<PAGE>

                                                                   Exhibit 10.34

                    INTELLECTUAL PROPERTY SECURITY AGREEMENT

            THIS INTELLECTUAL PROPERTY SECURITY AGREEMENT (as may be amended,
supplemented and otherwise modified from time to time, "IP Security Agreement")
is made and effective as of March 16, 2000, by CARAVELA SOFTWARE, INC.
(including any successor or permitted assignee thereof, "Grantor"), in favor of
MCG FINANCE CORPORATION, as Administrative Agent (including any successor,
participant, assignee or transferee thereof, "Administrative Agent") for itself
and the Lenders (as defined in the Credit Agreement below).

                                 R E C I T A L S

            WHEREAS, Grantor and each direct and indirect Subsidiary of Grantor
(each, a "Borrower"; collectively, the "Borrowers") desire and have applied to
Administrative Agent and the Lenders for a credit facility consisting of a term
loan pursuant to which up to $15.0 million can be borrowed from time to time;
and

            WHEREAS, pursuant to that certain Credit Facility Agreement by and
among Borrowers, Lenders and Administrative Agent dated as of March 16, 2000 (as
may be amended from time to time, "Credit Agreement"), a condition precedent to
the obligation of the Administrative Agent or any Lender to execute and perform
under the Credit Agreement is that Borrowers shall have executed and delivered
that certain Master Security Agreement, Collateral Assignment and Equity Pledge
executed by Borrowers in favor of Administrative Agent for the benefit of
Administrative Agent and the Lenders dated as of March 16, 2000 (as may be
amended from time to time, "Security Agreement") encumbering all of Borrowers'
tangible and intangible personal property assets in favor of Administrative
Agent for the benefit of Administrative Agent and the Lenders; and

            WHEREAS, under the terms of the Security Agreement, Grantor has
agreed to assign certain intellectual property to Administrative Agent for
purposes of securing the obligations to Administrative Agent and the Lenders
under the Credit Agreement and related Loan Documents; and

            WHEREAS, Grantor has determined that it is in its best interest to
execute this IP Security Agreement inasmuch as Grantor will derive substantial
direct and indirect benefits from the funding of the Advances by Administrative
Agent pursuant to the Credit Agreement;

            NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, Grantor and Administrative Agent hereby agree as follows:

            1. Grant. Grantor hereby grants to Administrative Agent an absolute,
present, unconditional, continuing first priority security interest in and to
Grantor's entire right, title and interest in and to the following property and
rights (collectively, the "Collateral"):
<PAGE>

                  (a) The U.S., state and foreign copyrights, associated
copyright registrations and applications for copyright registration, and
copyright licenses set forth on Schedule A attached hereto (collectively, the
"Copyrights"); and

                  (b) The U.S., state and foreign patents and patent
applications, and patent licenses set forth on Schedule B attached hereto,
including, without limitation, improvements, divisions, continuations, renewals,
reissues, extensions and continuations-in-part of the same (collectively, the
"Patents"); and

                  (c) The U.S., state and foreign trademark and service mark
registrations, trademark and service mark applications, and trademark and
service mark licenses set forth on Schedule C attached hereto (including all
associated goodwill, collectively, the "Trademarks"); and

                  (d) Any and all claims and causes of action for past, present
or future infringement of any of the Collateral, with the right, but not the
obligation, to sue for and collect damages for infringement of the Collateral;
and

                  (e) Any and all licenses or rights granted under any of the
Collateral, and all license fees and royalties arising from such licenses or
rights, to the extent permitted by such licenses or rights; and

                  (f) Any and all amendments, renewals, extensions, reissuances
and replacements of any of the Collateral; and

                  (g) Any and all products and proceeds of any of the foregoing.

            2. Requested Recordation. Grantor authorizes and requests that the
Register of Copyrights and the Commissioner of Patents and Trademarks (and any
state, foreign or other authorities to which this IP Security Agreement is
submitted) to file and record this IP Security Agreement (and any corresponding
or separate application forms of such jurisdiction) in order to publicly reflect
Administrative Agent's interest in the Collateral.

            3. Assignment. Upon the occurrence of an Event of Default (as
defined in the Security Agreement), Grantor shall execute and deliver to
Administrative Agent an absolute assignment transferring its entire right,
title, and interest in and to the Collateral to Administrative Agent.

            4. Power of Attorney. Grantor hereby irrevocably grants
Administrative Agent a power of attorney, to act as Grantor's attorney-in-fact,
with full authority in the name, place and stead of Grantor, from time to time
in Administrative Agent's discretion, to take any action and to execute any
instrument which Administrative Agent may deem reasonably necessary or advisable
to accomplish the purposes of the Security Agreement or this IP Security
Agreement. This authority includes, without limitation, the following:

                  (a) To modify or amend (in Administrative Agent's sole
discretion and without first obtaining Grantor's approval of or signature
thereto) Schedule A, Schedule B,


                                       2
<PAGE>

and/or Schedule C hereof, as appropriate, to include references to any
registered intellectual property (or application or license therefor) acquired
by Grantor after the execution hereof or to delete any reference to any
Collateral in which Grantor no longer has or claims any right, title or
interest; and

                  (b) To execute, file and pursue (in Administrative Agent's
sole discretion and without first obtaining Grantor's approval of or signature
thereto, unless otherwise prohibited by applicable law) any application, form or
other document in order to perfect, maintain, continue or otherwise protect
Administrative Agent's interest or Grantor's rights in the Collateral,
including, without limitation, executing and filing (i) any financing statement,
any continuation statement or any amendment thereto, and (ii) any document in
any proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or the relevant office of any state or foreign
jurisdiction (including, without limitation, the filing of applications for
renewal, affidavits of use, affidavits of incontestability and opposition,
interference and cancellation proceedings) and to pay any fees and taxes in
connection therewith or otherwise; and

                  (c) To execute any assignment or other document required to
acknowledge, register or perfect Administrative Agent's interest in any part of
the Collateral without the signature of Grantor unless prohibited by applicable
law.

The foregoing power of attorney is coupled with an interest and is irrevocable.

            5. Release. The security interest granted herein will terminate (and
all rights to the Collateral will revert to Grantor) upon satisfaction of the
following conditions: (a) payment and performance in full of all the obligations
secured hereby (unconditionally and indefeasibly) and (b) the termination of the
Credit Agreement (and the Facilities thereunder). Upon any such termination,
Administrative Agent (at Grantor's request and sole expense) will execute and
deliver to Grantor (without any representation, warranty or recourse of any kind
whatsoever) such documents as Grantor may reasonably request and provide to
Administrative Agent to evidence such termination.

            6. Miscellaneous. This IP Security Agreement has been entered into
in conjunction with the provisions of and the security interest granted to
Administrative Agent under the Security Agreement. The rights and remedies of
Grantor and Administrative Agent with respect to the security interest granted
herein are in addition and without prejudice to those set forth in the Security
Agreement and the Credit Agreement, all terms and provisions of which are hereby
incorporated herein by reference. This IP Security Agreement may be executed in
any number of counterparts with the same effect as if all the signatures on such
counterparts appeared on one document; each such counterpart will be deemed to
be an original but all counterparts together will constitute one and the same
instrument. In the event that any provisions of this IP Security Agreement are
deemed to conflict with the Security Agreement or the Credit Agreement, the
provisions of the Security Agreement or Credit Agreement shall govern.


                                       3
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have executed this IP
Security Agreement, as an instrument under seal (whether or not any such seals
are physically attached hereto), through their duly authorized officers, as of
the date first written above.

ATTEST:                                   CARAVELA SOFTWARE, INC.
                                          (Grantor)

By:                                       By:    /s/ Mark E. Munro
   ------------------------------            ------------------------------
Name:  Michael F. Sweeney                 Name:  Mark E. Munro
Title: Assistant Secretary                Title: President and Treasurer

      [CORPORATE SEAL]

                                          Address:    6 Way Road
                                                      Middlefield, CT 06455-1080


                                          Telephone:  (___) _________
                                          Facsimile:  (___) _________


WITNESS:                                  MCG FINANCE CORPORATION
                                          (Administrative Agent)

By:                                       By:    /s/ Steven Tunney
   ------------------------------            ------------------------------
                                          Name:  Steven Tunney
                                          Title: Chief Operating Officer and
                                                 Chief Financial Officer


                                          Address:    1100 Wilson Blvd.
                                                      Suite 800
                                                      Arlington, VA 22209

                                          Telephone:  (703) 247-7500
                                          Facsimile:  (703) 247-7505
<PAGE>

                                 ACKNOWLEDGMENT

STATE OF  _______________________   :
                                    : SS
COUNTY OF  ______________________   :

            Before me, the undersigned, a Notary Public, on this ____ day of
March, 2000, personally appeared Mark E. Munro and Michael F. Sweeney, to me
known personally, who, being by me duly sworn, did each separately say that he
is the President and Treasurer and Assistant Secretary (respectively, as
appropriate) of CARAVELA SOFTWARE, INC., and that said instrument (i.e., the
Intellectual Property Security Agreement) was signed on behalf of said Caravela
Software, Inc. by authority of its Board of Directors, and the said President
and Treasurer, and Assistant Secretary each acknowledged said instrument to be
his free act and deed.


                                    __________________________________________
                                    Notary Public

                                    My Commission Expires:____________________
<PAGE>

                                     ACKNOWLEDGEMENT

STATE OF  _______________________   :
                                    : SS
COUNTY OF  ______________________   :


            Before me, the undersigned, a Notary Public, on this _____ day of
March, 2000, personally appeared Steven Tunney, to me known personally, who,
being by me duly sworn, did say that he is the Chief Operating Officer and Chief
Financial Officer of MCG FINANCE CORPORATION, and that said instrument (i.e.,
the Intellectual Property Security Agreement) was signed on behalf of said MCG
Finance Corporation by authority of its Board of Directors (through its Credit
Committee), and the said Chief Operating Officer and Chief Financial Officer
knowledged said instrument to be his free act and deed.


                                    __________________________________________
                                    Notary Public

                                    My Commission Expires:____________________
<PAGE>

                                   SCHEDULE A

                              COPYRIGHT COLLATERAL

                            I. Registered Copyrights

         Copyright                  Registration                Registration
           Title                       Number                       Date
         ---------                  ------------                ------------

                                       N/A

                       II. Pending Copyright Applications

  Copyright       Application        Filing          Date of          Date of
   Title             Number           Date           Creation       Publication
  ---------       -----------        ------          --------       -----------

                                       N/A

                          III. Unregistered Copyrights

                                                         Date and      Date of
                                                       Recordation    Expected
                                                        Number of   Registration
 Copyright      Date of       Date of      Original    Assignment      (if
  Title        Creation     Publication  Author/Owner   to Grantor   applicable)
----------     --------     -----------  ------------  ------------  -----------

                                       N/A

                             IV. Copyright Licenses

                                           Effective    Expiration     Subject
 Copyright      Licensor      Licensee        Date         Date         Matter
 ---------      --------      --------     ---------    ----------     -------

                                       N/A
<PAGE>

                                   SCHEDULE B

                                PATENT COLLATERAL

                                   I. Patents

       Patent                      Issue
       Number             Country          Date                   Title
       ------             -------          ----                   -----

                                       N/A

                         II. Pending Patent Applications

  Patent       Atty. Docket                      Serial Filing
  Title           Number        Country       Number        Date        Status
  ------       -----------      -------       ------        ----        ------

                                       N/A

                              III. Patent Licenses

                                                        Effective    Expiration
Patent No.      Country      Licensor      Licensee        Date         Date
----------      -------      --------      --------     ---------    ----------

                                       N/A
<PAGE>

                                   SCHEDULE C

                              TRADEMARK COLLATERAL

                            I. Registered Trademarks

         Trademark                                              Registration
        Description                    Country                     Number
        -----------                    -------                  ------------

CONNIX                                   USA                     2,008,293

                       II. Pending Trademark Applications

                        Atty.
    Trademark          Docket                  Serial      Filing
   Description         Number      Country     Number       Date       Status
   -----------         ------      -------     ------      ------      ------

                                       N/A

                             III. Trademark Licenses

Registration                                          Effective    Expiration
   Number       Mark   Country   Licensor   Licensee     Date         Date
------------    ----   -------   --------   --------  ---------    ----------

                                       N/A