Document:

EXHIBIT 4.2

THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR APPLICABLE STATE SECURITIES LAWS. THE WARRANT
MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
UNLESS IT HAS BEEN REGISTERED UNDER THOSE LAWS OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO IT THAT SUCH DISPOSITION IS IN
COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

                                                Right to Purchase 600 Shares
                                                of Common Stock of Vsource, Inc.

                                  VSOURCE, INC.
                          Common Stock Purchase Warrant

     VSOURCE, INC., a Delaware corporation (the "Company"), hereby certifies
that, for value received, _______________ (the "Holder") is entitled, subject to
the terms set forth below, to purchase from the Company at any time on or before
5:00 p.m., Pacific Daylight Time, on July 18, 2007 (the "Expiration Date") Six
Hundred (600) fully paid and nonassessable shares of common stock of the
Company, par value $0.01 per share (the "Common Stock"), at a purchase price per
share equal to the Purchase Price, as defined herein. The number of such shares
of Common Stock and the Purchase Price are subject to adjustment as provided in
this Warrant. The initial purchase price for shares subject to this Warrant will
be 50/100 Dollars ($0.50) per share (the "Initial Purchase Price"), and will be
adjusted from time to time as provided herein. The Initial Purchase Price or, if
such price has been adjusted, the price per share of Common Stock as last
adjusted pursuant to the terms hereof is referred to as the "Purchase Price"
herein.

     1. EXERCISE OF WARRANT. This Warrant may be exercised by the Holder hereof
in full at any time until the Expiration Date by surrender of this Warrant and
the subscription form annexed hereto (duly executed by the Holder), to the
Company, and by making payment in cash or by certified or official bank check
payable to the order of the Company, in the amount obtained by multiplying (i)
the number of shares of Common Stock subject to the Warrant by (ii) the Purchase
Price then in effect.

     2. DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant, the Company will cause to be
issued in the name of and delivered to the Holder hereof a certificate for the
number of fully paid and nonassessable shares of Common Stock (or Other
Securities) to which the Holder shall be entitled on such exercise, plus, in
lieu of any fractional share to which the Holder would otherwise be entitled,
cash equal to such fraction multiplied by the then current fair market value (as
reasonably determined by the Company) of one full share, together with any other
stock or other securities or property (including cash, where applicable) to
which the Holder is entitled upon such exercise. "Other Securities" shall mean
any stock (other than Common Stock) and other securities of the Company or any

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other person (corporate or otherwise) which the Holder at any time shall be
entitled to receive, or shall have received, on the exercise of this Warrant, in
lieu of or in addition to Common Stock, or which at any time shall be issuable
or shall have been issued in exchange for or in replacement of Common Stock or
Other Securities pursuant to Sections 3 or 4.

     3. ADJUSTMENT.

          (a) Initial Purchase Price; Subsequent Adjustment of Price and Number
of Purchasable Shares. The Initial Purchase Price will be adjusted from time to
time as provided below. Upon each adjustment of the Purchase Price, the Holder
will thereafter be entitled to purchase, at the Purchase Price resulting from
such adjustment, the number of shares of Common Stock obtained by multiplying
the Purchase Price in effect immediately before such adjustment by the number of
shares of Common Stock purchasable pursuant to this Warrant immediately before
such adjustment and dividing the product by the Purchase Price resulting from
such adjustment.

          (b) Adjustment for Stock Splits and Combinations. If the Company at
any time or from time to time after the date of this Warrant effects a
subdivision of the outstanding shares of Common Stock, by stock split or
otherwise, the Purchase Price then in effect immediately before that subdivision
shall be proportionately decreased; and, conversely, if the Company at any time
or from time to time after the date of this Warrant combines the outstanding
shares of Common Stock, by reverse stock split or otherwise, the Purchase Price
then in effect immediately before that combination shall be proportionately
increased. Any adjustment under this Section 3(b) shall become effective at the
close of business on the date the subdivision or combination becomes effective.

          (c) Adjustment for Certain Dividends and Distributions. In the event
the Company at any time or from time to time after the date of this Warrant
either makes, or fixes a record date for the determination of holders of Common
Stock entitled to receive, a dividend or other distribution payable in
additional shares of Common Stock, then and in each such event the Purchase
Price then in effect shall be decreased as of the time of such issuance or, in
the event such a record date is fixed, as of the close of business on such
record date, by multiplying the Purchase Price then in effect by a fraction (1)
the numerator of which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance on the close of
business on such record date, and (2) the denominator of which shall be (i) the
total number of shares of Common Stock issued and outstanding immediately prior
to the time of such issuance or the close of business on such record date plus
(ii) the number of shares of Common Stock issuable in payment of such dividend
or distribution; provided, however, that if such record date is fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Purchase Price shall be recomputed accordingly as of the
close of business on such record date or date fixed therefor and thereafter the
Purchase Price shall be adjusted pursuant to this Section 3(c) as of the time of
actual payment of such dividend or distribution. For purposes of the foregoing
formula, "the total number of shares of Common Stock issued and outstanding" on
a particular date shall include shares of Common Stock issuable upon conversion
of stock or securities convertible into Common Stock and the exercise of

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warrants, options or rights for the purchase of Common Stock which are
outstanding on such date.

     (d) Adjustments for Other Dividends and Distributions. In the event the
Company at any time or from time to time after the date of this Warrant makes,
or fixes a record date for the determination of holders of Common Stock entitled
to receive, a dividend or other distribution payable in securities of the
Company other than shares of Common Stock, then and in each such event,
provision shall be made so that the Holder shall receive upon exercise hereof,
in addition to the number of shares of Common Stock receivable thereupon, the
amount and kind of securities of the Company which it would have received had
this Warrant been exercised for Common Stock as of the date of such event and
had it thereafter, during the period from the date of such event to and
including the date of exercise, retained such securities receivable by it as
aforesaid during such period, subject to all other adjustments called for during
such period under this Section 3 with respect to the rights of the Holder.

     (e) Adjustment for Recapitalization, Reclassification, or Exchange. If the
Common Stock issuable upon the exercise of this Warrant is changed into the same
or a different number of shares of any class or classes of stock of the Company,
whether by recapitalization, reclassification or other exchange (other than a
subdivision or combination of shares, or a stock dividend or a reorganization,
merger, consolidation or sale of assets, provided for elsewhere in this Section
3), then and in any such event the Holder shall have the right thereafter to
exercise this Warrant to purchase the kind and amount of stock and other
securities and property receivable upon such recapitalization, reclassification
or other exchange by holders of the number of shares of Common Stock which might
have been purchased under this Warrant immediately prior to such
recapitalization, reclassification or other exchange, all subject to further
adjustment as provided herein.

     (f) Reorganizations, Mergers, Consolidations or Sales of Assets. If at any
time or from time to time there is a capital reorganization of the Common Stock
(other than a subdivision or combination of shares or a stock dividend or a
recapitalization, reclassification or other exchange of shares, provided for
elsewhere in this Section 3 or a merger or consolidation of the Company with or
into another corporation, or the sale of all or substantially all of the
Company's assets to any other person), then, as a part of such capital
reorganization, provision shall be made so that the Holder shall thereafter be
entitled to receive upon exercise of this Warrant the number of shares of stock
or other securities or property of the Company, or of the successor corporation
resulting from such capital reorganization, to which a holder of the number of
shares of Common Stock deliverable upon such exercise would have been entitled
on such capital reorganization. In any such case, appropriate adjustment shall
be made in the application of the provisions of this Section 3 with respect to
the rights of the Holder after the capital reorganization to the end that the
provisions of this Section 3 (including the number of shares deliverable upon
exercise of this Warrant) shall continue to be applicable after that event and
shall be as nearly equivalent to the provisions hereof as may be practicable.

     (g) Certificate of Adjustment. Upon the occurrence of each adjustment or
readjustment of the Purchase Price and/or the number of shares of Common Stock
subject to this Warrant, the Company at its expense shall promptly compute such

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adjustment or readjustment in accordance with the terms hereof, and shall
prepare and furnish to the Holder a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based.

     4. EXERCISE UPON REORGANIZATION, CONSOLIDATION, MERGER, ETC. In case at any
time or from time to time, the Company intends to (a) effect a reorganization,
(b) consolidate with or merge into any other person, (c) sell or transfer all or
substantially all of its properties or assets to any other person, (d) dissolve,
(e) consummate an initial public offering of its securities; or if the Company
is sold through the sale of its capital stock, then, notwithstanding any other
provision of this Warrant, in each such case, as a condition of such
reorganization, consolidation, merger, sale, dissolution, conveyance, or
offering the Company shall give at least ten (10) days' notice to the Holder of
such pending transaction whereby the Holder shall have the right to exercise
this Warrant prior to any such reorganization, consolidation, merger, sale,
dissolution, conveyance or offering. Any exercise of this Warrant pursuant to
notice under this Section shall be conditioned upon the closing of such
reorganization, consolidation, merger, sale, dissolution, conveyance or offering
which is the subject of the notice and the exercise of this Warrant shall not be
deemed to have occurred until immediately prior to the closing of such
transaction.

     5. FURTHER ASSURANCES. The Company will take all action that may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock, free from all taxes, liens
and charges with respect to the issue thereof, on the exercise of all or any
portion of this Warrant from time to time outstanding.

     6. NOTICES OF RECORD DATE, ETC. In the event of:

          (a) any taking by the Company of a record of the holders of any class
of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend on, or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right, or

          (b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of all or
substantially all of the assets of the Company to or the sale, consolidation or
merger of the Company with, to or into any other person, or

          (c) any voluntary or involuntary dissolution, liquidation or winding
up of the Company;

then and in each such event the Company will mail or cause to be mailed to the
Holder, at least ten (10) days prior to such record date, a notice specifying
(i) the date on which any such record is to be taken for the purpose of such
dividend, distribution or right, and stating the amount and character of such
dividend, distribution or right, (ii) the date on which any such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding up is to take place, and the time, if any is

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to be fixed, as of which the holders of record of Common Stock (or Other
Securities) shall be entitled to exchange their shares of Common Stock (or Other
Securities) for securities or other property deliverable on such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding up, and (iii) the amount and character of
any stock or other securities, or rights or options with respect thereto,
proposed to be issued or granted, the date of such proposed issue or grant and
the persons or class of persons to whom such proposed issue or grant is to be
offered or made.

     7. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS. The
Company will at all times reserve and keep available out of its authorized but
unissued shares of capital stock, solely for issuance and delivery on the
exercise of this Warrant, a sufficient number of shares of Common Stock (or
Other Securities) to effect the full exercise of this Warrant and the exercise,
conversion or exchange of any other warrant or security of the Company
exercisable for, convertible into, exchangeable for or otherwise entitling the
Holder to acquire shares of Common Stock (or Other Securities), and if at any
time the number of authorized but unissued shares of Common Stock (or Other
Securities) shall not be sufficient to effect such exercise, conversion or
exchange, the Company shall take such action as may be necessary to increase its
authorized but unissued shares of Common Stock (or Other Securities) to such
number as shall be sufficient for such purposes.

     8. TRANSFER OF WARRANT. This Warrant cannot be transferred without the
prior written consent of the Company, which consent shall not be unreasonably
withheld; provided, however, the Holder may transfer this Warrant to any of its
affiliates without such consent so long as such transfer complies with all
applicable securities laws.

     9. NO RIGHTS AS A STOCKHOLDER. This Warrant shall not entitle the Holder
hereof to any voting rights or other rights as a stockholder of the Company.

     10. NOTICES, ETC. All notices which are required to be given pursuant to
this Warrant shall be in writing and shall be delivered by certified mail,
return receipt requested, first class postage prepaid, or sent by overnight
express or similarly recognized overnight delivery with receipt acknowledged or
by facsimile, with a copy thereof sent by one of the other means. Notices shall
be deemed to have been given at the time delivered and shall be addressed as
follows or to such other address as a party may designate by proper notice
hereunder.

If to Holder:                       To the address set forth on the first page
                                    hereof.

If to the Company:                  Vsource, Inc.
                                    7855 Ivanhoe Avenue, Suite 200
                                    La Jolla, California  92037
                                    Attn.:   CEO

     11. SECURITIES LAWS. By acceptance of this Warrant, the Holder hereby
represents to the Company that this Warrant is being acquired for investment for

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the Holder's own account, not as a nominee or agent, and not with a view to the
resale or distribution thereof, and that the Holder has no present intention of
selling, granting any participation in, or otherwise distributing this Warrant
or the Common Stock issuable upon exercise of this Warrant. By acceptance of
this Warrant, the Holder further represents that the Holder does not presently
have any contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participations to such person or to any third person,
with respect to this Warrant or the Common Stock issuable upon exercise of this
Warrant. The Holder is an "accredited investor" as the term is defined in Rule
501(a) of Regulation D promulgated under the Securities Act and has sufficient
knowledge and experience in finance and business that it is capable of
evaluating the risks and merits of its investment in the shares subject to this
Warrant and the Holder is able financially to bear the risks thereof. The Holder
understands that the sale and issuance of this Warrant and the Common Stock
issuable upon exercise of this Warrant have not been registered under the
Securities Act, by reason of a specific exemption from the registration
provisions of the Securities Act which depends upon, among other things, the
bona fide nature of the investment intent and the accuracy of the Holder's
representations as expressed herein. The Holder further recognizes and
acknowledges that because the sale and issuance of this Warrant and the Common
Stock issuable upon exercise of this Warrant are unregistered, they may not be
eligible for resale, and may only be resold in the future pursuant to an
effective registration statement under the Securities Act and any applicable
state securities laws, or pursuant to a valid exemption from such registration
requirements and that the Holder must, therefore, bear the economic risk of such
investment indefinitely.

     12. LEGEND. Unless theretofore registered for resale under the Securities
Act, each certificate for shares of Common Stock issued upon exercise of this
Warrant shall bear the following or a similar legend:

          THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
     UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
     APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR
     INVESTMENT AND MAY NOT BE RESOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF
     AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
     ACT OR AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH
     DISPOSITION IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE
     STATE SECURITIES LAWS.

     13. MISCELLANEOUS. This Warrant and any terms hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the internal laws of the State of Delaware, without regard to
conflict of laws principles. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect any of the terms hereof.

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The invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provision.

                                      * * *

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     IN WITNESS WHEREOF, the Company has caused this Warrant to be executed on
its behalf by one of its officers thereunto duly authorized as of July 7, 2005.

                                            VSOURCE, INC.

                                            By:  /s/ Dennis M. Smith
                                               ---------------------------------
                                            Name:    DENNIS M. SMITH
                                            Title:   Chief Executive Officer

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                              FORM OF SUBSCRIPTION

                                  VSOURCE, INC.

                   (To be signed only on exercise of Warrant)

TO:      VSOURCE, INC.

     1. The undersigned Holder of the attached original, executed Warrant of
Vsource, Inc., a Delaware corporation (the "Company"), hereby elects to exercise
its purchase right under such Warrant with respect to ______________
(__________) shares (the "Exercise Shares") of Common Stock (as defined in the
Warrant), constituting all the shares of Common Stock subject to the Warrant.

     2. The undersigned Holder is hereby paying the aggregate purchase price for
such the Exercise Shares (i) by the enclosed certified or official bank check
payable in United States dollars to the order of the Company in the amount of
$___________, or (ii) by wire transfer of United States funds to the account of
the Company in the amount of $______________, which transfer has been made
before or simultaneously with the delivery of this Form of Subscription pursuant
to the instructions of the Company.

     3. Please issue a stock certificate or certificates representing the
Exercise Shares in the name of the undersigned Holder.

Dated:_______________________

                                            ----------------------------------
                                                     Signature of Holder

                                      B-9EXHIBIT 10.1

                    CONSULTING AND NON-COMPETITION AGREEMENT

                                 BY AND BETWEEN

                                  VSOURCE, INC.

                                       AND

                                 DENNIS M. SMITH

                            DATED AS OF JULY 18, 2005

<PAGE>

This CONSULTING AND NON-COMPETITION AGREEMENT dated as of July 18, 2005 (the
"Effective Date"), by and between, Vsource, Inc., a Delaware company (the
"Company"), and Dennis M. Smith ("Consultant").

     In consideration of consulting services to be provided by the Consultant to
the Company and the cancellation and termination of the Existing Employment
Agreements (defined in Section 16 below), the parties hereto agree as follows:

1. CONSULTING. Subject to earlier termination in accordance with Sections set
out below this Agreement shall commence as of the Effective Date and continue
until the date which is the later of the Initial Term or such additional term
provided under Section 1.b.

     a. Duties. The Company agrees to retain the Consultant and Consultant
agrees to serve the Company, subject to the direction of the Board of Directors
of the Company (the "Board"), and to have such authority and duties relative to
the operation of the Company as may be determined by the Board. In addition,
Consultant agrees, if requested by the Board to serve as a Director of the
Company and/or it subsidiaries, subject to continuing directors and officers
insurance coverage pursuant to Section 16.j. below.

     b. Term. The initial term of this Agreement shall be from the Effective
Date hereof until July 18, 2007 (the "Initial Term"). This Agreement shall renew
automatically for additional one (1) year terms unless either party gives notice
of termination not less than 90 days prior to the end of the existing term.

     c. Best Efforts. Subject to the provisions set forth in Section 9 hereto,
during the term of this Agreement, Consultant shall use his best efforts to
advance the interests of the Company and any subsidiaries thereof (the "Vsource
Companies").

2. COMPENSATION. The Company shall pay to Consultant, as consideration for the
services to be rendered by Consultant hereunder, an annual fee of US$300,000 per
year payable monthly in twelve equal payments of $25,000 (the "Monthly Fee") on
or about the 20th day of each month by telegraphic or wire transfer to the
account designated by the Consultant from time to time in writing.

3. BONUSES, STOCK OPTIONS, RESTRICTED STOCK AND SIMILAR TYPES OF COMPENSATION
BENEFITS. Bonuses, stock option grants, participation in restricted stock
programs or deferred compensation programs and other similar types of
compensation plans will be decided by the Board.

4. BENEFITS. Consultant served as an officer of the Company prior to the
commencement of this Agreement. The Company will continue to provide the
Consultant with coverage under existing plans for medical, dental, and
retirement coverage or an alternative provider with equivalent coverage mutually
agreed by the parties.

5. EXPENSES. Upon presentation of proper vouchers, receipts or other proof,
Consultant shall be reimbursed promptly by the Company for all reasonable travel
and other expenses incurred by Consultant in connection with performing his
Consulting obligations hereunder, provided that the Consultant will comply with
the Company's expense approval policies, including prior approval of
expenditures in accordance with Company policy.

<PAGE>

6. TERMINATION OF THE AGREEMENT.

     a. By the Consultant. The Agreement may be terminated by the Consultant
without cause (a "Voluntary Termination") at any time upon at least 60 days
written notice to the Company.

     b. By the Company. The Agreement may be terminated by the Company for
actual cause or without actual cause as follows:

          i. Termination for Actual Cause.

               1.   immediately, in the event that (1) Consultant is convicted
                    or pleads guilty or nolo contendere to a felony or a crime
                    of moral turpitude, (2) the Board determines in good faith
                    that Consultant has been grossly negligent or acted
                    dishonestly to the material detriment of the Company, (3)
                    Consultant willfully disobeys the instructions or mandates
                    of the Board and such disobedience continues after
                    Consultant is afforded a reasonable opportunity to cure such
                    disobedience, or (4) the Board makes a good faith
                    determination that Consultant has engaged in actions
                    amounting to willful misconduct or failed to perform his
                    duties hereunder and such failure continues after Consultant
                    is afforded reasonable opportunity to cure such failure
                    (each of (1), (2), (3) or (4), referred to herein as a
                    "Termination for Actual Cause"); or

               2.   immediately, in the event that Consultant is indicted or
                    otherwise formally charged with a felony or a crime of moral
                    turpitude, in which case the Board may, upon three (3) days
                    written notice, suspend the Agreement. Thereafter, all
                    payments of salary and bonuses, if any, to which Consultant
                    otherwise would be entitled under this Agreement shall be
                    paid into an interest bearing escrow account. In the event
                    that Consultant shall be acquitted of such charges or such
                    charges shall otherwise be dismissed, Consultant shall be
                    reinstated as a Consultant, and all fees and accrued
                    bonuses, if any, paid into escrow, plus accrued interest,
                    shall be paid to Consultant. In the event Consultant shall
                    be convicted or pleads guilty or nolo contendere to such
                    charges; all salary and accrued bonuses paid into escrow
                    plus accrued interest, shall be paid over to the Company,
                    and this Agreement shall be deemed to have terminated as of
                    the date of his suspension.

          ii. Termination Without Actual Cause.

               1.   the Board, in its discretion, resolves to terminate the
                    Agreement for any reason other than those set forth in
                    sub-sections b(i)(1) or b(i)(2) above, upon written notice
                    to Consultant.

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     c. Death of Consultant. In the event of Consultant's death during the term
of his Agreement, this Agreement shall be deemed to have terminated on the last
day of the calendar month during which Consultant's death occurred.

8. SEVERANCE.

     a. Voluntary Termination or Termination for Actual Cause. In the event of
Voluntary Termination or Termination for Actual Cause, the Company shall pay to
Consultant, in full discharge of its obligations hereunder, the Monthly Fee
through the date specified in the applicable notice as the termination date (the
"Termination Date"); plus any Bonus that has been awarded but not yet been paid,
and expenses through the Termination Date, plus any compensation or benefits to
which he may be entitled pursuant to the benefit plans of the Company (in the
aggregate, the amounts in this sentence shall be the "Accrued Amounts");
provided, that in the case of a Voluntary Termination, if the Company permits
Consultant to terminate the Agreement on a date earlier than the Termination
Date (i.e. with less than sixty (60) days written notice), then the Company
shall only be obligated to pay the Monthly Fees and Accrued Amounts due
Consultant through such earlier date.

     b. Death. In event Consultant's consulting by the Company terminates on
account of Consultant's death, the Company shall pay to Consultant (or his
estate), in full discharge of its obligations hereunder, Consultant's Monthly
Fees through the Termination Date.

     c. Termination Without Actual Cause. In the event the Agreement is
terminated by the Company other than for a Termination for Actual Cause,
Consultant shall be entitled to receive a lump sum termination payment which
shall be made by the Company to the Consultant within 30 days of the Termination
Date equal to (i) the Accrued Amounts and (ii) the Monthly Fee times number of
months (including fractions thereof) until the last date of the Initial Term or,
if the Termination Without Actual Cause takes place after the completion of the
Initial Term, the date which is 90 days from the Termination Date.

9. NON-COMPETITION. Consultant covenants and agrees that during the term of
Agreement with the Company and for a period (the "Non-Compete Period")
commencing on the Termination Date and ending on the date which is one (1) year
from the date of the final payment by the Company to Consultant pursuant to this
Agreement, Consultant will refrain from: (i) directly or indirectly (as a
director, officer, Consultant, manager, consultant, independent contractor,
advisor or otherwise) engaging in competition with, or owning any interest in,
performing any services for, participating in or being connected with any
business or organization which engages in competition with any of the Vsource
Companies (the "Vsource Business") (ii) soliciting directly or indirectly the
patronage of any person with whom Consultant has had personal contact or
dealings on behalf of any of the Vsource Companies during the twelve (12) month
period immediately preceding the Termination Date, or (iii) directly or
indirectly employing, soliciting for employment, or advising or recommending to
any other person that they employ or solicit for employment, any Consultant of
any of the Vsource Companies.

     In connection with the foregoing provisions of this Section 9, Consultant
represents that his experience, capabilities and circumstances are such that the
provisions of these Sections will not prevent him from earning a livelihood and

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that the limitations set forth herein are reasonable and properly required for
the adequate protection of the Company.

     Furthermore, in connection with the foregoing provisions of this Section 9,
the Company acknowledges that the Consultant now serves, and will continue to
serve, in a number of other capacities concurrent with his role as a Consultant
to the Company.

10. CONFIDENTIAL INFORMATION.

     a. Non-Disclosure. Consultant agrees not to use other than for the benefit
of the Vsource Companies and to keep confidential, during the term of the
Agreement for at least two (2) years thereafter, all information about the
Vsource Companies which the Vsource Companies treat as confidential, including,
but not limited to, information about customers, marketing plans, marketing
techniques, technical information, and possible new products or services, except
that Consultant will not be required to keep particular items of information
confidential after those items of information become generally available to the
public without a breach by Consultant of Consultant's obligations under this
Section. Consultant covenants and agrees that except in the performance of his
duties hereunder, he will not, at any time, directly or indirectly, without the
prior written consent of the Company, use or disclose to any person any
confidential or proprietary information ("Confidential Information") obtained or
developed by him while employed by the Company relating to the business of the
Vsource Companies, except information which at the time (i) is available to
others in the business or generally known to the public other than as a result
of disclosure by him not permitted hereunder, (ii) is lawfully acquired from a
third party who is not obligated to a Vsource Company to maintain such
information in confidence or (iii) is used in any dispute or proceedings between
the parties and/or Consultant is legally compelled to disclose such information;
provided, however, that prior to any such compelled disclosure, Consultant will
(a) assert the privileged and confidential nature of the Confidential
Information against the third party seeking disclosure and (b) cooperate fully
with the Company or any other Vsource Company in protecting against any such
disclosure and/or obtaining a protective order narrowing the scope of such
disclosure and/or use of the Confidential Information. In the event that such
protection against disclosure is not obtained, Consultant will be entitled to
disclose the Confidential Information, but only as and to the extent necessary
to legally comply with such compelled disclosure.

     b. Disclosure to the Company. Consultant shall disclose promptly to the
Company all new discoveries, ideas, formulae, products, methods, processes,
designs, trade secrets, copyrightable material, patentable inventions, or other
useful technical information or know-how and all improvements, modifications or
alterations of existing discoveries made, discovered, or developed by him,
either alone or in conjunction with any other person during the term of his
Consulting by the Company, or using the Vsource Companies' materials or
facilities, which discoveries or developments are based on, derived from, or
make use of any information directly related to the business disclosed to, or
otherwise acquired by, Consultant from any of the Vsource Companies during his
Consulting by the Company. Consultant agrees that any copyright, patent,
trademark, or other proprietary rights in any such discoveries shall be the sole
and exclusive property of the Company, and none of the Vsource Companies need
account to Consultant for any revenue or profit derived therefrom. If by
operation of law or otherwise, any or all of the items set forth in Section 9,
or any component or element thereof, is considered to be the intellectual

                                      -4-

<PAGE>

property right of Consultant, Consultant hereby agrees to irrevocably assign to
the Company, its successor and assigns, ownership of all United States and
international copyrights and all other intellectual property rights available
with respect to each such element or item. Consultant shall be deemed to have
granted the Company an irrevocable power of attorney to execute as Consultant's
agent any and all documents (including copyright registrations) deemed necessary
by the Company to perfect the Company's intellectual properly rights in and to
each of the items set forth in this Section.

     c. Trade Secrets. Consultant agrees, in order to effectuate the intent of
the parties hereunder with respect to confidentiality of the trade secrets of
the Vsource Companies, to return to the Vsource Companies forthwith upon the
request of a Vsource Company or the termination of his Consulting or promptly
thereafter, all documents, materials, photographs, memorandums, and all copies
or reproductions hereof, or any property of a similar or different nature
containing information relating to the business or other Confidential
Information, whether such material was furnished by a Vsource Company, or
otherwise. Consultant further agrees to use his best efforts and to exercise
utmost diligence to protect and guard and keep secret and confidential all
Confidential Information that shall come into his possession by reason of his
Consulting by the Company.

     d. Company Property. Consultant agrees to return to the Vsource Companies
forthwith upon the request of any Vsource Company or the termination of his
Consulting or promptly thereafter, all other properly belonging to the Vsource
Companies.

11. REPORTING. Consultant shall report to the Chairman of the Board of the
Company.

                                      -5-

<PAGE>

12. INDEPENDENT CONTRACTOR. Consultant shall be an independent contractor, and
not an employee or agent of the Company or any of its affiliates or subsidiaries
for any purpose, including but not limited to FICA, FUTA, and income tax
withholding. Consultant agrees to perform consulting services in accordance with
this Agreement and shall not subcontract the performance of all or any part of
its obligations hereunder to any third parties without the Company's prior
written consent.

13. INDEMNITY.

     (a)  Subject to Sections 14 and 15 below, Consultant agrees to defend,
          indemnify, and hold the Company (and its affiliates, owners,
          employees, and agents) harmless from and against all indemnifiable
          damages, to the maximum extent permitted by applicable law.

     (b)  Subject to paragraphs 14 and 15 below, the Company agrees to defend,
          indemnify, and hold Consultant harmless from and against all
          indemnifiable damages, to the maximum extent permitted by applicable
          law.

     (c)  "Indemnifiable damages" means all expenses, losses, costs,
          deficiencies, liabilities, and damages (including related attorneys'
          and paralegals' fees, court costs, including costs for appeals, and
          arbitration expenses) incurred or suffered by a party, however caused
          and regardless of whether incurred or suffered in tort, contract or
          otherwise, resulting from any default in the performance of any of the
          covenants or agreements of the other party in this Agreement.

14. LIMITATION OF LIABILITY. Neither party shall be liable to the other party
with respect to this Agreement, except for such party's own gross negligence or
willful misconduct.

15. FORCE MAJEURE. Neither party shall be liable for failure to perform its
obligations hereunder due to causes beyond its control, including acts of God,
laws and requirements of any government, national emergencies, materials
shortages or labor difficulties.

16. MISCELLANEOUS.

     a. Notice. Any notices or other communications to Consultant or to the
Company under or relating to this Agreement must be in writing and will be
deemed given when delivered in person or sent by facsimile transmission to the
Company or Consultant, as the case may be, at the Company's principal offices,
or on the third day after the day on which mailed to the Company or Consultant,
as the case may be, by first class mail addressed to the Company or Consultant
at the Company's principal offices, except that after the term of this Agreement
terminates, any notice or other communication to Consultant will be deemed given
when delivered in person or sent by facsimile transmission, or on the third day
after the day on which mailed by first class mail, to Consultant at an address
specified by Consultant to the Company in the manner provided in this Section
(or, if Consultant does not specify an address, at the Company's principal
offices).

     b. No Duplication. The payments and benefits received by Consultant
hereunder are in addition to, and not duplicative of, payments and benefits
received by Consultant under Consultant's employment and non-competition

                                      -6-

<PAGE>

agreements with each of Vsource (Asia) Limited and Vsource (CI) Ltd , each dated
as of April 1, 2005 (together, the "Existing Employment Agreements").

     c. Entire Agreement; Amendment. This Agreement represents the entire
understanding of the parties with respect to the subject matter hereof and
replaces in their entirety the Existing Employment Agreements which Consultant
agrees are cancelled and terminated as of the Effective Date, except that
Consultant shall be credited hereunder with all benefits that have accrued under
the Existing Employment Agreements through the Effective Date, including without
limitation vacation that has accrued and Consultant stock options that have been
granted under the Existing Employment Agreements. No termination, revocation,
waiver, modification, amendment or supplement to this Agreement shall be binding
unless consented to in writing by Consultant and the Company.

     d. Governing Law. This Agreement shall be interpreted and construed in
accordance with the laws of Delaware, without giving effect to the conflict of
laws provisions thereof.

     e. Interpretation. As used in this Agreement, the masculine gender shall
include the feminine or neuter gender and the plural shall include the singular
wherever appropriate. The titles of the paragraphs and sections have been
inserted as a matter of convenience of reference only and shall not control or
affect the meaning or construction of any of the terms or provisions hereof.
Nothing herein shall be construed against or more favorably toward any party by
reason of any party having drafted this Agreement or any portion hereof.

     f. Severability. Any provision of this Agreement that is invalid, illegal
or unenforceable in any jurisdiction shall be automatically reformed and
construed so as to be valid, operative and enforceable to the maximum extent
permitted by law, or if no reformation is permissible, shall be ineffective to
the extent of such invalidity, illegality or unenforceability without
invalidating or rendering unenforceable the remaining provisions of this
Agreement, and any such invalidity, illegality or unenforceability shall not, of
itself, affect the validity, legality or enforceability of such provision in any
other jurisdiction.

     g. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute one and the same instrument.

     h. No Waiver. No failure or delay on the part of either party is exercising
any right or power hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power preclude any other right
or power.

     i. Previous Employer. Consultant hereby represents that he is under no
obligation or agreement that would prevent him from being a Consultant to the
Company or adversely impact his ability to perform the expected services for the
Company. As a condition of Consulting, no confidential documents, computer
discs, computer stored information, or any other confidential properly of any
previous employer are to be brought on the premises or used in any way in your
Consulting by the Company. As a further condition of Consulting, Consultant
agrees not to use or disclose the trade secrets or confidential information, if
any, of a previous employer in connection with Consultant's services for the
Company.

                                      -7-

<PAGE>

     j. Directors & Officers Insurance. The Company represents and warrants that
Article 7 (No Director Liability) of the Company's certificate of incorporation
(and the provisions therein, including those relating to indemnification)
remains in full force and effect and has not been amended, repealed or otherwise
modified. The Company agrees to maintain in effect reasonable and customary
Directors and Officers liability insurance providing a "tail period" covering
Consultant for his service as a director, officer and consultant of the Company
and its subsidiaries.

                                      -8-

<PAGE>

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

                                       Vsource, Inc.

                                       By:         /s/ James G. Higham
                                                --------------------------

                                                Name:  James G. Higham

                                                Title: Vice President

                                       By:      /s/ Dennis M. Smith
                                                --------------------------

                                                    Dennis M. Smith

                                      -9-

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