Document:

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                                                                   Exhibit 10.38

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                               SECURITY AGREEMENT

                            Dated as of March 9, 2000

                                     between

                   FIRST SECURITY BANK, NATIONAL ASSOCIATION,
             not individually, but solely as the Owner Trustee under
                               the VS Trust 2000-1

                                       and
                              BANK OF AMERICA, N.A.
                  as the Agent for the Lenders and the Holders

                          and accepted and agreed to by

                          VERITAS OPERATING CORPORATION

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                                TABLE OF CONTENTS

<TABLE>

 <S>                                                                  <C>
  1. Definitions.......................................................1
  2. Grant of Security Interest........................................3
  3. Payment of Obligations............................................5
  4. Other Covenants...................................................5
  5. Default; Remedies.................................................6
  6. Remedies Not Exclusive............................................6
  7. Performance by the Agent of the Borrower's Obligations............7
  8. Duty of the Agent.................................................7
  9. Powers Coupled with an Interest...................................7
  10. Execution of Financing Statements................................7
  11. Security Agreement Under Uniform Commercial Code.................8
  12. Authority of the Agent...........................................8
  13. Notices..........................................................9
  14. Severability.....................................................9
  15. Amendment in Writing; No Waivers; Cumulative Remedies............9
  16. Section Headings.................................................9
  17. Successors and Assigns..........................................10
  18. The Borrower's Waiver of Rights.................................10
  19. GOVERNING LAW...................................................10
  20. Obligations Are Without Recourse................................10
  21. Partial Release; Full Release...................................10
  22. Miscellaneous...................................................11
  23. Conflicts with Participation Agreement..........................11
  24. LESSEE AS A PARTY...............................................11
</TABLE>

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                               SECURITY AGREEMENT

        This SECURITY AGREEMENT, dated as of March 9, 2000 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time,
this "Security Agreement"), is made between FIRST SECURITY BANK, NATIONAL
ASSOCIATION, a national banking association, not individually, but solely as
Owner Trustee under the VS Trust 2000-1 (the "Borrower"), and BANK OF AMERICA,
N.A., a national banking association ("Bank"), as agent for (a) the Lenders
(hereinafter defined) under the Credit Agreement dated as of March 9, 2000 (as
amended, modified, extended, supplemented, restated and/or replaced from time to
time, the "Credit Agreement") by and among the Borrower, the lending
institutions from time to time parties thereto (the "Lenders") and Bank as the
agent for the Lenders and (b) the holders of the certificates issued pursuant to
the Trust Agreement dated as of March 9, 2000 (as amended, modified, extended,
supplemented, restated and/or replaced from time to time, the "Trust Agreement")
among the holders from time to time parties thereto (the "Holders") and the
Borrower, in its individual capacity thereunder and in its capacity as Owner
Trustee thereunder. The Lenders and the Holders, together with their successors
and permitted assigns, are collectively referred to hereinafter as the "Secured
Parties" Bank, in its capacity as agent for the Secured Parties is referred to
hereinafter as the "Agent", and this Security Agreement is accepted and agreed
to by VERITAS Operating Corporation, a Delaware corporation.

                              Preliminary Statement

        Pursuant to the Credit Agreement, the Lenders have severally agreed to
make Loans to the Borrower in an aggregate amount not to exceed the aggregate
Lender Commitments upon the terms and subject to the conditions set forth
therein, to be evidenced by the Notes issued by the Borrower under the Credit
Agreement. Pursuant to the Trust Agreement, the Holders have agreed to purchase
the ownership interests of the Trust created thereby in an aggregate amount not
to exceed the aggregate Holder Commitments upon the terms and subject to the
conditions set forth therein, to be evidenced by the Certificates issued by the
Borrower under the Trust Agreement. The Borrower is, or shall be upon the date
of the initial Advance with respect to each Property, the legal and beneficial
owner of such Property.

        It is a condition, among others, to the obligation of the Lenders to
make their respective Loans to the Borrower under the Credit Agreement and the
Holders to make their respective Holder Advances under the Trust Agreement that
the Borrower shall have executed and delivered this Security Agreement to the
Agent, for the benefit of the Lenders and the Holders.

        NOW, THEREFORE, in consideration of the premises and to induce the
Lenders to make their respective Loans under the Credit Agreement and to induce
the Holders to make their respective Holder Advances under the Trust Agreement,
the Borrower hereby agrees with the Agent, for the benefit of the Lenders and
the Holders, as follows:

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     1. DEFINITIONS.

     (a) As used herein, the following terms shall have the following respective
     meanings:

          "Accounts" shall mean all "accounts," as such term is defined in the
     Uniform Commercial Code, now owned or hereafter acquired by the Borrower,
     including without limitation (i) all accounts receivable, other
     receivables, book debts and other forms of obligations now owned or
     hereafter received or acquired by or belonging or owing to the Borrower,
     whether arising out of goods sold or leased or services rendered by it or
     from any other transaction (including without limitation any such
     obligations which may be characterized as an account under the Uniform
     Commercial Code), (ii) all of the Borrower's rights in, to and under all
     purchase orders or receipts now owned or hereafter acquired by it for goods
     or services, (iii) all of the Borrower's rights to any goods represented by
     any of the foregoing (including without limitation unpaid sellers' rights
     of rescission, replevin, reclamation and stoppage in transit and rights to
     returned, reclaimed or repossessed goods), (iv) all monies due or to become
     due to the Borrower under all purchase orders and contracts for the sale or
     lease of goods or the performance of services or both by the Borrower
     (whether or not yet earned by performance on the part of the Borrower) now
     or hereafter in existence, including without limitation the right to
     receive the proceeds of said purchase orders and contracts, and (v) all
     collateral security and guarantees of any kind, now or hereafter in
     existence, given by any Person with respect to any of the foregoing.

          "Chattel Paper" shall mean any and all "chattel paper," as such term
     is defined in the Uniform Commercial Code, now owned or hereafter acquired
     by the Borrower, wherever located.

          "Documents" shall mean any and all "documents", as such term is
     defined in the Uniform Commercial Code, now owned or hereafter acquired by
     the Borrower, wherever located, including without limitation each bill of
     lading, dock warrant, dock receipt, warehouse receipt or order for the
     delivery of goods, and also any other document which in the regular course
     of business or financing is treated as adequately evidencing that the
     person in possession of it is entitled to receive, hold and dispose of the
     document and the goods it covers.

          "General Intangibles" shall mean any and all "general intangibles," as
     such term is defined in the Uniform Commercial Code, now owned or hereafter
     acquired by the Borrower, including without limitation all contracts,
     undertakings, or agreements in or under which the Borrower may now or
     hereafter have any right (other than any right evidenced by Chattel Paper,
     Documents or Instruments), title or interest, including without limitation
     any agreements relating to the terms of payment or the terms of performance
     of any Account.

          "Holders" shall have the meaning specified in the first paragraph of
     this Security Agreement.

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          "Instruments" shall mean any and all "instruments", as such term is
     defined in the Uniform Commercial Code, now owned or hereafter acquired by
     the Borrower, wherever located, including without limitation all
     certificated securities, all certificates of deposit, and all notes and
     other, without limitation, evidences of indebtedness, other than
     instruments that constitute, or are a part of a group of writings that
     constitute, Chattel Paper.

          "Investment Property" shall mean any and all "investment property," as
     such term is defined in the Uniform Commercial Code, now owned or hereafter
     acquired by the Borrower, wherever located.

          "Lenders" shall have the meaning specified in the first paragraph of
     this Security Agreement.

          "Lessee" shall mean VERITAS Operating Corporation, a Delaware
     corporation, its successors, permitted assigns and permitted transferees.

          "Obligations" shall mean any and all obligations now existing or
     hereafter arising under the Credit Agreement, the Notes, the Trust
     Agreement, the Certificates and/or any other Operative Agreement.

          (b) Capitalized terms used but not otherwise defined in this Security
     Agreement shall have the respective meanings specified in the Credit
     Agreement or Appendix A to the Participation Agreement dated as of March 9,
     2000 (as amended, modified, extended, supplemented, restated and/or
     replaced from time to time in accordance with the applicable provisions
     thereof, the "Participation Agreement") among Lessee, the various parties
     thereto from time to time, as guarantors, the Borrower, the Holders, the
     Lenders and Bank of America, N.A., as agent for the Lenders and respecting
     the Security Documents, as the agent for the Lenders and the Holders, to
     the extent of their interests.

          (c) The rules of usage set forth in Appendix A to the Participation
     Agreement shall apply to this Agreement.

     2. GRANT OF SECURITY INTEREST.

     To secure payment of all the amounts advanced under the Credit Agreement in
connection with the Notes, all the amounts advanced or contributed under the
Trust Agreement in connection with the Certificates and all other amounts now or
hereafter owing to the Lenders, the Holders or the Agent thereunder or under any
other Operative Agreement, THE BORROWER HEREBY CONVEYS, GRANTS, ASSIGNS,
TRANSFERS, HYPOTHECATES, MORTGAGES AND SETS OVER TO THE AGENT FOR THE BENEFIT OF
THE SECURED PARTIES, A FIRST PRIORITY SECURITY INTEREST IN AND LIEN ON THE TRUST

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ESTATE, WHETHER NOW EXISTING OR HEREAFTER ACQUIRED INCLUDING WITHOUT LIMITATION
THE FOLLOWING:

          (a) all right, title and interest of the Borrower in and to the
     Operative Agreements now existing or hereafter acquired by the Borrower
     (including without limitation all rights to payment and indemnity rights of
     the Borrower under the Participation Agreement) (all of the foregoing in
     this paragraph (a) being referred to as the "Rights in Operative
     Agreements");

          (b) all right, title and interest of the Borrower in and to all of the
     Equipment;

          (c) all right, title and interest of the Borrower in and to all of the
     Fixtures;

          (d) all the estate, right, title, claim or demand whatsoever of the
     Borrower, in possession or expectancy, in and to each Property, Fixture or
     Equipment or any part thereof;

          (e) all right, title and interest of the Borrower in and to all
     substitutes, modifications and replacements of, and all additions,
     accessions and improvements to, the Fixtures and Equipment, subsequently
     acquired or leased by the Borrower or constructed, assembled or placed by
     the Borrower on any Property, immediately upon such acquisition, lease,
     construction, assembling or placement, and in each such case, without any
     further conveyance, assignment or other act by the Borrower;

          (f) all right, title and interest of the Borrower in, to and under
     books and records relating to or used in connection with the operation of
     one (1) or more Properties or any part thereof; all rights of the Borrower
     to the payment of money and all property; and all rights in and to any
     causes of action or choses in action now or hereafter existing in favor of
     the Borrower and all rights to any recoveries therefrom;

          (g) all right, title and interest of the Borrower in and to all
     unearned premiums under insurance policies now held or subsequently
     obtained by the Lessee relating to one (1) or more Properties and the
     Borrower's interest in and to all proceeds of any insurance policies
     maintained by or for the benefit of the Borrower, including without
     limitation any right to collect and receive such proceeds; and all awards
     and other compensation, including without limitation the interest payable
     thereon and any right to collect and receive the same, made to the present
     or any subsequent owner of any Property for the taking by eminent domain,
     condemnation or otherwise, of all or any part of any Property or any
     easement or other right therein;

          (h) all right, title and interest of the Borrower in and to (i) all
     consents, licenses, certificates and other governmental approvals relating
     to construction, completion, use or operation of any Property or any part
     thereof and (ii) all Plans and Specifications relating to any Property;

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          (i) all right, title and interest of the Borrower in and to all Rent
     and all other rents, payments, purchase prices, receipts, revenues, issues
     and profits payable under the Lease or pursuant to any other lease with
     respect to any Property;

          (j) all right, title and interest of the Borrower in and to all
     Instruments and Documents;

          (k) all right, title and interest of the Borrower in and to all
     General Intangibles;

          (l) all right, title and interest of the Borrower in and to all
     Chattel Paper (including without limitation all rights under the Lease);

          (m) all right, title and interest of the Borrower in and to all money,
     cash or cash equivalent and bank accounts;

          (n) all right, title and interest of the Borrower in and to all
     Accounts;

          (o) all right, title and interest of the Borrower in and to all
     proceeds of letters of credit issued in favor of the Borrower in connection
     with any Property;

          (p) [Reserved]; and

          (q) all right, title and interest of the Borrower in and to all
     proceeds, both cash and noncash, of any of the foregoing.

     (All of the foregoing property and rights and interests now owned or held
or subsequently acquired by the Borrower and described in the foregoing clauses
(a) through (q) are collectively referred to as the "Trust Property").

     TO HAVE AND TO HOLD the Trust Property and the rights and privileges hereby
granted unto the Agent (for the benefit of the Lenders and the Holders) its
successors and assigns for the uses and purposes set forth, until all of the
obligations owing to the Lenders, the Holders and the Agent under the Operative
Agreements are paid in full; provided, that EXCLUDED from the Trust Property at
all times and in all respects shall be all Excepted Payments.

     3. PAYMENT OF OBLIGATIONS.

     The Borrower shall pay all Obligations in accordance with the terms of the
Credit Agreement, the Notes, the Trust Agreement, the Certificates and the other
Operative Agreements and perform each term to be performed by it under the
Credit Agreement, the Notes, the Trust Agreement, the Certificates and the other
Operative Agreements.

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     4. OTHER COVENANTS.

     At any time and from time to time, upon the reasonable written request of
the Agent, and at the expense of the Borrower (with funds provided by the Lessee
for such purpose), the Borrower will promptly and duly execute and deliver such
further instruments and documents and take such further actions as the Agent
reasonably may request for the purposes of obtaining or preserving the full
benefits of this Security Agreement and of the rights and powers granted by this
Security Agreement.

     5. DEFAULT; REMEDIES.

        (a) If a Credit Agreement Event of Default has occurred and is
     continuing:

            (i) the Agent, in addition to all other remedies available at law or
        in equity, shall have the right forthwith to enter upon any Property (or
        any other place where any component of any Property is located at such
        time) without charge, and take possession of all or any portion of the
        Trust Property, and to re-let the Trust Property and receive the rents,
        issues and profits thereof, to make repairs and to apply said rentals
        and profits, after payment of all necessary or proper charges and
        expenses, on account of the amounts hereby secured (subject to the
        Excepted Payments); and

            (ii) the Agent, shall, as a matter of right, be entitled to the
        appointment of a receiver for the Trust Property, and the Borrower
        hereby consents to such appointment and waives notice of any application
        therefor.

        (b) If a Credit Agreement Event of Default has occurred and is
     continuing, the Agent may proceed by an action at law, suit in equity or
     other appropriate proceeding, to protect and enforce its rights, whether
     for the foreclosure of the Lien of this Security Agreement, or for the
     specific performance of any agreement contained herein or for an injunction
     against the violation of any of the terms hereof. The proceeds of any sale
     of any of the Trust Property shall be applied pursuant to Section 8.7 of
     the Participation Agreement. In addition, the Agent may proceed under
     Section 11 hereof.

        (c) The Borrower hereby waives the benefit of all appraisement,
     valuation, stay, extension and redemption laws now or hereafter in force
     and all rights of marshalling in the event of any sale of the Trust
     Property or any portion thereof or interest therein.

     6. REMEDIES NOT EXCLUSIVE.

     The Agent shall be entitled to enforce payment of the indebtedness and
performance of the Obligations and to exercise all rights and powers under this
Security Agreement or under any of the other Operative Agreements or other
agreements or any laws now or hereafter in force, notwithstanding some or all of
the Obligations may now or hereafter be otherwise secured,

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whether by deed of trust, mortgage, security agreement, pledge, Lien, assignment
or otherwise. Neither the acceptance of this Security Agreement nor its
enforcement, shall prejudice or in any manner affect the Agent's right to
realize upon or enforce any other security now or hereafter held by the Agent,
it being agreed that the Agent shall be entitled to enforce this Security
Agreement and any other security now or hereafter held by the Agent in such
order and manner as the Agent may determine in its absolute discretion. No
remedy conferred hereunder or under any other Operative Agreement upon or
reserved to the Agent is intended to be exclusive of any other remedy herein or
therein or by law provided or permitted, but each shall be cumulative and shall
be in addition to every other remedy given hereunder or thereunder or now or
hereafter existing at law or in equity or by statute. Every power or remedy
given by any of the Operative Agreements to the Agent or to which it may
otherwise be entitled, may be exercised, concurrently or independently, from
time to time and as often as may be deemed expedient by the Agent. In no event
shall the Agent, in the exercise of the remedies provided in this Security
Agreement (including without limitation in connection with the assignment of
Rents to the Agent, or the appointment of a receiver and the entry of such
receiver onto all or any part of the Land), be deemed a "mortgagee in
possession" or a "pledgee in possession", and the Agent shall not in any way be
made liable for any act, either of commission or omission, in connection with
the exercise of such remedies.

     7. PERFORMANCE BY THE AGENT OF THE BORROWER'S OBLIGATIONS.

     If the Borrower fails to perform or comply with any of its agreements
contained herein the Agent, at its option, but without any obligation so to do,
may perform or comply, or otherwise cause performance or compliance, with such
agreement. The expenses of the Agent incurred in connection with actions
undertaken as provided in this Section 7, together with interest thereon at a
rate per annum equal to the Overdue Rate, from the date of payment by the Agent
to the date reimbursed by the Borrower, shall be payable by the Borrower (with
funds provided by the Lessee for such purpose) to the Agent on demand and
constitutes part of the Obligations secured hereby.

     8. DUTY OF THE AGENT.

     The Agent's sole duty with respect to the custody, safekeeping and physical
preservation of any Trust Property in its possession, under Section 9-207 of the
Uniform Commercial Code or otherwise, shall be to deal with it in the same
manner as the Agent deals with similar property for its own account. Neither the
Agent, any Lender, any Holder nor any of their respective directors, officers,
employees, shareholders, partners or agents shall be liable for failure to
demand, collect or realize upon any of the Trust Property or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any
Trust Property upon the request of the Borrower or any other Person or to take
any other action whatsoever with regard to the Trust Property or any part
thereof.

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     9. POWERS COUPLED WITH AN INTEREST.

     All powers, authorizations and agencies contained in this Security
Agreement are coupled with an interest and are irrevocable until this Security
Agreement is terminated and the Liens created hereby are released.

     10. EXECUTION OF FINANCING STATEMENTS.

     Pursuant to Section 9-402 of the Uniform Commercial Code, the Borrower
authorizes the Agent at the expense of the Borrower (such amounts to be paid
with funds provided by the Lessee for such purpose) to file financing statements
with respect to the Trust Property under this Security Agreement without the
signature of the Borrower in such form and in such filing offices as the Agent
reasonably determines appropriate to perfect the security interests of the Agent
under this Security Agreement. A carbon, photographic or other reproduction of
this Security Agreement shall be sufficient as a financing statement for filing
in any jurisdiction. For purposes of such financing statement, the Borrower
shall be deemed to be the debtor, and the Agent shall be deemed to be the
secured party. The address of the Borrower is 79 South Main Street, Salt Lake
City, Utah 84111, Attention: Val T. Orton, Vice President, and the address of
the Agent is Bank of America, N.A., 901 Main Street, 14th Floor, Mail Code
TX1-492-14-11, Dallas, Texas 75202-3714, Attention: Mr. Otis E. Howard.

     11. SECURITY AGREEMENT UNDER UNIFORM COMMERCIAL CODE.

         (a) It is the intention of the parties hereto that this Security
     Agreement as it relates to matters of the grant, perfection and priority of
     security interests the subject hereof, shall constitute a security
     agreement within the meaning of the Uniform Commercial Code of the States
     in which the Trust Property is located. If a Credit Agreement Event of
     Default shall occur, then in addition to having any other right or remedy
     available at law or in equity, the Agent may proceed under the applicable
     Uniform Commercial Code and exercise such rights and remedies as may be
     provided to a secured party by such Uniform Commercial Code with respect to
     all or any portion of the Trust Property which is personal property
     (including without limitation taking possession of and selling such
     property). If the Agent shall elect to proceed under the Uniform Commercial
     Code, then fifteen (15) days' notice of sale of the personal property shall
     be deemed reasonable notice and the reasonable expenses of retaking,
     holding, preparing for sale, selling and the like incurred by the Agent
     shall include, but not be limited to, attorneys' fees and legal expenses.
     At the Agent's request, the Borrower shall assemble such personal property
     and make it available to the Agent at a place designated by the Agent which
     is reasonably convenient to both parties.

         (b) The Borrower, upon request by the Agent from time to time, shall
     execute, acknowledge and deliver to the Agent one (1) or more separate
     security agreements, in form satisfactory to the Agent, covering all or any
     part of the Trust Property and will further execute, acknowledge and
     deliver, or cause to be executed, acknowledged and delivered, any financing
     statement, affidavit, continuation statement or certificate or other

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     document as the Agent may request in order to perfect, preserve, maintain,
     continue or extend the security interest under, and the priority of the
     Liens granted by, this Security Agreement and such security instrument. The
     Borrower further agrees to pay to the Agent (with funds provided by the
     Lessee for such purpose) on demand all reasonable costs and expenses
     incurred by the Agent in connection with the preparation, execution,
     recording, filing and re-filing of any such document and all reasonable
     costs and expenses of any record searches for financing statements the
     Agent shall reasonably require. The filing of any financing or continuation
     statements in the records relating to personal property or chattels shall
     not be construed as in any way impairing the right of the Agent to proceed
     against any property encumbered by this Security Agreement.

     12. AUTHORITY OF THE AGENT.

     The Borrower acknowledges that the rights and responsibilities of the Agent
under this Security Agreement with respect to any action taken by the Agent or
the exercise or non-exercise by the Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Security Agreement shall be governed by the Credit Agreement and
Section 8.6 of the Participation Agreement and by such other agreements with
respect thereto as may exist from time to time (until such time as all amounts
due and owing to the Secured Parties and the Agent under the Operative
Agreements have been paid in full), but the Agent shall be conclusively presumed
to be acting as agent for the Secured Parties with full and valid authority so
to act or refrain from acting, and the Borrower shall be under no obligation, or
entitlement, to make any inquiry respecting such authority.

     13. NOTICES.

     All notices required or permitted to be given under this Security Agreement
shall be in writing and delivered as provided in Section 12.2 of the
Participation Agreement.

     14. SEVERABILITY.

     Any provision of this Security Agreement which is prohibited or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.

     15. AMENDMENT IN WRITING; NO WAIVERS; CUMULATIVE REMEDIES.

         (a) None of the terms or provisions of this Security Agreement may be
     waived, amended, supplemented or otherwise modified except in accordance
     with the terms of Section 12.4 of the Participation Agreement.

         (b) No failure to exercise, nor any delay in exercising, on the part of
     the Agent, any right, power or privilege hereunder shall operate as a
     waiver thereof. No single or partial exercise of any right, power or
     privilege hereunder shall preclude any other or further exercise thereof or
     the exercise of any other right, power or privilege. A

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     waiver by the Agent of any right or remedy hereunder on any one (1)
     occasion shall not be construed as a bar to any right or remedy which the
     Agent would otherwise have on any future occasion.

         (c) The rights and remedies herein provided are cumulative, may be
     exercised singly or concurrently and are not exclusive of any other rights
     or remedies provided by law.

     16. SECTION HEADINGS.

     The section headings used in this Security Agreement are for convenience of
reference only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

     17. SUCCESSORS AND ASSIGNS.

     This Security Agreement shall be binding upon the successors of the
Borrower, and the Borrower shall not assign any of its rights or obligations
hereunder or with respect to any of the Trust Property without the prior written
consent of the Agent. This Security Agreement shall inure to the benefit of the
Agent, the Lenders, the Holders and their respective successors and assigns, in
accordance with their respective interest herein.

     18. THE BORROWER'S WAIVER OF RIGHTS.

     Except as otherwise set forth herein, to the fullest extent permitted by
law, the Borrower waives the benefit of all laws now existing or that may
subsequently be enacted providing for (a) any appraisement before sale of any
portion of the Trust Property, (b) any extension of the time for the enforcement
of the collection of the indebtedness or the creation or extension of a period
of redemption from any sale made in collecting such debt and (c) exemption of
any portion of the Trust Property from attachment, levy or sale under execution
or exemption from civil process. Except as otherwise set forth herein, to the
fullest extent the Borrower may do so, the Borrower agrees that the Borrower
will not at any time insist upon, plead, claim or take the benefit or advantage
of any law now or hereafter in force providing for any appraisement, valuation,
stay, exemption, extension or redemption, or requiring foreclosure of this
Security Agreement before exercising any other remedy granted hereunder and the
Borrower, for the Borrower and its successors and assigns, and for any and all
Persons ever claiming any interest in the Trust Property, to the extent
permitted by law, hereby waives and releases all rights of redemption,
valuation, appraisement, stay of execution, notice of election to mature or
declare due the whole of the Obligations and marshalling in the event of
foreclosure of the Liens hereby created.

     19. GOVERNING LAW.

     EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN SECTION 11(a) HEREOF, THIS
SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED,

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INTERPRETED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK.

     20. OBLIGATIONS ARE WITHOUT RECOURSE.

The provisions of the Participation Agreement relating to limitations on
liability are hereby incorporated by reference herein, Mutatis Mutandis.

     21. PARTIAL RELEASE; FULL RELEASE.

     The Agent may release for such consideration as it may require any portion
of the Trust Property without (as to the remainder of the Trust Property) in any
way impairing or affecting the Lien, security interest and priority herein
provided for the Agent compared to any other Lien holder or secured party.
Further, the Agent shall execute and deliver to the Borrower such documents and
instruments as may be required to release the Lien and security interest created
by this Security Agreement with respect to the Properties as provided in Section
8.8 of the Participation Agreement or to grant the easements and permit the
other matters provided for in Section 8.5 of the Participation Agreement.

     22. MISCELLANEOUS.

         (a) This Security Agreement is one (1) of the documents which create
     Liens and security interests that secure payment and performance of the
     Obligations. The Agent, at its election, may commence or consolidate in a
     single action all proceedings to realize upon all such Liens and security
     interests. The Borrower hereby waives (i) any objections to the
     commencement or continuation of an action to foreclose the Lien of this
     Security Agreement or exercise of any other remedies hereunder based on any
     action being prosecuted or any judgment entered with respect to the
     Obligations or any Liens or security interests that secure payment and
     performance of the Obligations and (ii) any objections to the commencement
     of, continuation of, or entry of a judgment in any such other action based
     on any action or judgment connected to this Security Agreement. In case of
     a foreclosure sale, the Trust Property may be sold, at the Agent's
     election, in one (1) parcel or in more than one (1) parcel and the Agent is
     specifically empowered (without being required to do so, and in its sole
     and absolute discretion) to cause successive sales of portions of the Trust
     Property to be held.

         (b) This Security Agreement may not be amended, waived, discharged or
     terminated except in accordance with Section 12.4 of the Participation
     Agreement. Upon the prior written consent of the Majority Secured Parties
     and unless such matter is a Unanimous Vote Matter, the Agent may release
     any portion of the Trust Property or any other security, and grant such
     extensions and indulgences in relation to the Obligations secured hereby
     without in any manner affecting the priority of the Lien hereof on any part
     of the Trust Property.

                                       11
<PAGE>   14

         (c) THE PROVISIONS OF THE PARTICIPATION AGREEMENT RELATING TO
     SUBMISSION TO JURISDICTION AND VENUE ARE HEREBY INCORPORATED BY REFERENCE
     HEREIN, MUTATIS MUTANDIS.

     23. CONFLICTS WITH PARTICIPATION AGREEMENT.

     Notwithstanding any other provision hereof, in the event of any conflict
between the terms of this Security Agreement and the Participation Agreement,
the terms of the Participation Agreement shall govern.

     24. LESSEE AS A PARTY.

     LESSEE HAS EXECUTED THIS SECURITY AGREEMENT FOR THE PURPOSE OF SUBJECTING
TO THE SECURITY INTERESTS GRANTED HEREUNDER ALL OF ITS RIGHT, TITLE, ESTATE AND
INTEREST, IF ANY, IN AND TO THE TRUST PROPERTY TO SECURE ALL OBLIGATIONS OF ALL
CREDIT PARTIES UNDER THE OPERATIVE AGREEMENTS. ACCORDINGLY, LESSEE HEREBY GRANTS
TO THE AGENT (FOR THE BENEFIT OF THE LENDERS AND THE HOLDERS) A SECURITY
INTEREST IN AND TO ALL OF ITS RIGHT, TITLE, ESTATE AND INTEREST, IF ANY, IN AND
TO THE TRUST PROPERTY (TO THE EXTENT LESSEE HAS ANY RIGHT, TITLE OR INTEREST
THEREIN AND WITHOUT REGARD TO ANY LANGUAGE IN SECTION 2 OR THE DEFINITION OF
"TRUST PROPERTY" OR ANY DEFINITION OF ANY ITEM CONSTITUTING THE TRUST PROPERTY
WHICH OTHERWISE WOULD LIMIT THE TRUST PROPERTY TO THE RIGHT, TITLE AND INTEREST
OF THE BORROWER THEREIN) TO SECURE ALL OBLIGATIONS OF ALL CREDIT PARTIES UNDER
THE OPERATIVE AGREEMENTS. LESSEE ACKNOWLEDGES AND AGREES THAT, UPON THE
OCCURRENCE OF AN EVENT OF DEFAULT, THE AGENT SHALL HAVE THE RIGHT TO EXERCISE
ANY OR ALL OF ITS REMEDIES HEREUNDER AS AGAINST ANY SUCH RIGHT, TITLE, ESTATE OR
INTEREST OF LESSEE IN OR TO THE TRUST PROPERTY.

                            [signature page follows]

                                       12
<PAGE>   15

        IN WITNESS WHEREOF, each of the undersigned have caused the Security
Agreement to be duly executed and delivered as of the date first above written.

                               FIRST SECURITY BANK, NATIONAL
                               ASSOCIATION, not individually, but solely as the
                               Owner Trustee under the VS Trust 2000-1

                               By: /s/ VAL T. ORTON
                                  ----------------------------------
                               Name: Val T. Orton
                               Title: Vice President

                               BANK OF AMERICA, N.A., as the Agent for the
                               Lenders and the Holders

                               By: /s/ DOUGLAS T. MECKELNBURG
                                  ----------------------------------
                               Name: Douglas T. Meckelnburg
                               Title: Vice President

Accepted and Agreed to:

VERITAS OPERATING CORPORATION

By: /s/ KEN LONCHAR
   ---------------------------------
Name: Ken Lonchar
Title: Senior Vice President and
       Chief Financial Officer<PAGE>   1

                                                                   EXHIBIT 10.24

S3 INCORPORATED                                           [S3 Incorporated Logo]
2801 Mission College Blvd.
P.O. Box 58058
Santa Clara, CA 95052-8058

September 22, 1998

TO:      Andy Wolfe

Re:      Agreement Regarding Severance

Dear Andy,

        This letter agreement sets forth the terms and conditions of severance
that will be paid to you in the event your employment with S3 Incorporated (the
"Company") is involuntarily terminated other than for Cause.

        By signing below, you and the Company agree as follows:

        1. Severance Payment. Subject to the release requirement of paragraph 2,
if your employment is terminated at the behest of the company other than for
Cause, you will be paid a lump sum payment equal to six months of your base
salary, plus one month of base salary for every full year of your service to the
Company. In addition, the term for exercise of your outstanding options will be
extended until six months after your termination (although you will not continue
to vest after your termination). You should be aware that the extension of your
option exercise term will cause an incentive stock option to become a
nonstatutory stock option, which means that you could be taxed at exercise.
Please advise the Company if you have any concerns about this consequence before
signing below. Your severance will be reduced for applicable withholding.

        2. Release Requirement. No severance will be paid, and your option
exercise term will not be extended, unless you execute and deliver to the
Company a full and complete release and covenant not to sue (prepared by, and in
form and substance acceptable to, the Company (the "Release") of all past,
present and future claims you may have against the Company or any of its
officers, directors, shareholders, employees, consultants and agents arising
directly or indirectly from your employment relationship with the Company, this
letter agreement or any act or omission predating the execution of the Release
and thereafter take no action to void or otherwise limit or terminate the
Release within any applicable statutory periods providing such rights.

        3. Cause. For purposes of this letter agreement, "Cause" means: (i)
failure to substantially perform the duties and obligations of your employment,
(ii) misconduct which could reasonably be expected to cause substantial injury
to the Company or any of its affiliates, (iii) material breach of any agreement
between you and the Company or any of its affiliates, or (iv) violation or
breach of any obligation under any confidentiality, assignment of inventions, or
non-solicitation agreement between you and the Company.

<PAGE>   2

        4. Adjustments to Minimize Taxes Under Golden Parachute Rules. In the
event that any severance payments hereunder are determined to be "excess
parachute payments" pursuant to Section 28OG of the Internal Revenue Code of
1986, as amended, such severance payments shall be reduced to the extent
necessary to maximize your after-tax income.

        5. Binding On Successors. This letter agreement will be binding upon you
and any person who is a successor by merger, acquisition, consolidation or
otherwise to the business formerly carried on by the Company, or an affiliate of
any such person, and becomes your employer by reason of (or as the direct result
of) any direct or indirect sale or other disposition of the Company or
substantially all of the assets of the business currently carried on by the
Company, without regard to whether or not such person actively adopts this
letter agreement.

        6. Nonassignability. You may not sell, assign or otherwise transfer any
right or interest you may have under this letter agreement other than by will or
by operation of law.

        7. Dispute Resolution. You and the Company agree to be bound by the
Dispute Resolution procedures attached hereto.

        8. Severability. If any provision of this letter agreement is held
invalid or unenforceable, its invalidity or unenforceability will not affect any
other provision of the letter agreement, and the letter agreement will be
construed and enforced as if such provision had not been included.

        9. Governing Law. This letter agreement will be deemed a contract made
under, and for all purposes shall be construed in accordance with, the laws of
California (without regard to its choice of law provisions).

Sincerely,

 /s/ Terry Holdt
-----------------------------
Terry Holdt
President, CEO and Chairman
S3 Incorporated
Dated:  September 22, 1998

ACKNOWLEDGED AND AGREED

 /s/ Andy Wolfe
-----------------------------
Dated: October 25, 1998

DISPUTE RESOLUTION

Any disputes between you and the Company, including but not limited to disputes
arising out of or related to the letter agreement shall be resolved by using the
following procedures, except that paragraphs (c) and (d) will not be followed in
cases where the law specifically forbids the use of arbitration as a final and
binding remedy, or where paragraph (d) below specifically allows a different

<PAGE>   3

remedy.

(a) The party claiming to be aggrieved shall furnish to the other party a
written statement of the grievance identifying any witnesses or documents that
support the grievance and the relief requested or proposed.

(b) If the other party does not agree to furnish the relief requested or
proposed, or otherwise does not satisfy the demand of the party claiming to be
aggrieved, the parties shall submit the dispute to nonbinding mediation before a
mediator to be jointly selected by the parties. The Company will pay the cost of
the mediation.

(c) If the mediation does not produce a resolution of the dispute, the parties
agree that the dispute shall be resolved by final and binding arbitration. The
parties shall attempt to agree to the identity of an arbitrator, and, if they
are unable to do so, they will obtain a list of arbitrators from the Federal
Mediation and Conciliation Service and select an arbitrator by striking names
from that list. The arbitrator shall have the authority to determine whether the
conduct complained of in paragraph (a) violates the rights of the complaining
party and, if so, to grant any relief authorized by law; subject to the
exclusions of paragraph (d) below. The arbitrator shall not have the authority
to modify, change or refuse to enforce the terms of this letter agreement.

The hearing shall be transcribed. The Company shall bear the costs of the
arbitration if you prevail. If the Company prevails, you will pay half the cost
of the arbitration or $500, whichever is less. Each party shall be responsible
for paying its own attorneys' fees, unless the arbitrator orders otherwise,
pursuant to applicable law.

(d) Arbitration shall be the exclusive final remedy for any dispute between the
parties, and the parties agree that no dispute shall be submitted to arbitration
where the party claiming to be aggrieved has not complied with the preliminary
steps provided for above. The parties agree that the arbitration award shall be
enforceable in any court having jurisdiction to enforce this letter agreement,
so long as the arbitrator's findings of fact are supported by substantial
evidence on the whole and the arbitrator has not made errors of law; provided
however, that either party may bring an action, including but not limited to an
action for injunctive relief, in a court of competent jurisdiction, regarding or
related to matters involving the Company's confidential, proprietary or trade
secret information, or regarding or related to inventions that you may claim to
have developed prior to joining the Company or after joining the Company,
pursuant to California Labor Code 2870. The parties further agree that for
violations of any confidential, proprietary information or trade secret
obligations which the parties have elected to submit to arbitration, the Company
retains the right to seek preliminary injunctive relief in court in order to
preserve the status quo or prevent irreparable injury before the matter can be
heard in arbitration.

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