**[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINEDIN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELYWITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24(b)-2 OF THESECURITIES EXCHANGE ACT OF 1934, AS AMENDED.**

**EXHIBIT10.10**

**DATED 24TH JUNE 2004**

**VIEWSONIC EUROPELIMITEDANDBURDALE FINANCIAL LIMITED**

----

FACILITYAGREEMENTUS$20,000,000

----

 

Nabarro NathansonLacon HouseTheobald’s RoadLondon WC1X 8RW

Tel: 020 7524 6000

 

----

 

**Table of Contents**
|                                                  | ** ** | ** **                                        | ** ** | **Page** |
|--------------------------------------------------|------------|---------------------------------------------------|------------|----------|
| 1.                                               |       | DEFINITIONS  AND INTERPRETATION                   |       | 1        |
| 2.                                               |       | THE  FACILITIES                                   |       | 10       |
| 3.                                               |       | PURPOSE                                           |       | 11       |
| 4.                                               |       | CONDITIONS OF UTILISATION                         |       | 11       |
| 5.                                               |       | UTILISATION                                       |       | 11       |
| 6.                                               |       | RESTRICTIONS  APPLICABLE TO INDIVIDUAL FACILITIES |       | 12       |
| 7.                                               |       | RECEIVABLES  FINANCE                              |       | 13       |
| 8.                                               |       | PROVISIONS  CONCERNING L/CS                       |       | 14       |
| 9.                                               |       | CURE  RIGHTS                                      |       | 15       |
| 10.                                              |       | REPAYMENT                                         |       | 15       |
| 11.                                              |       | CANCELLATION                                      |       | 18       |
| 12.                                              |       | INTEREST  AND PURCHASE COMMISSION                 |       | 19       |
| 13.                                              |       | FEES                                              |       | 19       |
| 14.                                              |       | SET-OFF  AND TAX GROSS UP                         |       | 20       |
| 15.                                              |       | INCREASED  COSTS                                  |       | 21       |
| 16.                                              |       | OTHER  INDEMNITIES                                |       | 22       |
| 17.                                              |       | COSTS  AND EXPENSES                               |       | 22       |
| 18.                                              |       | GUARANTEE  AND INDEMNITY                          |       | 23       |
| 19.                                              |       | REPRESENTATIONS                                   |       | 25       |
| 20.                                              |       | INFORMATION  UNDERTAKINGS                         |       | 27       |
| 21.                                              |       | GENERAL  UNDERTAKINGS                             |       | 27       |
| 22.                                              |       | EVENTS  OF DEFAULT                                |       | 30       |
| 23.                                              |       | CHANGES TO THE LENDER                             |       | 33       |
| 24.                                              |       | CHANGES TO THE OBLIGORS                           |       | 34       |
| 25.                                              |       | NOTICES                                           |       | 34       |
| 26.                                              |       | MISCELLANEOUS  PROVISIONS                         |       | 35       |
| 27.                                              |       | REMEDIES  AND WAIVERS                             |       | 35       |
| 28.                                              |       | COUNTERPARTS                                      |       | 35       |
| 29.                                              |       | GOVERNING  LAW                                    |       | 35       |
| SCHEDULE  1 THE ORIGINAL OBLIGORS                |       | 36                                                |
| SCHEDULE  2 CONDITIONS PRECEDENT                 |       | 37                                                |
| SCHEDULE  3 REPORTING AND FINANCIAL UNDERTAKINGS |       | 39                                                |
| SCHEDULE  4 FORMS OF REQUEST                     |       | 44                                                |
| SCHEDULE 5 FORM OF  ACCESSION LETTER        |       | 48                                                |

 

i

----

**FACILITYAGREEMENT**

**DATE  24thJUNE 2004**

**PARTIES**

(1)                                    VIEWSONICEUROPE LIMITED (the **“Company”**);

(2)                                    THESUBSIDIARIES of the Company listed in **part**II of **Schedule** 1 as originalguarantors (together with the Company the **“Original Guarantors”**);

(3)                                    BURDALEFINANCIAL LIMITED (Registered in England and Wales No 2656007) ((together withits successors and assigns) the **“Lender”**).

**IT IS AGREED AS FOLLOWS:**

**1.****                                           DEFINITIONS AND INTERPRETATION**

**1.1****                                    Definitions**

In this Agreement:

**“Accession Letter”**

means a document substantially in the form set out in **Schedule** 5 (*Form of Accession Letter*);

**“Additional Borrower”**

means a company which becomes an Additional Borrowerin accordance with **clause** 24.2 (*Changes to the Obligors*);

**“Actual Date of Payment”**

means in relation to a Purchased Receivable, the dateon which full payment in respect of that Purchased Receivable is made into aBlocked Account by the relevant account debtor or the relevant FacilityCompany;

**“Additional Guarantor”**

means a company which becomes an Additional Guarantorin accordance with **clause** 24.3 (*Changes to the Obligors*);

**“Additional Obligor”**

means an Additional Borrower or an AdditionalGuarantor;

**“Affiliate”**

means, in relation to any person, a Subsidiary of thatperson or a Holding Company of that person or any other Subsidiary of thatHolding Company;

**“Authorisation”**

means an authorisation, consent, approval, resolution,licence, exemption, filing, notarisation or registration;

**“Availability Limit”**

means each of the Availability Limits established orreferred to in **clause** 6(Restrictions applicable to individual Facilities);

1

----

**“Availability Period”**

means the period from and including the date of thisAgreement to and including the date falling five Business Days prior to theFinal Repayment Date, or such later date as the Lender may allow;

**“Blocked Accounts”**

has the meaning given to it in the Debenture;

**“Borrower”**

means the Company and any Additional Borrower;

**“Business Day”**

means a day (other than a Saturday or Sunday) on whichbanks are open for general business in London;

**“Charged Accounts”**

means the Blocked Account and the Other Accounts;

**“Cash Request”**

means a request in the form set out in **part** II of **Schedule** 4.

**“Debenture”**

means the first-ranking debenture executed or to beexecuted by the Obligors in favour of the Lender;

**“Deed of Accession”**

has the meaning given to it in the Debenture;

**“Default”**

means an Event of Default or any event or circumstancespecified in **clause** 22 (Events ofDefault) which would (with the expiry of a grace period, the giving of notice,the making of any determination under the Finance Documents or any combinationof any of the foregoing) be an Event of Default;

**“Dilution Rate”**

means the monthly value of credit notes and non-cashcredits issued by a Borrower as a percentage of the monthly value of sales;

**“Documents”**

means any and all documents which represent or relateto any Goods and/or the possession of and/or ownership of and/or insurance ofand/or warehousing of and/or any other dealing in or with any Goods;

**“Dollars”, “US Dollars” and “$”**

means the lawful currency of the United States ofAmerica;

**“Dutch Pledge”**

means a pledge over Stock held for the Company byFurness Logistics BV, at Trade Boulevard 4, Haven nummer 5284761, RL Moerdijk,the Netherlands and other locations;

2

----

**“Eligible Country”**

means (i) any country which was a Member State ofthe European Union on 1 January 2004, (ii) Israel, (iii) Norway,and (iv) Switzerland;

**“Eligible Receivables”**

has the meaning given to it in **Schedule** 3;

**“Eligible Stock”**

has the meaning given to it in **Schedule** 3;

**“Event of Default”**

means any event or circumstance specified as such in **clause** 22 (Events of Default);

**“Expiry Date”**

means for an L/C, the last day of its Term;

**“Facility”**

includes the Receivables Finance Facility and theRevolving Credit Facility;

**“Facility Companies’’**

includes the Borrowers and the Guarantors;

**“Facility Limit”**

means US $20,000,000;

**“Final Repayment Date”**

means the date falling 36 months after the date ofthis Agreement;

**“Finance Document”**

means this Agreement, the Security Documents, anyAccession Letter and any other document designated as such by the Lender andthe Company;

**“Financial Indebtedness”**

means anyindebtedness for or in respect of:

**(a)****                                   **moneysborrowed;

**(b)****                                   **anyamount raised by acceptance under any acceptance credit facility;

**(c)****                                    **anyamount raised pursuant to any note purchase facility or the issue of bonds,notes, debentures, loan stock or any similar instrument;

**(d)****                                   **theamount of any liability in respect of any lease or hire purchase contract whichwould, in accordance with GAAP, be treated as a finance or capital lease;

**(e)****                                    **receivablessold or discounted (other than any receivables to the extent they are sold on anon-recourse basis);

**(f)****                                      **anyamount raised under any other transaction (including any forward sale orpurchase agreement) having the commercial effect of a borrowing;

3

----

**(g)****                                    **anyderivative transaction entered into in connection with protection against orbenefit from fluctuation in any rate or price (and, when calculating the valueof any derivative transaction, only the marked to market value shall be takeninto account);

**(h)****                                   **anycounter-indemnity obligation in respect of a guarantee, indemnity, bond,standby or documentary letter of credit or any other instrument issued by abank or financial institution; and

**(i)****                                      **theamount of any liability in respect of any guarantee or indemnity for any of theitems referred to in **paragraphs** (a) to(g) above;

**“GAAP”**

means generally accepted accounting principles in theUnited Kingdom or other country of incorporation where applicable;

**“Goods”**

means all Stock, produce inventory and/or other goodsand in respect of which an L/C has been issued;

**“Guarantor”**

means an Original Guarantor or an AdditionalGuarantor;

**“Holding Company”**

means, in relation to a company or corporation, anyother company or corporation in respect of which it is a Subsidiary;

**“Ineligible Country”**

means any countryother than:

**(a)****                                   **anEligible Country; and

**(b)****                                   **anycountry or territory in the Middle East;

**‘‘L/C’’**

means a letter ofcredit, guarantee or similar assurance which is from time to time either:

**(c)****                                    **openedby the Lender for the account of a Borrower; or

**(d)****                                   **withrespect to which the Lender has agreed to indemnify the issuer or to guaranteethe obligations of a Borrower to such issuer;

**“L/C Exposure”**

means:

**(a)****                                   **inrelation to an L/C opened for the purpose of purchasing Eligible Stock, theface amount of such L/C less the aggregate of:

**(i)****                                      **therelevant Stock Percentage of the cost of such Eligible Stock covered by thatLetter of credit; and

**(ii)****                                  **allfreight, taxes, duties and other amounts estimated by the Lender to be payablein order to ensure the delivery of such Eligible Stork to the premisesdesignated by the relevant Borrower in the Netherlands or in such other countryas the Lender may approve; and

4

----

**(b)****                                   **inrelation to any other L/C, the face amount of such L/C and other commitmentsassumed by the Lender with respect thereto;

**“L/C Limit”**

means $1,000,000;

**“L/C Request”**

means a request in the form set out in **part** III of **Schedule** 4;

**“LIBOR”**

means:

**(a)****                                   **the30 day LIBOR US Dollar rate (or, as the case may be, the rate for the otherPermitted Currency in which the relevant amount is deposited or outstanding) onthe first day of each month in the Financial Times, London edition asconclusively determined by the Lender; or

**(b)****                                   **if,for any reason, the Financial Times, London edition ceases or fails to quotesuch a rate) the 30 day LIBOR US Dollar Rate (or, as the case may be, the ratefor the Permitted Currency in which the relevant amount is outstanding) fromwhichever source it may reasonably select;

**“Mandatory Cost”**

means the cost (calculated as a percentage rate perannum) of the London branch of Wachovia N.A. (or any other bank from which theLender obtains funding for its provision of the Facilities) of complying withthe requirements of the Bank of England and/or the Financial Services Authorityand/or any other applicable regulatory authority in respect of monetarycontrol, liquidity or otherwise in relation to amounts similar to those madeavailable under this Agreement;

**“Margin”**

means two per cent, per annum;

**“Material Adverse Effect”**

means an effectwhich (in the reasonable opinion of the Lender) results in or is likely toresult in a material adverse change in:

**(a)****                                   **thebusiness, performance, operations or assets of the Obligors (whetherindividually or collectively); or

**(b)****                                   **theability of any Obligor to perform any of its respective obligations under anyof the Finance Documents; or

**(c)****                                    **thelegality, validity, priority or enforceability of any obligations or securitycreated by or arising under any Finance Document.

Where, however, the Company is required to represent,warrant or otherwise to confirm that no Event of Default involving a MaterialAdverse Effect has occurred, such representation, warranty or otherconfirmation shall be made or given by reference to the reasonable opinion ofthe company.

5

----

**“Maturity Date”**

means, in relationto a Receivable, the Business Day which is, or immediately succeeds, the datewhich is the earlier of:

**(a)****                                   **60days after the contractual due date for payment in respect of such Receivable;and

**(b)****                                   **90days after the date of the invoice in respect of such Receivable;

**“Net Stock Value”**

means the net value of Stock as determined by therelevant Obligor in accordance with its customary practices and procedures (asdisclosed to the Lender prior to the date of this Agreement and as may bevaried from time to time with the Lender’s written consent);

**“Obligor”**

means a Borrower or a Guarantor;

**“Original Obligor”**

means an Original Borrower or an Original Guarantor;

**“Other Accounts”**

means the bank accounts of the Obligors specified asOther Accounts in the Debenture and/or such other bank accounts of the Obligorsas the, Lender may permit;

**“Outstanding Purchase Price”**

means the aggregate amount from time to time of thePurchase Prices actually paid or (pursuant to **clause**7.3.1) deemed to be paid by the Lender under this Agreement and which have notbeen repaid;

**“Permitted Currencies”**

means US dollars, euro and sterling;

**“Permitted Security Interest”**

means a charge over a deposit of £31,000 in theCompany’s premium business account number **[*]**,sort code **[*]**executed by theCompany in favour of **[*]**and dated**[*]**;

**“Purchase Commission”**

means the purchase commission payable pursuant to **clause** 12.1. (Calculation of Interest andPurchase Commission);

**“Purchase Date”**

means, in relation to a Purchased Receivable, the dateon which the Lender receives the applicable Purchase Request;

**“Purchase Price”**

means the purchaseprice to be paid by the Lender in respect of an Eligible Receivable uponreceipt of a Cash Request, being:

**(a)****                                   **inrelation to any Eligible Receivable owing by a debtor in an Eligible Country,80 per cent of such Eligible Receivable;

*** Confidential Treatment Requested**

6

----

**(b)****                                   **inrelation to Eligible Receivables owing by debtors in an Ineligible Country:

**(i)****                                      **duringthe period May- August, in any year, 40 per cent; and

**(ii)****                                  **duringany other period, 20 per cent, provided that (x) (in each case) such percentageshall be increased to 70 per cent if the Company arranges for those Receivablesto be covered by trade insurance acceptable to the Lender (y) the maximumamount to be advanced in reliance upon such Receivables shall not exceed$2,500,000 at any time and (z) the maximum amount of such Receivables owing bya single debtor shall not exceed $350,000;

**“Purchase Request”**

means a request in the form of **part** I of **Schedule**4;

**“Purchased Receivable”**

means a Receivable purchased by the Lender under thisAgreement;

**“Receivable”**

means any debt owing to a Borrower, together with allconnected rights, claims, deposits and payments;

**“Receivables Finance Facility”**

means the receivables finance facility made availableunder this Agreement as described in **clause** 2.1(a);

**“Reserves”**

means reserves fromtime to time established by the Lender to reflect:

**(a)****                                   **thefull amount of any liabilities or amounts which may (by virtue of any SecurityInterest, the provisions of the Enterprise Act 2002, any other statutoryprovision or otherwise) rank equally with or in priority to the SecurityInterests granted to the Lender under the Finance Documents or which mayotherwise be unavailable to the Lender in the event of an insolvency;

**(b)****                                   **theamounts believed by the Lender (acting reasonably) to represent three months ofall third party warehouse lease costs and similar liabilities; and

**(c)****                                    **theamounts believed by the Lender (acting reasonably) to be necessary to providefor possible inaccuracies in any report or in any information provided to theLender in connection with this Agreement;

**“Review Period”**

means each twelve month period ending on the last dayof each calendar month;

**“Revolving Credit Facility”**

means the revolving credit facility made availableunder this Agreement as described in **clause** 2.1(b);

**“Revolving Credit Limit”**

means $14,000,000;

7

----

**“Revolving Loan”**

means a Loan made in respect of the Revolving CreditFacility;

**“Sales Days”**

means the number of units of stock for a specificproduct divided by the number of units of that product sold for the last threemonths multiplied by 90 days;

**“Security Documents”**

includes:

**(a)****                                   **theDebenture;

**(b)****                                   **theDutch Pledge; and

**(c)****                                    **anyother document from time to time executed by any person by way of security forthe obligations of any Obligor pursuant to this Agreement;

**“Security Interest”**

means a mortgage,charge, pledge, lien or other security interest securing any obligation of anyperson, or any arrangement having similar effect but excluding any suchinterests which:

**(a)****                                   **arecreated in favour of the Lender,

**(b)****                                   **whicharise by operation of law in the ordinary course of trading; or

**(c)****                                    **arePermitted Security Interest;

**“Stock”**

means each Borrower’s stock and inventory at any time;

**“Stock Percentage”**

means with respectto each specific line of Stock held on land or in transit by sea:

**(d)****                                   **thefirst 180 Sales Days of Stock, 55 per cent; and

**(e)****                                    **theStock between 181 and 360 Sales Days, 25 per cent.

**“Subsidiary”**

means a subsidiary within the meaning of section 736of the Companies Act 1985;

**“Tax”**

means any tax, levy, impost, duty or other charge orwithholding of a similar nature (including any penalty or interest payable inconnection with any failure to pay or any delay in paying any of the same);

**“Tax Credit”**

means a credit against, relief or remission for, orrepayment of any Tax;

**“Tax Deduction”**

means a deduction or withholding for or on account ofTax from a payment under a Finance Document;

8

----

**“Tax Payment”**

means an increased payment made by an Obligor to aLender under **clause** 14.2 (Taxgross-up) or a payment under **clause**14.3 (Tax indemnity);

**“Term”**

means each period determined under this Agreement forwhich the Lender is under a liability under or with respect to an L/C;

**“Total Availability”**

means at any relevant time: (i) the TotalReceivables Availability; PLUS (ii) the Total Stock Availability; LESS (iii) theamount of the Reserves;

**“Total Receivables Availability”**

means at any time the applicable Purchase Price of theEligible Receivables less maximum discounts, credits and allowances of anynature which may be taken by or granted to any account debtor or any otherperson in connection with the Eligible Receivables at such time;

**“Total Stock Availability”**

means at any time, the Stock Percentage of the NetStock Value of Eligible Stock at such time;

**“Trading Cashflow”**

means, in relationto any Review Period, the profit before tax on ordinary activities of theCompany for that period:

**(a)****                                   **addingback any depreciation or amortisation;

**(b)****                                   **adjustingfor any unrealised currency gains or losses;

**(c)****                                    **excludingany extraordinary or exceptional profits;

**(d)****                                   **deductingany capital expenditure; and

**(e)****                                    **makingsuch other adjustments as the Lender may from time to time approve in writing;

**“Unpaid Sum”**

means any sum due and payable but unpaid by an Obligorunder the Finance Documents;

**“Utilisation”**

means a utilisation of a Facility;

**“Utilisation Date”**

means the date specified by the Company in anyUtilisation Request on which a Utilisation is, or is to be, made;

**“Utilisation Request”**

includes (as the context may require) a PurchaseRequest, a Cash Request, and an L/C Request;

9

----

**“VAT”**

means value addedtax as provided for in the Value Added Tax Act 1994 and any other tax of asimilar nature.

**1.2****                                    Construction**

**1.2.1****                         **Unlessa contrary indication appears, any reference in this Agreement to;

**(a)****                                     “assets”** includes present andfuture properties, revenues and rights of every description;

**(b)****                                    **a**“FinanceDocument”** or any other agreement or instrument is a reference tothat Finance Document or other agreement or instrument as amended or novated;

**(c)****                                      “indebtedness”** includes anyobligation (whether incurred as principal or as surety) for the payment orrepayment of money, whether present or future, actual or contingent;

**(d)****                                    **a**“person”**includes any person, firm, company, corporation, government, state or agency ofa state or any association, trust or partnership (whether or not havingseparate legal personality) or two or more of the foregoing;

**(e)****                                     **a**“regulation”**includes any regulation, rule, official directive, request or guideline(whether or not having the force of law) of any governmental, intergovernmentalor supranational body, agency, department or regulatory, self-regulatory orother authority or organisation;

**(f)****                                       **aprovision of law is a reference to that provision as amended or re-enacted; and

**(g)****                                     **atime of day is a reference to London time.

Clause and Scheduleheadings are for ease of reference only.

**1.2.2****                         **ADefault (other than an Event of Default) is continuing if it has not beenremedied or waived and an Event of Default is continuing if it has not been waived.

**1.2.3****                         **Ifat any time there are no persons who are Guarantors, the term Obligors shall beconstrued, while such circumstance is continuing, as a reference solely to theFacility Companies and if at that time the Company is the only Facility Companythe references in this Agreement to Facility Company shall, whilst suchcircumstance is continuing, be construed accordingly.

**1.3****                                    Thirdparty rights**

A person who is not a party to this Agreement has noright under the Contracts (Rights of Third Parties) Act 1999 to enforce or toenjoy the benefit of any term of this Agreement.

**2.****                                           THE FACILITIES**

**2.1****                                    TheFacilities**

Subject to the terms of this Agreement, and during theAvailability Period, the Lender makes available to the Borrowers:

**2.1.1****                         **areceivables finance facility (the “**ReceivablesFinance Facility**”) pursuant to which the Lender will from time totime during the Availability Period purchase Receivables from the FacilityCompanies; and

10

----

**2.1.2****                         **arevolving credit facility (the “**RevolvingCredit Facility**”) pursuant to which the Lender will from time totime:

**(a)****                                    **makeRevolving Loans to the Borrowers, and

**(b)****                                    **issueor procure the issue of L/Cs for the account of the Borrowers.

**3.****                                           PURPOSE**

**3.1****                                    Purpose**

Each Borrower shall apply all amounts borrowed orraised by it in respect of the Revolving Credit Facility, for its generalcorporate and working capital purposes and to the extent permitted pursuant to **clause** 6.4, for the repayment ofintra-group indebtedness.

**3.2****                                    Monitoring**

The Lender is not bound to monitor or verify theapplication of any amount borrowed pursuant to this Agreement. A contraventionof **clause** 3.1 shall not affect theobligations of the Obligors under the Finance Documents.

**4.****                                           CONDITIONS OF UTILISATION**

**4.1****                                    Initialconditions precedent**

No Borrower may deliver a Utilisation Request unlessthe Lender has received all of the documents and other evidence listed in **Schedule** 2 (*Conditions precedent*) in form and substance satisfactory tothe Lender.

**4.2****                                    Furtherconditions precedent**

The Lender will only be obliged to comply with theterms of a Utilisation Request if on the date on which it is given and on theproposed Utilisation Date:

**4.2.1****                         **noDefault is continuing or would result from the proposed Utilisation; and

**4.2.2****                         **therepresentations set out in **clause**19 are true in all material respects with reference to the facts andcircumstances then subsisting.

**5.****                                           UTILISATION**

**5.1****                                    Deliveryof a Utilisation Request**

A Borrower may utilise a Facility by delivery to theLender of a duly completed Utilisation Request with respect to the relevantFacility not later than 11.00 am on the proposed Utilisation Date. The relevantBorrower will deliver the form of Utilisation Request appropriate to thedesired form of Utilisation.

**5.2****                                    Completionof a Utilisation Request**

**5.2.1****                         **EachUtilisation Request is irrevocable and will not be regarded as having been dulycompleted unless:

**(a)****                                    **theproposed Utilisation Date is a Business Day within the Availability Period applicableto the Facility in question; and

**(b)****                                    **theUtilisation Request is expressed in a Permitted Currency and it otherwisecomplies with (and contains the information and enclosures required by) theapplicable form of Utilisation Request.

**5.2.2****                         **Onlyone type of Utilisation may be requested in each Utilisation Request.

11

----

**5.3****                                    Lender’sobligations**

If the conditions set out in this Agreement have beenmet, the Lender shall comply with the terms of a duly completed UtilisationRequest on the applicable Utilisation Date.

**5.4****                                    Reutilisation**

Subject to the terms of this Agreement, the RevolvingCredit Facility is of a revolving nature and amounts recovered or repaid inrespect of the Revolving Credit Facility may accordingly be redrawn, For thispurpose, amounts received in respect of the Revolving Credit Facility will beapplied in reduction of the relevant Obligor’s liabilities on the Business Dayof actual receipt by the Lender

**6.****                                           RESTRICTIONS APPLICABLE TO INDIVIDUAL FACILITIES**

**6.1****                                    SpecificFacility Limits**

**6.1.1****                         **Theaggregate amount of:

**(a)****                                    **theOutstanding Purchase Price;

**(b)****                                    **allRevolving Loans; and

**(c)****                                     **allL/C Exposures shall not at any time exceed the lesser of:

**(i)****                                      **theFacility Limit; and

**(ii)****                                  **theTotal Availability.

**6.1.2****                         **Theaggregate amount of.

**(a)****                                    **allRevolving Loans; and

**(b)****                                    **allL/C Exposures shall not exceed the Revolving Credit Limit.

**6.1.3****                         **Theaggregate of the Revolving Loans made in respect of Eligible Stock shall notexceed $14,000,000 at any time.

**6.1.4****                         **Theaggregate of the Revolving Loans made in respect of Eligible Stock on watershall not exceed $7,500,000 at any time.

**6.1.5****                         **Theaggregate amount of all L/C Exposures shall not at any time exceed the L/CLimit.

**6.2****                                    RevolvingLoans**

No Revolving Loan may be drawn pursuant to a CashRequest unless either:

**6.2.1****                         **theReceivables Finance Facility is fully utilised; or

**6.2.2****                         **theObligors have no Receivables with which to utilise the Receivables FinanceFacility.

**6.3****                                    Adjustments**

The Lender may (after consultation with the Company)from time to time:

**6.3.1****                         **reducethe Purchase Price in proportion to an increase in the Dilution Rate;

**6.3.2****                         **reducethe Total Stock Availability (or any component of it) to reflect:

**(a)****                                    **anyreduction in the rate of turnover, quality, liquidation value or other matteraffecting patterns of sale; or

**(b)****                                    **anyreduction in the Facility Limit pursuant to any provision of this Agreement;

12

----

**6.3.3****                         **allocatethe Reserves among the Borrowers in such proportions as the Lender may deemappropriate; and

**6.3.4****                         **establish,in relation to each Borrower, such sub-limits with respect to the Utilisationof the Facilities as it may deem appropriate.

**6.4****                                    Intra-groupRepayments**

So long as noDefault has occurred, the proceeds of a Utilisation may be applied by anObligor in the repayment of indebtedness owing to ViewSonic Corporationprovided that:

**(a)****                                    **duringthe period in which such Utilisation is outstanding, the aggregate amount of (i) alloutstanding Utilisations; (ii) the amount of such repayment; and (iii) $3,000,000are less than the Total Availability; or

**(b)****                                    **therepayment is approved by the Lender.

**6.5****                                    Prohibitionon Utilisations**

No Utilisation may be made if it would cause any ofthe limits referred to in this **clause**6 to be exceeded.

**6.6****                                    DeemedUtilisations**

If the Lender makes any payment pursuant to or in respectof any L/C then the Obligor for whose account such payment was made shall bedeemed on the date of such payment to have received the proceeds of aUtilisation. A Utilisation so deemed to be made shall be deemed to be aRevolving Loan and the other provisions of this Agreement (as to interest,repayment and otherwise) shall apply to such Utilisation accordingly.

**7.****                                           RECEIVABLES FINANCE**

**7.1****                                    Saleof Receivables**

Subject to the terms of this Agreement, each Borrowershall offer to sell its Receivables to the Lender by delivery to the Lender atintervals of five Business Days of duly completed Purchase Requests, Deliveryof a Purchase Request will oblige the relevant Borrower to sell the Receivablesstated in such Purchase Request upon and subject to the terms and conditions ofthis Agreement.

**7.2****                                    Determinationof Purchase Price**

The Lender shall determine the Purchase Price for theReceivables specified in a Purchase Request and will (upon request) advise therelevant Borrower of such determination. The Purchase Price shall only bepayable if a valid Cash Request has been delivered to the Lender. When madeunder the terms of this Agreement, payment of the Purchase Price shall (withoutfurther act or document) suffice to constitute the assignment of the relevantReceivable in favour of the Lender.

**7.3****                                    Orderof Application**

**7.3.1****                         **Anyamounts paid by the Lender pursuant to a Cash Request shall be deemed to beapplied (firstly) in the payment of any outstanding and unpaid Purchase Priceand (secondly) in the drawing of a Revolving Loan.

**7.3.2****                         **TheLender’s obligation to pay the Purchase Price of any Receivable (or any unpaidportion of it) shall terminate on the earlier of:

**(a)****                                    **thedate on which the relevant account debtor pays such receivable; and

13

----

**(b)****                                    **theMaturity Date.

**7.3.3****                         **Tothe extent to which any moneys paid by the Lender to a Borrower (the “**Debtor Company**”) represent payment ofPurchase Price in relation to the Purchased Receivables of another Obligor (the“**Creditor Company**”) then (withoutdouble counting with the provisions of **clause**6.5) the Creditor Company shall be deemed to have made an on-demand loan (an “**Intercompany Loan**”) to the Debtor Companyin an amount equal to the amount of such payment by the Lender.

**8.****                                           PROVISIONS CONCERNING L/CS**

**8.1****                                   **NoUtilisation request with respect to an L/C may be delivered unless the form andcontent of the requested L/C has previously been approved by the Lender.

**8.2****                                   **ABorrower which requests the Lender to issue an L/C:

**8.2.1****                         **authorisesthe Lender to pay any claim made or purported to be made under such L/C andwhich appears on the face of it to be in order (a “**claim**”);

**8.2.2****                         **undertakesimmediately and unconditionally on demand:

**(a)****                                    **topay to the Leader an amount equal to the amount of any claim; and

**(b)****                                    **toindemnify the Lender against any cost, loss or liability incurred by the Lenderin connection with the L/C or its performance or any other matter relatingthereto, other than such cost, loss or liability arising out of the negligenceor wilful misconduct of the Lender;

**8.2.3****                         **acknowledgesthat:

**(a)****                                    **theLender is not obliged to carry out any investigation or to seek anyconfirmation from such Borrower or any other person before paying a claim,

**(b)****                                    **theLender will deal in Documents only and will thus not be concerned with any mattersconcerning any Goods or other issues relating to the underlying transaction;and

**(c)****                                     **suchBorrower will be bound by any action taken by the Lender in good faith inrelation to any L/C (including any decision to amend or extend the L/C and anyinterpretation of the terms or effect of any L/C); and

**8.2.4****                         **acknowledgesthat its obligations of payment and reimbursement under this **clause** 8.2 will not be in any wayprejudiced, affected or diminished by:

**(a)****                                    **anyunenforceability of, or amendment to or extension of, any L/C or any otherdocument or security;

**(b)****                                    **thevalidity, legitimacy or accuracy of any document or claim submitted pursuant toany L/C or any action taken or omitted with respect thereto; or

**(c)****                                     **anyother matter or thing which (but for this provision) might otherwise have theeffecting of diminishing or extinguishing the Borrower’s liability pursuant tothis **clause** 8.2.

**8.3****                                    Pledge**

All Goods and Documents are hereby and shall upondespatch from the supplier of any Goods be deemed to be pledged by the relevantBorrower to the Lender and the Goods and the proceeds of all insurances inrelation to them and all sales of them and all of the relevant Borrower’srights as unpaid seller of them shall be a continuing security for the paymentand discharge in full of all of the obligations of the relevant Borrower underthe Finance Documents.

14

----

**8.4****                                    Perfectionof Pledge**

The Lender shall be entitled at its option to obtainpossession of the Goods in order to perfect the pledge made by **clause** 8.3. The relevant Borrower assignsto the Lender its right, title and interest in and to the Documents and allclaims and rights arising from them and the relevant Borrower irrevocably andunconditionally authorises the Lender, following the occurrence of an Event ofDefault, to sign all documents and do all such other things as may be necessaryto obtain possession of and to realise the Goods, and to apply the proceeds inreduction of amounts owing under this Agreement.

**8.5****                                    TrustReceipts**

The Goods and the Documents shall only be released tothe relevant Borrower by the Lender against receipt by the Lender of a dulyexecuted trust receipt from the relevant Borrower in the Lender’s standard format the time or (failing such execution) shall be deemed to be subject to atrust receipt in such form.

**8.6****                                    Separation**

Each Borrower undertakes to keep the Documents and theGoods separate and distinct from any other bills of lading, documents of titleor goods.

**9.****                                           CURE RIGHTS**

**9.1****                                    CureDefaults**

The Lender (acting in the name of and on behalf of,the relevant Obligor) may, at its option and upon notice to the Company to thateffect:

**9.1.1****                         **cureany default by any Obligor under any agreement with respect to a Receivable orunder any other agreement with a third party as the Lender may considernecessary to facilitate the collection of Receivables or to facilitate accessto any Security under any of the Security Documents;

**9.1.2****                         **makeany payment, reach any settlement or compromise, issue, make or pay any bond;appeal any judgment against an Obligor or take any other action it may deemnecessary to prevent any repossession, seizure, execution, attachment orsimilar process against any plant, machinery or other asset of an Obligor whichmight impair the Security (or the enforcement of any Security) granted to theLender under any Security Document; and

**9.1.3****                         **dischargeany Taxes and any other Security Interests from time to time subsisting withrespect to any asset of any Obligor.

**10.****                                    REPAYMENT**

**10.1****                             ReceivablesFinance**

**10.1.1****                  **Ifthe Lender determines that it has not received (in accordance with **clause** 10.7) full payment in respect of aPurchased Receivable on the applicable Maturity Date, then the relevantBorrower shall on demand pay to the Lender an amount equal to the OutstandingPurchase Price in respect of such Purchased Receivable.

**10.1.2****                  **Nothingin **paragraph** (a) above shallprevent the Lender from pursuing payment in respect of the relevant PurchasedReceivable from the account debtor or from receiving payment of such PurchasedReceivable to the credit of a Blocked Account. Each Obligor shall tender suchassistance as the Lender may reasonably require for that purpose.

15

----

**10.1.3****                  **TheLender may deduct from payments in respect of Purchased Receivables made byaccount debtors or any of the Obligors into a Blocked Account the thenOutstanding Purchase Price in respect of such Purchased Receivables. Anybalance remaining after such deduction shall be applied in accordance with **clause** 10.2.

**10.2****                             OtherUtilisations**

Subject to the other provisions of this Agreement, allamounts standing to the credit of the Blocked Accounts shall be applied in thefollowing order:

**10.2.1****                  **inrepayment of the outstanding principal amount of any Revolving Loans in suchorder and manner as the Lender may determine;

**10.2.2****                  **inpayment of any fees, costs and expenses due from any Obligor to the Lenderunder any Finance Document;

**10.2.3****                  **inpayment of.

**(a)****                                    **allinterest due on any Revolving Loans made or deemed to be made under thisAgreement; and

**(b)****                                    **allPurchase Commission outstanding or falling due for payment on the last BusinessDay of the then current month;

**10.2.4****                  **inor towards payment of any other amounts owing by any Obligor under any FinanceDocument; and

**10.2.5****                  **tothe relevant Borrower by payment into such Other Account as it may specify.

**10.3****                             Revisionof Order of Application**

**10.3.1****                  **Ifan Event of Default is continuing, **clause**10.2 shall not apply and all amounts standing to the credit of a BlockedAccount shall be applied to the liabilities of the Obligors under the Finance Documentsin such order and manner as the Leader may determine.

**10.3.2****                  **Ifany amount standing to the credit of one Borrower’s Blocked Account is appliedin discharge of the liabilities of another Obligor, then such Obligor shallbecome indebted to the relevant Borrower on the basis set out in **clause** 7.3(c), with necessary adaptations.

**10.4****                             Currencies**

Where (i) any amount is held or is to be appliedby the Lender in reduction of amounts owing under this Agreement and (ii) therelevant amounts are denominated in different currencies, the Lender may applythe amounts so held or to be applied in the purchase of the latter currency atsuch rate (including commissions) as the Lender (acting reasonably) may deem tobe appropriate. Alternatively, the Lender may hold those funds pending receiptof the Borrower’s instructions. In that event the Lender shall credit theBorrower with interest on such amounts at LIBOR, to the extent to which thesums held do not exceed $20,000,000. The foregoing provision for payment of interestshall only apply to amounts in US dollars or another Permitted Currency.

**10.5****                             Repaymentsand Facility Limits**

If at any time and for any reason (whether by reasonof any Receivables ceasing to be Eligible Receivables, by reason of anyfluctuation in the exchange rate of any Permitted Currency as against the USdollar, or otherwise) any outstanding Utilisations cause any applicable limitestablished pursuant to **clause** 6to be exceeded, then the Company will immediately repay or procure therepayment of such amounts (together with accrued interest on such amounts) asmay be necessary to remedy the position. If necessary for that purpose, theCompany shall also 

16

----

provide or procure the provision of cash cover to theLender in respect of any Outstanding Purchase Price and/or any contingentobligations assumed by the Lender pursuant to this Agreement.

**10.6****                             FinalRepayment**

On the Final Repayment Date, the Company will pay (orprocure payment) to the Lender in full all outstanding amounts and unpaidliabilities under the Finance Documents (whether by way of principal, interest,commission, fees, costs, expenses or otherwise) and shall pay to the Lendersuch amount as is necessary to provide full cash collateral for any OutstandingPurchase Price and any outstanding obligations (contingent or otherwise)assumed by the Lender pursuant to the terms of this Agreement.

**10.7****                             Collectionof Receivables**

With respect to the collection of Receivables, eachObligor undertakes with the Lender as follows:

**10.7.1****                  **itwill collect and hold the proceeds of such Receivables as agent and trustee forthe Lender and immediately pay all amounts so received into a Blocked Account(but pending such payment will not commingle such amounts with any otherfunds);

**10.7.2****                  **ifany account debtor makes a payment into any account which is not a BlockedAccount, it will immediately (i) transfer the relevant amounts to aBlocked Account and (ii) direct the relevant account debtor to make futurepayments to a Blocked Account;

**10.7.3****                  **thepayments and collections described in (a) and (b) above shall becarried out on a daily basis or (following a Default) at such other intervalsas the Lender may require;

**10.7.4****                  **itwill collect all Receivables as agent and trustee for the Lender and pay theproceeds thereof directly to an account prescribed by the Lender for thatpurpose;

**10.7.5****                  **tothe extent to which the Lender does not obtain title to any PurchasedReceivable, it will hold such Receivable on trust for the Lender and deal withit in accordance with the other provisions of this **clause** 10.7;

**10.7.6****                  **itwill not grant any credit, discount or similar allowance in respect of anyReceivable except in the ordinary course of business in accordance with itsnormal policies or with the Lender’s consent;

**10.7.7****                  **itwill indemnify the Lender on demand against any liability incurred to any bankor person involved in the operation of a Blocked Account.

**10.8****                             BusinessDays**

If any payment under any Finance Document wouldotherwise be due on a day which is not a Business Day, it will be due on thenext Business Day or (if that Business Day falls in the following month) on thepreceding Business Day.

**10.9****                             Calculationof Interest**

All interest and Purchase Commission under thisAgreement shall be calculated on the basis of actual days elapsed and a 365 dayyear. For the purposes of calculating interest and Purchase Commission, anyrepayments received in respect of the Facilities concerned shall be credited tothe relevant Facility three Business Days following receipt by the Lender.

17

----

**10.10****                      CashCollateral**

Any amount to be provided under this Agreement by wayof cash collateral in respect of any contingent liability shall stand chargedto the Lender by way of cash cover in respect of such obligation and shall beheld by the Lender in a blocked interest bearing account for applicationagainst such contingent liability. Withdrawals from such account may only bemade in order to pay amounts owing to the Lender in respect of the liabilityconcerned and (if so requested by the Lender) the relevant Borrower shallexecute a charge over such account in such form as the Lender may require. Aftersuch liability has expired or has been settled, any remaining balance shall beapplied (i) in settlement of any other amounts then owing to the Lender underany Finance Documents and (ii) in repayment to the Obligor which providedsuch cash collateral.

**11.****                                    CANCELLATION**

**11.1****                             Illegality**

If it becomes unlawful in any applicable jurisdictionfor the Lender to perform or maintain any of its obligations as contemplated bythis Agreement then the Lender may notify the Company to that effect. TheFacilities shall thereupon be cancelled and the Borrowers to which outstandingUtilisations have been made shall upon demand (i) pay to the Lender allamounts then owing by them under this Agreement (including any accruedinterest, fees and other amounts) and (ii) provide cash cover to theLender in respect of all L/Cs or other contingent obligations assumed it therequest of that Borrower.

**11.2****                             Voluntarycancellation**

The Company may, if it gives the Lender not less than10 Business Days’ prior notice, cancel the whole or any part of a Facilitywhereupon such Facility shall be cancelled to the extent stated in such notice.No cancellation notice may be given in respect of amounts represented byoutstanding Utilisations.

**11.3****                             CancellationFee**

If thewhole or any part of a Facility is cancelled as a result of (i) a noticegiven by the Lender or the Company under this **clause**11 or (ii) a notice given by the Lender under **clause** 23 (*Events ofDefault*) then and in each such case the Company shall pay to theLender on the effective date of such cancellation a cancellation fee calculatedas a percentage of the amount of the Facilities so cancelled, as follows:
| **(1)**    | ** **                                         | **(2)**      |
|------------|----------------------------------------------------|--------------|
| ** ** | **Number of Months   From date of this Agreement** | ** **   | ** ** | ** ** | **Applicable Percentage** | ** ** |
| 0-12       |                                               | 2  per cent  |
| 12-24      |                                               | 1.5  percent |
| 24-36      |                                               | 1 per cent   |
|            |                                                    |              |  |  |  |  |

 

**11.4****                             Restrictionsand conditions**

Any notice of cancellation or prepayment given this **clause** 11 shall be irrevocable and, shallspecify the date or dates upon which the relevant cancellation or prepayment isto be made and the amount of that cancellation or prepayment.

**11.4.1****                  **Anyrepayment or prepayment under this Agreement shall be made together withaccrued interest and any other amounts owing in respect of the amount repair orprepaid the amount prepaid.

18

----

**11.4.2****                  **Noamount of any Facility which is cancelled may subsequently be reinstated. Saveas provided by **clause** 5.4 (*Reutilisation*) no amount repaid or prepaidmay be redrawn.

**11.4.3****                  **TheBorrowers shall not repay, prepay or cancel the Facilities or any part of themexcept at the times and in the manner expressly provided for in this Agreement.

**12.****                                    INTEREST AND PURCHASE COMMISSION**

**12.1****                             Calculationof interest and Purchase Commission**

The rate of interest on each Revolving Loan and therate of purchase commission payable in respect of the Outstanding PurchasePrice for each Purchased Receivable shall be the percentage rate per annumwhich is the aggregate of:

**12.1.1****                  **theMargin;

**12.1.2****                  **LIBOR;and

**12.1.3****                  **theMandatory Cost.

**12.2****                             Paymentof interest and Purchase Commission**

**12.2.1****                  **TheBorrower to which a Revolving Loan has been made shall pay accrued interest onthat Revolving Loan on the last Business Day of each month.

**12.2.2****                  **TheBorrower which has sold a Receivable to the Lender shall on the last BusinessDay of each month pay accrued Purchase Commission with respect theretocalculated from the date on which the Purchase Price was paid until the ActualDate of Payment.

**12.3****                             Defaultinterest**

If an Event of Default has occurred and so long as thesame is continuing, interest shall accrue on all amounts owing under theFinance Documents at a rate which is three per cent higher than the rateascertained pursuant to **clause**12.1 (*Calculation of interest and PurchaseCommission*). Any interest accruing under this **clause** 12.3 shall be payable on demand andmay be compounded on such basis as the Lender deems appropriate.

**13.****                                    FEES**

**13.1****                             Commitmentfee**

The Company shall pay to the Lender a fee computed atthe rate of 0.15 per cent, of the undrawn/unutilised amount of the FacilityLimit. For these purposes, the amount deemed to be utilised in respect of anyperiod shall be the average outstanding balance of the aggregate of theRevolving Loans, the Outstanding Purchase Price and the L/C Exposure throughoutthe period in which the calculation falls to be made. The accrued commitmentfee is payable on the last day of each calendar month which ends during therelevant Availability Period, on the last day of the Availability Period and,if cancelled in full, on the effective date of such cancellation.

**13.2****                             Arrangementfee**

The Company shall pay to the Lender an arrangement feeof $180,000. That fee shall be payable by instalments of $15,000. The firstsuch instalment shall be paid on the date of this Agreement and each subsequentinstalment shall be payable on each of the dates falling at three monthlyintervals after that date.

19

----

**13.3****                             MonitoringFee**

The Company shall pay to the Lender a monitoring feeof £1,500 on the date of this Agreement and on each of the dates falling atthree-monthly intervals after that date until all moneys owing under thisAgreement have been paid in full.

**13.4****                             L/CFee**

Each Borrower shall pay to the Lender a fee equal to2.4 per cent per annum on the face amount of each L/C issued at the request ofthat Borrower in respect of the period from the date of issue until the expiryof such L/C. Such fee shall be paid monthly in arrears and on the Expiry Dateof such L/C.

**14.****                                    SET-OFF AND TAX GROSS UP**

**14.1****                             NoSet-Off by Obligors**

All payments to be made by an Obligor under theFinance Documents shall be calculated and be made without (and free and clearof any deduction for) any set-off or counterclaim.

**14.2****                             **Tax gross-up****

**14.2.1****                  **EachObligor shall make all payments to be made by it without any Tax Deduction,unless a Tax Deduction is required by law.

**14.2.2****                  **TheCompany shall promptly upon becoming aware that an Obligor must make a TaxDeduction (or that there is any change in the rate or the basis of a TaxDeduction) notify the Lender accordingly.

**14.2.3****                  **Ifa Tax Deduction is required by law to be made by an Obligor, the amount of thepayment due from that Obligor shall be increased to an amount which (aftermaking any Tax Deduction) leaves an amount equal to the payment which wouldhave been due if no Tax Deduction had been required.

**14.2.4****                  **Ifan Obligor is required to make a Tax Deduction, that Obligor shall make that TaxDeduction and any payment required in connection with that Tax Deduction withinthe time allowed and in the minimum amount required by law.

**14.2.5****                  **Within30 days of making either a Tax Deduction or any payment required in connectionwith that Tax Deduction, the Obligor making that Tax Deduction shall deliver tothe Lender evidence reasonably satisfactory to the Lender that the TaxDeduction has been made or (as applicable) any appropriate payment paid to therelevant taxing authority.

**14.3**                             **Tax indemnity**

**14.3.1****                  **TheCompany shall (within three Business Days of demand by the Lender) pay to theLender an amount equal to the loss, liability or cost which the Lenderdetermines will be or has been (directly or indirectly) suffered for or onaccount of Tax by the Lender in respect of a Finance Document.

**14.3.2****                   Paragraph** (a) above shall notapply to any Tax assessed on the Lender if that Tax is imposed on or calculatedby reference to the net income received or receivable (but not any sum deemedto be received or receivable) by the Lender.

**14.4**                             **Tax Credit**

If an Obligor makesa Tax Payment and the Lender determines that:

**14.4.1**                   aTax Credit is attributable to that Tax Payment; and

20

----

**14.4.2****                  **theLender has obtained, utilised and retained that Tax Credit,

the Lender shall pay an amount to the Obligor whichthe Lender determines will leave the Lender (after that payment) in the sameafter-Tax position as it would have been in had the Tax Payment not been madeby the Obligor.

**14.5****                             Stamptaxes**

The Company shallpay and, within three Business Days of demand, indemnify the Lender against anycost, loss or liability the Lender incurs in relation to all stamp duty,registration and other similar Taxes payable in respect of any FinanceDocument.

**14.6****                             Valueadded tax**

**14.6.1****                  **Allconsideration expressed to be payable under a Finance Document by an Obligor toa Lender shall be deemed to be exclusive of any VAT. If VAT is chargeable onany supply made by the Lender to an Obligor in connection with a FinanceDocument, that Obligor shall pay to the Lender (in addition to and at the sametime as paying the consideration) an amount equal to the amount of the VAT.

**14.6.2****                  **Wherea Finance Document requires an Obligor to reimburse a Lender for any costs orexpenses, that Obligor shall also at the same time pay and indemnify the Lenderagainst all VAT incurred by the Lender in respect of the costs or expenses tothe extent that the Lender reasonably determines that it is not entitled tocredit or repayment of the VAT.

**15.****                                    INCREASED COSTS**

**15.1****                             Increasedcosts**

**15.1.1****                  **Subjectto **clause** 15.3 (*Exceptions*) the Company shall, withinthree Business Days of a demand by the Lender, pay to the Lender the amount ofany Increased Costs incurred by the Lender or any of its Affiliates as a resultof (i) the introduction of or any change in (or in the interpretation,administration or application of) any law or regulation or (ii) compliancewith any law or regulation made after the date of this Agreement.

**15.1.2****                  **Inthis Agreement “**Increased Costs**”means:

**(a)****                                    **areduction in the rate of return from the Facility or on the Lender’s (or itsAffiliate’s) overall capital;

**(b)****                                    **anadditional or increased cost; or

**(c)****                                     **areduction of any amount due and payable under any Finance Document,

which is incurred or suffered by a Lender or any ofits Affiliates to the extent that it is attributable to the Lender havingentered into this Agreement or funding or performing its obligations under anyFinance Document.

**15.2****                             Increasedcost claims**

If the Lender intends to make a claim pursuant to **clause** 15.1 (*Increased costs*) it shall notify the Lender of the eventgiving rise to the claim.

**15.3****                             Exceptions**

**Clause** 15.1 (*Increased costs*) does not apply to theextent any Increased Cost is:

**15.3.1****                  **attributableto a Tax Deduction required by law to be made by an Obligor;

21

----

**15.3.2****                  **compensatedfor by **clause** 14.3 (*Tax indemnity*) (or would have beencompensated for under **clause** 14.3(*Tax indemnity*) but was not socompensated solely because the exclusion in **paragraph**(b) of **clause** 14.3 (*Tax indemnity*) applied);

**15.3.3****                  **compensatedfor by the payment of the Mandatory Cost; or

**15.3.4****                  **attributableto the negligence of or wilful breach by the relevant Lender or its Affiliatesof any law or regulation.

**16.****                                    OTHER INDEMNITIES**

**16.1****                             Currencyindemnity**

If any sum due froman Obligor under the Finance Documents (a “**Sum**”),or any order, judgment or award given or made in relation to a Sum, has to beconverted from the currency (the “**FirstCurrency**”) in which that Sum is payable into another currency (the “**Second Currency**”) for the purpose of:

**16.1.1****                  **makingor filing a claim or proof against that Obligor;

**16.1.2****                  **obtainingor enforcing an order, judgment or award in relation to any litigation orarbitration proceedings,

that Obligor shall as an independent obligation, withinthree Business Days of demand, indemnify the Lender against (i) any cost,loss or liability arising out of or as a result of the conversion including anydiscrepancy between (a) the rate of exchange used to convert that Sum fromthe First Currency into the Second Currency and (b) the rate or rates ofexchange available to that person at the time of its receipt of that Sum and (ii) thecosts involved in effecting any such currency conversion.

**16.2****                             Otherindemnities**

The Company shall(or shall procure that an Obligor will), within three Business Days of demand,indemnify the Lender against any cost, loss or liability (including loss ofMargin) incurred by the Lender as a result of:

**16.2.1****                  **theoccurrence of any Event of Default;

**16.2.2****                  **afailure by an Obligor to pay any amount due under a Finance Document on its duedate;

**16.2.3****                  **funding,or making arrangements to fund, any amount requested by a Borrower in aUtilisation Request but not advanced or paid by reason of the operation of anyone or more of the provisions of this Agreement; or

**16.2.4****                  **anyamount not being prepaid in accordance with a notice of prepayment given by aBorrower or the Company.

**17.****                                    COSTS AND EXPENSES**

**17.1****                             Transactionexpenses**

The Company shallon demand pay the Lender the amount of all costs and expenses (including legaland valuation fees) reasonably incurred by it in connection with thenegotiation, preparation, printing and execution of:

**17.1.1****                  **thisAgreement and any other documents referred to in this Agreement; and

**17.1.2****                  **anyother Finance Documents executed after the date of this Agreement.

22

----

**17.2****                             Amendmentcosts**

If an Obligor requests an amendment, waiver orconsent, the Company shall, within three Business Days of demand, reimburse theLender for the amount of all costs and expenses (including legal fees)reasonably incurred by the Lender in responding to, evaluating, negotiating orcomplying with that request or requirement.

**17.3****                             CollectionCosts**

The Company shallon demand pay the Lender the amount of all costs and expenses (including legalfees) incurred by the Lender in connection with:

**17.3.1****                  **theremission of loan proceeds, collection of cheques and other items, the issue,maintenance and renewal of L/C’s, establishing and maintaining ChargedAccounts, together with the Lender’s associated and customary fees; and

**17.3.2****                  **asout of pocket expenses and costs from time to time (including those incurredprior to the date of this Agreement) during the course of periodic fieldexaminations and appraisals of the Obligor’s assets, operations financialrecords, systems and forecasts plus a daily charge at the rate of five hundredpounds (£500) for the Lender’s examinations in the field and office for up tofour such specific field examinations in any 12 month period prior to a Defaultand for any other or additional such examinations following a default. Theaggregate annual amount charged to the Company in any period of 12 months shallnot exceed twelve thousand pounds (£12,000), unless an Event of Default hasoccurred during that period.

**17.4****                             Enforcementand other costs**

The Company shall, within three Business Days ofdemand, pay to the Lender the amount of all costs and expenses (including legalfees) incurred by the Lender in connection with the exercise or enforcement of,or the preservation of any rights or discretions under, any Finance Document(including, without limitation, any payments made to third parties inaccordance with the terms of the Finance Documents to preserve, protect orenhance any security interest granted to the Lender).

**18.****                                    GUARANTEE AND INDEMNITY**

**18.1****                             Guaranteeand indemnity**

Each Guarantorirrevocably and unconditionally jointly and severally:

**18.1.1****                  **guaranteesto the Lender punctual performance by each Borrower of all that Borrower’sobligations under the Finance Documents;

**18.1.2****                  **undertakeswith the Lender that whenever a Borrower does not pay any amount when due underor in connection with any Finance Document, that Guarantor shall immediately ondemand pay that amount as if it was the principal obligor; and

**18.1.3****                  **indemnifiesthe Lender immediately on demand against any cost, loss or liability sufferedby the Lender if any obligation guaranteed by it is or becomes unenforceable,invalid or illegal. The amount of the cost, loss or liability shall be equal tothe amount which the Lender would otherwise have been entitled to recover.

**18.2****                             Continuingguarantee**

This guarantee is a continuing guarantee and willextend to the ultimate balance of sums payable by any Obligor under the FinanceDocuments, regardless of any intermediate payment or discharge in whole or inpart.

23

----

**18.3****                             Reinstatement**

If any payment byan Obligor or any discharge given by a Lender (whether in respect of theobligations of any Obligor or any security for those obligations or otherwise)is avoided or reduced as a result of insolvency or any similar event:

**18.3.1****                  **theLiability of each Obligor shall continue as if the payment, discharge,avoidance or reduction had not occurred; and

**18.3.2****                  **theLender shall be entitled to recover the value or amount of that security orpayment from any Obligor, as if the payment, discharge, avoidance or reductionhad not occurred.

**18.4****                             Waiverof defences**

The obligations ofeach Guarantor under this **clause**18 will not be affected by an act, omission, matter or thing which, but forthis Clause, would reduce, release or prejudice any of its obligations underthis **clause** 18 (withoutlimitation and whether or not known to it or the Lender) including:

**18.4.1****                  **anytime, waiver or consent granted to, or composition with, any Obligor or otherperson;

**18.4.2****                  **therelease of any other Obligor or any other person under the terms of anycomposition or arrangement with any creditor of any member of the Group;

**18.4.3****                  **thetaking, variation, compromise, exchange, renewal or release of, or refusal orneglect to perfect, take up or enforce, any rights against, or security overassets of, any Obligor or other person or any non-presentation ornon-observance of any formality or other requirement in respect of anyinstrument or any failure to realise the full value of any security:

**(a)****                                    **anyincapacity or lack of power, authority or legal personality of or dissolutionor change in the members or status of an Obligor or any other person;

**(b)****                                    **anyamendment (however fundamental) or replacement of a Finance Document or anyother document or security;

**(c)****                                     **anyunenforceability, illegality or invalidity of any obligation of any personunder any Finance Document or any other document or security; or

**(d)****                                    **anyinsolvency or similar proceedings.

**18.5****                             Immediaterecourse**

Each Guarantor waives any right it may have of firstrequiring the Lender (or any trustee or Lender on its behalf) to proceedagainst or enforce any other rights or security or claim payment from anyperson before claiming from that Guarantor under this **clause** 18. This waiver applies irrespectiveof any law or any provision of a Finance Document to the contrary.

**18.6****                             Appropriations**

Until all amountswhich may be or become payable by the Obligors under or in connection with theFinance Documents have been irrevocably paid in full, the Lender (or anytrustee or Lender on its behalf) may:

**18.6.1****                  **refrainfrom applying or enforcing any other moneys, security or rights held orreceived by the Lender (or any trustee or Lender on its behalf) in respect ofthose amounts, or apply and enforce the same in such manner and order as itsees fit (whether against those amounts or otherwise) and no Guarantor shall beentitled to the benefit of the same; and

24

----

**18.6.2****                  **holdin an interest-bearing suspense account any moneys received from any Guarantoror on account of any Guarantor’s liability under this **clause** 18.

**18.7****                             Deferralof Guarantors’ rights**

Until all amountswhich may be or become payable by the Obligors under or in connection with theFinance Documents have been irrevocably paid in full and unless the Lenderotherwise directs, no Guarantor will exercise any rights which it may have byreason of performance by it of its obligations under the Finance Documents:

**18.7.1****                  **tobe indemnified by an Obligor;

**18.7.2****                  **toclaim any contribution from any other guarantor of any Obligor’s obligationsunder the Finance Documents; and/or

**18.7.3****                  **totake the benefit (in whole or in part and whether by way of subrogation orotherwise) of any rights of the Finance Parties under the Finance Documents orof any other guarantee or security taken pursuant to, or in connection with,the Finance Documents by the Lender.

**18.8****                             Additionalsecurity**

This guarantee is in addition to and is not in any wayprejudiced by any other guarantee or security now or subsequently held by theLender. The obligations of each Guarantor shall be valid and enforceablenotwithstanding that those expressed to be assumed by any other Guarantor areinvalid or unenforceable for any reason whatsoever.

**19.****                                    REPRESENTATIONS**

Each Obligor makes the representations and warrantiesset out in this **clause** 19 to theLender on the date of this Agreement.

**19.1****                             Status**

**19.1.1****                  **Itis a corporation, duly incorporated and validly existing under the law of itsjurisdiction of incorporation.

**19.1.2****                  **Ithas the power to own its assets and carry on its business as it is beingconducted.

**19.2****                             Bindingobligations**

The obligations expressed to be assumed by it in eachFinance Document are legal, valid, binding and enforceable obligations.

**19.3****                             Non-conflictwith other obligations**

The entry into andperformance by it of, and the transactions contemplated by, the FinanceDocuments do not and will not conflict with:

**19.3.1****                  **anylaw or regulation applicable to it;

**19.3.2****                  **itsconstitutional documents; or

**19.3.3****                  **anyagreement or instrument binding upon or any of its assets.

**19.4****                             Powerand authority**

It has the power to enter into, perform and deliver,and has taken all necessary action to authorise its entry into, performance anddelivery of, the Finance Documents to which it is a party and the transactionscontemplated by those Finance Documents.

25

----

**19.5****                             Validityand admissibility in evidence**

All Authorisationsrequired or desirable:

**19.5.1****                  **toenable it lawfully to enter into, exercise its rights and comply with itsobligations in the Finance Documents to which it is a party; and

**19.5.2****                  **tomake the Finance Documents to which it is a party admissible in evidence in itsjurisdiction of incorporation,

have been obtained or effected and are in full forceand effect.

**19.6****                             Nofiling or stamp taxes**

Under the law of its jurisdiction of incorporation itis not necessary that the Finance Documents be filed, recorded or enrolled withany court or other authority in that jurisdiction or that any stamp,registration or similar tax be paid on or in relation to the Finance Documentsor the transactions contemplated by the Finance Documents.

**19.7****                             Nodefault**

**19.7.1****                  **NoEvent of Default is continuing or might reasonably be expected to result fromthe making of any Utilisation.

**19.7.2****                  **Noother event or circumstance is outstanding which constitutes a default underany other agreement or instrument which is binding on it or any of itsSubsidiaries or to which its (or its Subsidiaries) assets are subject whichmight have a Material Adverse Effect.

**19.8****                             Nomisleading information**

**19.8.1****                  **Anyinformation provided by any member of the Group (i) in connection with thenegotiation of the Facilities and the Finance Documents and (ii) inconnection with any valuations or reports required to be prepared for thepurposes of this Agreement was (in each case) true and accurate in all materialrespects as at the date it was provided or as at the date (if any) at which itis stated.

**19.8.2****                  **Nothinghas occurred since the date on which such information was provided which wouldrender it untrue or misleading in any material respect.

**19.9****                             Financialstatements**

Its latest audited financial statement were preparedin accordance with GAAP consistently applied.

Its latest audited financial statements fairlyrepresent its financial condition and operations (consolidated in the case ofthe Company) during the relevant financial year.

There has been no material adverse change in itsbusiness or financial condition since the date to which its latest auditedfinancial statements were made up.

**19.10****                      Paripassu ranking**

Its payment obligations under the Finance Documentsrank at least pari passu with the claims of all its other unsecured andunsubordinated creditors, except for obligations mandatorily preferred by lawapplying to companies generally.

**19.11****                      Noproceedings pending or threatened**

No litigation, arbitration or administrativeproceedings of or before any court, arbitral body or agency which, if adverselydetermined, might reasonably be expected to have a Material Adverse 

26

----

Effect have (to the best of its knowledge and belief)been started or threatened against it or any of its Subsidiaries.

**19.12****                      Retentionof Title**

Any list provided to the Lender prior to the date ofthis Agreement and which provides details of those suppliers whose terms ofbusiness include retention of title provisions is complete and accurate in allmaterial respects.

**19.13****                      BankAccounts**

All the accounts maintained or used by any Obligor atany Bank or financial institution have been included within the definition ofCharged Accounts.

**19.14****                      Repetition**

The representations in this **clause** 19 are deemed to be made by each Obligor by referenceto the facts and circumstances then existing on the date of each UtilisationRequest.

**20.****                                    INFORMATION UNDERTAKINGS**

The undertakings in this **clause** 20 remain in force from the date of this Agreement forso long as any amount is outstanding under the Finance Documents or anyCommitment is in force.

**20.1****                             Notificationof default**

Each Obligor shall notify the Lender of any Default (andthe steps, if any, being taken to remedy it) promptly upon becoming aware ofits occurrence.

**20.2****                             Securityand Financial Undertakings**

Each Obligor will comply with the undertakings set outin **Schedule** 3 (*Undertakings regarding Receivables etc*).

**21.****                                    GENERAL UNDERTAKINGS**

The undertakings in this **clause** 21 remain in force from the date of this Agreement forso long as any amount is outstanding under the Finance Documents or anyFacility remains available for utilisation.

**21.1****                             Authorisations**

Each Obligor shallpromptly:

**21.1.1****                  **obtain,comply with and do all that is necessary to maintain in full force and effect;and

**21.1.2****                  **supplycertified copies to the Lender of,

any Authorisation required under any law or regulationof its jurisdiction of incorporation to enable it to perform its obligationsunder the Finance Documents and to ensure the legality, validity,enforceability or admissibility in evidence in its jurisdiction ofincorporation of any Finance Document.

**21.2****                             Compliancewith laws**

Each Obligor shall comply in all respects with alllaws to which it may be subject, if failure so to comply would materiallyimpair its ability to perform its obligations under the Finance Documents.

27

----

**21.3****                             Negativepledge**

No Obligor shall create or permit to subsist anySecurity Interest (other than a Permitted Security Interest) over any of itsassets.

No Obligor shall:

**21.3.1****                  **sell,transfer or otherwise dispose of any of its assets on terms whereby they are ormay be leased to or re-acquired by an Obligor;

**21.3.2****                  **enterinto any arrangement under which money or the benefit of a bank or otheraccount may be applied, set-off or made subject to a combination of accounts;or

**21.3.3****                  **enterinto any other preferential arrangement having a similar effect,

in circumstances where the arrangement or transactionis entered into primarily as a method of raising Financial Indebtedness or offinancing the acquisition of an asset.

**21.4****                             Disposals**

**21.4.1****                  **NoObligor shall enter into a single transaction or a series of transactions(whether related or not) and whether voluntary or involuntary to sell, lease,transfer or otherwise dispose of any asset.

**21.4.2****                   Paragraph** (a) above does notapply to any sale, lease, transfer or other disposal:

**(a)****                                    **relatingto the disposal of Stock and made in the ordinary course of trading;

**(b)****                                    **relatingto the application of cash in the acquisition of goods and services in theordinary course of trading and in a manner consistent with the FinanceDocuments;

**(c)****                                     **relatingto the disposal of obsolete assets where any proceeds of sale are paid into ablocked account;

**(d)****                                    **anydisposal of any asset where the higher of the market value or considerationreceivable (when aggregated with the higher of the market value orconsideration receivable for any other sale, lease, transfer or other disposal,other than any permitted under **paragraphs**(i) to (iii) above) does not exceed US$30,000 (or its equivalent inanother currency or currencies) in any financial year and the proceeds are paidinto a Blocked Account;

**(e)****                                     **whichhas been approved in writing by the Lender.

**21.5****                             Mergersand Acquisitions**

No Obligor shall enter into any amalgamation,demerger, merger or corporate reconstruction or acquire any business,undertaking or (except in the ordinary course of business) other assets of anykind without the prior written consent of the Lender, such consent not to beunreasonably withheld.

**21.6****                             Changeof business**

The Company shall procure that no substantial changeis made to the general nature of the business of the Company any Obligor fromthat carried on at the date of this Agreement.

**21.7****                             Intra-GroupArrangements**

No Obligor will,without obtaining the Lender’s prior written consent (such consent not to beunreasonably withheld):

**21.7.1****                  **payany dividend or make any other distribution of any of its assets to itsshareholders or any of them; or

28

----

**21.7.2****                  **(subjectto (c) below) pay any other moneys, whether by way of interest, managementfees or otherwise howsoever, to any affiliate, subsidiary or any shareholder,director or employee except for (i) payments in the ordinary course of,and pursuant to the reasonable requirements of, trading and on arms lengthcommercial terms and (ii) payments which comply with the terms of **clause** 6.4;

**21.7.3****                  **payany sales commissions to any of its Affiliates in excess of 10 per cent; or

**21.7.4****                  **redeemany of its ordinary or preference share capital.

**21.8****                             FinancialIndebtedness**

No Obligor willincur any Financial Indebtedness other than:

**21.8.1****                  **underthe Finance Documents;

**21.8.2****                  **normaltrade credit granted to it in the ordinary course of business;

**21.8.3****                  **equipment,vehicle and operating leases and hire purchase transactions entered into in theordinary course of business where the total annual Financial Indebtedness forsuch leases and transactions for the Obligors as a whole does not exceedUS$500,000 at any one tune; or

**21.8.4****                  **withrespect to loans made to it by another Obligor which is a Chargor under theDebenture.

**21.9****                             MakingLoans**

No Obligor will bea creditor with respect to any Financial Indebtedness except for:

**21.9.1****                  **thegrant of normal trade credit in the ordinary course of its trade;

**21.9.2****                  **loansmade by it to another Obligor which is a Charger under the Debenture; and

**21.9.3****                  **loansmade in compliance with the terms of **clause**6.4.

**21.10****                      BankAccounts**

No Obligor will, open or maintain any account of anytype with any bank or financial institution providing like services other thanthe Charged Accounts.

**21.11****                      Insurance**

**21.11.1****           **EachObligor will:

**(a)****                                    **asregards all its assets and property of any kind (i) arrange and maintainin full force and effect insurances (including consequential loss, businessinterruption and public liability and damage and other insurances usuallymaintained by companies carrying on the same type of business under similarcircumstances) in such amounts, on such terms and with such insurers as theLender may approve and (ii) arrange and maintain such further and otherinsurances as the Lender may reasonably request;

**(b)****                                    **procurethat the Lender’s interest is noted on all policies relating to insurances soarranged in such manner as the Lender may in its absolute discretion requireand will use all reasonable endeavours to ensure that the Lender is named assole loss payee in respect of all assets and property of any kind of eachObligor (but without having any obligation for premium);

**(c)****                                     **ensurethat every policy of insurance contains a standard mortgagee clause, wherebysuch insurance will not be invalidated, vitiated or avoided as against amortgagee (or such other terms as the Lender may agree);

29

----

**(d)****                                    **supplyto the Lender copies of all such policies of insurance and all endorsements andrenewals of such policies, together with receipts for premiums;

**(e)****                                     **dulyand punctually pay all premiums in respect of its insurances and not do or omitto do any act, matter or thing whereby any such insurance may be or becomesvoid or voidable at the option of the insurers or settle any claim in respectof those insurances without the prior written consent of the Lender, suchconsent not to be unreasonably withheld or delayed;

**(f)****                                       **complywith, enforce and not waive, release, terminate or vary (or agree so to do) anyobligations arising under all policies of insurance and in particular, butwithout limitation, it shall notify the Lender immediately upon receiving noticefrom any insurer that the details of any insurance policy are to change in anyway and upon receiving notice from any insurer terminating any insurancepolicies;

**(g)****                                     **inthe event that it receives from any insurer notice that such insurer isterminating any insurance policy, it shall use all reasonable endeavours toenter into a corresponding policy with an insurer approved by the Lender andprocure that such steps are taken as may be necessary to ensure that suchpolicy complies in all respects with the terms of this Agreement;

**(h)****                                    **assoon as reasonably practicable give notice to the Lender of any occurrencewhich gives rise, or might give rise, to a claim exceeding $20,000 under anypolicy of insurance.

**21.11.2****           **Ifany Obligor at any time fails to perform any of its obligations contained inthis clause 21.12 the Lender may effect or renew such insurance as it thinksfit and such Obligor shall reimburse the Lender for the costs thereby incurredon demand.

**21.12****                      FinancialYear End**

No Obligor willalter its financial year end.

**21.13****                      Taxes**

Each Obligor willpromptly pay all Taxes as and when they fall due (except where the Lenderagrees that any relevant amounts are subject to a bona fide dispute).

**21.14****                      Changeof Name**

No Obligor willchange its name without giving the Lender 30 days’ prior written notice of theproposed new name and will supply a copy of the relevant certificate ofincorporation on change of name to the Lender as soon as it becomes available.

**22.****                                    EVENTS OF DEFAULT**

Each of the events or circumstances set out in **clause** 22 is an Event of Default.

**22.1****                             Non-payment**

An Obligor does not pay on the due date any amountpayable pursuant to a Finance Document at the place at and in the currency inwhich it is expressed to be payable unless (i) its failure to pay iscaused by administrative or technical error (not attributable to an Obligor)and (ii) payment is made within two Business Days of its due date.

30

----

**22.2****                             Otherobligations**

**22.2.1****                  **AnObligor does not comply with the provisions of **clause**s 21.3 (*NegativePledge*), 21.4 (*Disposals*),21.9 (*Financial Indebtedness*),21.12 (*Insurance*) or any of thefinancial undertakings set out in **paragraph**(B) **Schedule** 3 (*Reporting and Financial Undertakings*).

**22.2.2****                  **AnObligor does not comply with any of the reporting undertaking set out in **paragraph** (A) of **Schedule** 3 (*Reporting and Financial Undertakings*) within two BusinessDays of the date on which the Obligor ought to have so complied.

**22.2.3****                  **AnObligor does not comply with any other provision of the Finance Documents and,where such non-compliance is capable of remedy, such Obligor fails to remedysame with ten Business Days of becoming aware thereof.

**22.3****                             Misrepresentation**

Any representationor statement made or deemed to be made by an Obligor in the Finance Documentsor any other document delivered by or on behalf of any Obligor under or inconnection with any Finance Document is or proves to have been incorrect ormisleading in any material respect when made or deemed to be made.

**22.4****                             Crossdefault**

**22.4.1****                  **AnyFinancial Indebtedness of any Obligor exceeding US$50,000 (or its equivalent inother currencies) in the aggregate is not paid when due.

**22.4.2****                  **Anevent of default (however described) occurs under any document relating toFinancial Indebtedness of any Obligor exceeding US$50,000 (or its equivalent inother currencies).

**22.4.3****                  **AnySecurity Interest with respect to any Financial Indebtedness of any Obligorbecomes enforceable.

**2.24.4****                  **Anamount in excess of US$2 million in aggregate owed to trade creditors of anyObligor remains outstanding following the expiry of any customary trade creditperiod.

**22.5****                             Insolvency**

**22.5.1****                  **AnObligor is unable or admits inability to pay its debts as they fall due,suspends making payments on any of its debts or, by reason of actual or anticipatedfinancial difficulties, commences negotiations with one or more of itscreditors with a view to rescheduling any of its indebtedness.

**22.5.2****                  **Thevalue of the assets of any Obligor is less than its liabilities (taking intoaccount contingent and prospective liabilities).

**22.5.3****                  **Amoratorium is declared in respect of any indebtedness of any Obligor.

**22.6****                             Insolvencyproceedings**

Any corporateaction, legal proceedings or other procedure or step is taken in relation to:

**22.6.1****                  **thesuspension of payments, a moratoriurn of any indebtedness, winding-up,dissolution, administration or reorganisation (by way of voluntary arrangement,scheme of arrangement or otherwise) of any Obligor;

**22.6.2****                  **acomposition, assignment or arrangement with any creditor of any Obligor;

**22.6.3****                  **theappointment of a liquidator, receiver, administrator, administrative receiver,compulsory manager or other similar officer in respect of any Obligor or any ofits assets; or

31

----

**22.6.4****                  **enforcementof any Security over any assets of any Obligor,

**22.6.5****                  **orany analogous procedure or step is taken in any jurisdiction.

**22.7****                             Cessationof Business**

Any Obligor ceases or threatens to cease, to carry onall or a substantial part of its business without the Lender’s prior writtenconsent, such consent not to be unreasonably withheld.

**22.8****                             Creditors’process**

Any expropriation, attachment, sequestration, distressor execution affects any asset of any Obligor and is not discharged within 14days unless either (i) the Lender has given its written consent to thateffect or (ii) the Company has demonstrated to the satisfaction of theLender that such proceedings are being contested in good faith.

**22.9****                             Unlawfulness**

It is or becomes unlawful for an Obligor to performany of its obligations under the Finance Documents.

**22.10****                      Changeof Control**

Any single person or group of persons acting inconceit (as defined in the City Code on Takeovers and Mergers) not havingcontrol of the Company as at the date of this Agreement acquires or agrees toacquire control (as defined in section 416 of the Income and Corporation TaxesAct 1988) of the Company.

**22.11****                      ChargedAccount Arrangements**

Any bank repudiates or purports to terminate thearrangements set out in the Debenture in relation to any Charged Account(unless the Company has established alternative arrangements in all respectssatisfactory to the Lender) or a cash-sweep or payment required to be madeunder any Finance Document from a Charged Account is not made in the amount andmanner required.

**22.12****                      Materialadverse change**

An Event or series of events occurs which, in thereasonable opinion of the Lender, could be expected to have a Material AdverseEffect

**22.13****                      Acceleration**

On and at any time after the occurrence of an Event ofDefault which is continuing the Lender may, by notice to the Company:

**22.13.1****           **cancelthe Facilities whereupon they shall immediately be cancelled;

**22.13.2****           **declarethat all or part of the Loans, together with accrued interest, and all otheramounts accrued or outstanding under the Finance Documents be immediately dueand payable, whereupon they shall become immediately due and payable; and/or

**22.13.3****           **declarethat all or part of the Loans be payable on demand, whereupon they shallimmediately become payable on demand by the Lenders.

**22.13.4****           **declarethat the Company shall immediately pay or procure the payment of cash cover inrespect of the Outstanding Purchase Price and the L/Cs. The provisions of **clause** 10.10 (*Cash collateral*) shall apply to any cash cover to beprovided under this **clause**22.13.4.

32

----

**22.14****                      Leader’sRights following Default**

Without prejudice to the other provisions of this **clause** 22 or any of its other rights underany Finance Documents, the Lender may, at any time while a Default iscontinuing (and without incurring any liability for the exercise ornon-exercise of any such power):

**22.14.1****           **requireeach Obligor immediately to deliver to it all original documents relating tothe Receivables and the contracts giving rise to them; and/or

**22.14.2****           **givenotice (or require the relevant Obligors to give notice) to the account debtorsto the effect that the Receivables have been assigned to the Lender andrequiring that payment be made to such account as the Lender may specify;

**22.14.3****           **extendthe time for payment of any Receivable or otherwise enter into any arrangementsfor the settlement, compromise, release or discharge of any receivable; and/or

**22.14.4****           **generallytake such action as it may deem fit for the protection of any rights, remediesor security conferred upon it by any of the Finance Documents.

**22.15****                      Defaultby Lender**

On and at any time after the occurrence of any of theevents below which is continuing the Company may, by notice to the Lendercancel the Facilities whereupon they shall immediately be cancelled and declarethat all sums accrued or outstanding from the Lender to the Company beimmediately due and payable:

**22.15.1****           **theLender is unable or admits inability to pay its debts as they fall due,suspends making payments on any of its debts or, by reason of actual oranticipated financial difficulties, commences negotiations with one or more ofits creditors with a view to rescheduling any of its indebtedness;

**22.15.2****           **thevalue of the assets of the Lender is less than its liabilities (taking intoaccount contingent and prospective liabilities);

**22.15.3****           **amoratorium is declared in respect of any indebtedness of the Lender; or

**22.15.4****           **anycorporate action, legal proceedings or other procedure or step is taken inrelation to:

**(a)****                                    **thesuspension of payments, a moratorium of any indebtedness, winding-up,dissolution administration or reorganisation (by way of voluntary arrangement,scheme of arrangement or otherwise) of the Lender;

**(b)****                                    **acomposition, assignment or arrangement with any creditor of the Lender;

**(c)****                                     **theappointment of a liquidator, receiver, administrator, administrative receiver,compulsory manager or other similar officer in respect of the Lender or any ofits assets; or

**(d)****                                    **enforcementof any security over any assets of the Lender.

**23.****                                    CHANGES TO THE LENDER**

**23.1****                             Assignmentsand transfers by the Lender**

The Lender may at any time assign, transfer, delegateor offer participations in all or a proportion of its rights and obligationsunder the Finance Documents.

33

----

**24.****                                    CHANGES TO THE OBLIGORS**

**24.1****                             Assignmentsand transfer by Obligors**

No Obligor may assign any of its rights or transferany of its rights or obligations under the Finance Documents.

**24.2****                             AdditionalBorrowers**

The Company may request that any of its Subsidiariesbecomes an Additional Borrower. That Subsidiary shall become an AdditionalBorrower if:

**24.2.1****                  **theLender approves the addition of that Subsidiary;

**24.2.2****                  **theCompany delivers to the Lender a duly completed and executed Accession Letterand Deed of Accession;

**24.2.3****                  **theCompany confirms that no Default is continuing or would occur as a result ofthat Subsidiary becoming an Additional Borrower; and

**24.2.4****                  **theLender has received with respect to the Additional Obligor, documentationcorresponding to that Listed in **paragraph**(A) and (B) of **Schedule**2 (*Conditions precedent*) inrelation to that Additional Borrower, each in form and substance satisfactoryto the Lender.

**24.3****                             AdditionalGuarantors**

The Company shall procure that each of itsSubsidiaries is a Guarantor. If any company becomes a Subsidiary after the dateof this Agreement, the Company shall procure that such Subsidiary becomes aGuarantor by delivery to the Lender:

**24.3.1****                  **aduly completed and executed Accession Letter and Deed of Accession; and

**24.3.2****                  **allof the corresponding documents and other evidence listed in **paragraphs** (A) and (B) of **Schedule** 2 (*Conditions precedent*) in relation to that Guarantor, each inform and substance satisfactory to the Lender.

The Company shall not be obliged to procure thatViewSonic Limited becomes a Guarantor, unless and until it acquires any assetsor commences any business.

**24.4****                             Repetitionof Representations**

Delivery of an Accession Letter constitutesconfirmation by the relevant Subsidiary that the Repeating Representations aretrue and correct in relation to it as at the date of delivery as if made byreference to the facts and circumstances then existing.

**25.****                                    NOTICES**

**25.1****                             Communications**

Any communication, consent or other approval to bemade or given under or in connection with the Finance Documents shall be madein writing, may be made by fax or letter and shall be deemed to have beenreceived as follows:

**25.1.1****                  **ifby way of fax, when received in legible form; or

**25.1.2****                  **ifby way of letter, when it has been left at the relevant address or two BusinessDays after being deposited in the post postage prepaid in an envelope addressedto it at that address.

34

----

**25.2****                             Address**

Anynotice to be given to the Company or any Obligor shall be given to the Companyat the address or fax number set out on the execution pages. Each Obligorirrevocably appoints the Company as its agent for the purpose of receiving anysuch notice. Any notice to be given to the Lender shall be given to it at theaddress or fax number set out on the execution pages. Either party may changethese details by notice to the other.

**26.****                                    MISCELLANEOUS PROVISIONS**

**26.1****                             Certificatesand Determinations**

Anycertification or determination by the Lender of a rate or amount under anyFinance Document is, in the absence of manifest error, conclusive evidence ofthe matters to which it relates.

**26.2****                             Disclosureof Information**

TheUnder may disclose to any person with whom it proposes to enter into (or hasentered into) any assignment, transfer, participation or other arrangement withrespect to this Agreement such information concerning the Obligors as it thinksfit, and may advertise or publicise the transaction evidenced by this Agreementto such extent and in such manner as it sees fit.

**26.3****                             PartialInvalidity**

If,at any time, any provision of the Finance Documents is or becomes illegal, invalidor unenforceable in any respect under any law of any jurisdiction, neither thelegality, validity or enforceability of the remaining provisions nor thelegality, validity or enforceability of such provision under the law of anyother jurisdiction will in any way be affected or impaired.

**27.****                                    REMEDIES AND WAIVERS**

Nofailure to exercise, nor any delay in exercising, on the part of the Lender,any right or remedy under the Finance Documents shall operate as a waiver, norshall any single or partial exercise of any right or remedy prevent any furtheror other exercise or the exercise of any other right or remedy. The rights andremedies provided in this Agreement are cumulative and not exclusive of anyrights or remedies provided by law.

**28.****                                    COUNTERPARTS**

EachFinance Document may be executed in any number of counterparts, and this hasthe same effect as if the signatures an the counterparts were on a single copyof the Finance Document.

**29.****                                    GOVERNING LAW**

ThisAgreement is governed by the law of England and Wales.

**ThisAgreement has been entered into on the date stated at the beginning of thisAgreement.**

35

----

**SCHEDULE1**

The Original Obligors

Part I

The Original Borrowers

| **Name of Original Borrower** | ** ** | **Registration number (or  equivalent, if any)** |
|-------------------------------|------------|--------------------------------------------------|
| ViewSonic Europe Limited      |       | 03131161                                         |

 

Part II

The Original Guarantors

| **Name of Original Guarantor** | ** ** | **Registration number (or  equivalent, if any)**                |
|--------------------------------|------------|-----------------------------------------------------------------|
| ViewSonic Sarl                 |       | B404 220 139 (Commercial  and Companies Registry of Versailles) |
| ViewSonic Technology  GmbH     |       | 40 HRB 5493 (Commercial  Court of Krefeld)                      |

36

----

**SCHEDULE2**

Conditions Precedent

**(A)****                                   OriginalObligors**

**1.****                                          **Acertified copy of the constitutional documents of each Original Obligor.

**2.****                                          **Acertified copy of a resolution of the board of directors of each OriginalObligor approving the execution of the Finance Documents and the taking of anyaction required or permitted pursuant thereto.

**3.****                                          **Aspecimen of the signature of each person authorised to give notices on behalfof each Obligor.

**4.****                                          **Acertificate of each Obligor (signed by a director) confirming that theexecution and performance of this Agreement does not cause any borrowing,guaranteeing or similar limit binding on any Original Obligor to be exceeded.

**5.****                                          **Satisfactorycompany and/or other searches.

**6.****                                          **Suchlegal opinions and other documents as the Lender may require to confirm thevalidity and enforceability of the Finance Documents.

**(B)****                                  SecurityAnd Other Documents**

**7.****                                          **TheFinance Documents, duly executed by the parties thereto together with suchfurther documents as the Lender may require in connection with the completion,registration, perfection or enforceability thereof or of any security intendedto be created thereby.

**8.****                                          **Certifiedcopies of (i) all notices of assignment and other notices required to begiven pursuant to the Debenture to Barclays Bank plc and (ii) allacknowledgements required to be given with respect thereto, duly executed bythe recipient.

**9.****                                          **Areport or other evidence as to the insurances maintained by each Obligor and theirconformity to the terms of the Finance Documents (including (i) confirmationthat the Lender is noted as mortgagee and loss payee in relation to theproperty and assets of the Obligors and (ii) without limiting thegenerality of this paragraph, confirmation that adequate insurance on stock atbonded warehouses and at sea is in force).

**10.****                                   **Inrelation to Stock held in the Netherlands, a third party pledge holdersagreement.

**11.****                                   **Evidencethat the Blocked Accounts have been opened, together with copies of thecompleted mandates.

**12.****                                   **Detailsof the amounts standing to the credit of each Charged Account as at the date onwhich such details are delivered.

**13.****                                   **Evidencethat the assets and undertakings of each Obligor are free of anySecurity Interest (other than a Permitted Security Interest).

**14.****                                   **Atelephone and facsimile indemnity executed by each Borrower.

**(C)****                                 ****Availability Limit Information**

**15.****                                   **Suchinformation as the Lender may require in order to determine, as at the date ofthis Agreement, (i) the amount of the Eligible Receivables, (ii) theNet Stock Value and (iii) the Availability Limits pursuant to **clause** 6 *(Restrictionsapplicable to individual Facilities)*and (ii) the Reserves).

37

----

**16.****                                   **Suchinformation as the Lender may require in order to identify or determine (i) thoseSuppliers of Stock to the Obligors which supply on title retention terms, (ii) thosecustomers of the Obligors which acquire stock on sale or return terms, (iii) whichStock is supplied by any Obligor otherwise than as principal (whether as aconsignee or otherwise) and (iv) the nature of the payment terms whichapply as between the Obligors and their customers.

**17.****                                   **Evidencethat the total amount available for Utilisation (following the firstUtilisation) and net of any past due payables will be not less than $3,000,000.

**(D)****                                 MiscellaneousItems**

**18.****                                   **Confirmationthat VAT and similar customs duties in the Netherlands either do not create therequirement for a Reserve in accordance with the Lender’s normal lendingpractices or, if a Reserve is required, that adequate provision has been made.

**19.****                                   **Confirmationthat the Company is licensed by Viewsonic Corporation to use the brand name “Viewsonic”,and that such licence is on terms acceptable to the Lender.

**20.****                                   **Receiptof Viewsonic Corporation’s financial statements for the period to 31 December 2003.

38

----

**SCHEDULE3**

**Reporting and Financial Undertakings**

**(A)**   REPORTINGREQUIREMENTS

**1.**   ImmediateReporting Requirements

Each Obligor will furnish to the Lender full detailsof each of the following matters as soon as such Obligor becomes aware thereof:

**(a)****        **anymaterial delay in such Obligor’s performance of its obligations to an accountdebtor, (ii) any assertion by any account debtor of any right of set-off,defence, counterclaim or similar right with respect to any Receivable, (iii) anyinformation coming to its attention which may be materially adverse to thefinancial condition of any account debtor and (iv) any information comingto its attention which might lead the Lender to consider any Receivables as nolonger constituting Eligible Receivables;

**(b)****        **anyreturn of Stock by an account debtor where that Stock has a value in excess ofUS$50,000 and an equivalent replacement order has not been placed;

**(c)****         **anysupplier who imposes retention of title clauses (other than any mentioned in alist provided for the purposes of **clause** 19.12);

**(d)****        **thedetails of any litigation, arbitration or administrative proceedings which arecurrent, threatened or pending against any Obligor, and which might, ifadversely determined, have a Material Adverse Effect.

**2.**   DailyReporting Requirements

On each day on which theamount available for Utilisation under this Agreement is less than US$3,000,000each Obligor will furnish to the Lender on a daily basis:

**(a)****        **thesales book for the day, listing invoices delivered;

**(b)****        **schedulesof Receivables, collections and credits; and

**(c)****         **schedulesof Receivables which are (or are alleged by the account debtor to be) subjectto any restriction on assignment or charge.

**3.**   WeeklyReporting Requirements

Each Obligor will furnishto the Lender on a weekly basis:

**(a)****        **thesales book for the week, listing invoices delivered;

**(b)****        **areport on any Stock and Receivables which may for any reason no longer fall tobe treated as Eligible Stock or Eligible Receivables;

**(c)****         **(solong as any amounts are outstanding under this Agreement) a weekly StockReport; and

**(d)****        **(solong as any amounts are outstanding under this Agreement) a report on EligibleStock and Eligible Receivables enabling the Lender to calculate the TotalAvailability.

**4.**   Monthly Reporting Requirements

Each Obligor willfurnish to the Lender (in a formatacceptable to the Lender):

**(a)****        **ona monthly basis, a stock report in the form from time to time required by theLender;

39

----

**(b)****        **within15 days of the end of each month or at such other times and with respect tosuch other periods as the Lender may require, full details (in such form as theLender may from time to time require) of:

**(i)****            **asummary of ageings of payables and a detailed ageing of Receivables with datedinvoices;

**(ii)****        **thesales book for the month, listing invoices delivered;

**(iii)****    **detailsof any new retention of title clauses imposed by suppliers;

**(iv)****      **areport showing Stock and sales days, Stock returned by distributors and Stockdiscontinued;

**(v)****          **alist of all shipments of Goods on water, showing those where bills of ladingare held and those where they are awaited;

**(vi)****      **areconciliation of roll forward of Stock and Receivables to aged listings and tomanagement accounts; and

**(vii)****  **allStock by category and location;

**(c)****         **assoon as the same become available, but in any event within 30 days after theend of each monthly management accounting period (and in each case in a formatacceptable to the Lender):

**(i)****            **fallindividual and consolidated accounts for that period for itself and eachObligor, including profit and loss, balance sheet and cashflow statements;

**(ii)****        **detailsof Stock figures and valuations for that month, a breakdown of the value andidentity of preferential creditors for that month and details of all input andoutput VAT; and

**(iii)****    **areport on future capital expenditure requirements;

**(d)****        **togetherwith the accounts referred to in (c) above, a certificate from a Directorof the Company confirming that the Company was in compliance with the TradingCashflow Covenant in paragraph (B) below as at the date to which suchaccounts were made up; and

**(e)****         **ona monthly basis and on a best endeavours basis, a summary of inventory held byIngram on behalf of the Obligors.

**5.**   AnnualReporting Requirements

The Company shall supply to the Lender:

**(a)****        **assoon as the same become available, but in any event within 120 days after theend of each of its financial years:

**(i)****            **itsaudited financial statements (consolidated where appropriate) for thatfinancial year; and

**(ii)****        **theaudited financial statements of each Obligor and of ViewSonic Corporation forthat financial year;

**(b)****        **togetherwith the accounts referred to in (a) above, a certificate from itsauditors confirming that the Company was in compliance with the TradingCashflow Covenant in **paragraph** (B) belowas at the date to which such accounts were made up.

**(c)****         **nolater than the fifteenth day of each of its financial years:

**(i)****            **itsforecasts for that year including profit and loss, balance sheet and cashflowprojections;

**(ii)****        **aphysical count of Stock with a report thereon; and

40

----

**(iii)****    **acopy of all its current insurance policies.

**6.**   On Request Reporting Requirements

EachObligor will Famish to the Lender (in a format acceptable to the Lender) uponthe Lender’s request to that effect:

**(a)****        **anappraisal of its Stock addressed to the Lender and in a form and prepared by anappraiser acceptable to the Lender;

**(b)****        **suchfurther information regarding the financial condition, business and operationsof any Obligor as the Lender may reasonably request.

**7.**   Reporting Requirements on Issue

Each Obligor will furnish to the Lender all documentsdispatched by the Company to its shareholders (or any class of them) or itscreditors generally at the same time as they are dispatched.

**8.**   Provisions with respect to Stock,Receivables and Assets

**(a)****        **If,at any time, any Stock is returned to an Obligor by an account debtor or isreclaimed or repossessed, then:

**(i)****            **therelated Receivable will cease to be an Eligible Receivable; and

**(ii)****        **ifso requested by the Lender, the relevantObligor shall (i) hold the returned Stock on trust for the Lender, (ii) segregatedie returned Stock from its other property,

**(iii)****    **disposeof the returned Stock only in accordance with the Lender’s instructions and (iv) notissue and credits, discounts or allowances with respect to the returned Stockwithout the Lender’s prior written consent

**(b)****        **EachObligor undertakes to maintain complete, accurate and up to date debtor records(including transport documents evidencing that goods have been despatched andpayment is due), and to allow the Lender access to those records on request.

**(c)****         **EachObligor acknowledges that the Lender may take such steps as it may deemappropriate to verify any asset of such Obligor (whether by direct enquiry withaccount debtors or otherwise howsoever), on the proviso that it first informsthe relevant Obligor of such.

**9.**   Provisions with respect To Stock

**(a)****        **Withrespect to its Stock, each Obligor will:

**(i)****            **atall times maintain perpetual stock records acceptable to the Lender, whichshall accurately itemise and describe (i) the kind, type, quality andquantity of such Stock, (ii) the cost of such Stock and (iii) thedaily additions to/withdrawals from such Stock;

**(ii)****        **conducta physical count of such Stock at least once a year and (if an Event of Defaultis continuing) at such other times as the Lender may require, and deliver tothe Lender a report acceptable to it with respect to such count;

**(iii)****    **(exceptfor sales of Stock in the ordinary course of business and movements of Stockfor demonstration, inspection or testing or any other purpose previouslyapproved by the Lender in writing) not remove any Stock from propertycontrolled by it or from a public warehouse;

**(iv)****      **produce,use, store and maintain its Stock with reasonable care and in accordance withall regulatory and material insurance requirements;

41

----

**(v)****          **not,without the Lender’s prior written consent, sell any Stock exceeding US$10,000on sale or return or similar terms except for (i) sales to Ingram and (ii) thesale of Stock to distributors on a rotation basis in accordance witharrangements previously disclosed to the Lender;

**(vi)****      **keepthe Stock in good and marketable condition and not (without the prior writtenconsent of the Lender) accept any consignment stock.

**10.**   Provisions with respect to FinancialStatements and Audit

**(a)****        **Eachset of financial statements delivered by the Company pursuant the provisions ofthis schedule shall be certified by a director of the relevant company asfairly representing its financial condition as at the date as at which thosefinancial statements were drawn up. The Company shall procure that all auditedfinancial statements so delivered are (i) prepared by auditors previouslyapproved by the Lender and (ii) prepared in accordance with GAAP and usingaccounting principles and policies which are consistently applied.

**(b)****        **Each Obligor will permit the Lender or itsappointed representatives or agents at the relevant Obligor’s expense toconduct an audit of its financial records, systems and forecasts on a quarterlybasis or, following a Default at more frequent intervals as the Lender maystipulate and will afford all co-operation to the Lender and itsrepresentatives or agents to enable such audit to take place. The costs andexpenses of audits conducted by the Lender or its appointed representativeshall be restricted in accordance withthe provisions of **clause **17.3.

**11.**   Definitions

**“Eligible Receivables”****  **means, at anytime, any Receivables at such time which are evidenced by an invoice renderedby a Borrower to account debtors save for any Receivable which (in the opinionof the Lender):

**(a)****        **doesnot arise from the actual and bona fide sale and delivery of goods or renderingof services in the ordinary come of the business of the relevant Borrower;

**(b)****        **remainsfully or partly unpaid after its Maturity Date or such longer period as may beagreed by the Lender;

**(c)****         **isowing by a single account debtor if Receivables representing 50 per cent ormore of the aggregate balance owing by such account debtor to the Borrowers arenot Eligible Receivables by reason of the operation of **paragraph** (b) above;

**(d)****        **withrespect to which the account debtor is a director, officer, employee orAffiliate of any Obligor;

**(e)****         **withrespect to which the account debtor has or has asserted a counterclaim or has aright of set off, to the extent of such counterclaim or set off;

**(f)****           **asto which (i) performance has not been completed by the relevant Borrower, (ii) noinvoice has been rendered or (iii) the relevant Borrower is not entitledto assign;

**(g)****         **withrespect to which the account debtor is the subject of any winding up,administration or similar procedure indicative of insolvency;

**(h)****        **withrespect to which the account debtor’s obligation to pay the Receivable is inany respect conditional or subject to any right of return, rejection or similarright;

42

----

**(i)****           **owedby an account debtor whose total indebtedness to the Obligors exceeds anycredit limit set by the Lender from time to time, to the extent of such excess;

**(j)****           **wherethere are proceedings or actions which are threatened or pending against therelevant account debtors which may result in any material adverse change in anysuch account debtor’s financial condition;

**(k)****        **wherethere are facts, events or occurrences which would impair the validity,enforceability, collectability or full recoverability of that Receivable.

Notwithstanding the foregoing provisions, Receivablesmay be treated as Eligible Receivables for these purposes if:

**(a)****        **theyare owing by debtors established in an Eligible Country and are approved by theLender on a case by case basis (in which event the provisions of **paragraph** (a) of the definition of “PurchasePrice” shall apply to them);

**(b)****        **theyare owing by debtors established in an Ineligible Country and are approved bythe Lender on a case by case basis (in which event the provisions of **paragraph** (b) of the definition of “PurchasePrice” shall apply to them).

**“Eligible Stock”****  **means all Stocksave for any Stock which, at any time and in the opinion of the Lender:

**(a)****        **isobsolete, slow-moving, (i.e. with over 360 Sales Days) not in goodcondition or not currently usable or saleable;

**(b)****        **isheld at third party premises without acceptable access arrangements for theLender;

**(c)****         **constitutesmaterials over which the Lender does not have a valid first ranking fixed orfloating charge under the Security Documents;

**(d)****        **constitutesconsumables used in a Borrower’s business or constitutes packaging or shippingmaterials;

**(e)****         **constitutesreturned, damaged or defective materials;

**(f)****           **isheld by a Borrower as consignee for a third party;

**(g)****         **isnot the property of the relevant Borrower by virtue of retention of title orRomalpa provisions in favour of any person;

**(h)****        **isspare parts or scrap;

**(i)****           **isin transit outside property which is owned and controlled by any Obligor or itsagents or representatives except in cases where they are (i) in transit onwater between a supplier and such properties and the aggregate value of suchStock does not at any time exceed the sum of US$13,636,363 or (ii) intransit to a an Obligor and the Lender has direct access to all originals ofthe bills of lading or other documents of title with respect to such Stock andhas received all such other documents as the Lender requires to perfect itssecurity and to obtain possession from any third party; or

**(j)****           **isunsuitable for forming the basis of a lending decision as a result of anylegal, regulatory or similar consideration.

**(B)**   FINANCIALUNDERTAKINGS

**Trading Cashflow Covenant**

TheCompany shall procure that the Trading Cashflow is greater than zero in respectof each Review Period.

43

----

**SCHEDULE4**

**Forms of Request**

Part I—Form ofPurchase Request

[On letterhead of relevant Borrower)
| Date:      |                       |   |
|------------|----------------------------|--------|
| To:        | Burdale Financial  Limited |
|       | 53 Queen Anne  Street      |
|       | LONDON W1G9HP              |
| Attention: | Company Secretary          |

 

**Dear Sirs,**

**Facility Agreementdated _______**(the “Facility Agreement”)

We refer to the Facility Agreement, terms defined inwhich have the same meaning when used in this Purchase Request.

1.                We wish to sell toBurdale on or before ______ or such later date as we may agree with the Lender(the “**Purchase Date”**) theReceivables numbered assignment_______ amounting to £______ details of whichare set out in the attached Schedule, initialled on each page for thepurposes of identification.

2.                We hold theinvoice strictly to your order and agree to supply it, or a copy (certified byan ______ officer of the relevant Facility Company or otherwise as theLender may from time to time approve) together with certified copies ofrelevant shipping documents in respect of such Receivables, and a copy of ourirrevocable instructions to the account debtor to pay the full invoice amountof the relevant Receivable (without deduction, withholding or set off) atmaturity to a Blocked Account, forthwith upon your request.

3.                We further confirmthat the relevant Receivables offered are readily identifiable from our books.

We confirm that no Default has occurred and iscontinuing or would result from the Lender purchasing the Receivables offered,no availability limit will be breached as a result of the Lender purchasing theReceivables offered and all the representations and warranties in **clause** 19 of the Facility Agreementwhich are to be made or repeated as at the date of this Purchase Request aretrue and correct.

**Yoursfaithfully**

for and on behalf ofVIEWSONIC EUROPE LIMITED

44

----

**SCHEDULE**
| Invoice No | ** ** | ** ** | ** ** | ** ** | **Account Debtor** | ** ** | ** ** | ** ** | **Invoice Date** | ** ** |
|------------|------------|------------|------------|------------|--------------------|------------|------------|------------|------------------|------------|
| ** ** | ** ** | ** ** | ** ** | ** ** | ** **         | ** ** | ** ** | ** ** | ** **       | ** ** |
| ** ** | ** ** | ** ** | ** ** | ** ** | ** **         | ** ** | ** ** | ** ** | ** **       | ** ** |
| ** ** | ** ** | ** ** | ** ** | ** ** | ** **         | ** ** | ** ** | ** ** | ** **       | ** ** |

** **

45

----

**PART II—Form ofCash Request**

[Onletterhead of relevant Borrower]
| Date:      |                       |   |
|------------|----------------------------|--------|
| To:        | Burdale Financial  Limited |
|       | 53 Queen Anne  Street      |
|       | LONDON W1G9HP              |
| Attention: | Company Secretary          |

 

Dear Sirs,

**Facility Agreementdated _______**(the “Facility Agreement”)

We refer to the Facility Agreement. Terms defined inthe Facility Agreement have the same meaning when used in this Cash Request.

Pursuant to the terms of the Facility Agreement, wewish you to pay to us the sum of £________ ([WRITE AMOUNT IN WORDS ALSO]) asfollows:

(a)          Utilisation Date:               ___________

(b)         Payment Instructions:      Please credit the following account:
|        | Account Name: ___________________                    |
|--------|------------------------------------------------------|
|   | Bank: ___________________Bank  plc                   |
|   | Branch: ___________________  Branch                  |
|   | Account No: ___________________                      |
|   | Sort Code: __________ - __________  - ______________ |

 

We confirm that no Default has occurred and remainsoutstanding or would result from the requested Utilisation being made, noAvailability Limit would be breached by the making of the requested Utilisationand that all the representations and warranties in **clause** 19 of the Facility Agreement *(Representations)*which are to be made or repeated as at the date of this Cash Requestare true and correct.

**Yoursfaithfully**

for and on behalfof[Borrower]

46

----

**PART III—Form ofL/C Request**

[Onletterhead of relevant Borrower]
| Date:      |                       |   |
|------------|----------------------------|--------|
| To:        | Burdale Financial  Limited |
|       | 53 Queen Anne  Street      |
|       | LONDON W1G9HP              |
| Attention: | Company Secretary          |

 

Dear Sirs,

**Facility Agreementdated _______**(the “Facility Agreement”)

We refer to the Facility Agreement. Terms defined inthe Facility Agreement have the same meaning when used in this L/C Request.

We wish to have [state type of L/C] opened for ouraccount under the Facility Agreement as follows:
| (a) |   | Issue Date:                       |   | ________________                                                                                  |
|-----|--------|-----------------------------------|--------|---------------------------------------------------------------------------------------------------|
| (b) |   | Expiry Date:                      |   | ________________                                                                                  |
| (c) |   | Requested Amount:                 |   | ________________                                                                                  |
| (d) |   | Beneficiary:                      |   | ________________                                                                                  |
| (e) |   | Beneficiary’s bank  account: |   | ________________                                                                                  |
| (f) |   | Concerning:                       |   | [Reference the  agreement under which the liability arises, describe its nature and quantify  it] |

 

We confirm that no Default has occurred and iscontinuing or would result from the requested Utilisation, no AvailabilityLimit will be breached as a result of the requested Utilisation and all therepresentations and warranties in **clause **19*(Representations) of*the FacilityAgreement which are to be made or repeated as at the date of this L/C Requestare true and correct.

Yours faithfully

for and on behalfof[Borrower]

47

----

**SCHEDULE5**

**Form of Accession Letter**
| To:    | Burdale Financial Limited as Lender          |
|--------|----------------------------------------------|
| From:  | *[Subsidiary]*  and ViewSonic Europe Limited |
| Dated: |                                         |

 

Dear Sirs

**ViewSonic EuropeLimited - $20,000,000 Facility Agreement dated [__________]**(the “Agreement”)

1.                 We refer to theAgreement. This is an Accession Letter. Terms defined in the Agreement have thesame meaning in this Accession Letter unless given a different meaning in thisAccession Letter.

2.                 [*Subsidiary*] agrees to become an Additional[Borrower]/[Guarantor] and to be bound by the terms of the Agreement as anAdditional [Borrower]/[Guarantor] pursuant to clause [24.2 (*Additional Borrowers*)]/[**clause** 24.3 (*Guarantors*)] of the Agreement. [*Subsidiary*] is a company duly incorporatedunder the laws of [*name of relevant jurisdiction*].

3.                 [*Subsidiary’s*] administrative details areas follows:

Address:

Fax No:

Attention:

4.                 The followingbank accounts shall be Blocked Accounts of the Additional Obligor for thepurposes of the Agreement. **[Details to beinserted]**

5.                 This AccessionLetter is governed by the law of England and Wales.

[This Guarantor Accession Letter is entered into bydeed.]

ViewSonic Europe Limited     [Subsidiary]

48

----

**EXECUTIONPAGES**

**THE COMPANY**
| Signed for and on behalf of  |                   | )      |                   |
|------------------------------|------------------------|--------|------------------------|
| **VIEWSONIC EUROPE LIMITED** |                   | )      | /s/ Christopher Franey |
| Address:                     | ViewSonic House,       |   | )                      |   |
|                         | Fleming Way,           |   | )                      |   |
|                         | Crawley,               |   | )                      |   |
|                         | RH10 2GA               |   | )                      |   |
| Fax No.:                     | 01293 643915           |   | )                      |   |
| Attention:                   | European Legal Counsel |   | )                      | President |

 

**THE ORIGINAL GUARANTORS**
| Signed for and on behalf of |                   | )      |                   |
|-----------------------------|------------------------|--------|------------------------|
| **VIEWSONIC SARL**          |                   | )      | /s/ Christopher Franey |
| Address:                    | ViewSonic House,       |   | )                      |   |
|                        | Fleming Way,           |   | )                      |   |
|                        | Crawley,               |   | )                      |   |
|                        | RH10 2GA               |   | )                      |   |
| Fax No.:                    | 01293 643915           |   | )                      |   |
| Attention:                  | European Legal Counsel |   | )                      | Director |

 
| Signed for and on behalf of   |                   | )      |                   |
|-------------------------------|------------------------|--------|------------------------|
| **VIEWSONIC TECHNOLOGY GMBH** |                   | )      | /s/ Christopher Franey |
| Address:                      | ViewSonic House,       |   | )                      |   |
|                          | Fleming Way,           |   | )                      |   |
|                          | Crawley,               |   | )                      |   |
|                          | RH10 2GA               |   | )                      |   |
| Fax No.:                      | 01293 643915           |   | )                      |   |
| Attention:                    | European Legal Counsel |   | )                      | Director |

 

**THE LENDER**
| Signed  for and on behalf of  |                                   | )      |              |
|-------------------------------|----------------------------------------|--------|-------------------|
| **BURDALE FINANCIAL LIMITED** |                                   | )      | /s/ Nigel B. Hogg |
| Address:                      | 53 Queen Anne Street, London, WIG 9HP, |   | )                 |   |
| Fax No.:                      | 020 7935 5445                          |   | )                 | Director |
| Attention:                    | Company Secretary                      |   | )                 |   |

 

**[*] = CERTAINCONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HASBEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSIONPURSUANT TO RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.**

49

----