EXHIBIT 10.38



                                SOFTWARE LICENSE
                                 AND MAINTENANCE
                                    AGREEMENT




           This is a standard WINS Software License Agreement prepared
                by The Wheatly Group, Ltd. This contract may not
                         be altered in part or in whole.



<PAGE>



                           SOFTWARE LICENSE AGREEMENT
                                       FOR
                          Home State Insurance Company

         This Agreement is entered into and effective this day of August 12,
1994 by and between The Wheatly Group, Ltd., a New York corporation with offices
at One Huntington Quadrangle, Melville, New York 11747 (hereinafter called
"Licensor") and Home State Insurance Management, Inc. with offices at

                                One Harding Road
                               Red Bank, NJ 07701

(hereinafter called "Licensee").

WHEREAS, Licensor has developed certain software and related documentation known
as the WINS insurance information processing system (hereinafter referred to as
WINS), including object code and source code, and will provide a copy for
Licensee's internal use only for the lines of business as described in the
attached Product Description/Price Schedule;

WHEREAS, Licensor is willing to grant such rights as hereinafter defined in
consideration of payment as hereinafter set forth;

NOW THEREFORE, in consideration of the mutual convenants and conditions set
forth herein it is agreed as follows:

                                    Section 1

                                     LICENSE

         1.1 Licensor grants to Licensee a 5 year, non-exclusive,
non-transferable license for products described in the attached WINS Product
Description/Price Schedule to use WINS only for its own internal use in a single
AS/400 machine. Such license may not be assigned, sub-licensed, or otherwise
transferred by License without prior written consent of Licensor, except as
provided in Section 5.2. No right to copy WINS, in whole or in part, is granted
except as hereinafter expressly provided. The serial number(s) of the single
computer system on which WINS will be used is ______________.

         1.2 At the conclusion of this license term, will have the option to
extend this Software License Agreement, at no additional cost, by signing a new
5 year Maintenance Agreement, and thereby automatically extend the software
license for as long as a Maintenance Agreement is in effect, or, forego
maintenance and opt for a separate extension of this Software License Agreement
for multiple 5 year consecutive terms at a cost of 25 percent of the total
software license fees listed in this Agreement.

                                    Section 2

                                     PAYMENT

         Payment is in compliance with the payment schedule listed in the
Product Description/Price Schedule.

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Software License Agreement                                                Page 1


<PAGE>


                                    Section 3

                                  RIGHT TO COPY

         WINS may be copied, in whole or in part, in print or machine-readable
form solely for on-site and off-site backup and disaster recovery purposes.

                                    Section 4

                        WINS REMAINS LICENSOR'S PROPERTY

         Title to WINS licensed hereunder and all rights therein, including all
rights in patents, copyrights, trademarks and trade secrets applicable thereto,
or to any modifications or derivatives of WINS, shall remain vested in Licensor,
unless otherwise specifically agreed to in writing in advance of any such
modifications or derivatives. Any type or manner of copies made by Licensee, in
whole or in part, shall remain Licensor's property.

                                    Section 5

                             PROTECTION AND SECURITY

         5.1 With reference to any copyright notice or other proprietary legend
of Licensor associated with WINS, Licensee agrees to include the same on all
copies it makes, in whole or in part, and to include the same on any updated
work. Licensor's copyright notice may appear in any of several forms, including
machine-readable form within WINS.

         5.2 Licensee agrees to hold WINS in confidence and not to provide or
otherwise make available in any form the system or any portion thereof, to any
person other than employees of Licensee or Licensor without prior written
consent thereof by Licensor. Licensee agrees to obtain the written agreement of
each such employee of Licensee to abide by the applicable terms of this
Agreement.

         5.3 Each party acknowledges that all information concerning the
business of the other party is "Confidential and Proprietary Information." Each
party agrees that it will not permit the duplication, use or disclosure of any
such Confidential and Proprietary Information to any person (other than its own
employees who must have such information for the performance of its obligations
under this Agreement), unless authorized in writing by the other party.
"Confidential and Proprietary Information" is not meant to include any
information which, at the time of disclosure, is generally known by the public
or in the trade.


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Software License Agreement                                                Page 2


<PAGE>


                                    Section 6

                                   TERMINATION

         Licensor may terminate this Agreement if Licensee is in default of any
of the terms and conditions of this Agreement and termination is effective if
Licensee fails to correct such default within 30 days after written notice
thereof by Licensor. In the event of termination, Licensee shall immediately
cease using WINS and, at the option of Licensor, either return to Licensor or
destroy any and all copies of WINS, giving Licensor a written statement
certifying such return or destruction.

                                    Section 7

                                   MAINTENANCE

         Wheatly requires a maintenance program for the term of this License
Agreement as stated in the attached Maintenance Agreement.

                                    Section 8

                                    WARRANTY

         8.1 Licensor warrants that WINS upon original delivery shall conform to
the product specifications, descriptions and user documentation delivered by
Licensor. In case of failure of WINS to perform as warranted, Licensor shall
replace or correct WINS as soon as possible so that it will perform in
substantial conformance with the product specifications, descriptions and
applicable user documentation at no charge to Licensee. If such programs are
altered from their delivered basis by the Licensee, then this warranty is null
and void. All reasonable out-of-pocket expenses are additional and billed at
cost at the time they are incurred, unless it is demonstrably clear that the
out-of-pocket expenses are as a result of a "bug" in the Licensor's software and
are of no fault of the Licensee.

         8.2 The foregoing states the Licensor's sole liability for warranty
claims. This warranty is exclusive of WINS maintenance as described in 
Section 7.

                                    Section 9

                             DISCLAIMER OF WARRANTY

         Except as provided in Section 8, no other warranty is provided with
respect to WINS, whether express, implied, or statutory, including implied
warranties of merchantability or fitness for a particular purpose.


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Software License Agreement                                                Page 3


<PAGE>


                                   Section 10

                         PATENT AND COPYRIGHT INDEMNITY


         10.1 Licensor agrees to defend at its expense any suits against
Licensee based upon a claim that WINS directly infringes a U.S. patent or
copyright, trademark or other proprietary right, and to pay costs and damages
finally awarded in any suit, provided that Licensor is given control of said
suit by Licensee and all reasonably requested assistance for defense of same.

         10.2 Licensor shall have no liability for any claim of copyright or
patent infringement if the infringement arises out of compliance with Licensee's
specification, or from the use of other than a current unaltered release of WINS
available from Licensor if such infringement would have been avoided by the use
of a current unaltered release of WINS, or from the use or combination of WINS
with programs not supplied by Licensor.

         10.3 The foregoing states the entire liability of Licensor with respect
to infringement of any proprietary rights, including patents, copyrights, or any
other rights. In no event shall Licensor be liable for incidental or
consequential damages arising from infringement or alleged infringement of
patents or copyrights.

                                   Section 11

                             LIMITATION OF LIABILITY

         Licensee agrees that Licensor's total liability under this Agreement
above shall not exceed the fees paid by Licensee for WINS, except in Section 10.
IN NO EVENT SHALL LICENSOR BE LIABLE FOR INCIDENTAL, SPECIAL, INDIRECT, COVER OR
CONSEQUENTIAL DAMAGES FOR THE USE OF WINS.

                                   Section 12

                                 APPLICABLE LAW

         This Agreement shall be governed by the laws of the state of New York.

                                   Section 13

                                      TAXES

         Licensee shall be responsible for the payment of all taxes in
connection with this Agreement, except for any tax based on Licensor's net
income.



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Software License Agreement                                                Page 4


<PAGE>

                                   Section 14

                                     NOTICES

         All notices in connection with this Agreement shall be in writing via
certified mail, return receipt requested, to the following address:

         If to Licensor:

         The Wheatley Group, Ltd.
         One Huntington Quadrangle
         Melville, New York 11747
         Attention: C.E.O. and President

         If to Licensee:

         (To address listed above, unless stated herein).

         For purposes of this Agreement, a notice shall be deemed effective upon
receipt by the noticed party.

                                   Section 15

                                   ASSIGNMENT

         This Agreement may not be assigned by either party without the prior
written consent of the other.

                                   Section 16
  
                                   PRECEDENCE

         This Agreement sets forth the entire understanding between the parties
with respect to the subject matter herein, and shall not be replaced by any
other facsimile thereof. This Agreement supercedes all prior written agreements,
discussions and understandings, expressed or implied, concerning such matters,
and shall take precedence over any conflicting terms which may be contained in
Licensee's purchase order or any other form submitted by Licensee.



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Software License Agreement                                                Page 5

<PAGE>




IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the day and year first written above.


Home State                                    The Wheatley Group, Ltd.
---------------------------------             ----------------------------------
Licensee                                      Licensor


/s/ Bob Abidor                                /s/ John Reeves
---------------------------------             ----------------------------------
Authorized Signature                          Authorized Signature


CEO                                           Exec. Vice Pres.
---------------------------------             ----------------------------------
Title                                         Title

8/12/94                                       8/12/94
---------------------------------             ----------------------------------
Date                                          Date


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Software License Agreement                                                Page 6

<PAGE>



                       PRODUCT DESCRIPTION/PRICE SCHEDULE
                                      FOR
                          HOME STATE INSURANCE COMPANY


I.   The standard WINS base system, including personal and commercial recording,
     consisting of:

     -- Policy Management
     -- Premium Accounting
     -- Claim Management
     -- Reinsurance Processing
     -- File Maintenance
     -- Management/Insurance Information
     -- Statistical Reporting

Base License Fee:                                                      $195,000

II.  Selected product processors for the specific lines of business required by
     Home State Insurance Company as listed below.

     (Each product processor includes standard WINS forms and is integrated with
     the standard WINS base system. Automatic rating for particular product
     processors, where applicable, is listed separately.)

     1.   Standard WINS Personal Automobile, including automatic rating for the
          states of Connecticut, Delaware, Maryland, New Jersey, New York,
          Pennsylvania, West Virginia, Georgia, Florida, South Carolina and
          Alabama

Product License Fee:                                                   $125,000

Additional standard ISO automatically rated states for Personal Auto (except
Massachusetts) will be provided at $2,500 per state.

     2.   Standard WINS Commercial Auto

Product License Fee:                                                   $ 50,000

<PAGE>

III. Additional Products and Services:

     1.   Eighty (80) WINS Standard Reports.

     2.   Up to twenty-five (25) days of implementation and training assistance
          provided by Wheatley.

     3.   WINS Documentation

          -- User Guides
          -- Operation Guides

Based on the total WINS software package listed above, including the lines of
business selected, the additional products and services listed in this section
are included without additional charge, with the exception of out of pocket
expenses, which are additional and are billed separately. Additional reports and
additional implementation and training assistance may be purchased at Wheatley's
prevailing rates. Unused implementation and training assistance days included in
this section expire ninety (90) days after going live. Prices listed in this
proposal are valid for ninety days from proposal date.

IV.  Maintenance

     1.   WINS Maintenance Service provides ongoing support to the WINS
          operational system. This support is based on the total WINS software
          package, including the lines of business selected, and is required
          initially for a term of sixty (60) months commencing thirty days after
          initial delivery of WINS. It consists of:

          -- WINS Software Version Upgrades
          -- On-Line Trouble-Shooting
             -- Dial-Up communication from our Melville office
             -- Hot line service to Wheatley customer service
          -- Bureau & Regulatory Support

Maintenance Fees, per month:                                            $ 5,250

<PAGE>

V.   Commercial Rating Interface

The Wheatley Group and ISI, Inc. are in the process of developing an interface
from The Insurance Writer commercial rating system to WINS. Phase one (new
business and renewals) is completed and is currently being tested at an
insurance company; phase two (endorsements and subsequent activity) is scheduled
to be completed by October 1, 1994. If the interface is delivered by Wheatley to
Home State before January 1, 1995, the cost for this interface will be as
follows:

Interface License Fee:                                                  $25,000

Interface Maintenance Fee, per month:                                   $ 1,500

If the interface is not delivered by January 1, 1995, the interface license fee
will be reduced by $5,000 for each calendar month that it is not delivered
(e.g. delivery in January: $20,000 interface license fee; delivery in February:
$15,000; delivery in March: $10,000; etc.) until there is no charge for it.

VI.  Payment Schedule

The payment schedule for WINS will be as follows:

     1) Twenty percent (20%) of the total software license fee upon execution of
     this contract.

     2) Seventy percent (70%) of the total software license fee upon completion
     of successful installation of the standard WINS software described above.
     (Successful installation means that the software has been loaded on Home
     State's AS/400 and it is operational.)

     3) Ten Percent (10%) of the total software license fee thirty (30) days
     after Home State has gone into production with WINS, or on January 15,
     1995, whichever is earlier.

The payment schedule for the commercial rating interface from The Insurance
Writer to WINS will be as follows:

     1) Ninety percent (90%) of the interface license fee upon delivery of phase
     one and phase two of the interface, as described in section V. Commercial
     Rating Interface, above.

     2) Ten percent (10%) of the interface license fee thirty (30) days after
     delivery of the interface.

Maintenance fees for the interface will begin thirty (30) days after delivery of
the interface.


<PAGE>


                              MAINTENANCE AGREEMENT
                                       FOR
                          Home State Insurance Company

     This Maintenance Agreement is entered into as of August 12, 1994 by and
between The Wheatley Group, Ltd. (hereinafter called "Vendor"), and Home State
Insurance Management, Inc. (hereinafter called "Customer").

WHEREAS, Customer has acquired a license to use the Software owned by Vendor and
identified below;

WHEREAS, Customer wishes Vendor to perform certain maintenance services with
respect to the Software, in accordance with the terms set forth herein;

NOW THEREFORE, the parties agree as follows:

                                    Section 1

                                   DEFINITIONS

     1.1 "Software" shall mean the source and/or object code for Vendor's WINS
standard software product, in whatsoever form, format and medium, related
documentation or information and any corrections, modifications, updates and
enhancements supplied from time to time by Vendor and which are licensed by
Customer.

     1.2 "Maintenance Services" shall mean the maintenance services of Vendor
described in Section 3 herein.

                                    Section 2

                        PROVISION OF MAINTENANCE SERVICES

     In consideration of the payments to be made to the Vendor, the Vendor
agrees to provide the Maintenance Services described in this Agreement with
respect to the Software. The location(s) at which the Services shall be
performed, and the term of this Agreement, shall be as set forth in Section 5
herein and any schedule attached hereto.


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Maintenance Agreement                                                     Page 1


<PAGE>


                                    Section 3

                   MAINTENANCE RESPONSIBILITIES OF THE VENDOR

     3.1 Defects and Nonconformities. Vendor shall maintain the Software so that
it operates in conformity with descriptions in the applicable Software License
Agreement. Vendor shall correct defects and nonconformities discovered by the
Customer, and in connection therewith shall furnish off-site telephone support,
in the form of consultations, assistance and advice on the use and maintenance
of the Software. In the event that such problem in the Software is not
identified within 48 hours of the initiation of such off-site telephone support,
Customer shall submit to Vendor a listing of output and all such other data
which Vendor reasonably may request in order to reproduce operating conditions
similar to those present when the defect or nonconformity was discovered. In the
event that such problem is not corrected within a reasonable time after Vendor
receives from Customer a listing of output and other data, Vendor shall make
available on-site consulting in order to remedy the problem, but Customer shall
be responsible for Vendor's actual travel and other out-of-pocket expenses,
unless it is demonstrably clear that the out-of-pocket expenses are as a result
of a "bug" in the Vendor's Software and are of no fault of the Customer.

     3.2   Inclusive Maintenance Services. During the term of this Maintenance
Agreement, Vendor shall provide Customer with the following Maintenance
Services:

     3.2.1 NAIC and ISO statistical bureau reporting changes for the lines of
business listed in the attached Product Description/Price Schedule.

     3.2.2 Version upgrades of WINS to Wheatley's clients who are participants
in the Maintenance Agreement.

     3.2.3 On-line troubleshooting, in the form of a hotline service to Wheatley
customer service personnel, during regular business hours (8:00-8:00 EST) and a
remote dial-up communication from the Melville, New York office of Wheatley.

     3.3 Additional Services. Any Customer-initiated requirements, ratings, new
lines of business, new states, or special state requirements may be developed by
Vendor for Customer for reasonable per diem rates and may be maintained by
Vendor for an additional monthly maintenance fee. If any customer initiated
requirements developed by vendor need to be retrofitted (because of a new
software version upgrade or other enhancement), customer may contract with
vendor to retrofit these requirements for reasonable per diem rates.

     3.4 Exclusions. Vendor shall not be responsible for the provisions of any
Maintenance Services in the event that Customer fails to upgrade its IBM AS/400
operating system software (OS/400) to its latest version within 60 days of the
availability of any such upgrade to IBM's customers, and shall not be
responsible for the provision of Maintenance Services to any portion of the
Software which has been altered by Customer from its original state as delivered
to Customer and subsequently modified by Vendor.


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Maintenance Agreement                                                     Page 2


<PAGE>


                                    Section 4

                                     CHARGES

     4.1 Computation. Monthly charges shall be as stated in the attached Product
Description/Price Schedule. These monthly charges shall be paid in advance of
each month and shall cover all Maintenance Services provided under this
Agreement, with the exception of out-of-pocket expenses, and all charges shall
be paid within 10 days of receipt of the invoice.

     4.2 Price Protection and Changes. The charges as stated shall not be
increased for a period of 1 year after commencement of services hereunder, and
not to exceed annual increases in the Consumer Price Index in years two through
five. Thereafter, such prices may be increased to Vendor's prevailing prices to
its customers generally for similar services.

                                    Section 5

                              TERM AND TERMINATION

     5.1 Term. This Agreement shall have an initial term of 5 years, and shall
thereafter have optional renewal. Written notification of an election not to so
renew is required to be forwarded by one party to the other at least 45 days
prior to the expiration of the initial term or a renewal term, or unless
terminated sooner in accordance herewith.

     5.2 Termination of Maintenance Agreement. If either the Vendor or the
Customer terminates the License Agreement between the parties for any reason
provided therein, Customer shall have the right without penalty to terminate
this Agreement.

     5.3 Default. Each party has the right to terminate this Agreement if the
other party breaches or is in default of any obligation hereunder which default
is incapable of cure or which, being capable of cure, has not been cured within
30 days after receipt of notice of such default (or such additional cure period
as the nondefaulting party may authorize).

     5.4 Acts of Insolvency. Either party may immediately terminate this
Agreement by written notice to the other and may regard the other party as in
default of this Agreement, if the other party becomes insolvent, makes a general
assignment for the benefit of creditors, files a voluntary petition of
bankruptcy, suffers or permits the appointment of a receiver for its business or
assets, or becomes subject to any proceeding under any bankruptcy or insolvency
law, whether domestic or foreign, or has wound up or liquidated, voluntarily or
otherwise. In the event that any of the above events occurs, the affected party
shall immediately notify the other party of its occurrence.


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Maintenance Agreement                                                     Page 3


<PAGE>


     5.5 Force Majeure; Suspension and Termination. In the event that either
party is unable to perform any of its obligations under this Agreement or to
enjoy any of its benefits because of (or if loss of the services is caused by)
natural disaster, action or decrees of governmental bodies or communication line
failure not the fault of the affected party (hereinafter referred to as a "Force
Majeure Event") the party who has been so affected immediately shall give notice
to the other party and shall do everything possible to resume performance. Upon
receipt of such notice, all obligations under this Agreement shall be
immediately suspended. If the period of nonperformance exceeds 15 days from the
receipt of notice of the Force Majeure Event, the party whose performance has 
not been so affected may, by giving written notice, terminate this Agreement.

     5.6 Rights and Obligations of the Parties on Termination. In the event that
this Agreement is terminated as a result of the occurrence of a Force Majeure
Event, or other cause as provided herein, each party shall return to the other
all data, materials, and other properties of the other party then in its
possession.

     5.7 Continuing Obligations. The obligations of the parties under Sections
5, 6 and 8 shall survive the termination of any services hereunder.

                                    Section 6

                             PROPRIETARY INFORMATION

     Each party acknowledges that all information concerning the business of the
other party is "Confidential and Proprietary Information." Each party agrees
that it will not permit the duplication, use or disclosure of any such
Confidential and Proprietary Information to any person (other than its own
employees who must have such information for the performance of its obligations
under this Agreement), unless authorized in writing by the other party.
Confidential and Proprietary Information is not meant to include any information
which, at the time of disclosure, is generally known by the public or in the
trade.

                                    Section 7

                             DISCLAIMER OF LIABILITY

     VENDOR DISCLAIMS ANY AND ALL REPRESENTATIONS OR WARRANTIES WITH RESPECT TO
THE MAINTENANCE SERVICES PROVIDED HEREUNDER, EXPRESS OR IMPLIED, INCLUDING
WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE. IN NO EVENT SHALL VENDOR BE LIABLE FOR DAMAGES, INCLUDING BUT NOT
LIMITED TO SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES, COVER DAMAGES OR DAMAGES
FOR LOSS OF USE, DATA OR PROFITS, IN CONNECTION WITH OR ARISING OUT OF THIS
AGREEMENT OR CUSTOMER'S USE OF THE SOFTWARE, EVEN IF VENDOR SHALL HAVE BEEN
INFORMED IN ADVANCE OF THE POSSIBILITY OF SUCH DAMAGE.


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Maintenance Agreement                                                     Page 4


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                                    Section 8

                                      TAXES

     Customer shall be responsible for the payment of all taxes in connection
with this Agreement, except for any tax based on Vendor's net income.

                                    Section 9

                                  MISCELLANEOUS

     9.1 Applicable Law. This Agreement shall be governed by the laws of the
State of New York.

     9.2 Severability. Any invalidity, in whole or in part, of any provision of
this Agreement shall not affect the validity of any other of its provisions.

     9.3 Notices. Any notice or other communication hereunder shall be in
writing and shall be either personally served or mailed, registered or
certified, return receipt requested.


     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the day and year first written above.

Home State                                  The Wheatley Group, Ltd.
----------------------------------          -----------------------------------
Customer                                    Vendor


/s/ Bob Abidor                              /s/ John Reeves
----------------------------------          -----------------------------------
Authorized Signature                        Authorized Signature


President                                   Exec. Vice Pres.
----------------------------------          -----------------------------------
Title                                       Title


8/12/94                                     8/15/94
----------------------------------          -----------------------------------
Date                                        Date


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Maintenance Agreement                                                     Page 5


<PAGE>



                                    HARDWARE
                                    PURCHASE
                                   AGREEMENT


          This is a standard WINS Hardware Purchase Agreement prepared
               by The Wheatley Group, Ltd. This contract may not
                        be altered in part or in whole.


<PAGE>


Agreement Number: 9405
                  ----------
Agreement Date:
                  ----------


                          HARDWARE PURCHASE AGREEMENT
                                      FOR
                          Home State Insurance Company

     This Agreement of Sale is entered into and effective this day of August 12,
1994 by and between The Wheatley Group, Ltd., a New York corporation with
offices at One Huntington Quadrangle, Melville, New York 11747 (hereinafter
called "Seller"), and HSIM having its principal offices at

                                One Harding Road
                               Red Bank, NJ 07701

(hereinafter called "Buyer") is the complete Agreement between the parties,
replacing any prior oral or written communications between us, regarding the
sale of certain Equipment, described below, by Seller to Buyer.

                                    Section 1

                                   DEFINITIONS
                     (Shown in bold type in this Agreement)

     1.1 "Equipment." shall mean the IBM AS/400 machine, its features,
conversions, upgrades, elements, or accessories, or any combination of them
described in Section 2.

     1.2 "Date of Installation." shall mean the business day Buyer's Equipment
is installed or, if Buyer defers installation, when Seller makes it available to
Buyer for installation.

                                   Section 2

                                   EQUIPMENT

     Seller agrees to sell, Buyer agrees to purchase from Seller the following
Equipment detailed on the Hardware Purchase Agreement Supplement.

                                   Section 3

                                 PURCHASE PRICE

     3.1 The purchase price of the Equipment is detailed on the Hardware
Purchase Agreement Supplement. The Buyer agrees to pay the Seller as follows:

     a.   20 percent of purchase price upon execution of this Agreement;

     b.   the balance (80 percent of purchase price) is due on the Date of
          Installation or if boxes are opened.

     c.   A 2% late-payment fee will be billed for any balance not paid within
          30 days from the invoice date and compounded each subsequent 30 days.

     d.   This price does not include applicable sales taxes.


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Hardware Purchase Agreement                                               Page 1


<PAGE>


     3.2 Maintenance option. Initial here if this Equipment should be placed
under IBM Hardware Maintenance. ________ (Price not included above.)

                                   Section 4

                                    DELIVERY

     Seller will deliver Equipment to Buyer at buyer's location on a date to be
mutually agreed upon. Seller will pay normal transportation charges for
Equipment shipped.

     Seller will use its best efforts to deliver Equipment as agreed but shall
not be liable for delays in delivery beyond its control including, but not
limited to, delays resulting from inventory shortages, acts of God, strikes, or
weather.

                                   Section 5

                                     TITLE

     Seller will transfer title to Buyer on the Date of Installation and upon
receipt of the purchase price shown in Section 3.

     Seller reserves a purchase money security interest in Equipment and Buyer
grants Seller a purchase money security interest (and agrees to sign appropriate
documents to permit Seller to perfect its purchase money security interest) from
the date of sale until Seller receives the amounts due under this Agreement for
the purchase of the hardware hereunder.

                                   Section 6

                                  RISK OF LOSS

     Seller bears the risk of loss for Equipment until the Date of Installation.

                                   Section 7

                                     TAXES

     Buyer will be responsible for and shall pay all applicable taxes imposed by
taxing authorities on the sale and delivery of the Equipment described in
Section 2.

                                   Section 8

                                  CANCELLATION

     Buyer may cancel an order for Equipment prior to shipment. Seller may
charge Buyer a cancellation charge not to exceed 10 percent of the purchase
price for cancellations within 2 weeks of confirmed delivery, and shall deduct
such charge from the monies paid by Buyer at the execution of this Agreement.


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Hardware Purchase Agreement                                               Page 2


<PAGE>


                                   Section 9

                              WARRANTY PROVISIONS

     Seller assigns to Buyer all IBM Warranties currently in effect on the
Equipment to the fullest extent such IBM Warranties are assignable by an
authorized IBM reseller that is in good standing with IBM, and agrees to execute
all documents and take all other action reasonably necessary to effect such
assignment, provided, however, that such assignment shall not impose any
additional responsibilities on Seller or create any additional warranties,
express or implied, with respect to the Equipment.

     Limitation of Liability: (a) Except as specifically set forth in this
Agreement, Seller makes no representations or warranties, express or implied,
including without limitation, the warranties of merchantability and fitness for
a particular purpose with respect to the Equipment. (b) Seller's liability to
Buyer for damages, from any cause whatsoever, and regardless of the form of
action, including Seller's liability for its own negligence, shall be limited to
the purchase price. (c) Seller shall not be liable to Buyer or any other person
for any claim arising, directly or indirectly, from or in connection with the
furnishing of services or Equipment pursuant to this Agreement, or the
interruption, use or loss of use or performance thereof. (d) Under no
circumstances shall Seller be liable to any person not a party to this Agreement
and Buyer shall indemnify Seller and hold Seller harmless against any claim or
action brought by such a party. Such indemnification shall include all costs and
attorneys fees.

                                   Section 10

                                    NOTICES

     Any notice provided for herein shall be in writing and sent by registered
or certified mail, postage prepaid, addressed to the party for which it is
intended at the address set forth in the first paragraph of this Agreement or to
such other address as either party shall from time to time indicate in writing.
Any such notice to be deemed to be effective upon receipt or 5 days from the
date of mailing, whichever occurs first.

                                   Section 11

                           GOVERNING LAW: AMENDMENTS

     This Agreement shall be construed in accordance with and governed by the
laws of the state of New York (without regard to choice of law principles). This
Agreement may not be amended except by written agreement signed by both the
parties hereto.

                                   Section 12

                                     TERMS

     All prices listed on this Agreement are subject to change after 10 days.
This offer shall be valid for a period of 10 days.


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Hardware Purchase Agreement                                               Page 3


<PAGE>


IN WITNESS WHEREOF, the parties have cause this Agreement to be executed as of
the day and year first written above.


Home State Insurance Company                The Wheatley Group, Ltd.
----------------------------------          -----------------------------------
Buyer                                       Seller


/s/ Bob Abidor                              /s/ John Reeves
----------------------------------          -----------------------------------
Authorized Signature                        Authorized Signature


President                                   Exec. Vice Pres.
----------------------------------          -----------------------------------
Title                                       Title


8/12/94                                     9/1/94
----------------------------------          -----------------------------------
Date                                        Date


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Hardware Purchase Agreement                                               Page 4


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                                          Reference Agreement Number: 9405
                                                                      ----------


                     HARDWARE PURCHASE AGREEMENT SUPPLEMENT


                                   EQUIPMENT

<TABLE>
<CAPTION>

HARDWARE:

        Machine                                                               Purchase       Warranty
Qty      Type       Model           Description                                Price         Period
-----------------------------------------------------------------------------------------------------
<S>      <C>         <C>        <C>                                           <C>              <C>
1        9406        300        Advanced Series AS/400 Model 300              $152,235         1 Yr
                                (As proposed and fax'd on 8/11/94)

1        9348        001        1/2" Reel Tape Drive                          $ 18,500         1 Yr

1        9309        002        Rack Enclosure                                $  3,820         1 Yr

1        7855        010        Modem                                         $  1,455         1 Yr

1        3490        E11        1/2" Cartridge Tape Drive -- Rack mounted     $ 27,275         1 Yr

1        2386        BG3        Infowindow Display Station                    $  1,000         3 Yr


HARDWARE TOTAL                                                                                     $204,285.00
</TABLE>


<TABLE>
<CAPTION>

IBM SOFTWARE:

        Program                                                               One-time       Warranty
Qty      Type       Model           Description                                Charge        Period
-----------------------------------------------------------------------------------------------------
<S>      <C>         <C>        <C>                                           <C>              <C>

1        5763        SS1        OS/400 Version (Unltd Users)                  $ 33,600         N/A

1        5763        XA1        Client Access (Unltd Users)                   $ 51,145         N/A

1        5763        PW1        Application Development Tools (ADS & ADM)     $ 13,200         N/A

1        5763        DB1        AS/400 System/38 Utilities                    $  5,625         N/A

1        5763        DCT        Dictionaries                                  $    495         N/A

1        5763        WP1        Officevision (Unltd Users)                    $ 30,995         N/A

1        5763        QU1        Query/400 (4 Users)                           $  3,000         N/A

1        5763        CB1        Cobol/400                                     $  6,000         N/A

1        5763        PT1        Performance Tools/400                         $  4,190         N/A


IBM SOFTWARE TOTAL                                                                                 $148,250.00

EQUIPMENT TOTAL                                                                                    $352,535.00

WHEATLEY VALUE-ADD ALLOWANCE                                                                       $ 67,113.00

NET EQUIPMENT TOTAL PRICE                                                                          $285,422.00

</TABLE>


Home State Insurance Company                8/12/94
----------------------------------          -----------------------------------
Customer Name                               Date


/s/ Bob Abidor                              President
----------------------------------          -----------------------------------
Name                                        Title


Bob Abidor
----------------------------------
Authorized Signature


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Hardware Purchase Agreement Supplement                                    Page 1


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