvency, or debtor-in-relief
                         acts; or who has had appointed a trustee, custodian, or
                         receiver for the assets of such Account Debtor;  or who
                         has made an
<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 2
Loan No. 1101700001                  (Continued)


                         assignment for the benefit of creditors or has become
                         insolvent  or  fails   generally  to  pay  its  debts
                         (including its payrolls) as such debts become due.

                  (i)    Accounts with respect to which the Account  Debtor is
                         the United  States  government  or any  department or
                         agency of the United States.

                  (j)    Accounts  which  have  not been  paid in full  within
                         Under Ninety (90) days from the invoice date.

         ERISA. The word "ERISA" means the Employee  Retirement  Income Security
         Act of 1974, as amended.

         Event of Default. The words "Event of Default" mean and include without
         limitation  any of the Events of Default set forth below in the section
         titled "EVENTS OF DEFAULT."

         Expiration  Date.  The  words   "Expiration  Date"  mean  the  date  of
         termination of Lender's commitment to lend under this Agreement.

         Grantor.  The word "Grantor" means and includes without limitation each
         and all of the persons or entities  granting a Security Interest in any
         Collateral  for the  indebtedness,  including  without  limitation  all
         Borrowers granting such a Security Interest.

         Guarantor.  The word "Guarantor" means and includes without  limitation
         each and all of the guarantors,  sureties, and accommodation parties in
         connection with any indebtedness.

         Indebtedness.  The  word  "indebtedness"  means  and  includes  without
         limitation all Loans,  together with all other  obligations,  debts and
         liabilities of Borrower to Lender,  or any one or more of them, as well
         as all claims by Lender against  Borrower,  or any one or more of them;
         whether now or hereafter existing, voluntary or involuntary, due or not
         due,  absolute  or  contingent,  liquidated  or  unliquidated;  whether
         Borrower may be liable  individually  or jointly  with others;  whether
         Borrower may be obligated as a guarantor, surety, or otherwise; whether
         recovery upon such  indebtedness  may be or hereafter may become barred
         by any statute of limitations;  and whether such indebtedness may be or
         hereafter may become otherwise unenforceable.

         Lender.  The word "Lender"  means UNITED  NATIONAL BANK, its successors
         and assigns.

         Line of Credit.  The words  "Line of Credit"  mean the credit  facility
         described in the Section entitled "LINE OF CREDIT" below.

         Liquid Assets.  The words "Liquid  Assets" mean Borrower's cash on hand
         plus Borrower's readily marketable securities.

         Loan. The word "Loan" or "Loans" means and includes without  limitation
         any and all commercial loans and financial  accommodations  from Lender
         to Borrower,  whether now or hereafter existing, and however evidenced,
         including without  limitation those loans and financial  accommodations
         described  herein or described  on any exhibit or schedule  attached to
         this Agreement from time to time.

         Note. The word "Note" means and includes without limitation  Borrower's
         promissory   note  or  notes,  if  any,   evidencing   Borrower's  Loan
         obligations in favor of Lender, as well as any substitute,  replacement
         or refinancing note or notes therefor.

         Permitted  Liens.  The  words  "Permitted  Liens"  mean:  (a) liens and
         security  interests  securing  indebtedness owed by Borrower to Lender;
         (b) liens for taxes, assessments, or similar charges either not yet due
         or being contested in good faith; (c) liens of materialmen,  mechanics,
         warehousemen,  or carriers, or other like liens arising in the ordinary
         course  of  business  and  securing   obligations  which  are  not  yet
         delinquent;  (d)  purchase  money  liens  or  purchase  money  security
         interests  upon or in any property  acquired or held by Borrower in the
         ordinary course of business to secure  indebtedness  outstanding on the
         date of this  Agreement or permitted to be incurred under the paragraph
         of this  Agreement  titled  "Indebtedness  and  Liens";  (e)  liens and
         security  interests which, as of the date of this Agreement,  have been
         disclosed to and approved by the Lender in writing; and (f) those liens
         and security interests which in the aggregate  constitute an immaterial
         and  insignificant  monetary  amount  with  respect to the net value of
         Borrower's assets.

         Related  Documents.  The words  "Related  Documents"  mean and  include
         without  limitation  all  promissory  notes,  credit  agreements,  loan
         agreements,  environmental agreements, guaranties, security agreements,
         mortgages,  deeds of trust, and all other  instruments,  agreements and
         documents,  whether now or hereafter  existing,  executed in connection
         with the indebtedness.

         Security  Agreement.  The words  "Security  Agreement" mean and include
         without limitation any agreements,  promises, covenants,  arrangements,
         understandings or other agreements,  whether created by law,  contract,
         or  otherwise,  evidencing,  governing,  representing,  or  creating  a
         Security Interest.

         Security  Interest.  The words  "Security  Interest"  mean and  include
         without limitation any type of collateral security, whether in the form
         of a lien, charge, mortgage, deed of trust, assignment, pledge, chattel
         mortgage,  chattel trust,  factor's lien, equipment trust,  conditional
         sale,  trust  receipt,  lien or  title  retention  contract,  lease  or
         consignment  intended as a security  device,  or any other  security or
         lien  interest  whatsoever,   whether  created  by  law,  contract,  or
         otherwise.

         SARA.   The  word   "SARA"   means   the   Superfund   Amendments   and
         Reauthorization Act of 1986 as now or hereafter amended.

         Subordinated Debt. The words  "Subordinated Debt" mean indebtedness and
         liabilities  of  Borrower  which  have  been  subordinated  by  written
         agreement  to  indebtedness  owed by  Borrower  to  Lender  in form and
         substance acceptable to Lender.

         Tangible  Net Worth.  The words  "Tangible  Net Worth" mean  Borrower's
         total  assets  excluding  all  intangible   assets  (i.  e.,  goodwill,
         trademarks,  patents, copyrights,  organizational expenses, and similar
         intangible items, but including leaseholds and leasehold  improvements)
         less total Debt.

         Working Capital.  The words "Working  Capital" mean Borrower's  current
         assets,   excluding   prepaid   expenses,   less   Borrower's   current
         liabilities.

LINE OF CREDIT.  Lender  agrees to make  Advances to Borrower  from time to time
from the date of this Agreement to the Expiration  Date,  provided the aggregate
amount of such  Advances  outstanding  at any time does not exceed the Borrowing
Base.  Within the  foregoing  limits,  Borrower may borrow,  partially or wholly
prepay, and reborrow under this Agreement as follows.

         Conditions  Precedent to Each Advance.  Lender's obligation to make any
         Advance to or for the  account of  Borrower  under  this  Agreement  is
         subject to the  following  conditions  precedent,  with all  documents,
         instruments,  opinions,  reports,  and other items  required under this
         Agreement to be in form and substance satisfactory to Lender:

                  (a)    Lender shall have received evidence that this Agreement
                         and all Related  Documents  have been duly  authorized,
                         executed, and delivered by Borrower to Lender.

                  (b)    Lender shall have  received  such  opinions of counsel,
                         supplemental  opinions,  and  documents  as Lender  may
                         request.
<PAGE>
09-30-1999                         LOAN AGREEMENT                        PAGE 3
Loan No. 1101700001                  (Continued)


                  (c)    The  security  interests in the  Collateral  shall have
                         been duly authorized, created, and perfected with first
                         lien priority and shall be in full force and effect.

                  (d)    All  guaranties  required  by  Lender  for the  Line of
                         Credit  shall  have been  executed  by each  Guarantor,
                         delivered to Lender, and be in full force and effect.

                  (e)    Lender,  at its option and for its sole benefit,  shall
                         have conducted an audit at Borrower's Accounts,  books,
                         records, and operations,  and Lender shall be satisfied
                         as to their condition.

                  (f)    Borrower shall have paid to Lender all fees, costs, and
                         expenses  specified in this  Agreement  and the Related
                         Documents as are then due and payable;

                  (g)    There  shall  not  exist at the time of any  Advance  a
                         condition  which would  constitute  an Event of Default
                         under this Agreement, and Borrower shall have delivered
                         to Lender the compliance  certificate called for in the
                         paragraph below titled "Compliance Certificate."

         Making  Loan  Advances.  Advances  under  the  Line  of  Credit  may be
         requested  orally subject to the  limitations  set forth below.  Lender
         may,  but need not,  require  that all oral  requests be  confirmed  in
         writing. Each Advance shall be conclusively deemed to have been made at
         the request of and for the benefit of Borrower (a) when credited to any
         deposit account of Borrower maintained with Lender or (b) when advanced
         in accordance with the instructions of an authorized person. Lender, at
         its  option,  may set a cut-off  time,  after  which all  requests  for
         Advances  will  be  treated  as  having  been  requested  on  the  next
         succeeding  Business  Day.  Under  no  circumstances  shall  Lender  be
         required to make any Advance in an amount less than $1,000.00.

         Mandatory  Loan  Repayments.  If at any  time the  aggregate  principal
         amount  of  the  outstanding   Advances  shall  exceed  the  applicable
         Borrowing Base, Borrower,  immediately upon written or oral notice from
         Lender,  shall pay to Lender an amount equal to the difference  between
         the  outstanding  principal  balance of the Advances and the  Borrowing
         Base. On the Expiration Date,  Borrower shall pay to Lender in full the
         aggregate  unpaid principal amount of all Advances then outstanding and
         all accrued unpaid  interest,  together with all other applicable fees,
         costs and charges, if any, not yet paid.

         Loan Account. Lender shall maintain on its books a record of account in
         which  Lender shall make entries for each Advance and such other debits
         and  credits  as shall be  appropriate  in  connection  with the credit
         facility.  Lender shall provide  Borrower  with periodic  statements of
         Borrower's account,  which statements shall be considered to be correct
         and conclusively binding on Borrower unless Borrower notifies Lender to
         the contrary  within thirty (30) days after  Borrower's  receipt of any
         such statement which Borrower deems to be incorrect.

COLLATERAL. To secure payment of the Line of Credit and performance of all other
Loans,  obligations and duties owed by Borrower to Lender, Borrower (and others,
if  required)  shall grant to Lender  Security  Interests  in such  property and
assets as Lender may require (the  "Collateral"),  including without  limitation
Borrower's  present  and  future  Accounts  and  general  intangibles.  Lender's
Security Interests in the Collateral shall be continuing liens and shall include
the proceeds and products of the Collateral,  including  without  limitation the
proceeds of any insurance.  With respect to the Collateral,  Borrower agrees and
represents and warrants to Lender:

         Perfection  of  Security  Interests.  Borrower  agrees to execute  such
         financing  statements  and to take whatever other actions are requested
         by Lender to perfect and continue  Lender's  Security  Interests in the
         Collateral. Upon request of Lender, Borrower will deliver to Lender any
         and all of the documents evidencing or constituting the Collateral, and
         Borrower will note Lender's  interest upon any and all chattel paper if
         not delivered to Lender for possession by Lender.  Contemporaneous with
         the execution of this Agreement,  Borrower will execute one or more UCC
         financing  statements and any similar  statements as may be required by
         applicable  law, and will file such  financing  statements and all such
         similar statements in the appropriate  location or locations.  Borrower
         hereby  appoints  Lender as its  irrevocable  attorney-in-fact  for the
         purpose of executing any documents  necessary to perfect or to continue
         any  Security  Interest.  Lender may at any time,  and without  further
         authorization from Borrower, file a carbon,  photograph,  facsimile, or
         other  reproduction  of any financing  statement for use as a financing
         statement.  Borrower  will  reimburse  Lender for all  expenses for the
         perfection,  termination,  and the  continuation  of the  perfection of
         Lender's  security  interest in the Collateral.  Borrower promptly will
         notify Lender of any change in Borrower's  name including any change to
         the assumed  business  names of Borrower.  Borrower  also promptly will
         notify Lender of any change in  Borrower's  Social  Security  Number or
         Employer  Identification  Number.  Borrower  further  agrees  to notify
         Lender  in  writing  prior to any  change in  address  or  location  of
         Borrower's  principal  governance  office or should  Borrower  merge or
         consolidate with any other entity.

         Collateral  Records.  Borrower  does now,  and at all  times  hereafter
         shall,  keep correct and  accurate  records of the  Collateral,  all of
         which records  shall be available to Lender or Lender's  representative
         upon demand for  inspection and copying at any  reasonable  time.  With
         respect to the  Accounts,  Borrower  agrees to keep and  maintain  such
         records as Lender may require, including without limitation information
         concerning  Eligible  Accounts  and Account  balances  and agings.  The
         following is an accurate and  complete  list of all  locations at which
         Borrower  keeps or maintains  business  records  concerning  Borrower's
         Accounts: 21 Meridian Road, Edison, Middlesex County, New Jersey.

         Collateral  Schedules.  Concurrently with the execution and delivery of
         this Agreement, Borrower shall execute and deliver to Lender a schedule
         of Accounts and Eligible Accounts,  in form and substance  satisfactory
         to the Lender.  Thereafter Borrower shall execute and deliver to Lender
         such supplemental schedules of Eligible Accounts and such other matters
         and information  relating to Borrower's Accounts as Lender may request.
         Supplemental  schedules  shall be delivered  according to the following
         schedule:  to Lender, as soon as available,  but in no event later than
         ten (10) days after the end of the month.

         Representations and Warranties Concerning Accounts. With respect to the
         Accounts,  Borrower represents and warrants to Lender: (a) Each Account
         represented by Borrower to be an Eligible  Account for purposes of this
         Agreement conforms to the requirements of the definition of an Eligible
         Account;  (b) All Account  information listed on schedules delivered to
         Lender will be true and correct,  subject to immaterial  variance;  and
         (c) Lender, its assigns, or agents shall have the right at any time and
         at Borrower's expense to inspect, examine, and audit Borrower's records
         and to confirm with Account Debtors the accuracy of such Accounts.

REPRESENTATIONS  AND WARRANTIES.  Borrower represents and warrants to Lender, as
of the  date of this  Agreement,  as of the  date of each  disbursement  of Loan
proceeds, as of the date of any renewal,  extension or modification of any Loan,
and at all times any indebtedness exists:

         Organization.  Borrower  is a  corporation  which  is  duly  organized,
         validly  existing,  and in good standing under the laws of the State of
         New Jersey and is validly  existing and in good  standing in all states
         in which  Borrower is doing  business.  Borrower has the full power and
         authority to own its properties and to transact the businesses in which
         it is presently engaged or presently proposes to engage.  Borrower also
         is duly qualified as a foreign  corporation  and is in good standing in
         all states in which the  failure  to so  qualify  would have a material
         adverse effect on its businesses or financial condition.

         Authorization.   The  execution,  delivery,  and  performance  of  this
         Agreement  and all Related  Documents by Borrower,  to the extent to be
         executed, delivered or performed by Borrower, have been duly authorized
         by all  necessary  action by  Borrower;  do not  require the consent or
         approval of any other  person,  regulatory  authority  or  governmental
         body; and do not conflict with, result in a

<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 4
Loan No. 1101700001                  (Continued)


         violation  of, or  constitute a default  under (a) any provision of its
         articles of incorporation or organization,  or bylaws, or any agreement
         or other instrument binding upon Borrower or (b) any law,  governmental
         regulation, court decree, or order applicable to Borrower.

         Financial Information. Each financial statement of Borrower supplied to
         Lender truly and completely disclosed Borrower's financial condition as
         of the date of the  statement,  and there has been no material  adverse
         change in Borrower's  financial condition subsequent to the date of the
         most recent  financial  statement  supplied to Lender.  Borrower has no
         material  contingent  obligations except as disclosed in such financial
         statements.

         Legal  Effect.  This  Agreement  constitutes,  and  any  instrument  or
         agreement  required  hereunder to be given by Borrower  when  delivered
         will  constitute  legal,  valid and  binding  obligations  of  Borrower
         enforceable against Borrower in accordance with their respective terms.

         Properties.  Except for  Permitted  Liens,  Borrower  owns and has good
         title to all of  Borrower's  properties  free and clear of all Security
         Interests,  and has not executed  any  security  documents or financing
         statements  relating to such properties.  All of Borrower's  properties
         are titled in  Borrower's  legal name,  and Borrower  has not used,  or
         filed a financing statement under, any other name for at least the last
         five (5) years.

         Hazardous   Substances.   The  terms  "hazardous   waste,"   "hazardous
         substance," "disposal," "release," and "threatened release," as used in
         this  Agreement,  shall  have the  same  meanings  as set  forth in the
         "CERCLA,"  "SARA," the  Hazardous  Materials  Transportation  Act,  49,
         U.S.C.  Section 1801, et seq., the Resource  Conservation  and Recovery
         Act. 42 U.S.C.  Section 6901, et seq., the New Jersey  Industrial  Site
         Recovery  Act,  NJSA  Section 13: 1K-6  ("ISRA"),  the New Jersey Spill
         Compensation  and Control Act,  NJSA 58:  10-23.11,  et seq.,  or other
         applicable  state  or  Federal  laws,  rules,  or  regulations  adopted
         pursuant  to  any  of  the  foregoing.   Except  as  disclosed  to  and
         acknowledged  by Lender in writing,  Borrower  represents  and warrants
         that: (a) During the period of Borrower's  ownership of the properties,
         there has been no use,  generation,  manufacture,  storage,  treatment,
         disposal,  release  or  threatened  release of any  hazardous  waste or
         substance by any person on, under, about or from any of the properties.
         (b) Borrower  has no knowledge  of, or reason to believe that there has
         been  (i)  any  use,  generation,   manufacture,   storage,  treatment,
         disposal,  release,  or threatened  release of any  hazardous  waste or
         substance on, under,  about or from the  properties by any prior owners
         or occupants of any of the properties, or (ii) any actual or threatened
         litigation  or  claims  of any  kind  by any  person  relating  to such
         matters.  (c) Neither  Borrower  nor any tenant,  contractor,  agent or
         other  authorized  user of any of the properties  shall use,  generate,
         manufacture,  store, treat,  dispose of, or release any hazardous waste
         or substance on, under,  about or from any of the  properties;  and any
         such  activity  shall be conducted in  compliance  with all  applicable
         federal, state, and local laws, regulations, and ordinances,  including
         without  limitation  those laws,  regulations and ordinances  described
         above.  Borrower  authorizes  Lender  and its  agents to enter upon the
         properties  to make  such  inspections  and  tests as  Lender  may deem
         appropriate to determine compliance of the properties with this section
         of the Agreement.  Any  inspections or tests made by Lender shall be at
         Borrower's  expense  and for  Lender's  purposes  only and shall not be
         construed  to create any  responsibility  or  liability  on the part of
         Lender to  Borrower or to any other  person.  The  representations  and
         warranties  contained  herein are based on Borrower's  due diligence in
         investigating   the  properties  for  hazardous   waste  and  hazardous
         substances.  Borrower  hereby (a) releases and waives any future claims
         against  Lender for  indemnity or  contribution  in the event  Borrower
         becomes  liable for cleanup or other costs under any such laws, and (b)
         agrees  to  indemnify  and hold  harmless  Lender  against  any and all
         claims, losses,  liabilities,  damages,  penalties,  and expenses which
         Lender may directly or indirectly  sustain or suffer  resulting  from a
         breach of this section of the Agreement or as a consequence of any use,
         generation,  manufacture,  storage,  disposal,  release  or  threatened
         release  of a  hazardous  waste or  substance  on the  properties.  The
         provisions of this section of the  Agreement,  including the obligation
         to  indemnify,  shall survive the payment of the  indebtedness  and the
         termination  or expiration of this  Agreement and shall not be affected
         by  Lender's  acquisition  of any  interest  in any of the  properties,
         whether by foreclosure or otherwise.

         Litigation   and   Claims.   No   litigation,   claim,   investigation,
         administrative proceeding or similar action (including those for unpaid
         taxes) against  Borrower is pending or  threatened,  and no other event
         has occurred which may materially adversely affect Borrower's financial
         condition  or  properties,  other  than  litigation,  claims,  or other
         events,  if any, that have been disclosed to and acknowledged by Lender
         in writing.

         Taxes. To the best of Borrower's knowledge, all tax returns and reports
         of Borrower that are or were required to be filed, have been filed, and
         all taxes, assessments and other governmental charges have been paid in
         full,  except those  presently  being or to be contested by Borrower in
         good faith in the ordinary  course of business  and for which  adequate
         reserves have been provided.

         Lien  Priority.  Unless  otherwise  previously  disclosed  to Lender in
         writing,  Borrower  has  not  entered  into  or  granted  any  Security
         Agreements,  or  permitted  the filing or  attachment  of any  Security
         Interests on or affecting any of the Collateral  directly or indirectly
         securing  repayment of Borrower's Loan and Note, that would be prior or
         that may in any way be  superior  to Lender's  Security  Interests  and
         rights in and to such Collateral.

         Binding  Effect.  This  Agreement,  the Note,  all Security  Agreements
         directly or indirectly  securing  repayment of Borrower's Loan and Note
         and all of the Related  Documents  are binding upon Borrower as well as
         upon  Borrower's  successors,  representatives  and  assigns,  and  are
         legally enforceable in accordance with their respective terms.

         Commercial  Purposes.  Borrower intends to use the Loan proceeds solely
         for business or commercial related purposes.

         Employee Benefit Plans. Each employee benefit plan as to which Borrower
         may have any  liability  complies  in all  material  respects  with all
         applicable  requirements of law and regulations,  and (i) no Reportable
         Event nor  Prohibited  Transaction  (as defined in ERISA) has  occurred
         with respect to any such plan, (ii) Borrower has not withdrawn from any
         such plan or  initiated  steps to do so, (iii) no steps have been taken
         to terminate any such plan, and (iv) there are no unfunded  liabilities
         other than those previously disclosed to Lender in writing.

         Location  of  Borrower's  Offices  and  Records.  Borrower's  place  of
         business,  or Borrower's Chief executive  office,  if Borrower has more
         than one place of business,  is located at 21 Meridian Road, Edison, NJ
         08820.  Unless  Borrower  has  designated  otherwise  in  writing  this
         location is also the office or offices where Borrower keeps its records
         concerning the Collateral.

         Information.  All information heretofore or contemporaneously  herewith
         furnished  by Borrower to Lender for the  purposes of or in  connection
         with this Agreement or any transaction  contemplated hereby is, and all
         information  hereafter  furnished by or on behalf of Borrower to Lender
         will be, true and accurate in every material  respect on the date as of
         which  such  information  is  dated  or  certified;  and  none  of such
         information  is or will be incomplete by omitting to state any material
         fact necessary to make such information not misleading.

         Survival of Representations  and Warranties.  Borrower  understands and
         agrees that Lender, without independent investigation,  is relying upon
         the above  representations and warranties in extending Loan Advances to
         Borrower.  Borrower  further agrees that the foregoing  representations
         and  warranties  shall be continuing in nature and shall remain in full
         force and effect until such time as  Borrower's  indebtedness  shall be
         paid in full, or until this Agreement shall be terminated in the manner
         provided above, whichever is the last to occur.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower will:

<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 5
Loan No. 1101700001                  (Continued)


         Litigation.  Promptly  inform  Lender in  writing  of (a) all  material
         adverse changes in Borrower's financial condition, and (b) all existing
         and all threatened litigation, claims,  investigations,  administrative
         proceedings  or similar  actions  affecting  Borrower or any  Guarantor
         which could  materially  affect the financial  condition of Borrower or
         the financial condition of any Guarantor.

         Financial  Records.  Maintain its books and records in accordance  with
         generally  accepted  accounting  principles,  applied  on a  consistent
         basis,  and permit  Lender to examine  and audit  Borrower's  books and
         records at all reasonable times.

         Additional   Information.   Furnish  such  additional  information  and
         statements, lists of assets and liabilities,  agings of receivables and
         payables,  inventory schedules,  budgets,  forecasts,  tax returns, and
         other  reports  with  respect to  Borrower's  financial  condition  and
         business operations as Lender may request from time to time.

         Financial Covenants and Ratios. Comply with the following covenants and
         ratios:

         Other Ratio. Maintain a ratio of Maximum Debt to Worth of 0.75 to 1.00.
         Except as provided above, all computations made to determine compliance
         with the  requirements  contained  in this  paragraph  shall be made in
         accordance with generally accepted accounting principles,  applied on a
         consistent basis, and certified by Borrower as being true and correct.

         Insurance.  Maintain fire and other risk  insurance,  public  liability
         insurance,  and such other insurance as Lender may require with respect
         to Borrower's  properties and operations,  in form, amounts,  coverages
         and with insurance companies reasonably acceptable to Lender.

         Borrower,  upon request of Lender,  will deliver to Lender from time to
         time the policies or certificates of insurance in form  satisfactory to
         Lender,  including stipulations that coverages will not be cancelled or
         diminished  without at least ten (10)  days'  prior  written  notice to
         Lender.  Each  insurance  policy  also  shall  include  an  endorsement
         providing  that coverage in favor of Lender will not be impaired in any
         way by any act, omission or default of Borrower or any other person. In
         connection  with all policies  covering assets in which Lender holds or
         is offered a security  interest  for the Loans,  Borrower  will provide
         Lender  with such loss  payable  or other  endorsements  as Lender  may
         require.

         Insurance Reports.  Furnish to Lender, upon request of Lender,  reports
         on each existing  insurance  policy showing such  information as Lender
         may reasonably request, including without limitation the following: (a)
         the name of the insurer;  (b) the risks insured;  (c) the amount of the
         policy;  (d) the  properties  insured;  (e) the then  current  property
         values  on the  basis of which  insurance  has been  obtained,  and the
         manner of determining those values;  and (f) the expiration date of the
         policy.  In addition,  upon  request of Lender  (however not more often
         than   annually),   Borrower   will  have  an   independent   appraiser
         satisfactory to Lender determine, as applicable,  the actual cash value
         or replacement cost of any Collateral. The cost of such appraisal shall
         be paid by Borrower.

         Other  Agreements.  Comply with all terms and  conditions  of all other
         agreements, whether now or hereafter existing, between Borrower and any
         other party and notify Lender  immediately in writing of any default in
         connection with any other such agreements.

         Loan Proceeds.  Use all Loan proceeds  solely for  Borrower's  business
         operations,  unless specifically consented to the contrary by Lender in
         writing.

         Taxes,  Charges  and  Liens.  Pay  and  discharge  when  due all of its
         indebtedness  and  obligations,   including   without   limitation  all
         assessments,  taxes,  governmental charges,  levies and liens, of every
         kind and nature,  imposed upon Borrower or its properties,  income,  or
         profits,  prior to the date on which  penalties  would attach,  and all
         lawful claims that,  if unpaid,  might become a lien or charge upon any
         of  Borrower's  properties,   income,  or  profits.  Provided  however,
         Borrower will not be required to pay and discharge any such assessment,
         tax,  charge,  levy,  lien or claim so long as (a) the  legality of the
         same shall be contested in good faith by appropriate  proceedings,  and
         (b) Borrower shall have established on its books adequate reserves with
         respect to such contested assessment, tax, charge, levy, lien, or claim
         in accordance with generally accepted accounting  practices.  Borrower,
         upon demand of Lender,  will  furnish to Lender  evidence of payment of
         the  assessments,  taxes,  charges,  levies,  liens and claims and will
         authorize the appropriate governmental official to deliver to Lender at
         any  time a  written  statement  of any  assessments,  taxes,  charges,
         levies,  liens and  claims  against  Borrower's  properties,  income or
         profits.

         Performance.  Perform  and  comply  with  all  terms,  conditions,  and
         provisions set forth in this Agreement and in the Related  Documents in
         a timely manner,  and promptly  notify Lender if Borrower learns of the
         occurrence  of any event which  constitutes  an Event of Default  under
         this Agreement or under any of the Related Documents.

         Operations.   Maintain   executive  and   management   personnel   with
         substantially  the same  qualifications  and  experience as the present
         executive and management personnel; provide written notice to Lender of
         any change in executive and management personnel;  conduct its business
         affairs in a reasonable and prudent  manner and in compliance  with all
         applicable  federal,  state and municipal laws,  ordinances,  rules and
         regulations  respecting  its  properties,   charters,   businesses  and
         operations, including without limitation, compliance with the Americans
         With  Disabilities Act and with all minimum funding standards and other
         requirements of ERISA and other laws applicable to Borrower's  employee
         benefit plans.

         Inspection. Permit employees or agents of Lender at any reasonable time
         to inspect any and all  Collateral for the Loan or Loans and Borrower's
         other  properties and to examine or audit Borrower's  books,  accounts,
         and records  and to make  copies and  memoranda  of  Borrower's  books,
         accounts,  and  records.  If  Borrower  now  or at any  time  hereafter
         maintains any records (including without limitation  computer generated
         records and  computer  software  programs  for the  generation  of such
         records in the possession of a third party,  Borrower,  upon request of
         Lender,  shall  notify such party to permit  Lender free access to such
         records at all  reasonable  times and to provide  Lender with copies of
         any records it may request, all at Borrower's expense.

         Compliance  Certificate.  Unless  waived in writing by Lender,  provide
         Lender at least annually and at the time of each  disbursement  of Loan
         proceeds with a  certificate  executed by  Borrower's  chief  financial
         officer,  or other officer or person  acceptable to Lender,  certifying
         that the representations and warranties set forth in this Agreement are
         true  and  correct  as of the  date  of  the  certificate  and  further
         certifying that, as of the date of the certificate, no Event of Default
         exists under this Agreement.

         Environmental  Compliance  and  Reports.  Borrower  shall comply in all
         respects with all  environmental  protection  federal,  state and local
         laws,  statutes,  regulations  and  ordinances;  not cause or permit to
         exist,  as a  result  of an  intentional  or  unintentional  action  or
         omission  on its part or on the part of any third  party,  on  property
         owned and/or  occupied by Borrower,  any  environmental  activity where
         damage  may  result  to  the  environment,  unless  such  environmental
         activity is  pursuant to and in  compliance  with the  conditions  of a
         permit issued by the appropriate  federal,  state or local governmental
         authorities;  shall furnish to Lender  promptly and in any event within
         thirty (30) days after receipt  thereof a copy of any notice,  summons,
         lien,  citation,  directive,  letter  or other  communication  from any
         governmental  agency or  instrumentality  concerning any intentional or
         unintentional  action or omission on Borrower's part in connection with
         any  environmental  activity  whether  or not  there is  damage  to the
         environment and/or other natural resources.

         Additional  Assurances.  Make,  execute  and  deliver  to  Lender  such
         promissory  notes,  mortgages,  deeds of  trust,  security  agreements,
         financing  statements,  instruments,  documents and other agreements as

<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 6
Loan No. 1101700001                  (Continued)

         Lender or its attorneys may  reasonably  request to evidence and secure
         the Loans and to perfect all Security Interests.

         NEGATIVE  COVENANTS.  Borrower  covenants  and agrees  with Lender that
         while this  Agreement  is in effect,  Borrower  shall not,  without the
         prior written consent of Lender:

         Indebtedness  and Liens.  (a) Except  for trade  debt  incurred  in the
         normal course of business and  indebtedness  to Lender  contemplated by
         this  Agreement,  create,  incur or assume  indebtedness  for  borrowed
         money,  including capital leases,  (b) except as allowed as a Permitted
         Lien, sell, transfer, mortgage, assign, pledge, lease, grant a security
         interest in, or encumber  any of  Borrower's  assets,  or (c) sell with
         recourse any of Borrower's accounts, except to Lender.

         Continuity  of  Operations.  (a)  Engage  in  any  business  activities
         substantially  different  than  those in which  Borrower  is  presently
         engaged, (b) cease operations,  liquidate,  merge, transfer, acquire or
         consolidate with any other entity,  change ownership,  change its name,
         dissolve or transfer or sell  Collateral out of the ordinary  course of
         business,  (c)  pay any  dividends  on  Borrower's  stock  (other  than
         dividends payable in its stock), provided, however that notwithstanding
         the foregoing, but only so long as no Event of Default has occurred and
         is  continuing  or would  result  from the  payment  of  dividends,  if
         Borrower is a  "Subchapter S  Corporation"  (as defined in the Internal
         Revenue Code of 1986, as amended),  Borrower may pay cash  dividends on
         its stock to its shareholders from time to time in amounts necessary to
         enable the  shareholders to pay income taxes and make estimated  income
         tax payments to satisfy their  liabilities  under federal and state law
         which arise solely from their status as  Shareholders of a Subchapter S
         Corporation  because of their ownership of shares of stock of Borrower,
         or (d) purchase or retire any of Borrower's outstanding shares or alter
         or amend Borrower's capital structure.

         Loans,  Acquisitions  and  Guaranties.  (a) Loan,  invest in or advance
         money or assets,  (b)  purchase,  create or acquire any interest in any
         other  enterprise or entity,  or (c) incur any  obligation as surety or
         guarantor other than in the ordinary course of business.

CESSATION OF  ADVANCES.  If Lender has made any  commitment  to make any Loan to
Borrower,  whether  under this  Agreement or under any other  agreement,  Lender
shall have no  obligation to make Loan Advances or to disburse Loan proceeds if:
(a) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the  Related  Documents  or any  other  agreement  that  Borrower  or any
Guarantor  has with Lender;  (b) Borrower or any  Guarantor  becomes  insolvent,
files a  petition  in  bankruptcy  or  similar  proceedings,  or is  adjudged  a
bankrupt;  (c) there occurs a material  adverse  change in Borrower's  financial
condition,  in the financial condition of any Guarantor,  or in the value of any
Collateral  securing any Loan; or (d) any Guarantor  seeks,  claims or otherwise
attempts to limit, modify or revoke such Guarantor's guaranty of the Loan or any
other loan with Lender.

ANNUAL RENEWAL.  Notwithstanding the foregoing,  the unpaid principal balance of
the Note shall be due and  payable,  if not called  earlier,  together  with all
accrued and unpaid interest, fees and charges from the date of this Note to July
31, 2000. The Lender will have the option to renew the Line of Credit created by
this Note and may terminate it at it's absolute discretion by giving thirty (30)
days written  notice to the Borrower at any time.  Should the Bank choose not to
renew the facility,  the Borrower(s)  shall pay the Bank the entire  outstanding
principal balance together with all accrued and unpaid interest, thereon and all
other unpaid fee, charges, and expenses.

BORROWER'S FINANCIAL STATEMENTS. Borrower covenants and agrees with Lender that,
while this  Agreement is in affect,  Borrower shall furnish Lender with, as soon
as available,  but in no event later than ninety (90) days after the end of each
fiscal year,  Borrower's  balance sheet and income statement for the year ended,
audited by a certified  public  account  satisfactory  to Lender.  All financial
reports  required  to be  provided  under this  Agreement  shall be  prepared in
accordance  with  generally  accepted  accounting   principles,   applied  on  a
consistant basis, and certified by Borrower(s) as being true and correct.

INTERIM  FINANCIAL  STATEMENTS.  Borrower  shall furnish Lender with, as soon as
available,  but in no event  later  than  sixty  (60) days after the end of each
fiscal  quarter,  Profit and Loss  Statements and Account  Receivables  list and
aging report. All financial reports required to be provided under this Agreement
shall be supplied by Borrower,  prepared on a consistant  basis and certified by
Borrower as being true and correct.

AUTOMATIC  PAYMENTS.  Borrower hereby authorizes Lender  automatically to deduct
from Borrower's  account numbered  400-335-9 the amount of any loan payment.  If
the funds are  insufficient to cover any payment,  Lender shall not be obligated
to advance funds to cover the payment. At any time and for any reason,  Borrower
or Lender may voluntarily terminate Automatic Payments.

BORROWING  BASE  REQUIREMENTS.  Borrower  covenants  and agrees with Lender that
while this Agreement is in affect: I) Maximum  borrowings shall be the lesser of
a) $2,000,000.00;  or b) 75.000% of agregate amount of "Eligible  Accounts." II)
Eligible  Accounts shall be Accounts  Receivable that are under ninety (90) days
evidenced  by  monthly  Borrowing  Base   Certificate.   III)  Monthly  Accounts
Receivable aging reports are to submitted to Lender,  as soon as available,  but
in no case later than ten (10) day after the end of each month.  IV) Lender will
reserve the right to conduct an audit of Accounts Receivable, twice annually, at
the  Borrower's  expense  or at any time and  frequency  should a  condition  of
default exist.

RIGHT OF SETOFF.  Borrower grants to Lender a contractual  security interest in,
and hereby  assigns,  conveys,  delivers,  pledges,  and transfers to Lender all
Borrower's right, title and interest in and to, Borrower's  accounts with Lender
(whether checking, savings, or some other account), including without limitation
all accounts  held jointly with someone else and all accounts  Borrower may open
in the  future,  excluding  however  all IRA and Keogh  accounts,  and all trust
accounts for which the grant of a security  interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to charge
or setoff all sums owing on the indebtedness against any and all such accounts.

EVENTS OF DEFAULT.  Each of the following  shall  constitute an Event of Default
under this Agreement:

         Default on  Indebtedness.  Failure of Borrower to make any payment when
         due on the Loans.

         Other Defaults. Failure of Borrower or any Grantor to comply with or to
         perform  when due any other term,  obligation,  covenant  or  condition
         contained  in this  Agreement  or in any of the Related  Documents,  or
         failure  of  Borrower  to comply  with or to  perform  any other  term,
         obligation,  covenant or  condition  contained  in any other  agreement
         between Lender and Borrower.

         Default  In Favor of Third  Parties.  Should  Borrower  or any  Grantor
         default  under any  loan,  extension  of  credit,  security  agreement,
         purchase or sales agreement,  or any other  agreement,  in favor of any
         other creditor or person that may  materially  affect any of Borrower's
         property or Borrower's  or any Grantor's  ability to repay the Loans or
         perform their respective obligations under this Agreement or any of the
         Related Documents.

         False  Statements.  Any warranty,  representation  or statement made or
         furnished  to Lender by or on behalf of Borrower  or any Grantor  under
         this  Agreement or the Related  Documents is false or misleading in any
         material  respect at the time made or  furnished,  or becomes  false or
         misleading at any time thereafter.

         Defective  Collateralization.  This  Agreement  or any  of the  Related
         Documents ceases to be in full force and effect  (including  failure of
         any  Security  Agreement  to  create  a valid  and  perfected  Security
         Interest) at any time and for any reason.

         Insolvency. The dissolution or termination of Borrower's existence as a
         going  business,  the  insolvency  of Borrower,  the  appointment  of a
         receiver for any part of Borrower's  property,  any  assignment for the
         benefit of creditors, any type of creditor workout, or the commencement
         of any proceeding under any bankruptcy or insolvency laws by or against
         Borrower.

<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 7
Loan No. 1101700001                  (Continued)


         Credit  or  Forfeiture  Proceedings.  Commencement  of  foreclosure  or
         forfeiture  proceedings,  whether by  judicial  proceeding,  self-help,
         repossession  or any other  method,  by any creditor of  Borrower,  any
         creditor  of  any  Grantor   against  any   collateral   securing   the
         indebtedness,   or  by  any  governmental   agency.   This  includes  a
         garnishment,  attachment,  or levy on or of any of  Borrower's  deposit
         accounts with Lender. However, this Event of Default shall not apply if
         there is a good faith  dispute by Borrower or Grantor,  as the case may
         be, as to the  validity  or  reasonableness  of the claim  which is the
         basis of the  creditor  or  forfeiture  proceeding,  and if Borrower or
         Grantor  gives  Lender  written  notice of the  creditor or  forfeiture
         proceeding and furnishes  reserves or a surety bond for the creditor or
         forfeiture proceeding satisfactory to Lender.

         Events  Affecting  Guarantor.  Any of the preceding  events occurs with
         respect to any  Guarantor of any of the  indebtedness  or any Guarantor
         dies or becomes incompetent, or revokes or disputes the validity of, or
         liability  under,  any  Guaranty of the  indebtedness.  Lender,  at its
         option, may, but shall not be required to permit the Guarantor's estate
         to assume unconditionally the obligations arising under the guaranty in
         a manner  satisfactory  to Lender,  and, in doing so, cure the Event of
         Default  Change In  Ownership.  Any change in ownership of  twenty-five
         percent (25%) or more of the common stock of Borrower.

         Change In  Ownership.  Any change in ownership of  twenty-five  percent
         (25%) or more of the common stock of Borrower.

         Adverse  Change.   A  material  adverse  change  occurs  in  Borrower's
         financial  condition,  or Lender  believes  the  prospect of payment or
         performance of the indebtedness is impaired.

         Right to Cure. If any default, other than a Default on indebtedness, is
         curable and if  Borrower  or Grantor,  as the case may be, has not been
         given a notice of a similar  default  within the preceding  twelve (12)
         months, it may be cured (and no Event of Default will have occurred) if
         Borrower or Grantor, as the case may be, after receiving written notice
         from  Lender  demanding  cure of such  default:  (a) cures the  default
         within  thirty (30) days;  or (b) if the cure requires more than thirty
         (30) days,  immediately  initiates steps which Lender deems in Lender's
         sole  discretion to be  sufficient  to cure the default and  thereafter
         continues and completes all reasonable and necessary  steps  sufficient
         to produce compliance as soon as reasonably practical.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where
otherwise provided in this Agreement or the Related  Documents,  all commitments
and  obligations of Lender under this Agreement or the Related  Documents or any
other  agreement  immediately  will terminate  (including any obligation to make
Loan  Advances or  disbursements),  and, at Lender's  option,  all  indebtedness
immediately  will  become due and  payable,  all  without  notice of any kind to
Borrower,  except that in the case of an Event of Default of the type  described
in the "Insolvency"  subsection above, such acceleration  shall be automatic and
not  optional.  In  addition,  Lender  shall have all the  rights  and  remedies
provided in the Related  Documents or available at law, in equity, or otherwise.
Except as may be  prohibited  by  applicable  law,  all of  Lender's  rights and
remedies  shall be cumulative and may be exercised  singularly or  concurrently.
Election by Lender to pursue any remedy  shall not exclude  pursuit of any other
remedy,  and an  election to make  expenditures  or to take action to perform an
obligation  of  Borrower or of any Grantor  shall not affect  Lender's  right to
declare a default and to exercise its rights and remedies.

MISCELLANEOUS  PROVISIONS.  The following miscellaneous provisions are a part of
this Agreement:

Amendments. This Agreement, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this  Agreement.  No  alteration  of or  amendment  to this  Agreement  shall be
effective  unless given in writing and signed by the party or parties  sought to
be charged or bound by the alteration or amendment.

Applicable  Law.  This  Agreement  has been  delivered to Lender and accepted by
Lender in the State of New Jersey.  If there is a lawsuit,  Borrower agrees upon
Lender's request to submit to the jurisdiction of the courts of SOMERSET County,
the State of New Jersey.  This  Agreement  shall be governed by and construed in
accordance with the laws of the State of New Jersey.

Caption  Headings.  Caption  headings  in this  Agreement  are  for  convenience
purposes  only and are not to be used to interpret or define the  provisions  of
this Agreement.

Multiple Parties;  Corporate  Authority.  All obligations of Borrower under this
Agreement shall be joint and several,  and all references to Borrower shall mean
each and every  Borrower.  This means that each of the persons signing below is
responsible for all obligations in this Agreement.

Consent to Loan Participation.  Borrower agrees and consents to Lender's sale or
transfer,  whether now or later, of one or more  participation  interests in the
Loans to one or more purchasers,  whether related or unrelated to Lender. Lender
may provide,  without any limitation whatsoever,  to any one or more purchasers,
or potential  purchasers,  any  information  or knowledge  Lender may have about
Borrower or about any other matter  relating to the Loan,  and  Borrower  hereby
waives any rights to privacy it may have with respect to such matters.  Borrower
additionally waives any and all notices of sale of participation  Interests,  as
well as all notices of any repurchase of such participation interests.  Borrower
also agrees that the  purchasers  of any such  participation  interests  will be
considered as the absolute  owners of such  interests in the Loans and will have
all the rights granted under the participation agreement or agreements governing
the sale of such participation interests.  Borrower further waives all rights of
offset or  counterclaim  that it may have now or later against Lender or against
any purchaser of such a participation  interest and unconditionally  agrees that
either Lender or such  purchaser  may enforce  Borrower's  obligation  under the
Loans irrespective of the failure or insolvency of any holder of any interest in
the Loans.  Borrower further agrees that the purchaser of any such participation
interests  may enforce its  interests  irrespective  of any  personal  claims or
defenses that Borrower may have against Lender.

Costs and Expenses. Borrower agrees to pay upon demand all of Lender's expenses,
including without  limitation  attorneys' fees,  incurred in connection with the
preparation,  execution,  enforcement,   modification  and  collection  of  this
Agreement  or in  connection  with the Loans made  pursuant  to this  Agreement.
Lender  may pay  someone  else to help  collect  the Loans and to  enforce  this
Agreement,  and Borrower  will pay that amount.  This  includes,  subject to any
limits  under  applicable  law,  Lender's  attorneys'  fees and  Lender's  legal
expenses,  whether  or not there is a  lawsuit,  including  attorneys'  fees for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay
or injunction),  appeals, and any anticipated post-judgment collection services.
Borrower also will pay any court costs, in addition to all other sums provided
by law.

Notices. All notices required to be given under this Agreement shall be given in
writing,  may be sent by telefacsimile  (unless otherwise  required by law), and
shall be effective  when actually  delivered or when deposited with a nationally
recognized  overnight  courier or  deposited in the United  States  mail,  first
class, postage prepaid, addressed to the party to whom the notice is to be given
at the address  shown above.  Any party may change its address for notices under
this Agreement by giving formal written notice to the other parties,  specifying
that the purpose of the notice is to change the party's  address.  To the extent
permitted by applicable  law, if there is more than one Borrower,  notice to any
Borrower will constitute notice to all Borrowers. For notice purposes,  Borrower
will keep Lender informed at all times of Borrower's current address(es).

No Joint Venture Partnership. The relationship of Borrower and Lender created by
this  Agreement is strictly that of  debtor-creditor,  and nothing  contained in
this Agreement or in any of the Related  Documents  shall be deemed or construed
to create a partnership or joint venture between Borrower and Lender.

Severability.  If a court of competent  jurisdiction finds any provision of this
Agreement to be invalid or unenforceable as to any person or circumstance,  such
finding shall not render that provision invalid or unenforceable as to any other
persons or  circumstances.  If feasible,  any such offending  provision shall be
deemed to be modified  to be within the limits of  enforceability  or  validity;


<PAGE>

09-30-1999                         LOAN AGREEMENT                        PAGE 8
Loan No. 1101700001                 (Continued)

however,  if the offending  provision cannot be so modified it shall be stricken
and all other  provisions  of this  Agreement in all other  respect shall remain
valid and enforceable.

Subsidiaries  and  Affiliates  of  Borrower.  To the extent  the  context of any
provisions of this Agreement makes it appropriate,  including without limitation
any  representation,  warranty or covenant,  the word  "Borrower" as used herein
shall include all subsidiaries and affiliates of Borrower.  Notwithstanding  the
foregoing however,  under no circumstances  shall this Agreement be construed to
require  Lender  to  make  any  Loan or  other  financial  accommodation  to any
subsidiary or affiliate of Borrower.

Successors and Assigns.  All covenants and agreements  contained by or on behalf
of Borrower shall bind its successors and assigns and shall inure to the benefit
of Lender,  its successors and assigns.  Borrower shall not,  however,  have the
right to assign its rights under this Agreement or any interest therein, without
the prior written consent of Lender.

Survival.  All  warranties,  representations,  and covenants made by Borrower in
this Agreement or in any certificate or other  instrument  delivered by Borrower
to Lender under this  Agreement  shall be considered to have been relied upon by
Lender and will  survive  the making of the Loan and  delivery  to Lender of the
Related Documents, regardless of any investigation made by Lender or on Lender's
behalf.

Time  is of the  Essence.  Time is of the  essence  in the  performance  of this
Agreement.

Waiver.  Lender  shall  not be deemed  to have  waived  any  rights  under  this
Agreement unless such waiver is given in writing and signed by Lender.  No delay
or omission  on the part of Lender in  exercising  any right shall  operate as a
waiver of such right or any other  right.  A waiver by Lender of a provision  of
this  Agreement  shall not  prejudice or  constitute a waiver of Lender's  right
otherwise to demand strict compliance with that provision or any other provision
of this Agreement.  No prior waiver by Lender, nor any course of dealing between
Lender and  Borrower,  or between  Lender and any  Grantor,  shall  constitute a
waiver of any of  Lender's  rights or of any  obligations  of Borrower or of any
Grantor  as to any  future  transactions.  Whenever  the  consent  of  Lender is
required  under this  Agreement,  the  granting of such consent by Lender in any
instance shall not constitute  continuing consent in subsequent  instances where
such  consent  is  required,  and in all cases  such  consent  may be granted or
withheld in the sole discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS LOAN AGREEMENT, AND
BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF SEPTEMBER 30, 1999.

BORROWER:
ION Networks, Inc.

By:  /s/ Ken Hay
     --------------------------------
     Ken Hay, Chief Financial Officer

ATTEST:

By:  /s/ Illegible
     --------------------------------                   (CORPORATE SEAL)
     Secretary or Assistant Secretary


LENDER:

UNITED NATIONAL BANK


By:
     --------------------------------
     Authorized Officer