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                                                                    EXHIBIT 10.4

                               CONTINUING GUARANTY
                         (Elite Information Group, Inc.)

               1. Guaranty of Indebtedness. At the solicitation of Elite
Information Systems, a California corporation ("Debtor"), the undersigned
requests Mellon Bank, N.A., a national banking association ("Lender"), to extend
credit or provide other financial accommodations to Debtor, and in consideration
thereof, the undersigned unconditionally, absolutely and irrevocably guarantees
and promises to pay to Lender, or order, on demand, in lawful money of the
United States, as and when the same shall become due (by demand, acceleration or
otherwise), all present and future Indebtedness, as hereinafter defined, of
Debtor to Lender. The word "Indebtedness" is used herein in its most
comprehensive sense and includes any and all obligations of Debtor to Lender
under the certain Loan and Security Agreement, of even date herewith, between
Debtor and Lender and under all other Loan Documents to which Debtor is a party,
whether heretofore, now or hereafter made, incurred or created, whether
voluntary or involuntary and howsoever arising, whether due or not due, absolute
or contingent, liquidated or unliquidated, secured or unsecured, and whether
Debtor may be liable individually or jointly with others, and whether recovery
upon such Indebtedness may be or hereafter becomes barred by any statute of
limitations, or whether such Indebtedness may be or hereafter becomes otherwise
unenforceable.

               2. Independent Obligations; Subrogation. The obligations of the
undersigned hereunder are independent of and separate from the obligations of
Debtor and any other guarantor, maker or endorser of the Indebtedness and shall
not be reduced by, but shall survive as if the same had not been made, any and
all payments by Debtor and/or any other guarantor, maker or endorser of the
Indebtedness and/or the application of any proceeds from any collateral security
for the Indebtedness until the Indebtedness is fully paid and finally
discharged. To the maximum extent permitted by law, the undersigned hereby
waives any claim, right or remedy which the undersigned may now have or
hereafter acquire against Debtor that arises hereunder and/or from the
performance by any guarantor hereunder, including, without limitation, any
claim, remedy or right of subrogation, reimbursement, exoneration, contribution,
indemnification, or participation in any claim, right or remedy of Lender
against Debtor or any security which Lender now has or hereafter acquires,
whether or not such claim, right or remedy arises in equity, under contract, by
statute, under common law or otherwise, until the Indebtedness is fully paid and
finally discharged. In addition, the undersigned hereby waives any right to
proceed against Debtor, now or hereafter, for contribution, indemnity,
reimbursement, and any other suretyship rights and claims, whether direct or
indirect, liquidated or contingent, whether arising under express or implied
contract or by operation of law, which the undersigned may now have or hereafter
have as against the Debtor with respect to the Indebtedness, until the
Indebtedness is fully paid and finally discharged. The undersigned also hereby
waives any rights to recourse to or with respect to any asset of Borrower, until
the Indebtedness is fully paid and finally discharged.

               3. Authority to Modify Obligations and Security. The undersigned
authorizes Lender, without notice or demand and without affecting the liability
hereunder, from
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time to time, whether before or after any notice of termination hereof or before
or after any default in respect of the Indebtedness, to: (a) renew, extend,
accelerate, or otherwise change the time for payment of, or otherwise change any
other term or condition of any document or agreement evidencing or relating to,
any Indebtedness, including, without limitation, increase or decrease of the
rate of interest thereon; (b) accept, substitute, waive, decrease, increase,
release, exchange or otherwise alter any collateral security, in whole or in
part, securing the Indebtedness or any other guaranty of the Indebtedness; (c)
apply any and all such collateral security and direct the order or manner of
sale thereof as Lender, in its sole discretion, may determine; (d) add, release
or substitute any one or more other guarantors, makers or endorsers of the
Indebtedness, and otherwise deal with Debtor or any other guarantor, maker or
endorser as Lender may elect; (e) in Lender's sole discretion, settle, release
on terms satisfactory to Lender, or by operation of law or otherwise, compound,
compromise, collect or otherwise liquidate any Indebtedness and/or any
collateral security therefor in any manner, and bid and purchase any collateral
security at any sale thereof; (f) apply any and all payments or recoveries from
Debtor, from any other guarantor, maker, endorser or from the undersigned to
such of the Indebtedness as Lender, in its sole discretion, may determine,
whether such Indebtedness is secured or unsecured or guaranteed or not
guaranteed by others; (g) apply any and all payments or recoveries from any
other guarantor, maker or endorser of the Indebtedness or sums realized from
collateral security furnished by any of them upon any of their indebtedness or
obligations to Lender as Lender, in its sole discretion, may determine, whether
or not such indebtedness or obligations relate to the Indebtedness; and (h)
refund at any time, at Lender's sole discretion, any payment received by Lender
in respect of any Indebtedness, and payment to Lender of the amount so refunded
shall be fully guaranteed hereby even though prior thereto this Continuing
Guaranty may have been cancelled or surrendered by Lender; all without in any
way diminishing, releasing or discharging the liability of the undersigned
hereunder.

               4. Waiver of Defenses. Upon default of Debtor in respect of any
Indebtedness, Lender may, at its option and without notice to the undersigned,
proceed directly against the undersigned to collect and recover the full amount
of the liability hereunder, or any portion thereof, and the undersigned waives
any right to require Lender to: (a) proceed against Debtor, or any other
guarantor, endorser, or other person whomsoever; (b) proceed against or exhaust
any collateral security given to or held by Lender in connection with the
Indebtedness; (c) give notice of the terms, time and place of any public or
private sale of any real or personal property security for the Indebtedness or
any other guaranty of the Indebtedness; or (d) pursue any other remedy in
Lender's power whatsoever. A separate action or actions may be brought and
prosecuted against the undersigned whether or not action is brought against
Debtor and/or any other guarantor, maker or endorser of the Indebtedness and
whether Debtor and/or any other guarantor, maker or endorser be joined in any
such action or actions; and the undersigned waives the benefit of any statute of
limitations affecting the liability hereunder or the enforcement hereof, and
agrees that any payment of any Indebtedness or other act which shall toll any
statute of limitations applicable thereto shall similarly operate to toll such
statute of limitations applicable to the liability hereunder.

               5. Right to Dispose of Security; Impairment of Rights. The
undersigned hereby authorizes and empowers Lender in its sole discretion,
without any notice or demand to

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the undersigned whatsoever and without affecting the liability of the
undersigned hereunder, to exercise any right or remedy which Lender may have
available to it, including, but not limited to, judicial foreclosure, exercise
of rights of power of sale without judicial action, or taking a deed or an
assignment in lieu of foreclosure as to any collateral security for the
Indebtedness, whether real, personal or intangible property, and the undersigned
hereby waives any defense to the recovery by Lender against the undersigned of
any deficiency after such action notwithstanding any impairment or loss of any
right of reimbursement or subrogation or other right or remedy against Debtor,
or any other guarantor, maker or endorser, or against any collateral security
for the Indebtedness or for any guaranty of the Indebtedness. In furtherance of
the foregoing, and as provided in California Civil Code Section 2856, the
undersigned waives all rights and defenses that the undersigned may have by
reason of the Indebtedness being or becoming secured by real property. This
means, among other things: (a) Lender may collect from the undersigned without
first foreclosing on any real or personal property collateral pledged by Debtor;
(b) the amount of the Indebtedness may be reduced only by the price for which
that collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price; and (c) Lender may collect from the undersigned even
if Lender, by foreclosing on the real property collateral, has destroyed any
right the undersigned may have to collect from Debtor. This is an unconditional
and irrevocable waiver of any rights and defenses the undersigned may have
because the Indebtedness is secured by real property. These rights and defenses
include, but are not limited to, any rights or defenses based upon Sections
580a, 580b, 580d, or 726 of the California Code of Civil Procedure. The
undersigned waives all rights and defenses arising out of an election of
remedies by Lender, even though that election of remedies, such as nonjudicial
foreclosure with respect to security for a guaranteed obligation, has destroyed
the undersigned's rights of subrogation and reimbursement against Debtor by the
operation of Section 580d of the California Code of Civil Procedure or
otherwise. Without limiting the foregoing and without waiving the benefits of
California Commercial Code Section 9501, the undersigned specifically agrees
that action maintained by Lender for the appointment of any receiver, trustee or
custodian to collect rents, issues or profits or to obtain possession of any
property shall not constitute an "action" within the meaning of Section 726 of
the California Code of Civil Procedure.

               6. Additional Waivers. The undersigned waives any defense arising
by reason of any disability or other defense of Debtor or by reason of the
cessation from any cause whatsoever of the liability of Debtor or by reason of
any act or omission of Lender or others which directly or indirectly results in
or aids the discharge or release of Debtor or any Indebtedness or any security
in respect thereof by operation of law or otherwise. The obligations hereunder
shall be enforceable without regard to the validity, regularity or
enforceability of any of the Indebtedness or any of the documents related
thereto, any other guaranty of the Indebtedness or any collateral security
documents securing any of the Indebtedness or securing any other guaranty of the
Indebtedness. No exercise by Lender of, and no omission of Lender to exercise,
any power or authority recognized herein and no impairment or suspension of any
right or remedy of Lender against Debtor, any other guarantor, maker or endorser
or any collateral security shall in any way suspend, discharge, release,
exonerate or otherwise affect any of the undersigned's obligations hereunder or
any collateral security furnished by the undersigned or give to the undersigned
any right of recourse against Lender. The undersigned specifically agrees that
the failure of Lender: (a) to perfect any lien on or security interest in any
property

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heretofore or hereafter given by Debtor or any guarantor, maker or endorser to
secure payment of the Indebtedness or of any guaranty of the Indebtedness, or to
record or file any document relating thereto or (b) to file or enforce a claim
against the estate (either in administration, bankruptcy or other proceeding) of
Debtor, any guarantor, maker or endorser, shall not in any manner whatsoever
terminate, diminish, exonerate or otherwise affect the liability of the
undersigned hereunder.

               7. Additional Indebtedness; Duty of Undersigned. Additional
Indebtedness may be created from time to time at the request of Debtor and
without further authorization from or notice to the undersigned even though
Debtor's financial condition may deteriorate since the date hereof. In giving
Lender this Continuing Guaranty, the undersigned is an affiliate of Debtor and
is thoroughly acquainted with Debtor's financial condition and waives the right,
if any, to require Lender to disclose to the undersigned any information it may
now have or hereafter acquire concerning Debtor's character, credit, collateral,
financial condition or other matters. The undersigned has established adequate
means to obtain from Debtor on a continuing basis financial and other
information pertaining to Debtor's business and affairs, and assumes the
responsibility for being and keeping informed of the financial and other
conditions of Debtor and of all circumstances bearing upon the risk of
nonpayment of the Indebtedness hereunder which diligent inquiry would reveal. If
Debtor is a corporation or a partnership, Lender need not inquire into the
powers of Debtor or the authority of its officers, directors, partners or agents
acting or purporting to act in its behalf, and any Indebtedness created in
reliance upon the purported exercise of such power or authority is hereby
guaranteed. All Indebtedness of Debtor to Lender heretofore, now or hereafter
created shall be deemed to have been granted at the undersigned's special
insistence and request and in consideration of and in reliance upon this
Continuing Guaranty.

               8. Notices, Demands, Etc. Lender shall be under no obligation
whatsoever to make or give to the undersigned, and the undersigned hereby
waives, notice of acceptance of this Continuing Guaranty, diligence, all rights
of setoff and counterclaim against Lender, all demands, presentments, protests,
notices of protests, notices of nonperformance, notices of dishonor, and all
other notices of every kind or nature, including notice of the existence,
creation or incurring of any new or additional Indebtedness.

               9. Subordination. Except as otherwise provided in this paragraph,
any indebtedness of Debtor now or hereafter owing to the undersigned is hereby
subordinated to all Indebtedness of Debtor to Lender heretofore, now or
hereafter created, whether before or after notice of termination hereof, and
without the prior consent of Lender shall not be paid in whole or in part nor
will the undersigned accept any payment of or on account of any such
indebtedness at any time after the occurrence and during the continuance of an
Event of Default and while the undersigned remains liable under this Continuing
Guaranty. At the request of Lender, after the occurrence and during the
continuance of an Event of Default, Debtor shall pay to Lender all or any part
of such subordinated indebtedness and any amount so paid to Lender at its
request shall be applied to payment of the Indebtedness. Each payment on the
indebtedness of Debtor to the undersigned received in violation of any of the
provisions hereof shall be deemed to have been received by the undersigned as
trustee for Lender and shall be paid over to Lender immediately

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on account of the Indebtedness, but without otherwise affecting in any manner
the undersigned's liability under any of the provisions of this Continuing
Guaranty. The undersigned agrees to file all claims against Debtor in any
bankruptcy or other proceeding in which the filing of claims is required by law
in respect of any indebtedness of Debtor to the undersigned, and Lender shall be
entitled to all of the undersigned's rights thereunder. If for any reason the
undersigned fails to file such claim at least thirty (30) days prior to the last
date on which such claim should be filed, Lender, as the undersigned's
attorney-in-fact, is hereby authorized to do so in the undersigned's name or, in
Lender's discretion, to assign such claim to and cause proof of claim to be
filed in the name of Lender's nominee. In all such cases, whether in
administration, bankruptcy or otherwise, the person or persons authorized to pay
such claim shall pay to Lender the full amount payable on the claim in the
proceeding, and to the full extent necessary for that purpose the undersigned
hereby assigns to Lender all the undersigned's rights to any payments or
distributions to which the undersigned otherwise would be entitled. If the
amount so paid is greater than the undersigned's liability hereunder, Lender
will pay the excess amount to the party entitled thereto.

               10. Delivery of Financial Statements and Tax Returns. The
undersigned agrees to deliver to Lender any and all information required by
Lender.

               11. Revival of Guaranty. If any payments of money or transfers of
property made to Lender by Debtor, any other guarantor, any maker or any
endorser should for any reason subsequently be declared to be fraudulent (within
the meaning of any state or federal law relating to fraudulent conveyances),
preferential or otherwise voidable or recoverable in whole or in part for any
reason (herein after collectively called "voidable transfers") under the
Bankruptcy Code or any other federal or state law and Lender is required to
repay or restore any such voidable transfer, or the amount or any portion
thereof, then as to any such voidable transfer or the amount repaid or restored
and all costs and expenses (including attorneys' fees) of Lender related
thereto, the undersigned's liability hereunder shall automatically be revived,
reinstated and restored and shall exist as though such voidable transfer had
never been made to Lender. In the event Lender shall have returned this
Continuing Guaranty to the undersigned and subsequently be required to restore
or repay any such voidable transfer, the amount thereof, or any portion thereof,
the undersigned shall remain liable as provided herein to the same extent as if
this Continuing Guaranty had not been returned to the undersigned.

               12. Delays; Cumulative Remedies. No failure or delay by Lender in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise of any other right,
power or privilege. All rights and remedies of Lender in respect of the
Indebtedness, the collateral security for the Indebtedness or for this or any
other guaranty, or under any document in respect of any of the foregoing, shall
be cumulative and may be exercised singly or concurrently, and are not exclusive
of any other right or remedy permitted by law or in equity.

               13. Complete Agreement; Modification; Termination. This
Continuing Guaranty contains all the terms and conditions of the agreement
between Lender and the

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undersigned and is an integrated agreement. No evidence of any term or agreement
not set forth herein shall be admissible in any dispute involving this
Continuing Guaranty. None of the terms or provisions of this Continuing Guaranty
may be waived, altered, modified or amended, except by an instrument in writing
duly executed by the party to be charged thereby. This Continuing Guaranty may
be terminated upon receipt by Lender of written notice of its termination;
provided, however, that termination shall not apply to any Indebtedness created
prior to the time such notice of termination becomes effective as provided
herein. Such notice of termination shall be personally delivered to an officer
of Lender at the originating office of Lender or mailed by registered or
certified mail, return receipt requested, postage prepaid, and addressed to
Lender at the originating office. In any event, notice of termination shall not
be effective until twelve o'clock noon, Pacific Standard or Daylight Savings
time, as the case may be, on the Lender business day succeeding the date such
notice is actually received by Lender as above provided. If the originating
office of Lender is not in existence at the time notice of termination is
desired to be given, then such notice shall be given in the manner above
provided by delivering the same to an officer of any other office of Lender.
Upon receipt of such termination as above provided, this Continuing Guaranty
shall terminate as and to the extent provided herein.

               14. Understanding of Waivers. The undersigned warrants and agrees
that the waivers set forth in this Continuing Guaranty are made with full
knowledge of their significance and consequences, and that under the
circumstances, the waivers are reasonable and not contrary to public policy or
law. If any of said waivers are determined to be contrary to any applicable law
or public policy, such waivers shall be effective only to the maximum extent
permitted by law. Should any one or more provisions of this Continuing Guaranty
be determined to be illegal or unenforceable, all other provisions hereof shall
nevertheless remain effective.

               15. Binding Effect. This Continuing Guaranty shall remain in full
force and effect and be binding in accordance with its terms upon the
undersigned, and the representatives, executors, administrators, heirs,
successors and assigns of the undersigned, and inure to the benefit of Lender,
its successors, endorsees, transferees and assigns, until the obligations and
liabilities of the undersigned hereunder shall have been finally satisfied by
payment in full.

               16. Attorneys' Fees. The undersigned agrees without demand to pay
to and reimburse Lender for all reasonable costs, attorneys' fees and other
expenses which Lender expends or incurs in the enforcement of any right relating
to any Indebtedness, including collection thereof, or in the enforcement of this
Continuing Guaranty.

               17. Unlimited Liability. The obligations of the undersigned
hereunder shall be in addition to any obligations of the undersigned under any
other guaranties of Indebtedness of Debtor to Lender or of any other person to
Lender heretofore given or hereafter to be given to Lender unless such other
guaranties are expressly modified or terminated in writing. The liability of the
undersigned to Lender shall at all times be deemed to be the aggregate liability
of the undersigned under the terms of this Continuing Guaranty and of any other
guaranties heretofore or hereafter given by the undersigned to Lender and not
expressly terminated or modified in writing.

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               18. Governing Law; Jurisdiction; WAIVER OF JURY TRIAL; Venue.
This Continuing Guaranty and the rights, obligations and liabilities hereunder
shall be governed by, and shall be construed and interpreted in accordance with,
the laws of the State of California. The undersigned agrees that any legal
action or proceeding arising out of or relating to this Continuing Guaranty may
be instituted in the Superior Court of the State of California in the County of
Los Angeles, or in the United States District Court for the Central District of
California, at Lender's discretion. THE UNDERSIGNED AND LENDER MUTUALLY WAIVE
THE RIGHT TO A JURY TRIAL. By the execution and delivery of this Continuing
Guaranty, the undersigned irrevocably and unconditionally submits to the
jurisdiction of such courts in any such action or proceeding and waives any
objection relating to the basis for personal or in rem jurisdiction or to venue
which it may now or hereafter have in any such suit, action or proceeding.

               19. Captions. The captions or titles of the paragraphs of this
Continuing Guaranty are for convenience of reference only and shall not define
or limit any of the provisions hereof.

               20. Security. This Continuing Guaranty is secured by the
"Collateral" as defined in that certain General Security Agreement of even date
herewith by the undersigned in favor of Lender.

                      RECEIPT OF A TRUE COPY OF THIS CONTINUING GUARANTY IS
HEREBY ACKNOWLEDGED BY THE UNDERSIGNED.

               This Continuing Guaranty is made this 16th day of May, 2000.

                                     ELITE INFORMATION GROUP, INC.,
                                     a Delaware corporation


                                     By:
                                     Name:
                                     Title:



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