Exhibit 10.18
                                 -------------


                    CORPORATE RESOLUTION TO GRANT COLLATERAL

Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity:  09-01-2003
Loan No.:  9001
Call/Coll: 2/7380
Account:
Officer:   54403
Initials:

References  in the shaded  area are for  Lender's  use only and do not limit the
applicability  of this document to any  particular  loan or item. Any item above
containing "***" has been omitted due to text length limitations.
<TABLE>
<S>                                                  <C>
Borrower: CATEGORY 5 TECHNOLOGIES, INC.              Lender: ZIONS FIRST NATIONAL BANK
          2795 COTTONWOOD PARKWAY, SUITE 450                 SALT LAKE COMMERCIAL BANKING DIVISION
          SALT LAKE CITY, UT 84121                           10 EAST SOUTH TEMPLE, SUITE 200
                                                             SALT LAKE CITY, UT 84133
</TABLE>

Corporation: EPENZIO, INC.
2795 COTTONWOOD PARKWAY, STE 450
SALT LAKE CITY, UT 84121

================================================================================

WE, THE UNDERSIGNED, DO HEREBY CERTIFY THAT:
THE CORPORATION'S EXISTENCE. The complete and correct name of the Corporation is
EPENZIO, INC. ("Corporation"). The Corporation is a corporation for profit which
is, and at all times shall be, duly  organized,  validly  existing,  and in good
standing under and by virtue of the laws of the State of Utah.  The  Corporation
is duly  authorized  to  transact  business  in all  other  states  in which the
Corporation  is  doing  business,   having   obtained  all  necessary   filings,
governmental  licenses and approvals for each state in which the  Corporation is
doing  business.  Specifically,  the  Corporation is, and at all times shall be,
duly qualified as a foreign corporation in all states in which the failure to so
qualify  would have a  material  adverse  effect on its  business  or  financial
condition.  The  Corporation  has  the  full  power  and  authority  to own  the
properties  and to transact  the  business in which it is  presently  engaged or
presently  proposes  to  engage.  The  Corporation  maintains  an office at 2795
COTTONWOOD  PARKWAY,  STE 450, SALT LAKE CITY, UT 84121.  Unless the Corporation
has designated otherwise in writing, the principal office is the office at which
the Corporation  keeps as books and records.  The Corporation will notify Lender
prior to any change in the location of the  Corporation's  state of organization
or any change in the  Corporation's  name. The  Corporation  shall do all things
necessary to preserve and to keep in full force and effect its existence, rights
and  privileges,  and shall  comply  with all  regulations,  rules,  ordinances,
statutes, orders and decrees of any governmental or quasi-governmental authority
or  court  applicable  to  the  Corporation  and  the   Corporation's   business
activities.

RESOLUTIONS ADOPTED. At a meeting of the Directors of the Corporation, or if the
Corporation  is a close  corporation  having  no  Board of  Directors  then at a
meeting of the  Corporation's  shareholders,  duly  called and held on August 7,
2002,  at which a quorum was  present and  voting,  or by other duly  authorized
action in lieu of a meeting,  the  resolutions set forth in this Resolution were
adopted.

OFFICER. The following named person is an officer of EPENZIO, INC.:

NAMES                  TITLES         AUTHORIZED        ACTUAL SIGNATURES
-----                  ------         ----------        -----------------

BRAD V CRAWFORD        COO             Y                  X    /s/
                                                         ---------------------

ACTIONS  AUTHORIZED.  The  authorized  person  listed  above may enter  into any
agreements  of any  nature  with  Lender,  and  those  agreements  will bind the
Corporation.  Specifically,  but without  limitation,  the authorized  person is
authorized, empowered, and directed to do the following for and on behalf of the
Corporation:

         Grant Security. To mortgage, pledge, transfer, endorse, hYpothecate, or
         otherwise  encumber and deliver to Lender any property now or hereafter
         belonging  to  the  Corporation  or in  which  the  Corporation  now or
         hereafter may have an interest,  including without  limitation all real
         property and all personal  property  (tangible  or  intangible)  of the
         Corporation,  as security for the payment of any loans,  any promissory
         notes, or any other or further indebtedness of CATEGORY 5 TECHNOLOGIES,
         INC.  to Lender at any time owing,  however the same may be  evidenced.
         Such  property  may  be  mortgaged,  pledged,  transferred,   endorsed,
         hypothecated  or encumbered at the time such loans are obtained or such
         indebtedness  is  incurred,  or at any other time or times,  and may be
         either in addition to or in lieu of any property theretofore mortgaged,
         pledged,  transferred,   endorsed,   hypothecated  or  encumbered.  The
         provisions of this  Resolution  authorizing  or relating to the pledge,
         mortgage, transfer, endorsement,  hypothecation, granting of a security
         interest in, or in any way  encumbering,  the assets of the Corporation
         shall include, without limitation,  doing so in order to bad collateral
         security for the indebtedness,  now or hereafter  existing,  and of any
         nature  whatsoever,  of CATEGORY 5  TECHNOLOGIES,  INC. to Lender.  The
         Corporation has considered the value to itself of lending collateral in
         support of such indebtedness,  and the Corporation represents to Lender
         that the Corporation is benefited by doing so.

         Execute Security Documents.  To execute and deliver to Lender the forms
         of mortgage, deed of trust, pledge agreement,  hypothecation agreement,
         and other security agreements and financing statements which Lender may
         require and which shall  evidence  the terms and  conditions  under and
         pursuant  to which  such  liens  and  encumbrances,  or any of them are
         given;  and also to execute  and  deliver  to Lender any other  written
         instruments, any chattel paper, or any other collateral, of any kind or
         nature, which Lender may deem necessary or proper in connection with or
         pertaining to the giving of the liens and encumbrances.

         Further  Acts.  To do and  perform  such  other  acts and things and to
         execute and deliver  such other  documents  and  agreements,  including
         agreements  requiring  disputes  with Lander to be submitted to binding
         arbitration  for final  resolution,  as the  officer  may in his or her
         discretion deem  reasonably  necessary or proper in order to carry into
         effect the provisions of this Resolution.

ASSUMED  BUSINESS NAMES.  The Corporation has filed or recorded all documents or
filings  required  by law  relating to all  assumed  business  names used by the
Corporation.  Excluding the name of the Corporation, the following is a complete
list of ail assumed  business names under which the  Corporation  does business:
None.

NOTICES TO LENDER.  The  Corporation  will promptly  notify Lender in writing at
Lender's  address  shown above (or such other  addresses as Lender may designate
from time to time) prior to any {A) change in the Corporation's name; (B) change
in the Corporation's  assumed business name(s):  (C) change in the management of
the  Corporation;  (D)  change in the  authorized  signer(s);  {E) change in the
Corporation's principal office address; (F) change in the Corporation's state of
organization;  (G)  conversion of the  Corporation to a new or different type of
business  entity;  or (H)  change in any other  aspect of the  Corporation  that
directly or indirectly  relates to any agreements  between the  Corporation  and
Lender. No change in the  Corporation's  name or state of organization will take
effect until after Lender has received notice.

CERTIFICATION  CONCERNING  OFFICERS AND RESOLUTIONS.  The officer named above is
duty elected,  appointed, or employed by or for the Corporation, as the case may
be, and occupies the position  set  opposite his or her  respective  name.  This
Resolution  now  stands of record  on the books of the  Corporation,  is in full
force and effect, and has not been modified or revoked in any manner whatsoever.

NO CORPORATE SEAL. The Corporation has no corporate seal, and therefore, no seal
is affixed to this Resolution.


<PAGE>




                    CORPORATE RESOLUTION TO GRANT COLLATERAL
Loan No: 9001                   (Continued)                               Page 2
================================================================================

CONTINUED VALIDITY.  Any and all acts authorized pursuant to this Resolution and
performed  prior to the  passage  of this  Resolution  are hereby  ratified  and
approved.  This Resolution  shall be continuing,  shall remain in full force and
effect and Lender may rely on it until written  notice of its  revocation  shall
have been  delivered to and received by Lender at Lender's  address  shown above
(or such addresses as Lender may designate  from time to time).  Any such notice
shall not affect any of the Corporation's agreements or commitments in effect at
the time notice is given.

IN  TESTIMONY  WHEREOF,  We have  hereunto  set our  hand  and  attest  that the
signature set opposite the name listed above his or her genuine signature.

We each have read all the provisions of this Resolution,  and we each personally
and on behalf of the Corporation certify that all statements and representations
made in this Resolution are true and correct.  The Corporate Resolution to Grant
Collateral is dated August 7, 2002.

                                         CERTIFIED TO AND ATTESTED BY:

                                         By:   /s/
                                            ----------------------------------
                                            Authorized Signer for EPENZIO, INC.



NOTE:  If the officer  signing this  Resolution  is  designated by the foregoing
document as one of the officers  authorized to act on the Corporation's  behalf,
it is advisable,  to have this Resolution signed by at least one  non-authorized
officer of the Corporation.
================================================================================


<PAGE>

                    CORPORATE RESOLUTION TO BORROW/GRANT COLLATERAL

Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity:  09-01-2003
Loan No.:  9001
Call/Coll: 2/7380
Account:   3147622
Officer:   54403
Initials:

References  in the shaded  area are for  Lender's  use only and do not limit the
applicability  of this document to any  particular  loan or item. Any item above
containing "***" has been omitted due to text length limitations.
<TABLE>
<S>                                                  <C>
Borrower: CATEGORY 5 TECHNOLOGIES, INC.              Lender: ZIONS FIRST NATIONAL BANK
          2795 COTTONWOOD PARKWAY, SUITE 450                 SALT LAKE COMMERCIAL BANKING DIVISION
          SALT LAKE CITY, UT 84121                           10 EAST SOUTH TEMPLE, SUITE 200
                                                             SALT LAKE CITY, UT 84133
</TABLE>
================================================================================

WE, THE UNDERSIGNED, DO HEREBY CERTIFY THAT:

THE CORPORATION'S EXISTENCE. The complete and correct name of the Corporation is
CATEGORY 5 TECHNOLOGIES, INC. ("Corporation").  The Corporation is a corporation
for  profit  which  is,  and at all  times  shall be,  duly  organized,  validly
existing,  and in good standing  under and by virtue of the laws of the State of
Nevada.  The Corporation is duly authorized to transact business in the State of
Utah and all other states in which the  Corporation  is doing  business,  having
obtained all  necessary  filings,  governmental  licenses and approvals for each
state in which the Corporation is doing business.  specifically, the Corporation
is, and at all times shall be, duly  qualified as a foreign  corporation  in all
states in which the failure to so qualify would have a material  adverse  effect
on its business or financial  condition.  The Corporation has the full power and
authority  to own its  properties  and to transact  the  business in which it is
presently engaged or presently proposes to engage. The Corporation  maintains an
office at 2795 COTTONWOOD  PARKWAY,  SUITE 450, SALT LAKE CITY, UT 84121. Unless
the Corporation has designated otherwise in writing, the principal office is the
office at which the  Corporation  keeps its books and records.  The  Corporation
will notify  Lender  prior to any change in the  location  of the  Corporation's
state of organization or any change in the  Corporation's  name. The Corporation
shall do all things  necessary  to preserve and to keep in full force and effect
its existence,  rights and  privileges,  and shall comply with all  regulations,
rules,  ordinances,   statutes,  orders  and  decrees  of  any  governmental  or
quasi-governmental  authority or court  applicable  to the  Corporation  and the
Corporation's business activities.

RESOLUTIONS ADOPTED. At a meeting of the Directors of the Corporation, or if the
Corporation  is a close  corporation  having  no  Board of  Directors  then at a
meeting of the  Corporation's  shareholders,  duly  called and held on August 7,
2002,  at which a quorum was  present and  voting,  or by other duly  authorized
action in lieu of a meeting,  the  resolutions set forth in this Resolution were
adopted.

OFFICER.  The following  named person is an officer of CATEGORY 5  TECHNOLOGIES,
INC.:


NAMES                  TITLES         AUTHORIZED        ACTUAL SIGNATURES
-----                  ------         ----------        -----------------

PAUL S ANDERSON        CEO             Y               X    /s/
                                                         ---------------------

ACTIONS  AUTHORIZED.  The  authorized  person  listed  above may enter  into any
agreements  of any  nature  with  Lender,  and  those  agreements  will bind the
Corporation.  Specifically,  but without  limitation,  the authorized  person is
authorized, empowered, and directed to do the following for and on behalf of the
Corporation:

         Borrow Money. To borrow, as a cosigner or otherwise,  from time to time
         from  Lender,  on  such  terms  as  may  be  agreed  upon  between  the
         Corporation  and  Lender,  such  sum or sums of  money as in his or her
         judgment should be borrowed, without limitation.

         Execute Notes.  To execute and deliver to Lender the promissory note or
         notes, or other evidence of the Corporation's credit accommodations, on
         Lender's  forms,  at such rates of interest and on such terms as may be
         agreed  upon,  evidencing  the sums of money so  borrowed or any of the
         Corporation's  indebtedness to Lender,  and also to execute and deliver
         to   Lender   one  or   more   renewals,   extensions,   modifications,
         refinancings,  consolidations,  or substitutions for one or more of the
         notes,  any  portion  of the  notes,  or any other  evidence  of credit
         accommodations.

         Grant Security. To mortgage, pledge, transfer, endorse, hypothecate, or
         otherwise  encumber and deliver to Lender any property now or hereafter
         belonging  to  the  Corporation  or in  which  the  Corporation  now or
         hereafter may have an interest,  including without  limitation all real
         property and all personal  property  (tangible  or  intangible}  of the
         Corporation,  as  security  for the  payment  of any  loans  or  credit
         accommodations so obtained, any promissory notes so executed (including
         any amendments to or  modifications,  renewals,  and extensions of such
         promissory  notes),  or  any  other  or  further  indebtedness  of  the
         Corporation  to  Lender  at any  time  owing,  however  the same may be
         evidenced.  Such  property  may  be  mortgaged,  pledged,  transferred,
         endorsed,  hypothecated  or  encumbered  at the  time  such  loans  are
         obtained  or such  indebtedness  is  incurred,  or at any other time or
         times,  and may be either  in  addition  to or in lieu of any  property
         theretofore mortgaged, pledged, transferred,  endorsed, hypothecated or
         encumbered.

         Execute Security Documents.  To execute and deliver to Lender the forms
         of mortgage, deed of trust, pledge agreement,  hypothecation agreement,
         and other security agreements and financing statements which Lender may
         require and which shall  evidence  the terms and  conditions  under and
         pursuant  to which such  liens and  encumbrances,  or any of them,  are
         given;  and also to execute  and  deliver  to Lender any other  written
         instruments, any chattel paper, or any other collateral, of any kind or
         nature, which Lender may deem necessary or proper in connection with or
         pertaining to the giving of the liens and encumbrances.

         Negotiate Items. To draw, endorse, and discount with Lender all drafts,
         trade acceptances, promissory notes, or other evidences of indebtedness
         payable to or belonging to the  Corporation or in which the Corporation
         may have an  interest,  and either to  receive  cash for the same or to
         cause such  proceeds to be credited to the  Corporation's  account with
         Lender,  or to cause such other  disposition  of the  proceeds  derived
         therefrom as he or she may deem advisable.

         Further Acts. In the case of lines of credit,  to designate  additional
         or alternate  individuals as being authorized to request advances under
         such lines,  and in all cases,  to do and  perform  such other acts and
         things,  to pay any and all fees and costs,  and to execute and deliver
         such other documents and  agreements,  including  agreements  requiring
         disputes with Lender to be submitted to binding  arbitration  for final
         resolution, as the officer may in his or her discretion deem reasonably
         necessary  or proper in order to carry into  affect the  provisions  of
         this  Resolution.  The  following  person  currently is  authorized  to
         request advances and authorized payments under the line of credit until
         Lander receives from the Corporation,  at Lander's address shown above,
         written notice of revocation of his or her authority:  PAUL S ANDERSON,
         CEO of CATEGORY 5 TECHNOLOGIES, INC.

ASSUMED  BUSINESS NAMES.  The Corporation has filed or recorded all documents or
filings  required  by law  relating to all  assumed  business  names used by the
Corporation.  Excluding the name of the Corporation, the following is a complete
list of all assumed  business names under which the  Corporation  does business:
None.


NOTICES TO LENDER.  The  Corporation  will promptly  notify Lender in writing at
Lender's  address  shown above (or such other  addresses as Lender may designate
from time to time) prior to an (A) change in the  Corporation's name; (b) change

<PAGE>




                CORPORATE RESOLUTION TO BORROW / GRANT COLLATERAL
Loan No: 9001                      (Continued)                            Page 2
================================================================================

in the Corporation's assumed  business name(s); (C) change  in the management of
the  Corporation;  (D)  change in the  authorized  signer(s);  (E) change in the
Corporation's principal office address; (F) change in the Corporation's state of
organization;  (G)  conversion of the  Corporation to a new or different type of
business  entity;  or (H)  change in any other  aspect of the  Corporation  that
directly or indirectly  relates to any agreements  between the  Corporation  and
Lender. No change in the  Corporation's  name or state of organization will take
effect until after Lender has received notice.

CERTIFICATION  CONCERNING  OFFICERS AND RESOLUTIONS.  The officer named above is
duly elected,  appointed, or employed by or for the Corporation, as the case may
be, and occupies the position  set  opposite his or her  respective  name.  This
Resolution now stands of record on the books of the Corporation is in full force
and effect, and has not been modified or revoked in any manner whatsoever.

NO CORPORATE SEAL. The Corporation has no corporate seal, and therefore, no seal
is affixed to this Resolution.

CONTINUING VALIDITY. Any and all acts authorized pursuant to this Resolution and
performed  prior to the  passage  of this  Resolution  are hereby  ratified  and
approved.  This Resolution  shall be continuing,  shall remain in full force and
effect and Lender may rely on it until written  notice of its  revocation  shall
have been  delivered to and received by Lender at Lender's  address  shown above
(or such addresses as Lender may designate  from time to time).  Any such notice
shall not affect any of the Corporation's agreements or commitments in effect at
the time notice is given.

IN TESTIMONY WHEREOF. We have hereunto set our hand.

We each have read all the provisions of this Resolution,  and we each personally
and on behalf of the Corporation  certify that all statement and representations
made in this  Resolution  are true and correct.  This  Corporate  Resolution  to
Borrow / Grant Collateral is dated August 7, 2002.


                                         CERTIFIED TO AND ATTESTED BY:

                                         By:   /s/
                                            ----------------------------------
                                            Authorized Signer for CATEGORY 5
                                            TECHNOLOGIES, INC.


NOTE:  If the officer  signing this  Resolution  is  designated by the foregoing
document as one of the officers  authorized to act on the Corporation's  behalf,
it is advisable,  to have this Resolution signed by at least one  non-authorized
officer of the Corporation.
================================================================================


<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Principal: $2,000,000.00
Loan Date: 08-07-2002
Maturity:  09-01-2003
Loan No.:  9001
Call/Coll: 2/7380
Account:   3147622
Officer:   54403
Initials:

References  in the shaded  area are for  Lender's  use only and do not limit the
applicability  of this document to any  particular  loan or item. Any item above
containing "***" has been omitted due to text length limitations.
<TABLE>
<S>                                                  <C>
Borrower: CATEGORY 5 TECHNOLOGIES, INC.              Lender: ZIONS FIRST NATIONAL BANK
          2795 COTTONWOOD PARKWAY, SUITE 450                 SALT LAKE COMMERCIAL BANKING DIVISION
          SALT LAKE CITY, UT 84121                           10 EAST SOUTH TEMPLE, SUITE 200
                                                             SALT LAKE CITY, UT 84133
</TABLE>

================================================================================

THIS  BUSINESS  LOAN  AGREEMENT  (ASSET BASED) dated August 7. 2002, is made and
executed  between  CATEGORY 5  TECHNOLOGIES  INC.  ("Borrower")  and ZIONS FIRST
NATIONAL BANK  ("Lender") on the following  terms and  conditions.  Borrower has
received  prior  commercial  loans  from  Lender or has  applied to Lender for a
commercial  loan or loans or other  financial  accommodations,  including  those
which may be  described  on any exhibit or schedule  attached to this  Agreement
("Loan").  Borrower understands and agrees that: (A) in granting,  renewing,  or
extending  any  Loan,   Lender  is  relying  upon  Borrower's   representations,
warranties,  and  agreements as set forth in this  Agreement;  (B) the granting,
renewing,  or  extending  of any Loan by Lender at all times shall be subject to
Lender's  sole  judgment  and  discretion;  and (C) all such Loans  shall be and
remain subject to the terms and conditions of this Agreement.

TERM. This Agreement shall be effective as of August 7, 2002, and shall continue
in full force and effect until such time as all of Borrower's  Loans in favor of
Lender have been paid in full, including principal,  interest,  costs, expenses,
attorneys'  fees, and other fees and charges,  or until such time as the parties
may agree in writing to terminate this Agreement.

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

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

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

         (2) Lender shall have received  such opinions of counsels  supplemental
         opinions, and documents as Lender may request.

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

         (4i All  guaranties  required  by Lender for the  credit  facility(ies)
         shall have been executed by each Guarantor, delivered to Lender, and be
         in full force and effect.

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

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

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

Making Loan Advances.  Advances under this credit faculty, as well as directions
for payment from Borrower's  accounts,  may be requested orally or in writing by
authorized persons.  Lender may, but need not, require that all oral requests be
confined in writing. Each Advance shall be conclusively deemed to have been made
at the  request of and for the  benefit of  Borrower  (1) when  credited  to any
deposit  account of  Borrower  maintained  with  Lender or (2) when  advanced in
accordance with the instructions of an authorized person. Lender, at its option,
may set a cutoff time,  after which all requests for Advances will be treated as
having been requested on the next succeeding Business Day.

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

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

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

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


<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 2
================================================================================

         Employer  Identification  Number.  Borrower  further  agrees  to notify
         Lender  in  writing  prior to any  change in  address  or  location  of
         Borrower's  principal  governance  office or should  Borrower  merge or
         consolidate with any other entity.

         Collateral  Records.  Borrower  does now,  and at all  times  hereafter
         shall,  keep correct and  accurate  records of the  Collateral,  all of
         which records  shall be available to Lender or Lender's  representative
         upon demand for  inspection and copying at any  reasonable  time.  With
         respect to the  Accounts,  Borrower  agrees to keep and  maintain  such
         records as Lender may require, including without limitation information
         concerning  Eligible Accounts and Account balances and agings.  Records
         related to Accounts  (Receivables)  are or will be located at 2755 EAST
         COTTONWOOD PARKWAY, 4TH FLOOR. SALT LAKE CITY, UTAH 84121. The above is
         an accurate and complete list of all locations at which  Borrower keeps
         or maintains business records concerning Borrower's collateral.

         Collateral  Schedules.  Concurrently with the execution and delivery of
         this Agreement,  Borrower shall execute and deliver to Lender schedules
         of Accounts and  schedules of Eligible  Accounts in form and  substance
         satisfactory to the Lender.  Thereafter supplemental schedules shall be
         delivered according to the following schedule: With respect to Eligible
         Accounts, schedules shall be delivered Every 30 days.

         Representations and Warranties Concerning Accounts. With respect to the
         Accounts,  Borrower represents and warrants to Lender: (1) Each Account
         represented by Borrower to be an Eligible  Account for purposes of this
         Agreement conforms to the requirements of the definition of an Eligible
         Account;  (2) All Account  information listed on schedules delivered to
         Lender will be true and correct,  subject to immaterial  variance;  and
         (3),  Lender,  its assigns,  or agents shall have the right at any time
         and at Borrower's  expense to inspect,  examine,  and audit  Borrower's
         records  and to confirm  with  Account  Debtors  the  accuracy  of such
         Accounts.

         Remittance Account. Borrower agrees that Lender may at any time require
         Borrower  to  institute  procedures  whereby  the  payments  and  other
         proceeds of the Accounts  shall be paid by the Account  Debtors under a
         remittance  account or lock box  arrangement  with Lender,  or Lender's
         agent, or with one or more financial institutions designated by Lender.
         Borrower  further agrees that, if no Event of Default exists under this
         Agreement,  any and all of such funds  received under such a remittance
         account or lock box  arrangement  shall,  at Lender's sole election and
         discretion,  either  be (1)  paid  or  turned  over  to  Borrower;  (2)
         deposited into one or more accounts for the benefit of Borrower  (which
         deposit accounts shall be subject to a security  assignment in favor of
         Lender);  (3) deposited into one or more accounts for the joint benefit
         of  Borrower  and Lender  (which  deposit  accounts  shall  likewise be
         subject  to a  security  assignment  in favor of  Lender);  (4) paid or
         turned over to Lender to be applied to the  Indebtedness  in such order
         and priority as Lender may determine within its sole discretion; or (5)
         any combination of the foregoing as Lender shall determine from time to
         time.  Borrower  further  agrees  that,  should  one or more  Events of
         Default  exist,  any and all funds  resolved  under  such a  remittance
         account or lock box arrangement  shall be paid or turned over to Lender
         to be applied to the Indebtedness,  again in such order and priority as
         Lender may determine within its sole discretion.

CONDITIONS  PRECEDENT TO EACH ADVANCE.  Lender's  obligation to make the initial
Advance and each subsequent Advance under this Agreement shall be subject to the
fulfillment to Lender's  satisfaction of all of the conditions set forth in this
Agreement and in the Related Documents.

         Loan  Documents.   Borrower  shall  provide  to  Lender  the  following
         documents for the Loan: (1) the Note; (2) Security  Agreements granting
         to  Lender  security   interests  in  the  Collateral;   (3)  financing
         statements  and  all  other  documents   perfecting  Lender's  Security
         Interests;  (4) evidence of insurance as required  below;  (5) together
         with all such Related Documents as Lender may require for the Loan; all
         in form and substance satisfactory to Lender and Lender's counsel.

         Borrower's  Authorization.  Borrower  shall have  provided  in form and
         substance satisfactory to Lender properly certified  resolutions,  duly
         authorizing the execution and delivery of this Agreement,  the Note and
         the Related Documents.  In addition,  Borrower shall have provided such
         other resolutions,  authorizations, documents and instruments as Lender
         or its counsel, may require.

         Fees and  Expends  Under  This  Agreement.  Borrows  shall have paid to
         Lender all fees,  costs,  and expenses  specified in this Agreement and
         the Related Documents as are then due and payable.

         Representations and Warranties.  The representations and warranties set
         forth in this Agreement, in the Related Documents,  and in any document
         or  certificate  delivered to Lender under this  Agreement are true and
         correct.

         No Event of Default. There shall not exist at the time of any Advance a
         condition  which  would  constitute  an Event  of  Default  under  this
         Agreement or under any Related Document.

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

         Organization. Borrower is a corporation for profit which is, and at all
         times shall be, duly organized,  validly existing, and in good standing
         under and by virtue of the laws of the  State of  Nevada.  Borrower  is
         duly  authorized  to  transact  business  in all other  states in which
         Borrower is doing  business,  having  obtained all  necessary  filings,
         governmental licenses and approvals for each state in which Borrower is
         doing business.  Specifically,  Borrower is, and at all times shall be,
         duly  qualified  as a foreign  corporation  in all  states in which the
         failure to so  qualify  would  have a  material  adverse  effect on its
         business  or  financial  condition.  Borrower  has the full  power  and
         authority to own its  properties  and to transact the business in which
         it is  presently  engaged or  presently  proposes  to engage.  Borrower
         maintains an office at 2795  COTTONWOOD  PARKWAY,  SUITE 450, SALT LAKE
         CITY, UT 84121.  Unless  Borrower has designated  otherwise in writing,
         the principal  office is the office at which  Borrower  keeps its books
         and records including its records  concerning the Collateral.  Borrower
         will notify  Lender prior to any change in the  location of  Borrower's
         state of organization or any change in Borrower's name.  Borrower shall
         do all  things  necessary  to  preserve  and to keep in full  force and
         effect its existence,  rights and privileges, and shall comply with all
         regulations,  rules,  ordinance,  statutes,  orders and  decrees of any
         governmental  or  quasi-governmental  authority or court  applicable to
         Borrower and Borrower's business activities.

         Assumed Business Names. Borrower has filed or recorded all documents or
         filings  required by law relating to all assumed business names used by
         Borrower.  Excluding the name of Borrower,  the following is a complete
         list of all assumed  business names under which Borrower does business:
         None.

         Authorization.  Borrower's execution, delivery, and performance of this
         Agreement and all the Related  Documents  have bean duly  authorized by
         all necessary action by Borrower and do not conflict with,  result in a
         violation  of, or  constitute  a default  under  (1) any  provision  of
         Borrower's articles of incorporation or organization, or bylaws, or any
         agreement or other  instrument  binding  upon  Borrower or (2) any law,
         governmental regulation,  court decree, or order applicable to Borrower
         or to Borrower's properties.

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

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


<PAGE>

<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 3
================================================================================

         Properties.  Except as  contemplated by this Agreement or as previously
         disclosed in  Borrower's  financial  statements or in writing to Lender
         and as accepted by Lender,  and except for property tax liens for taxes
         not presently due and payable,  Borrower owns and has good title to all
         of Borrower's properties free and clear of all Security Interests,  and
         has  not  executed  any  security  documents  or  financing  statements
         relating to such properties. All of Borrower's properties are titled in
         Borrower's  legal name,  and Borrower has not used or filed a financing
         statement under any other name for at least the last five (5) years.

         Hazardous Substances. Except as disclosed to and acknowledged by Lender
         in writing,  Borrower  represents  and  warrants  that:  (1) During the
         period of Borrower's ownership of Borrower's Collateral, there has been
         no use, generation,  manufacture,  storage, treatment, disposal release
         or  threatened  release of any  Hazardous  Substance  by any person on,
         under,  about  or  from  any of the  Collateral.  (2)  Borrower  has no
         knowledge  of, or reason to believe  that there has been (a) any breach
         or  violation  of any  Environmental  Laws;  (b) any  use,  generation,
         manufacture,   storage,  treatment,  disposal,  release  or  threatened
         release  of any  Hazardous  Substance  on,  under,  about  or from  the
         Collateral  by any prior owners or occupants of any of the  Collateral;
         or (c) any actual or threatened litigation or claims of any kind by any
         person  relating to such matters.  (3) Nether  Borrower nor any tenant,
         contractor,  agent or other  authorized  user of any of the  Collateral
         shall use, generate,  manufacture,  store, treat, dispose of or release
         any Hazardous Substance on, under, about or from any of the Collateral;
         and any  such  activity  shall  be  conducted  in  compliance  with all
         applicable federal, state, and local laws, regulations, and ordinances,
         including   without   limitation  all  Environmental   Laws.   Borrower
         authorizes  Lender and its agents to enter upon the  Collateral to make
         such  inspections and tests as Lender may deem appropriate to determine
         compliance of the Collateral  with this section of the  Agreement.  Any
         inspections or tests made by Lender shall be at Borrower's  expense and
         for  Lender's  purposes  only and shall not be  construed to create any
         responsibility or liability on the part of Lender to Borrower or to any
         other person. The representations  and warranties  contained herein are
         based on Borrower's due diligence in  investigating  the Collateral for
         hazardous waste and Hazardous Substances.  Borrower hereby (1) releases
         and  waives  any  future  claims   against   Lender  for  indemnity  or
         contribution in the event Borrower  becomes liable for cleanup or other
         costs  under  any such  laws,  and (2)  agrees  to  indemnity  and hold
         harmless  Lender  against  any and  all  claims,  losses,  liabilities,
         damages,   penalties,   and  expenses  which  Lender  may  directly  or
         indirectly sustain or suffer resulting from a breach of this section of
         the Agreement or as a consequence of any use, generation,  manufacture,
         storage,  disposal,  release or threatened release of a hazardous waste
         or substance on the  Collateral.  The provisions of this section of the
         Agreement,  including the  obligation  to indemnity,  shall survive the
         payment  of  the  Indebtedness  and  the  termination,   expiration  or
         satisfaction  of this  Agreement  and shall not be affected by Lender's
         acquisition  of any  interest  in any of  the  Collateral,  whether  by
         foreclosure or otherwise.

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

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

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

         Binding Effect.  This Agreement,  the Note, all Security Agreements (if
         any), and all Related  Documents are binding upon the signers  thereof,
         as well as upon their successors,  representatives and assigns, and are
         legally enforceable in accordance with their respective terms.

AFFIRMATIVE COVENANTS. Borrower  covenants and  agrees with Lender that, so long
as this Agreement remains in effect, Borrower will:

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

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

         Financial Statements. Furnish Lender with the following:

              Annual  Statements.  As soon as  available,  but in no event later
              than  ninety  (90)  days  after  the  end  of  each  fiscal  year,
              Borrower's  balance sheet and income statement for the year ended,
              audited by a certified public accountant satisfactory to Lender.

              Interim  Statements.  As soon as available,  but in no event later
              than 45 days  after  the end of each  fiscal  quarter,  Borrower's
              balance sheet and profit and loss  statement for the period ended,
              prepared by Borrower.

         All  financial  reports  required to be provided  under this  Agreement
         shall be  prepared in  accordance  with GAAP,  applied on a  consistent
         basis, and certified by Borrower as being true and correct.

         Additional   Information.   Furnish  such  additional  information  and
         Statements, as Lender may request from time to time.

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

         Insurance Reports.  Furnish to Lender, upon request of Lender,  reports
         on each existing  insurance  policy showing such  information as Lender
         may reasonably request, including without limitation the following: (1)
         the name of the insurer;  (2) the risks insured;  (3) the amount of the
         policy;  (4) the  properties  insured;  (5) the then  current  property
         values  on the  basis of which  insurance  has been  obtained,  and the
         manner of determining those values;  and (6) the expiration date of the
         policy.  In addition,  upon  request of Lender  (however not more often
         than annually) Borrower will have an independent appraiser satisfactory
         to  Lender  determine,   as  applicable,   the  actual  cash  value  or
         replacement cost of any Collateral. The cost of such appraisal shall be
         paid by Borrower.

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

<PAGE>


                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 4
================================================================================


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

         Taxes.  Charges  and  Liens.  Pay  and  discharge  when  due all of its
         indebtedness  and  obligations,   including   without   limitation  all
         assessments,  taxes,  governmental charges,  levies and liens, of every
         kind and nature,  imposed upon Borrower or its properties,  income,  or
         profits,  prior to the date on which  penalties  would attach,  and all
         lawful claims that,  if unpaid,  might become a lien or charge upon any
         of Borrower's properties, income, or profits.

         Performances.  Perform and comply, in a timely manner,  with all terms,
         conditions,  and provisions set forth in this Agreement, in the Related
         Documents, and in all other instruments and agreements between Borrower
         and Lender.  Borrower shall notify Lender immediately in writing of any
         default in connection with any agreement.

         Operations.   Maintain   executive  and   management   personnel   with
         substantially  the same  qualifications  and  experience as the present
         executive and management personnel; provide written notice to Lender of
         any change in executive and management personnel;  conduct its business
         affairs in a reasonable and prudent manner.

         Environmental  Studies.  Promptly  conduct and complete,  at Borrower's
         expense,  all such investigations,  studies,  samplings and testings as
         may be requested by Lender or any  governmental  authority  relative to
         any substance,  or any waste or by-product of any substance  defined as
         toxic or a hazardous  substance  under  applicable  federal,  state, or
         local law, rule,  regulation,  order or directive,  at or affecting any
         property or any facility owned, leased or used by Borrower.

         Compliance  with  Governmental  Requirements.  Comply  with  all  laws,
         ordinances,  and  regulations,  now  or  hereafter  in  effect,  of all
         governmental  authorities  applicable  to  the  conduct  of  Borrower's
         properties,  businesses and operations,  and to the use or occupancy of
         the  Collateral,  including  without  limitation,  the  Americans  With
         Disabilities  Act.  Borrower  may  contest  in good faith any such law,
         ordinance, or regulation and withhold compliance during any proceeding,
         including  appropriate appeals, so long as Borrower has notified Lender
         in writing  prior to doing so and so long as, in Lender's sole opinion,
         Lender's  interests in the Collateral are not  jeopardized.  Lender may
         require Borrower to post adequate security or a surety bond, reasonably
         satisfactory to Lender, to protect Lender's interest.

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

         Compliance  Certificates.  Unless waived in writing by Lender,  provide
         Lender within thirty (30) days after the end of each fiscal year and at
         the time of each  disbursement  of Loan  proceeds,  with a  certificate
         executed by Borrower's  chief  financial  officer,  or other officer or
         person acceptable to Lender,  certifying that the  representations  and
         warranties  set forth in this  Agreement are true and correct as of the
         date of the certificate and further  certifying that, as of the date of
         the certificate, no Event of Default exists under this Agreement.

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

         Additional  Assurances.  Make,  execute  and  deliver  to  Lender  such
         promissory  notes,  mortgages,  deeds of  trust,  security  agreements,
         assignments,  financing  statements,  instruments,  documents and other
         agreements  as  Lender  or its  attorneys  may  reasonably  request  to
         evidence and secure the Loans and to perfect all Security Interests.

RECOVERY OF  ADDITIONAL  COSTS.  If the  imposition of or any change in any law,
rule,  regulation or guideline,  or the  interpretation  or  application  of any
thereof by any court or administrative or governmental  authority (including any
request or policy not  having  the force of law)  shall  impose,  modify or make
applicable any taxes (except  federal,  state or local income or franchise taxes
imposed on Lender), reserve requirements, capital adequacy requirements or other
obligations  which  would (A)  increase  the cost to  Lender  for  extending  or
maintaining the credit  facilities to which this Agreement  relates,  (B) reduce
the amounts payable to Lender under this Agreement or the Related Documents,  or
(C) reduce the rate of return on Lender's  capital as a consequence  of Lender's
obligations  with  respect to the  credit  facilities  to which  this  Agreement
relates,  then  Borrower  agrees to pay Lender such  additional  amounts as will
compensate  Lender therefor  within five (5) days after Lender's  written demand
for such payment,  which demand shall be  accompanied  by an explanation of such
imposition or charge and a calculation  in reasonable  detail of the  additional
amounts  payable  by  Borrower,  which  explanation  and  calculations  shall be
conclusive in the absence of manifest error.

LENDER'S  EXPENDITURES.  If any action or  proceeding  is  commenced  that would
materially  affect  Lender's  interest in the Collateral or if Borrower fails to
comply with any provision of this Agreement or any Related Documents,  including
but not limited to  Borrower's  failure to discharge or pay when due any amounts
Borrower is required to  discharge  or pay under this  Agreement  or any Related
Documents,  Lender on Borrower's behalf may (but shall not be obligated to) take
any  action  that  Lender  deems  appropriate,  including  but  not  limited  to
discharging or paying all taxes,  liens,  security  interests,  encumbrances and
other  claims,  at any time  levied or placed on any  Collateral  and paying all
costs  for  insuring,  maintaining  and  preserving  any  Collateral.  All  such
expenditures  incurred  or paid by  Lender  for such  purposes  will  then  bear
interest at the rate  charged  under the Note from the date  incurred or paid by
Lender to the date of  repayment by Borrower.  All such  expenses  will become a
part of the Indebtedness and, at Lender's option, will (A) be payable on demand;
(B) be added to the balance of the Note and be apportioned  among and be payable
with any  installment  payments to become due during  either (1) the term of any
applicable  insurance  policy;  or (2) the remaining term of the Note; or (C) be
treated  as a  balloon  payment  which  will be due and  payable  at the  Note's
maturity.

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

         Indebtedness  and Liens.  (1) Except for trade debt  incurred in normal
         course of business  and  indebtedness  to Lender  contemplated  by this
         Agreement,  create,  incur or assume  indebtedness  for borrowed money,
         including capital leases, (2) sell, transfer, mortgage, assign, pledge,
         lease,  grant a security  interest  in, or encumber  any of  Borrower's
         assets  (except  as  allowed  as  Permitted  Liens),  or (3) sell  with
         recourse any of Borrower's accounts, except to Lender.

<PAGE>


                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 5
================================================================================

         Continuity  of  Operations.  (1)  Engage  in  any  business  activities
         substantially  different  than  those in which  Borrower  is  presently
         engaged, (2) cease operations,  liquidate,  merge, transfer, acquire or
         consolidate  with any  other  entity,  change  its  name,  dissolve  or
         transfer or sell Collateral out of the ordinary course of business,  or
         (3) pay any dividends on Borrower's Stock (other than dividends payable
         in its stock),  provided,  however that  notwithstanding the foregoing,
         but only so long as no Event of Default has occurred and is  continuing
         or would  result  from the  payment  of  dividends,  if  Borrower  is a
         "Subchapter S Corporation"  (as defined in the Internal Revenue Code of
         1986, as amended),  Borrower may pay cash dividends on its stock to its
         shareholders  from time to time in  amounts  necessary  to  enable  the
         shareholders to pay income taxes and make estimated income tax payments
         to satisfy  their  liabilities  under federal and state law which arise
         solely from their status as  Shareholders of a Subchapter S Corporation
         because of their  Ownership of shares of Borrower's  stock, or purchase
         or  retire  any of  Borrower's  outstanding  shares  or  alter or amend
         Borrower's capital structure.

         Loans,  Acquisitions  and Guaranties.  (1 ) Loan,  invest in or advance
         money or assets,  (2)  purchase,  create or acquire any interest in any
         other  enterprise or entity,  or (3} incur any  obligation as surety or
         guarantor other than in the ordinary course of business.

CESSATION OF  ADVANCES.  If Lender has made any  commitment  to make any Loan to
Borrower,  whether  under this  Agreement or under any other  agreement,  Lender
shall have no  obligation to make Loan Advances or to disburse Loan proceeds if:
(A) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the  Related  Documents  in any  other  agreement  that  Borrower  or any
Guarantor  has  with  Lender,  (B)  Borrower  or  any  Guarantor  dies,  becomes
incompetent  or becomes  insolvent,  files a petition in  bankruptcy  or similar
proceedings,  or is adjudged a  bankrupt;  (C) there  occurs a material  adverse
change in Borrower's  financial  condition,  in the  financial  condition of any
Guarantor,  or in the value of any  Collateral  securing  any  Loan;  or (D) any
Guarantor seeks,  claims or otherwise  attempts to limit,  modify or revoke such
Guarantor's guaranty of the Loan or any other loan with Lender; or (E) Lender in
good faith deems  itself  insecure,  even though no Event of Default  shall have
occurred.

RIGHT OF SETOFF.  To the extent  permitted by applicable  law, Lender reserves a
right of  setoff in all  Borrower's  accounts  with  Lender  (whether  checking,
savings,  or some other  accounts.  This  includes all accounts  Borrower  holds
jointly  with  someone  else and all  accounts  Borrower may open in the future.
However,  this does not include any IRA or Keogh accounts, or any trust accounts
for which cutoff would be prohibited by law. Borrower  authorizes Lender, to the
extent  permitted by  applicable  law, to charge or setoff all sums owing on the
Indebtedness  against any and all such  accounts,  and, at Lender's  option,  to
administratively  freeze all such  accounts to allow Lender to protect  Lender's
charge and setoff rights provided in this paragraph.

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

         Payment Default.  Borrower fails to make any payment when due under the
         Loan.

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

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

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

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

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

         Creditor or Forfeiture  Proceedings.  Commencement  of  foreclosure  or
         forfeiture  proceedings,  whether by  judicial  proceeding,  self-he1p,
         repossession or any other method, by any creditor of Borrower or by any
         governmental  agency  against any  collateral  securing the Loan.  This
         includes a garnishment of any of Borrowers accounts,  including deposit
         accounts,  with Lender.  However, this Event of Default shall not apply
         if there is a good faith  dispute by  Borrower  as to the  validity  or
         reasonableness  of the  claim  which is the  basis of the  creditor  or
         forfeiture  proceeding  and the Borrower gives Lender written notice of
         the creditor or forfeiture  proceeding  and deposits with Lender monies
         or a surety  bond for the  creditor  or  forfeiture  proceeding,  in an
         amount  determined  by  Lender,  in its  sole  discretion,  as being an
         adequate reserve or bond for the dispute.

         Events  Affecting  Guarantor.  Any of the preceding  events occurs with
         respect to any  Guarantor of any of the  Indebtedness  or any Guarantor
         dies or becomes incompetent, or revokes or disputes the validity of, or
         liability  under, any Guaranty of the  Indebtedness.  In the event of a
         death, Lender, at its option, may, but shall not be required to, permit
         the  Guarantor's  estate  to  assume  unconditionally  the  obligations
         arising under the guaranty in a manner  Satisfactory to Lender, and, in
         doing so, cure any Event of Default.

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

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

         Insecurity. Lender in good faith believes itself insecure.

         Right to Cure. If any default, other than a default on Indebtedness, is
         curable and if  Borrower  or Grantor,  as the case may be, has not been
         given a notice of a similar  default  within the preceding  twelve (12)
         months, it may be cured (and no Event of Default will have occurred) if
         Borrower or Grantor, as the case may be, after receiving written notice
         from Lender demanding cure of such default: (1) cure the default within
         fifteen (15) days;  or (2) if the cure  requires more than fifteen (15)
         days,  immediately  initiate  steps which Lender deems in Lender's sole
         discretion to be sufficient to cure the default and thereafter continue
         and complete all reasonable and necessary  steps  sufficient to produce
         compliance as soon as reasonably practical.

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


<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 6
================================================================================

CUSTOMER  LIST.  Borrower  shall  furnish to Lender an annual list of Borrower's
account receivable  customers and their addresses in a form acceptable to Lender
within 20 days of the end of each year.

ACCOUNTS PAYABLE AGING.  Borrower shall furnish to Lender a quarterly Accounts
Payable  Aging  report  within  20 days of the  end of  each  quarter  in a form
acceptable to Lender.

AUTHORIZATION TO VERIFY ACCOUNTS  RECEIVABLE.  Borrower hereby authorizes Lender
to verify its accounts  receivable  through  written and/or verbal  verification
methods at the discretion of the Lender.

WAIVER OF CLAIMS.  BORROWER  (i)  REPRESENTS  THAT THEY HAVE NO  DEFENSES  TO OR
SETOFFS  AGAINST ANY  INDEBTEDNESS OR OTHER  OBLIGATIONS  OWING TO LENDER OR ITS
AFFILIATES (THE "OBLIGATIONS"),  NOR CLAIMS AGAINST LENDER OR ITS AFFILIATES FOR
ANY MATTER WHATSOEVER, RELATED OR UNRELATED TO THE OBLIGATIONS, AND (ii) RELEASE
LENDER AND ITS AFFILIATES FROM ALL CLAIMS,  CAUSES OF ACTION,  AND COSTS, IN LAW
OR EQUITY,  EXISTING AS OF THE DATE OF THIS AGREEMENT  WHICH BORROWER HAS OR MAY
HAVE BY REASON OF ANY MATTER OF ANY  CONCEIVABLE  KIND OR CHARACTER  WHATSOEVER,
RELATED OR UNRELATED TO THE  OBLIGATIONS,  INCLUDING THE SUBJECT  MATTER OF THIS
AGREEMENT.  THIS PROVISION  SHALL NOT APPLY TO CLAIMS FOR PERFORMANCE OF EXPRESS
CONTRACTUAL OBLIGATIONS OWING TO BORROWER BY LENDER OR ITS AFFILIATES.

BORROWING BASE CERTIFICATE. Borrower shall furnish to Lender a monthly Borrowing
Base  Certificate,  certified  by an  authorized  officer/employee  of Borrower,
within 20 days of the end of each month,  in a form  acceptable to Lender unless
Lender specifically requests otherwise in writing to Borrower.

FIELD  EXAM.  A field  examination  will be  performed  annually  on  Borrower's
accounting  records to verity  reliability of collateral  information  within 20
days of each year.

DEFINITION  OF NOTE.  "Note"  as  referenced  herein is  hereby  deleted  in its
entirety and replaced with the following:

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

ACCOUNTS  RECEIVABLE AGING.  Borrower shall furnish to Lender a monthly accounts
receivable  aging  report  within  20 days of the  end of each  month  in a form
acceptable to Lender.

COLLATERAL  EXAM.  BORROWER  SHALL ALLOW  LENDER TO PERFORM AN ANNUAL  REVIEW OF
COLLATERAL.

DEBT  COVERAGE.  BORROWER  SHALL  MAINTAIN  A RATIO  OF  TOTAL  EARNINGS  BEFORE
INTEREST, TAXES, DEPRECIATION AND AMORTIZATION TO TOTAL DEBT SERVICE COVERAGE OF
NOT LESS THAN 1.50 TO 1.00, MEASURED ON A QUARTERLY BASIS.

TANGIBLE NET WORTH.  BORROWER  SHALL  MAINTAIN A RATIO OF TOTAL  LIABILITIES  TO
TANGIBLE  NET  WORTH OF NOT LESS THAN  $5,000,000.00,  MEASURED  ON A  QUARTERLY
BASIS.

NO  ADDITIONAL  DEBT.  BORROWER  SHALL NOT DIRECTLY  INCUR ANY  ADDITIONAL  DEBT
WITHOUT  THE  PRIOR  WRITTEN  CONSENT  OF  LENDER,  WHICH  CONSENT  SHALL NOT BE
UNREASONABLY WITHHELD.

ADDITIONAL ACQUISITION. ANY ACQUISITION BY CATEGORY 5 TECHNOLOGIES,  INC. OR ITS
SUBSIDIARY  COMPANY,  EPENZIO,  INC.,  SHALL HAVE PRIOR WRITTEN CONSENT OF ZIONS
FIRST NATIONAL BANK.

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

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

Arbitration Disclosures.

         1.  ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY
         VERY UNITED REVIEW BY A COURT.
         2. IN  ARBITRATION  THE PARTIES ARE WAIVING  THEIR RIGHT TO LITIGATE IN
         COURT, INCLUDING THEIR RIGHT TO A JURY TRIAL.
         3. DISCOVERY IN ARBITRATION IS MORE UNITED THAN DISCOVERY IN COURT.
         4.  ARBITRATORS ARE NOT REQUIRED TO INCLUDE  FACTUAL  FINDINGS OR LEGAL
         REASONING IN THEIR AWARDS.  THE RIGHT TO APPEAL OR SEEK MODIFICATION OF
         ARBITRATORS' RULINGS IS VERY LIMITED.
         5. A PANEL OF  ARBITRATORS  MIGHT INCLUDE AN  ARBITRATOR  WHO IS OR WAS
         AFFILIATED WITH THE BANKING INDUSTRY.
         6. ARBITRATION WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES, NOT JUST
         THOSE CONCERNING THE AGREEMENT.
         7. IF YOU HAVE QUESTIONS  ABOUT  ARBITRATION,  CONSULT YOUR ATTORNEY OR
         THE AMERICAN ARBITRATION ASSOCIATION.

         (a) Any claim or controversy  ("Dispute")  between or among the parties
         and their employees,  agents, affiliates,  and assigns,  including, but
         not limited to, Disputes  arising out of or relating to this agreement,
         this  arbitration  provision  ("arbitration  clause"),  or any  related
         agreements or  instruments  relating  hereto or delivered in connection
         herewith ("Related Agreements"),  and including,  but not limited to, a
         Dispute based on or arising from an alleged tort,  shall at the request
         of any party be resolved by binding  arbitration in accordance with the
         applicable  arbitration rules of the American  Arbitration  Association
         (the "Administrator").  The provisions of this arbitration clause shall
         survive any termination,  amendment, or expiration of this agreement or
         Related  Agreements.  The provisions of this  arbitration  clause shall
         supersede any prior arbitration agreement between or among the parties.

         (b) The arbitration  proceedings  shall be conducted in a city mutually
         agreed by the parties.  Absent such an agreement,  arbitration  will be
         conducted  in  Salt  Lake  City,  Utah or such  other  place  as may be
         determined   by  the   Administrator.   The   Administrator   and   the
         arbitrator(s)  shall have the  authority to the extent  practicable  to
         take any action to require the  arbitration  proceeding to be completed
         and the  arbitrator(s)'  award issued  within 150 days of the filing of
         the Dispute with the  Administrator.  The arbitrator(s)  shall have the
         authority  to impose  sanctions  on any party that fails to comply with
         time  periods  imposed  by  the  Administrator  or  the  arbitrator(s),
         including the sanction of summarily  dismissing  any Dispute or defense
         with prejudice.  The arbitrator(s)  shall have the authority to resolve
         any Dispute  regarding the terms of this  agreement,  this  arbitration
         clause,  or  Related  Agreements,  including  any claim or  controversy
         regarding the  arbitrability  of any Dispute.  All limitations  periods
         applicable to any Dispute or defense,  whether by statute or agreement,
         shall  apply  to  any   arbitration   proceeding   hereunder   and  the
         arbitrator(s) shall have the authority to decide whether any Dispute or
         defense is barred by a  limitations  period  and,  it so, to  summarily
         enter an award  dismissing  any Dispute or defense on that  basis.  The
         doctrines of compulsory  counterclaim,  res judicata,  and  collateral
         estoppel shall apply to any arbitration  proceeding hereunder so that a
         party must state as a counterclaim  in the  arbitration  proceeding any
         claim or controversy  which arises out of the transaction or occurrence
         that is the subject matter of the Dispute. The arbitrator(s) may in the
         arbitrators'   discretion  and  at  the  request  of  any  party:   (1)
         consolidate in a single arbitration  proceeding any other claim arising
         out of the same transaction involving another party to that transaction
         that is bound by an arbitration clause with Lender,  such as borrowers,
         guarantors, sureties, and owners of collateral; and, (2) consolidate or
         administer  multiple  arbitration  claims or  controversies  as a class
         action  in  accordance  with  Rule 23 of the  Federal  Rules  of  Civil
         Procedures.


<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 7
================================================================================


         (c) The arbitrator(s) shall be selected in accordance with the rules of
         the Administrator from panels maintained by the Administrator. A single
         arbitrator  shall have  expertise in the subject matter of the Dispute.
         Where three arbitrators conduct an arbitration proceeding,  the Dispute
         shall be decided by a majority vote of the three arbitrators,  at least
         one of whom must have  expertise  in the subject  matter of the Dispute
         and  at  least  one  of  whom  must  be  a  practicing  attorney.   The
         arbitrator(s) shall award to the prevailing party recovery of all costs
         and   fees   (including   attorneys'   fees  and   costs,   arbitration
         administration   fees  and  costs,   and   arbitrator(s)'   fees).  The
         arbitrator(s)'  either during the pendency of the arbitration  proceeds
         or as part of the  arbitration  award,  also may grant  provisional  or
         ancillary  remedies including but not limited to an award of injunctive
         relief, foreclosure, sequestration,  attachment, replevin, garnishment,
         or the appointment of a receiver.

         (d)  Judgement  upon an  arbitration  award may be entered in any court
         having  jurisdiction,   subject  to  the  following   limitation:   the
         arbitration  award is binding  upon the parties only if the amount does
         not exceed Four Million Dollars  ($4,000,000.00);  if the award exceeds
         that limit either  party may demand the right to a court trial.  Such a
         demand  must be filed with the  Administrator  within  thirty (30) days
         following the date of the  arbitration  award;  if such a demand is not
         made with that time period,  the amount of the arbitration  award shall
         be binding. The computation of the total amount of an arbitration award
         shall  include   amounts   awarded  for  attorneys'   fees  and  costs,
         arbitration administration fees and costs, and arbitrator(s)' fees.

         (e) No provision of this  arbitration  clause,  nor the exercise of any
         rights hereunder, shall limit the right of any party to: (1) judicially
         or  nonjudicially  foreclose  against  any  real or  personal  property
         collateral  or  other  security;   (2)  exercise  self-help   remedies,
         including but not limited to  repossession  and setoff  rights;  or (3)
         obtain from a court having  jurisdiction  thereover any  provisional or
         ancillary  remedies  including  but not limited to  injunctive  relief,
         foreclosure,  sequestration,  attachment replevin,  garnishment, or the
         appointment  of a receiver.  Such rights can be  exercised at any time,
         before or after initiation of an arbitration proceeding,  except to the
         extent such action is contrary to the arbitration  award.  The exercise
         of such rights shall not constitute a waiver of the right to submit any
         Dispute to  arbitration,  and any claim or  controversy  related to the
         exercise  of such rights  shall be a Dispute to be  resolved  under the
         provisions  of  this  arbitration   clause.   Any  party  may  initiate
         arbitration with the Administrator. If any party desires to arbitrate a
         Dispute  asserted  against  such  party in a  complaint,  counterclaim,
         cross-claim, or third-party complaint thereto, or in an answer or other
         reply to any such pleading,  such party must make an appropriate motion
         to the trial court seeking to compel arbitration,  which motion must be
         filed  with the court  within 45 days of service  of the  pleading,  or
         amendment  thereto,  setting  forth such  Dispute.  If  arbitration  is
         compelled  after  commencement  of litigation  of a Dispute,  the party
         obtaining an order compelling  arbitration  shall commence  arbitration
         and pay the  Administrator's  filing  fees and costs  within 45 days of
         entry of such order.  Failure to do so shall constitute an agreement to
         proceed with  litigation  and waiver of the right to arbitrate.  In any
         arbitration  commenced  by a consumer  regarding  a  consumer  Dispute,
         Lender  shall pay one half of the  Administrator's  filing  fee,  up to
         $250.

         (f)  Notwithstanding  the  applicability  of  any  other  law  to  this
         agreement,  the arbitration  clause, or Related  Agreements  between or
         among the parties,  the Federal Arbitration Act, 9 U.S.C.  Section 1 et
         seq.,  shall  apply  to the  construction  and  interpretation  of this
         arbitration  clause. If any provision of this arbitration clause should
         be  determined  to be  unenforceable,  all  other  provisions  of  this
         arbitration clause shall remain in full force and effect.

         Attorneys'  Fees;  Expenses.  Borrower agrees to pay upon demand all of
         Lender's costs and expenses,  including Lender's reasonable  attorneys'
         fees and  Lender's  legal  expenses,  incurred in  connection  with the
         enforcement of this  Agreement.  Lender may hire or pay someone else to
         help  enforce  this  Agreement,  and  Borrower  shall pay the costs and
         expenses  of such  enforcement.  Costs and  expenses  include  Lender's
         reasonable  attorneys' fees and legal expenses  whether or not Lender's
         salaried  employee  and  whether or not there is a  lawsuit,  including
         reasonable   attorneys'   fees  and  legal   expenses  for   bankruptcy
         proceedings  (including  efforts to modify or vacate any automatic stay
         or injunction),  appeals, and any anticipated post-judgement collection
         services.  Borrower also shall pay all court costs and such  additional
         fees as may be directed by the court.

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

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

         Governing  Law.  This  Agreement  will be governed  by,  construed  and
         enforced accordance with federal law and the laws of the State of Utah.
         This Agreement has been accepted by Lender in the State of Utah.

         Choice of Venue.  If there is a Lawsuit,  Borrower agrees upon Lender's
         request  to  submit  to the  jurisdiction  of the  courts  of SALT LAKE
         County, State of Utah.

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

         Notices.  Unless  otherwise  provided by a  applicable  law, any notice
         required to be given under this  Agreement  or required by law shall be
         given in writing,  and shall be effective  when  actually  delivered in
         accordance with the law or with this Agreement,  when actually received
         by  telefacsimile  (unless  otherwise  required by law), when deposited
         with a nationally  recognized  overnight courier,  or, if mailed,  when
         deposited  in the United  States  mail,  as first  class  certified  or
         registered mail postage  prepaid,  directed to the addresses shown near
         the beginning of this  Agreement.  Any party may change its address for
         notices  under this  Agreement by giving formal  written  notice to the
         other parties,  specifying  that the purpose of the notice is to change

<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 8
================================================================================


         the  parties  address.  For notice  purposes,  Borrower  agrees to keep
         Lender  informed at all times of  Borrower's  current  address.  Unless
         otherwise  provided  by  applicable  law,  if  there  is more  than one
         Borrower,  any notice  given by Lender to any  Borrower is deemed to be
         notice given to all Borrowers.

         Severability.  If a court of competent jurisdiction finds any provision
         of this Agreement to be illegal,  invalid,  or  unenforceable as to any
         circumstance,  that  finding  shall  not make the  offending  provision
         illegal,  invalid,  or unenforceable as to any other  circumstance.  If
         feasible,  the offending provision shall be considered modified so that
         it becomes legal,  valid and  enforceable.  If the offending  provision
         cannot  be so  modified,  it  shall be  considered  deleted  from  this
         Agreement.   Unless   otherwise   required  by  law,  the   illegality,
         invalidity,  or  unenforceability  of any  provision of this  Agreement
         shall not affect the legality,  validity or enforceability of any other
         provision of this Agreement.

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

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

         Survival of Representations  and Warranties.  Borrower  understands and
         agrees  that in  extending  Loan  Advances,  Lender is  relying  on all
         representations,  warranties,  and  covenants  made by Borrower in this
         Agreement  or in any  certificate  or  other  instrument  delivered  by
         Borrower  to Lender  under this  Agreement  or the  Related  Documents.
         Borrower  further agrees that regardless of any  investigation  made by
         Lender, all such representations, warranties and covenants will survive
         the  extension  of Loan  Advances and delivery to Lender of the Related
         Documents,  shall be  continuing  in nature,  shall be deemed  made and
         redated by  Borrower at the time each Loan  Advance is made,  and shall
         remain  in  full  force  and  effect  until  such  time  as  Borrower's
         Indebtedness  shall be paid in full, or until this  Agreement  shall be
         terminated  in the  manner  provided  above,  whichever  is the last to
         occur.

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

DEFINITIONS.  The following capitalized words and terms shall have the following
meanings  when  used  in  this  Agreement.  Unless  specifically  stated  to the
contrary, all references to dollar amounts shall mean amounts in lawful money of
the United States of America. Words and terms used in the Singular shall include
the  plural,  and the plural  shall  include  the  singular,  as the context may
require.  Words and terms not otherwise defined in this Agreement shall have the
meanings  attributed to such terms in the Uniform  Commercial  Code.  Accounting
words and terms not otherwise  defined in this Agreement shall have the meanings
assigned to them in accordance with generally accepted accounting  principles as
in effect on the date of this Agreement:

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

         Advance. The word "Advance" means a disbursement of Loan funds made, or
         to be made,  to Borrower or on  Borrower's  behalf  under the terms and
         conditions of this Agreement.

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

         Borrower. The word "Borrower" means CATEGORY 5 TECHNOLOGIES,  INC., and
         all other persons and entities signing the Note in whatever capacity.

         Borrowing Base. The words "Borrowing Base" mean as determined by Lender
         from time to time,  the lesser of (1)  $2,000,000.00  or (2) 50.000% of
         the aggregate amount of Eligible Accounts.

         Business Day. The words  "Business Day" mean a day on which  commercial
         banks are open in the State of Utah.

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

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

              (1) Accounts with respect to which the Account  Debtor is employee
              or agent of Borrower.

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

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

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

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

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

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

              (8) Accounts of any Account  Debtor who has filed or has had filed
              against it a pension in  bankruptcy or an  application  for relief
              under  any   provision   of  any  state  or  federal   bankruptcy,
              insolvancy,  or debtor-in-relief  acts; or who has had appointed a
              trustee,  custodian,  or receiver  for the assets of such  Account
              Debtor; or who has made an assignment for the benefit of creditors
              or has  become  insolvent  or  fails  generally  to pay its  debts
              (including its payrolls) as such debts become due.

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


<PAGE>

                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                          Page 9
================================================================================


              (10) Accounts  which have not been paid in full within Any account
              that  is 30 days  past  due,  serviced  by  Duvera  and  owned  by
              Grantor's is deemed ineligible.  from the invoice date. The entire
              balance  of any  account  of any  single  Account  Debtor  will be
              ineligible  whenever the portion of the Account which has not been
              paid  within  Any  account  that in 30 days past due  serviced  by
              Duvera  and  owned by  Grantors  is  deemed  ineligible.  from the
              invoice  date  is  in  excess  of  20.000%  of  the  total  amount
              outstanding on the Account.

              (11) That  portion of the  Accounts of any single  Account  Debtor
              which exceeds 10.000% of all of Borrower's Accounts.

              (12)  Accounts  with respect to which the Account  Debtor is not a
              resident  of the United  States or one of the  following  Canadian
              Provinces: British Columbia, Alberta,  Saskatchewan,  Manitoba, or
              Ontario,  except to the extent  such  Accounts  are  supported  by
              insurance, bonds, or other assurances satisfactory to Lender.

              Accounts  which  Lender in its sole  discretion  reasonably  deems
              ineligible

         Environmental  Laws.  The words  "Environmental  Laws" mean any and all
         state, federal and local statutes,  regulations and ordinances relating
         to the protection of human health or the environment, including without
         limitation the Comprehensive Environmental Response,  Compensation, and
         Liability  Act of 1980,  as amended,  42 U.S.C.  Section  9601, et seq.
         ("CERCLA"),  the Superfund Amendments and Preauthorization Act of 1986,
         Pub. L. No. 99499 ("SARA"), the Hazardous Materials Transportation Act,
         49 U.S.C. Section 1801, et seq., the Resource Conservation and Recovery
         Act, 42 U.S.C.  Section  6901, et seq.,  or other  applicable  state or
         federal laws, rules, or regulations adopted pursuant thereto.

         Event of Default.  The words "Event of Default"  mean any of the events
         of default set forth in this  Agreement in the default  section of this
         Agreement.

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

         GAAP. The word "GAAP" means generally accepted accounting principles.

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

         Guarantor.  The  word  "Guarantor"  means  any  guarantor,  surety,  or
         accommodation party of any or all of the Loan.

         Guaranty.  The word  "Guaranty"  means the guaranty  from  Guarantor to
         Lender,  including without  limitation a guaranty of all or part of the
         Note.

         Hazardous Substances.  The words "Hazardous  Substances" mean materials
         that, because of their quantity, concentration or physical, chemical or
         infectious  characteristics,  may cause or pose a present or  potential
         hazard  to  human  health  or the  environment  when  improperly  used,
         treated, stored, disposed of, generated,  manufactured,  transported or
         otherwise handled.  The words "Hazardous  Substances" are used in their
         very  broadest  sense  and  include  without  limitation  any  and  all
         hazardous  or toxic  substances,  materials  or waste as  defined by or
         listed under the  Environmental  Laws. The term "Hazardous  Substances"
         also includes, without limitation,  petroleum and petroleum by-products
         or any fraction thereof and asbestos.

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

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

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

         Note.   The  word  "Note"  means  the  Note   executed  by  CATEGORY  5
         TECHNOLOGIES,  INC.  in the  principal  amount of  $2,000,000.00  dated
         August  7,  2002,   together  with  all  renewals  of,  extensions  of,
         modifications of, refinancings of, consolidations of, and substitutions
         for the note or credit agreement.

         Permitted  Liens.  The  words  "Permitted  Liens"  mean (1)  liens  and
         security  interests  securing  indebtedness owed by Borrower to Lender;
         (2) Liens for taxes, assessments, or similar charges either not yet due
         or being contested in good faith; (3} liens of materialmen,  mechanics,
         warehousemen,  or carriers, or other like liens arising in the ordinary
         course  of  business  and  securing   obligations  which  are  not  yet
         delinquent;  (4)  purchase  money  liens  or  purchase  money  security
         interests  upon or in any property  acquired or held by Borrower in the
         ordinary course of business to secure  indebtedness  outstanding on the
         date of this  Agreement or permitted to be incurred under the paragraph
         of this  Agreement  titled  "Indebtedness  and  Liens";  (5)  Liens and
         security  interests which, as of the date of this Agreement,  have been
         disclosed to and approved by the Lender in writing; and (6) those liens
         and security interests which in the aggregate  constitute an immaterial
         and  Insignificant  monetary  amount  with  respect to the net value of
         Borrower's assets.

         Primary Credit  Facility.  The words "Primary Credit Facility" mean the
         credit  facility  described  in the  Line  of  Credit  section  of this
         Agreement.

         Related  Documents.  The words "Related  Documents" mean all promissory
         notes, credit agreements,  loan agreements,  environmental  agreements,
         guaranties,  security agreements,  mortgages,  deeds of trust, security
         deeds, collateral mortgages, and all other instruments,  agreements and
         documents,  whether now or hereafter  existing  executed in  connection
         with the Loan.

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

         Security  Interest.   The  words  "Security   Interest"  mean,  without
         limitation,  any and all  types of  collateral  security,  present  and
         future whether in the form of a lien,  charge,  encumbrance,  mortgage,
         deed of trust,  security deed,  assign,  pledge,  crop pledge,  chattel
         mortgage,  collateraly chattel mortgage,  chattel trust, factor's lien,
         equipment  trust,  conditional  sale,  trust  receipt,  lien  or  title
         retention contract, lease or consignment intended as a security device,
         or any other security or lien interest  whatsoever  whether  created by
         law, contract, or otherwise.
<PAGE>


                      BUSINESS LOAN AGREEMENT (ASSET BASED)

Loan No: 9001                        (Continued)                         Page 10
================================================================================

FINAL AGREEMENT.  Borrower  understands that this Agreement and the related loan
documents are the final expression of the agreement  between Lender and Borrower
and may not be contradicted by evidence of any alleged oral agreement.

BORROWER  ACKNOWLEDGES  HAVING READ ALL THE  PROVISIONS  OF THIS  BUSINESS  LOAN
AGREEMENT  (ASSET  BASED) AND BORROWER  AGREES TO ITS TERMS.  THIS BUSINESS LOAN
AGREEMENT (ASSET BASED) IS DATED AUGUST 7, 2002.

BORROWER:



CATEGORY 5 TECHNOLOGIES, INC.


By:
   --------------------------
   PAUL S. ANDERSON, CEO OF
   CATEGORY 5 TECHNOLOGIES, INC.

LENDER:

ZIONS FIRST NATIONAL BANK


By:
   --------------------------
    Authorized Signer
<PAGE>