Document:

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                                                                    Exhibit 10.1

                            SECURED CREDIT AGREEMENT

               This SECURED CREDIT AGREEMENT (as amended, supplemented or
modified from time to time, this "Agreement") is dated as of May 19, 2003, and
is between MICROSTRATEGY INCORPORATED, MICROSTRATEGY SERVICES CORPORATION,
MICROSTRATEGY MANAGEMENT CORPORATION, MICROSTRATEGY ADMINISTRATION CORPORATION
and STRATEGY.COM INCORPORATED; and BANK OF AMERICA, N.A.

               The parties hereto agree as follows:

                                    ARTICLE I
                               GENERAL DEFINITIONS

               Section 1.1.   Definitions. The following terms, as used herein,
have the following meanings:

               "Affiliate" means (i) any Person that directly, or indirectly
through one or more intermediaries, controls a Borrower (a "Controlling Person")
or (ii) any Person (other than a Borrower or a Subsidiary) which is controlled
by or is under common control with a Controlling Person. As used herein, the
term "control" means possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract, or otherwise.

               "Applicable Interest Rate" means (a) the Eurodollar Rate or (b)
the Base Rate, as determined pursuant to Section 2.5.

               "Application" means any Application and Agreement for Standby
Letter of Credit executed and delivered by a Borrower to the Bank in accordance
with the terms and conditions of this Agreement, substantially in the form of
Exhibit A hereto and appropriately completed, including all extensions,
supplements and modifications thereto, and renewals thereof; and "Applications"
means all of said applications.

               "Bank" means Bank of America, N.A., a national banking
association, and its successors and assigns.

               "Base Rate" means a rate per annum equal at all times to the sum
of (a) 1.0% plus (b) the Prime Rate.

               "Base Rate Loan" means any Revolving Loan for which interest is
to be computed with reference to the Base Rate.

               "Borrower" means (i) the Parent, (ii) MicroStrategy Services
Corporation, a Delaware corporation, (ii) MicroStrategy Management Corporation,
a Delaware corporation, (iii) MicroStrategy Administration Corporation, a
Delaware corporation, (iv) Strategy.com Incorporated, a Delaware corporation,
and (v) any Person required by Section 6.17 to be a Borrower hereunder; and
their respective successors; and "Borrowers" means all of said Persons.

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               "Borrowing Base" means 85% of the balance of Eligible Accounts.
No item of Collateral owned by a Borrower or a Domestic Subsidiary will be
included in the Borrowing Base unless the Bank has a valid and perfected first
priority Lien on it.

               "Borrowing Base Certificate" has the meaning set forth in Section
2.7.

               "Business Day" means any day except a Saturday, Sunday or other
day on which commercial banks in the Commonwealth of Virginia are authorized by
law to close.

               "Class Action Notes" means the 7 1/2% Series A Unsecured Notes
due June 24, 2007, issued pursuant to that certain Indenture, dated as of
January 11, 2001, between the Parent and American Stock Transfer & Trust
Company, as trustee, as amended.

               "Code" means the Internal Revenue Code of 1986, as amended.

               "Collateral" means all of the property which is subject or is to
be subject to the Liens granted by the Collateral Documents.

               "Collateral Documents" means the Security Agreements, the Pledge
Agreement and all supplemental assignments, mortgages, deeds of trust and other
documents delivered or to be delivered pursuant thereto.

               "Comfort Letters" means (i) that certain letter agreement from
the Parent to the directors of MicroStrategy Ltd., dated February 10, 2003, with
regard to the funding and financial support of said entity and its Subsidiaries,
(ii) any other letter agreement from the Parent to any of its Consolidated
Subsidiaries of similar effect as the letter described in clause (i), and (iii)
any re-issue of any of the foregoing on the same terms.

               "Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which would be consolidated with those of a
Borrower in its consolidated financial statements as of such date.

               "Date of Maturity" has the meaning given that term in the Note.

               "Debt" has the meaning set forth in Section 5.1

               "Default" means any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.

               "Domestic Subsidiary" means a Subsidiary organized under the laws
of any of the 50 States of the United States or the District of Columbia.

               "Effective Date" means the date on which this Agreement becomes
effective in accordance with Section 9.8.

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               "Eligible Accounts" means total worldwide billed trade accounts
receivable of the Parent and all Subsidiaries of the Parent.

               "Eurodollar Loan" means any Revolving Loan for which interest is
to be computed with reference to the Eurodollar Rate.

               "Eurodollar Rate" means the LIBOR Rate plus the Variance, as
determined in accordance with Section 2.5(c).

               "Event of Default" has the meaning set forth in Section 8.1.

               "Existing Letter of Credit" has the meaning set forth in Section
2.1(b).

               "Family Members" means, with respect to any individual, any other
individual having a relationship by blood (to the second degree of
consanguinity), marriage, or adoption to such individual.

               "Family Trusts" means, with respect to any individual, bona fide
trusts or other bona fide estate planning vehicles established for the benefit
of such individual and/or Family Members of such individual.

               "Foreign Subsidiary" means a Subsidiary other than a Domestic
Subsidiary.

               "GAAP" means generally accepted accounting principles in the
United States.

               "Inter-company Transaction" means any transaction described in,
or contemplated by, Sections 6.7(v), 6.9(b)(3), or 6.12(B); and "Inter-company
Transactions" means all of such transactions. Notwithstanding the foregoing, the
Comfort Letters shall not be deemed to be "Inter-company Transactions"
hereunder.

               "LIBOR Rate" means that fluctuating rate of interest equal to the
average per annum interest rate (rounded upwards, if necessary, to the nearest
1/100 of 1%) at which U.S. dollar deposits would be offered for one month by
major banks in the London inter-bank market as shown on Telerate Page 3750 (or
any successor page) as determined for each banking day at approximately 11:00
a.m. (London time) two (2) London Banking Days prior to the date in question, as
adjusted from time to time in the Bank's sole discretion for then-applicable
reserve requirements, deposit insurance assessment rates and other regulatory
costs. If, for any reason, such rate does not appear on Telerate Page 3750 (or
any successor page), the rate will be determined by such alternate method as is
reasonably selected by the Bank. Interest will accrue on any non-banking day at
the rate in effect on the immediately preceding banking day.

               "Letter of Credit" means any Irrevocable Standby Letter of Credit
issued by the Bank for the account of a Borrower pursuant to the terms hereof
and of an Application, including all extensions, supplements and modifications
thereto, and renewals thereof; and "Letters of Credit" means all of said letters
of credit.

               "Letter of Credit Loans" has the meaning set forth in Section
2.1(b).

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               "Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, a Borrower shall be deemed to own
subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.

               "Loan" means a Revolving Loan or a Letter of Credit Loan, and
"Loans" means all of such Loans. A Letter of Credit Loan shall not be deemed a
Revolving Loan, and a Revolving Loan shall not be deemed a Letter of Credit
Loan.

               "London Banking Day" is a day on which the Bank's London Banking
Center is open for business and dealing in offshore dollars.

               "Note" has the meaning set forth in Article II.

               "Parent" means MicroStrategy Incorporated, a Delaware
corporation, and its successors.

               "Permitted Holders" means Michael Saylor, Sanju Bansal, the
Family Members and Family Trusts of each of the foregoing, or any other Person
who, directly or indirectly, controls, is controlled by, or is under common
control with Michael Saylor, Sanju Bansal, the Family Members and Family Trusts
of each of the foregoing, together with the Affiliates of such Permitted
Holders.

               "Permitted Liens" means the Liens permitted by Section 6.8(a).

               "Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.

               "Pledge Agreement" means the Pledge Agreement dated as of May 19,
2003, between the Parent and the Bank, substantially in the form of Exhibit B
hereto, as such Pledge Agreement may be amended, supplemented or modified from
time to time.

               "Prime Rate" means the rate of interest publicly announced from
time to time by the Bank as its prime rate. It is a rate set by the Bank based
upon various factors including the Bank's costs and desired return, general
economic conditions, and other factors, and is used as a reference point for
pricing some loans. However, the Bank may price loans at, above, or below such
announced rate. Any changes in the Prime Rate shall take effect on the day
specified in the public announcement of such change.

               "Principal Sum" has the meaning given that term in the Note.

               "Revolving Commitment" has the meaning set forth in Section
2.1(a).

               "Revolving Credit Period" means the period from and including the
Effective Date to but excluding the later of (i) the Date of Maturity, or (ii)
the date to which the Revolving Credit Period has been extended pursuant to
Section 2.3.

               "Revolving Loans" has the meaning set forth in Section 2.1(a).

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               "Security Agreement" means that certain Security Agreement dated
as of May 19, 2003, between the Borrowers and the Bank, substantially in the
form of Exhibit C hereto, as such Agreement may be amended, supplemented or
modified from time to time.

               "Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by a Borrower.

               "Tax" means any fee (including license, filing and registration
fee), tax (including any income, gross receipts, franchise, sales, use or real,
personal, tangible or intangible property tax), interest equalization or stamp
tax, assessment, levy, impost, duty, charge or withholding of any kind or nature
whatsoever, imposed or assessed by any governmental body, agency or official,
together with any penalty, fine or interest thereon.

               "Variance" means a rate per annum which is to be determined with
reference to the Total Funded Debt Ratio at the time of determination pursuant
to Section 2.5.

               "Wholly-Owned Consolidated Subsidiary" means any Consolidated
Subsidiary all of the shares of capital stock or other ownership interests of
which (except directors' qualifying shares) are at the time directly or
indirectly owned by a Borrower.

               Section 1.2.   Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with GAAP as in effect from time to time, applied on a basis
consistent (except for changes concurred in by the Borrower's independent public
accountants) with the most recent audited consolidated financial statements of
the Borrowers and their Consolidated Subsidiaries delivered to the Bank.

                                   ARTICLE II
                                   THE CREDIT

               Section 2.1.   Commitment to Make Loans.

               (a)   Revolving Commitment. The Bank agrees, on the terms and
conditions set forth in this Agreement, to make loans ("Revolving Loans") to the
Borrowers from time to time during the Revolving Credit Period in an aggregate
principal amount not to exceed, at any one time outstanding, the lesser of the
Principal Sum and the Borrowing Base (such amount, as it may be reduced from
time to time pursuant to Section 2.6, being herein referred to as the "Revolving
Commitment"). Any borrowing under this subparagraph (a) shall be in a principal
amount of at least $100,000.00 (except that any such borrowing may be in the
amount of the unused Revolving Commitment). Subject to the foregoing, the
Borrowers may borrow under this subparagraph (a), prepay and reborrow, without
premium or penalty.

               (b)   Letter of Credit Feature. As a feature of the Revolving
Commitment, the Bank agrees, on the terms and conditions set forth in this
Agreement and in the applicable Applications, to make loans to the Borrowers by
issuing Letters of Credit for the account of the applicable Borrower ("Letter of
Credit Loans"). Each Letter of Credit shall be issued for a term not to exceed
one (1) year,

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although any Letter of Credit may be automatically renewed in accordance with
the terms and conditions of said Letter of Credit and the related Application.
Any letter of credit issued by the Bank for the account of any of the Borrowers
that is outstanding on the Effective Date (each, an "Existing Letter of Credit")
shall be deemed to be a Letter of Credit issued hereunder, and the related
extension of credit to the Borrowers shall be a "Letter of Credit Loan". A
Letter of Credit may be denominated only in U.S. Dollars. Each draft paid by the
Bank under a Letter of Credit shall, if such amount is available under the
Revolving Commitment, be deemed a Revolving Loan under the Revolving Commitment
and shall accrue interest at the rate then applicable under the Note. Subject to
the foregoing, the Borrowers may borrow under this subparagraph (b), prepay and
reborrow, without premium or penalty. To the extent the terms of this Agreement
or any other Loan Document and the terms of any Application are inconsistent,
the terms of this Agreement or such other Loan Document (other than the
Application), as applicable, shall govern.

               (c)   At no time shall the aggregate of (i) the undrawn amount of
all outstanding Letters of Credit, plus (ii) all amounts paid by the Bank in
connection with drawings under Letters of Credit for which the Bank has not been
reimbursed (including by any Revolving Loan hereunder), plus (without
duplication) (iii) the outstanding balance of Revolving Loans, exceed the
Revolving Commitment.

               Section 2.2.   Method of Borrowing. All borrowings hereunder may
be obtained by any Borrower, on behalf of itself and all other Borrowers. A
Borrower shall give the Bank notice not later than 11:00 a.m. (Eastern Time) on
the date of each proposed Revolving Loan, and five (5) Business Days prior to
the date of each proposed Letter of Credit Loan, specifying the date on which it
proposes to borrow (which shall be a Business Day), and the amount and type of
the Loan to be borrowed. In addition, additional notice may be required as set
forth in Section 2.5(b)(v). Not later than 2:00 p.m. (Eastern Time) on the date
so specified, the Bank shall (unless it determines that any applicable condition
specified in this Agreement, including without limitation, the notice
requirements set forth in Section 2.5(b)(v), has not been satisfied) make the
amount of the requested Loan available (in Federal or other funds immediately
available in McLean, Virginia, in the case of a Revolving Loan) to the Borrowers
in an account for the Borrowers maintained with the Bank at the Bank's address
specified in Section 9.1, or as otherwise directed by the Borrowers in writing.

               Section 2.3.   Extension of Revolving Credit Period. The
Revolving Credit Period may be extended for one (1) year on the Date of
Maturity, provided (i) the Bank has received a written request therefor by the
Parent not later than 20 Business Days prior to the date on which the Revolving
Credit Period would otherwise terminate and (ii) the Bank has responded
favorably in writing to said request prior to the Date of Maturity. The failure
of the Bank to respond as aforesaid, for any reason, shall be deemed to be a
refusal of said request. The ability of the Bank not to extend the Revolving
Credit Period shall be unconditional and within its sole discretion,
notwithstanding that no Event of Default exists under this Agreement or the Note
and regardless of the adequacy of the Collateral or the Borrowers' performance
of their obligations hereunder and thereunder.

               Section 2.4.   Note; Applications.

               (a)   The Revolving Loans shall be evidenced by, and repayable
with interest in accordance with, a single note substantially in the form of
Exhibit D hereto and appropriately completed (as the same may be renewed,
extended, modified, increased, supplemented and replaced, the "Note").

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               (b)   Each Letter of Credit Loan shall be evidenced by its
related Application.

               (c)   The Bank shall record, and prior to any transfer of the
Note shall endorse on a schedule forming a part thereof appropriate notations to
evidence, the date and amount of each Revolving Loan, and the date and amount of
each payment of principal made by the Borrower with respect thereto; provided,
however, that any failure of the Bank to make such a notation or any error
therein shall not in any manner affect the obligation of the Borrowers to repay
the Loans in accordance with the terms of the Note or the related Application,
as applicable. The Borrowers hereby irrevocably authorize the Bank so to endorse
the Note and to attach to and make part of the Note a continuation of any such
schedule as and when required.

               Section 2.5.   Interest Rate; Fees.

               (a)   Each Revolving Loan shall bear interest until maturity
(whether by acceleration, declaration, extension or otherwise) at either the
Base Rate or the Eurodollar Rate, as selected and specified by the Borrower(s)
in the notice furnished to the Bank in accordance with the provisions of
Sections 2.2 and 2.5(b)(v), or as otherwise determined in accordance with the
provisions of this Section 2.5, and as may be adjusted from time to time in
accordance with the provisions of subsection (b)(vii) of this Section 2.5.

               (b)   Selection of Interest Rates.

                     (i)    The Borrowers may select the initial Applicable
Interest Rate or Applicable Interest Rates to be charged on the Revolving Loans.

                     (ii)   From time to time after the Effective Date as
provided in this Section, by a proper and timely notice furnished to the Bank in
accordance with the provisions of Section 2.5(b)(v), the Borrowers may select an
initial Applicable Interest Rate or Applicable Interest Rates for any Revolving
Loans or may change the Applicable Interest Rate for any existing Revolving Loan
to any other Applicable Interest Rate.

                     (iii)  The Borrowers' selection of an Applicable Interest
Rate, the Borrowers' election to change an Applicable Interest Rate to another
Applicable Interest Rate, and any other adjustments in an interest rate are
subject to the following limitations:

                            (A)   no change from the Eurodollar Rate to the Base
         Rate shall become effective on a day other than a Business Day, and no
         change from the Base Rate to the Eurodollar Rate shall become effective
         on a day other than a day which is a London Banking Day;

                            (B)   any Applicable Interest Rate change for any
         Revolving Loan to be effective on a date on which any principal payment
         on account of such Revolving Loan is scheduled to be paid, shall be
         made only after such payment shall have been made; and

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                            (C)   as of the effective date of such selection or
         election, there shall not exist an Event of Default.

                     (iv)   If a request for an advance under the Revolving
Commitment is not accompanied by an Interest Rate Selection Notice (defined
below) or does not otherwise include a selection of an Applicable Interest Rate,
or if, after having made a selection of an Applicable Interest Rate, the
Borrowers fail or are not otherwise entitled under the provisions of this
Agreement to continue such Applicable Interest Rate, the Borrowers shall be
deemed to have selected the Base Rate for such advance as the Applicable
Interest Rate until such time as the Borrowers have selected a different
Applicable Interest Rate in accordance with, and subject to, the provisions of
this Section.

                     (v)    The Bank will not be obligated to make Revolving
Loans, or to change the Applicable Interest Rate on Revolving Loans to another
Applicable Interest Rate, unless the Bank shall have received an irrevocable
written or telephonic notice (an "Interest Rate Selection Notice") from the
Borrowers specifying the following information:

                            (A)   the amount to be borrowed or the amount to
         which a requested change of the Applicable Interest Rate shall apply;

                            (B)   a selection of the Base Rate or the Eurodollar
         Rate (provided that if no such election is made, it shall be deemed to
         be the Base Rate); and

                            (C)   the requested date on which the action for
         which the Interest Rate Selection Notice is made is to be effective.

                     (vi)   Any telephonic notice must be confirmed in writing
within three (3) Business Days. Each Interest Rate Selection Notice must be
received by the Bank not later than 11:00 a.m. (Eastern Time) on the Business
Day of any requested borrowing or change in Applicable Interest Rate in the case
of a selection of the Base Rate and not later than 11:00 a.m. (Eastern Time) on
the third Business Day before the effective date of any requested borrowing or
change in the Applicable Interest Rate in the case of a selection of the
Eurodollar Rate.

                     (vii)  In the event that (A) the Bank shall have determined
that, by reason of circumstances affecting the London interbank eurodollar
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate with respect to a Revolving Loan that the Borrowers have
requested to be made as or to be changed into a Eurodollar Loan or (B) the Bank
shall determine that the Eurodollar Rate with respect to a Revolving Loan the
Borrowers have requested to be made as or to be changed into a Eurodollar Loan
does not adequately and fairly reflect the cost to the Bank of funding or
changing the Applicable Interest Rate of such Loan, the Bank shall give
telephonic or written notice of such determination to the Borrowers at least one
(1) day prior to the proposed date for funding or changing such Revolving Loan,
specifying the reason for such determination in such notice. If such notice is
given, the applicable request for a Eurodollar Loan shall be made as or changed
into a Base Rate Loan. Until such notice has been withdrawn by the Bank, the
Borrowers will not request that any Revolving Loan be made as or changed into a
Eurodollar Loan.

               (c)   Eurodollar Loans.

                     (i)    The interest rate Variance shall be established
quarterly based on the Total Funded Debt Ratio as of the date that is one day
after delivery of the financial statements required

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by Section 6.1(i) or (ii), with the Variance in effect on the Effective Date
(based upon the Borrower's financial statements as of December 31, 2002) equal
to 2.75% per annum. The Variance shall be based on the Total Funded Debt Ratio,
as follows:

               If the Total Funded Debt Ratio         ... then the Variance is:
               in effect is ...

               *   2.00:1                                         3.00%
               *** 2.00:1 but * 1.50:1                            2.75%
               *** 1.50:1                                         2.50%

*   More than
*** Less than or equal to

                     (ii)   Notwithstanding the foregoing, if the Borrower fails
to deliver financial statements to the Bank in accordance with Sections 6.1(i)
or (ii), as applicable, within one (1) day after the date said financial
statements are due, the Variance on the Note shall be changed, without notice,
to 3.00%, and shall remain 3.00% until the Bank receives said financial
statements.

               (d)   Upon the maturity of the Note (whether scheduled, by
acceleration, or otherwise), the principal amount outstanding under the Note
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the sum of 4.0% plus the otherwise applicable interest rate.

               (e)   Fees.

                     (i)    During the Revolving Credit Period, the Borrowers
shall pay to the Bank a commitment fee at the rate per annum set forth below on
an amount equal to the Revolving Commitment less the sum of (A) the undrawn
amount of all outstanding Letters of Credit, plus (B) all amounts paid by the
Bank in connection with drawings under Letters of Credit for which the Bank has
not been reimbursed, plus (without duplication) (C) the outstanding balance of
Revolving Loans. Such commitment fee shall accrue from and including the
Effective Date to but excluding the last day of the Revolving Credit Period and
shall be payable quarterly on the payment dates set forth in the Note. The
amount of said fee shall be based on the Total Funded Debt Ratio on the date
that is one day after delivery of the financial statements required by Section
6.1(i) or (ii), as follows (provided that the commitment fee in effect on the
Effective Date (based on the Borrower's financial statements as of December 31,
2002) is equal to 0.25% per annum):

              If the Total Funded Debt Ratio             ... then the commitment
              in effect is ...                           fee is:

              *   2.00:1                                           0.375%
              *** 2.00:1                                            0.25%

*   More than
*** Less than or equal to

Notwithstanding the foregoing, if the Borrower fails to deliver financial
statements to the Bank in accordance with Sections 6.1(i) or (ii), as
applicable, within one (1) day after the date said financial statements are due,
the commitment fee shall be changed, without notice, to .375%, and shall remain
..375% until the Bank receives said financial statements.

                     (ii)   During the Revolving Credit Period, the Borrowers
shall pay to the Bank a letter of credit fee on each Letter of Credit issued and
outstanding, in the amount of 2.00% per annum of the undrawn amount of said
Letter of Credit, which fee shall be payable, in advance, upon the issuance

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of said Letter of Credit and, so long as said Letter of Credit remains
outstanding, on each anniversary of the issuance of said Letter of Credit.
Notwithstanding anything to the contrary herein, no such fees will be payable
with respect to any Existing Letter of Credit, until the renewal date thereof.

                     (iii)   On the Effective Date, the Borrowers shall pay to
the Bank a loan fee of $25,000.00.

               Section 2.6.  Optional Termination or Reduction of the Revolving
Commitment. The Borrowers may, upon at least three (3) Business Days' notice to
the Bank, either (i) terminate the unused portion of the Revolving Commitment at
any time, or (ii) reduce from time to time by an aggregate amount of $100,000.00
or any larger multiple of $100,000.00, the unused portion of the Revolving
Commitment. If the Revolving Commitment is terminated in its entirety, any
accrued commitment fee shall be payable on the effective date of such
termination. If the Revolving Commitment is terminated in its entirety, no
Letters of Credit are outstanding, and all other amounts due and owing hereunder
or under the Note have been paid in full, then this Agreement and the other Loan
Documents shall terminate. Any reduction or termination hereof or hereunder
shall be without premium or penalty.

               Section 2.7.  Borrowing Base Certificates.

               (a)   The Borrowing Base shall be established by a certificate
("Borrowing Base Certificate") prepared by the Borrowers and substantially in
the form attached hereto as Exhibit F. Presentation of a Borrowing Base
Certificate shall constitute the Borrowers' representation to the Bank that, as
of the date thereof, the Eligible Accounts included in the Borrowing Base
Certificate qualify as such in accordance with the terms of this Agreement, and
that all other information contained therein is accurate and complete.

               (b)   A Borrowing Base Certificate dated as of the last Business
Day of each calendar quarter (the "Certificate Date") shall be presented by the
Borrowers to the Bank on or before the last day of the month next following the
Certificate Date, or if such day is not a Business Day, the next following
Business Day (the "Delivery Date"). The Borrowing Base as evidenced by a
Borrowing Base Certificate shall be effective from and including the date the
Bank receives it on or before the Delivery Date, until the Bank receives the
next Borrowing Base Certificate on or before the next following Delivery Date.

                                   ARTICLE III
                               CONDITIONS TO LOANS

               The obligation of the Bank to make each Loan is subject to the
satisfaction of the following conditions:

               Section 3.1.  All Loans. In the case of each Loan:

                     (i)     receipt by the Bank of notice of borrowing as
         required by Section 2.2 and, if applicable, Section 2.5(b)(v);

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                     (ii)   the fact that no Default has occurred and is
         continuing or would result from such Loan;

                     (iii)  the fact that the representations and warranties of
         the Borrowers contained in this Agreement shall be true on and as of
         the date of such Loan; and

                     (iv)   the fact that such Loan will be secured by the
         Collateral Documents.

Each borrowing hereunder shall be deemed to be a representation and warranty by
the Borrowers on the date thereof that the facts hereinabove set forth in
clauses (ii), (iii) and (iv) of this Section are true as of such date.

               Section 3.2. First Loan.  In the case of the first Loan:

                     (i)    receipt by the Bank of a duly executed Note, dated
         on or before the date of such Loan, complying with the provisions of
         Section 2.4;

                     (ii)   all legal matters incident to this Agreement, the
         Note and the Collateral Documents and the transactions contemplated
         hereby and thereby shall be reasonably satisfactory to Troutman Sanders
         LLP, counsel for the Bank;

                     (iii)  receipt by the Bank of (A) a copy of each Borrower's
         certificate of incorporation, as amended, certified by the appropriate
         office of the state of its incorporation; (B) a certificate of such
         office, dated as of a recent date, as to the good standing and charter
         documents of said Borrower on file; and (C) a certificate of the
         Secretary or an Assistant Secretary of said Borrower dated the date of
         such Loan and certifying (1) that the certificate of incorporation of
         said Borrower has not been amended since the date of the last amendment
         thereto indicated on the certificate furnished pursuant to clause (B)
         above, (2) as to the absence of dissolution or liquidation proceedings
         by or against said Borrower, (3) that attached thereto is a true and
         complete copy of the by-laws of said Borrower as in effect on the date
         of such certification, (4) that attached thereto is a true, correct and
         complete copy of resolutions adopted by the board of directors of said
         Borrower authorizing the execution, delivery and performance of this
         Agreement, the Note and the Collateral Documents to which said Borrower
         is a party and that said resolutions have not been amended and are in
         full force and effect on the date of such certificate and (5) as to the
         incumbency and specimen signatures of each officer of said Borrower
         executing this Agreement, the Note and any other Collateral Documents
         to which it is a party, or any other document delivered in connection
         herewith or therewith;

                     (iv)   receipt by the Bank of executed copies of the
         Collateral Documents granting to the Bank a first Lien in all the
         Collateral described therein, subject to Permitted Liens;

                                      -11-

<PAGE>

                     (v)     receipt by the Bank of certificates representing
         the shares of stock pledged under the Pledge Agreement, duly indorsed
         in blank or accompanied by stock powers duly executed in blank;

                     (vi)    receipt by the Bank of an opinion of Hale and Dorr,
         LLP, counsel for the Borrowers, substantially in the form of Exhibit E
         hereto and covering such additional matters relating to the
         transactions contemplated hereby as the Bank may reasonably request;

                     (vii)   on or prior to the date of such Loan, each document
         (including, without limitation, each Uniform Commercial Code financing
         statement, but excluding filings with the U.S. Patent and Trademark
         Office or the Register of Copyrights) required by law or reasonably
         requested by the Bank to be filed, registered or recorded with a
         governmental authority in order to create in favor of the Bank a
         perfected first priority security interest in the Collateral shall have
         been properly filed, registered or recorded in each jurisdiction in
         which the filing, registration or recordation thereof is so required or
         requested, and the Bank shall have received an acknowledgment copy, or
         other evidence satisfactory to it, of each such filing, registration or
         recordation;

                     (viii)  receipt by the Bank of certified copies of Requests
         for Information or Copies (Form UCC-11), or equivalent reports, listing
         the financing statements referred to in clause (vii) above and all
         other effective financing statements that name each Borrower (under its
         present names and any previous names) as debtors or sellers and that
         are filed in the jurisdictions referred to in clause (vii) above,
         together with copies of such other financing statements (none of which
         shall cover the Collateral, except as otherwise disclosed in writing
         to, and accepted by, the Bank, and Permitted Liens);

                     (ix)    receipt by the Bank of evidence of the insurance
         required by the Collateral Documents;

                     (x)     receipt by the Bank of a certificate signed by the
         chief financial officer, treasurer, or president of each Borrower, to
         the effect set forth in clauses (ii) and (iii) of Section 3.1; and

                     (xi)    receipt by the Bank of all documents it may
         reasonably request relating to the existence of each Borrower and its
         corporate authority to execute, deliver and perform this Agreement, the
         Note and the Collateral Documents and the validity of this Agreement,
         the Note and the Collateral Documents and any other matters relevant
         hereto or thereto, all in form and substance satisfactory to the Bank.

               Section 3.3.  Letter of Credit Loans. In the case of each Letter
of Credit Loan, except any Existing Letter of Credit (and in addition to the
requirements of Sections 3.1 and 3.2):

                                      -12-

<PAGE>

                     (i)     receipt by the Bank of a duly executed Application,
         together with all agreements and documents required to be delivered to
         the Bank as set forth therein; and

                     (ii)    payment of the letter of credit fee set forth in
         Section 2.5(e)(ii).

All documents and opinions referred to in this Article shall be in form and
substance reasonably satisfactory to the Bank and its counsel.

                                   ARTICLE IV
                         REPRESENTATIONS AND WARRANTIES

               Each Borrower represents and warrants that:

               Section 4.1.  Corporate Existence and Power. Said Borrower is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted. Said Borrower and each of its Domestic
Subsidiaries is duly qualified as a foreign corporation, licensed and in good
standing in each jurisdiction where qualification or licensing is required by
the nature of its business or the character and location of its property,
business or customers and in which the failure to so qualify or be licensed, as
the case may be, in the aggregate, could reasonably be expected to have a
material adverse effect on the business, financial position, results of
operations, properties or prospects of said Borrower and its Consolidated
Subsidiaries, considered as a whole.

               Section 4.2.  Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by said Borrower of this
Agreement, the Note, the Applications, and the Collateral Documents to which it
is a party, (Y) are within its corporate power, have been duly authorized by all
necessary corporate action, require no action by or in respect of, or filing
(not including the filing of UCC financing statements or filings with the United
States Patent and Trademark Office or the Register of Copyrights) with, any
governmental body, agency or official and (Z) do not contravene, or constitute
(with or without the giving of notice or lapse of time or both) a default under,
any provision of applicable law or of the articles of incorporation or by-laws
of said Borrower or of any agreement, judgment, injunction, order, decree or
other instrument binding upon or affecting said Borrower, in the case of each of
the foregoing under clause (Z) above, such as would reasonably be expected to
have a material adverse effect on such Borrower and its Consolidated
Subsidiaries, taken as a whole, or result in the creation or imposition of any
Lien (other than the Lien of the Collateral Documents) on any material portion
of its assets.

               Section 4.3.  Binding Effect. This Agreement constitutes a valid
and binding agreement of said Borrower and the Note and each Application, when
executed and delivered in accordance with this Agreement, will constitute valid
and binding obligations of said Borrower, in each case enforceable against said
Borrower in accordance with its terms, except as (i) the enforceability hereof
and thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) rights of acceleration and the availability
of equitable remedies may be limited by equitable principles of general
applicability.

                                      -13-

<PAGE>

               Section 4.4.  Financial Information.

               (a)   The most recent annual consolidated balance sheet, and the
related consolidated financial statements, of the Parent and its Consolidated
Subsidiaries, reported on by PricewaterhouseCoopers LLP, copies of which have
been delivered to the Bank, fairly present, in conformity with GAAP, the
consolidated financial position of the Parent and its Consolidated Subsidiaries
as of such date and their results of operations and changes in financial
position for the fiscal year so reported. As of the date of such financial
statements, the Parent and its Consolidated Subsidiaries did not have any
material contingent obligation, contingent liability or liability for Taxes,
long-term lease or unusual forward or long-term commitment, which is not
reflected in any of such financial statements or notes thereto.

               (b)   Except for any quarter covered by the financial statements
provided under Section 4.4(a), above, the most recent unaudited quarterly
consolidated balance sheet, and the related consolidated financial statements,
of the Parent and its Consolidated Subsidiaries, for the three months then
ended, a copy of which has been delivered to the Bank, fairly present, in
conformity with GAAP applied on a basis consistent with the financial statements
referred to in clause (a) of this Section, the consolidated financial position
of the Parent and its Consolidated Subsidiaries as of such date and their
results of operations and changes in financial position for such three-month
period (subject to normal year-end adjustments).

               (c)   Since the date of the latest balance sheet described above,
there has been no material adverse change in the business, financial position,
results of operations or prospects of the Parent and its Consolidated
Subsidiaries, considered as a whole.

               Section 4.5.  Litigation. Except as set forth in Schedule 4.5
hereto, there is no action, suit or proceeding pending against, or to the
knowledge of said Borrower threatened against or affecting, said Borrower or any
of its Consolidated Subsidiaries before any court, governmental body, agency or
official in which there is a reasonable possibility of an adverse decision which
could reasonably be expected to materially adversely affect the business,
financial position or results of operations of said Borrower and its
Subsidiaries, taken as a whole, or which in any manner draws into question the
validity of this Agreement, the Note, any Application, or any Collateral
Document.

               Section 4.6.  Marketable Title. Said Borrower has good and
marketable title to all its properties and assets subject to no Lien, except
Permitted Liens.

               Section 4.7.  Filings. All actions by or in respect of, and all
filings (but not including the filing of UCC financing statements or filings
with the United States Patent and Trademark Office or the Register of
Copyrights) with, any governmental body, agency or official required in
connection with the execution, delivery and performance of this Agreement, the
Note, the Applications and the Collateral Documents, or necessary for the
validity or enforceability thereof or for the protection or perfection of the
rights and interests of the Bank thereunder, will, prior to the date of delivery
thereof, have been duly taken or made, as the case may be, and will at all times
thereafter remain in full force and effect.

               Section 4.8.  Regulation U. The proceeds of the Loans will be
used by said Borrower only for the purposes set forth in Section 6.14 hereof.
None of the Loan proceeds will be used, directly or indirectly, for the purpose
of purchasing or carrying any margin stock or for the purpose of reducing or

                                      -14-

<PAGE>

retiring any indebtedness which was originally incurred to purchase or carry
margin stock or for any other purchase which might constitute the Loans a
"purpose credit" within the meaning of Regulation U or Regulation X of the Board
of Governors of the Federal Reserve System.

               Section 4.9.   Taxes. Said Borrower and its Domestic Subsidiaries
have filed all United States Federal income tax returns and all other domestic
or foreign tax returns which are required to be filed by them and have paid all
Taxes due pursuant to such returns or pursuant to any assessment received by
said Borrower or any such Domestic Subsidiary, other than those which are being
contested in good faith and by appropriate proceedings and for which adequate
reserves have been made on the books of said Borrower or Subsidiary, or those
with respect to which such failure to file or failure to pay would not result in
a material adverse effect on the business, financial position or results of
operation of the Borrowers and their Subsidiaries, taken as a whole. The
charges, accruals and reserves on the books of said Borrower and its Domestic
Subsidiaries in respect of Taxes are, in the opinion of said Borrower, adequate.

               Section 4.10.  Subsidiaries. Each of said Borrower's corporate
Foreign Subsidiaries is duly organized under the laws of its country of
organization, and has all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted,
except where the failure to be so organized, or have such licenses,
authorizations, consents or approvals could not reasonably be expected to have a
material adverse effect on the business, financial position, results of
operations, properties or prospects of said Borrower and its Consolidated
Subsidiaries, considered as a whole.

               Section 4.11.  Environmental Compliance.

               (a)   Said Borrower (including for purposes of this Section 4.11,
any former or current Affiliate or Subsidiary of said Borrower) is in compliance
with all applicable laws, rules, regulations and orders of all governmental
bodies, agencies and officials relating to environmental matters and the
release, handling and disposal of hazardous, toxic and polluting substances,
except where such non-compliance could not reasonably be expected to materially
adversely affect the business, financial position or results of operations of
said Borrower and its Subsidiaries, taken as a whole.

               (b)   Said Borrower has obtained and is in compliance with all
required governmental permits, certificates, licenses, approvals and other
authorizations relating to environmental compliance, except where such failure
to obtain or such non-compliance could not reasonably be expected to materially
adversely affect the business, financial position or results of operations of
said Borrower and its Subsidiaries, taken as a whole, and has filed all material
notifications relating to air emissions, effluent discharges and solid and
hazardous waste storage, treatment and disposal required by applicable law in
connection with its ownership or use of real estate or the operation of its
business.

               (c)   There are no outstanding notices of violation, orders,
claims, citations, complaints, penalty assessments, suits or other proceedings,
administrative, criminal or civil, at law or in equity relating to environmental
compliance, pending against said Borrower or its properties that would have a
material adverse effect on the business, financial position or results of
operations of said Borrower and its Subsidiaries, taken as a whole, and to
Borrower's knowledge, no investigation or review is pending or threatened
against said Borrower by any governmental body, agency or official with respect
to any alleged violation of any governmental environmental law, regulation,
ordinance, standard, permit or order in connection with its ownership or use of
any real estate or the conduct of its business which

                                      -15-

<PAGE>

could reasonably be expected to have a material adverse effect on said Borrower
and its Subsidiaries, taken as a whole.

               (d)   All toxic or hazardous substances generated by said
Borrower have been transported in compliance with applicable law to storage,
treatment and disposal facilities permitted or authorized to handle such
substances by the governmental agency with jurisdiction thereof, in each case
such that no material adverse effect on the business, financial position or
results of operations of said Borrower and its Subsidiaries, taken as a whole,
would occur. No notification of release of a hazardous substance pursuant to the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended by the Superfund Amendment and to Reauthorization Act of 1986
("CERCLA"), the Federal Clean Water Act or the Clean Air Act of any other
applicable environmental law, regulation or ordinance has been filed as to any
property now or formerly occupied or owned by said Borrower.

               (e)   No hazardous, toxic or polluting substances have been
released, discharged or disposed of, in violation of any applicable law, on
property now or formerly owned or occupied by said Borrower that would have a
material adverse effect on said Borrower's business, financial position or
results of operations of said Borrower and its Subsidiaries, taken as a whole.

               (f)   Said Borrower has not received from any environmental
regulatory entity and any requests for information, notices of claim, demand
letters or other notification that in connection with the ownership or use of
any real estate or the conduct of said Borrower's business it is or may be
potentially responsible to respect to any investigation or clean-up hazardous
substances or toxic waste or pollutants at any sites, in each case such that no
material adverse effect on the business, financial position or results of
operations of said Borrower and its Subsidiaries, taken as a whole, would occur.

               (g)   To the best knowledge of said Borrower, no waste generated
by said Borrower has ever been sent, nor is waste generated by said Borrower
being sent, directly or indirectly, to any site listed or formerly proposed for
listing on the National Priority List promulgated pursuant to CERCLA or to any
site listed on any state list of hazardous substances sites requiring
investigation or clean up.

               Section 4.12.  Disclosure. None of this Agreement, any Collateral
Document, any schedule or exhibit thereto or document, certificate, report,
statement or other information furnished to the Bank in connection herewith or
therewith or with the consummation of the transactions contemplated hereby or
thereby contains any material misstatement of fact or omits to state a material
fact necessary to make the statements contained herein or therein not
misleading. There is no fact materially adversely affecting the assets,
business, financial position, results of operations or prospects of said
Borrower which has not been set forth in a footnote included in the financial
statements referred to in Section 4.4(a) or in exhibit or schedule thereto,
which fact existed as of the date of such financial statement.

                                    ARTICLE V
                               FINANCIAL COVENANTS

               The Borrowers agree that so long as the Bank is committed to make
Loans hereunder or any amount payable hereunder or under the Note, any
Application, or any Collateral Document remains unpaid:

                                      -16-

<PAGE>

               Section 5.1.   Certain Definitions. As used in this Article V and
hereafter in this Agreement, the following terms have the following meanings:

               "Capital Expenditures" means for any period the gross amount paid
by the Parent and its Consolidated Subsidiaries during such period, in
connection with the purchase by the Parent or its Consolidated Subsidiaries of
fixed assets that would be required to be capitalized and shown on the balance
sheet of such Person in accordance with GAAP.

               "Capital Leases" means all leases that should be capitalized on
the balance sheet of the lessee prepared in accordance with GAAP.

               "Consolidated Cash Interest Expense" means, for any period, total
interest expense of the Parent and its Consolidated Subsidiaries for such period
including, without limitation, the portion of any obligation under Capital
Leases allocable to interest expense in accordance with GAAP, which are paid in
such period (rather than merely accrued or deferred).

               "Consolidated Cash Taxes" means, for any period, taxes of the
Parent and its Consolidated Subsidiaries which are paid in cash, but only to the
extent such taxes are based solely on income of the Parent and its Consolidated
Subsidiaries in such period (rather than merely accrued or deferred).

               "Consolidated Funded Debt" means at any date, all Debt of the
Parent and its Consolidated Subsidiaries, including letter of credit
obligations, obligations under Capital Leases, the sum of the book value of the
Class Action Notes outstanding, and, without duplication, all obligations
Guaranteed by any such Person.

               "Consolidated Interest Expense" means, for any period, total
interest expense of the Parent and its Consolidated Subsidiaries for such period
including, without limitation, the portion of any obligation under Capital
Leases allocable to interest expense in accordance with GAAP.

               "Consolidated Net Income" means, for any period, the consolidated
net income (or deficit) of the Parent and its Consolidated Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP; provided that
there shall be excluded from the calculation thereof any extraordinary, unusual
or non-recurring gains or losses during such period in accordance with GAAP.

               "Current Maturities of Consolidated Funded Debt" means at any
date the aggregate amount of principal payments (including, without limitation,
the portion of any obligation under Capital Leases allocable to amortization in
accordance with GAAP) in respect of the Consolidated Funded Debt which are
current liabilities as of such date.

               "Debt" of any Person means at any date, without duplication, (i)
all obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services (other than trade account payables incurred in the ordinary course of
business and intercompany transfers occurring in the ordinary course of business
which would not be characterized as "debt" under GAAP on a consolidated basis),
(iv) all obligations of such Person as lessee under Capital Leases, (v) all
obligations of such Person to purchase securities or other property which arise
out of or in connection with the sale of the same or substantially similar
securities or property (other than in

                                      -17-

<PAGE>

connection with the bona fide repurchase of stock, options or warrants from
employees or directors), (vi) all obligations, contingent or otherwise, of such
Person to reimburse any bank or other person in respect of amounts paid under a
letter of credit or similar instrument, (vii) all obligations of others secured
by a Lien on any asset of such Person, whether or not such obligation is assumed
by such Person, (viii) all obligations of such Person to repurchase any tangible
or intangible property sold pursuant to any sales agreement (other than in
connection with the bona fide repurchase of stock, options or warrants from
employees or directors), and (ix) all obligations of others Guaranteed by such
Person. Notwithstanding the foregoing, neither the Comfort Letters nor that
certain Microsoft Enterprise Select Agreement, executed as of May 25, 2000, as
amended, nor the obligations thereunder, shall be deemed to be "Debt" hereunder.

               "EBITDA" shall mean, for any 12-month period, the sum (determined
without duplication in accordance with GAAP) of net income (or loss)
attributable to common stockholders; minus interest income; plus Consolidated
Interest Expense, provision for income taxes, depreciation and amortization,
restructuring and impairment charges taken in fiscal year 2002 (up to $4,200,000
in the aggregate, including up to $1,400,000 for non-cash write-downs taken in
the fourth quarter of fiscal year 2002), non-cash dividends, accretion, and
beneficial conversion features on convertible preferred stock; plus loss (or
minus income) from discounted operations (non-cash); plus loss (or minus gain)
on investments; plus provision for reduction (or minus provision for increase)
in estimated non-cash cost of litigation settlement; plus loss (or minus gain)
on early extinguishment of notes payable; plus other expense (or minus other
income), net; plus extraordinary income (or minus loss); minus gain on Exchange
Application contract termination and net gain on refinancing of Series B, C and
D convertible preferred stock; of the Parent and its Consolidated Subsidiaries,
for such period.

               "Fixed Charge Coverage Ratio" means, at any time, the ratio of
(a) EBITDA of the Parent and its Consolidated Subsidiaries minus Capital
Expenditures and Consolidated Cash Taxes, to (b) prior year scheduled Current
Maturities of Consolidated Funded Debt plus Consolidated Cash Interest Expense,
plus cash portion of redemptions of Class Action Notes, minus the Senior Note
Payments.

               "Guaranty" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guarantying any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part); provided that the term Guaranty shall not include indorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.

               "Senior Funded Debt" has the meaning given that term under GAAP.
Senior Funded Debt shall exclude Debt subordinate in right of payment to any
Debt to the Bank.

               "Senior Funded Debt Ratio" means, at any time, the ratio of (a)
Senior Funded Debt of the Parent and its Consolidated Subsidiaries, to (b)
EBITDA of the Parent and its Consolidated Subsidiaries.

                                      -18-

<PAGE>

               "Senior Note Payments" means the payments under (i) that certain
Senior Promissory Note Due July 31, 2003 (No. 4) dated August 6, 2002, made by
the Parent payable to HFTP Investment, L.L.C., in the amount of $434,782.61,
(ii) that certain Senior Promissory Note Due July 31, 2003 (No. 3) dated August
6, 2002, made by the Parent payable to Leonardo, L.P., in the amount of
$1,956,521.74, (iii) that certain Senior Promissory Note Due July 31, 2003 (No.
2) dated August 6, 2002, made by the Parent payable to Wingate Capital, Ltd., in
the amount of $834,782.61, and (iv) that certain Senior Promissory Note Due July
31, 2003 (No. 1) dated August 6, 2002, made by the Parent payable to Fisher
Capital, Ltd., in the amount of $1,773,913.04.

               "Total Funded Debt Ratio" means, at any time, the ratio of (a)
Consolidated Funded Debt, to (b) EBITDA, of the Parent and its Consolidated
Subsidiaries.

               Section 5.2.   Fixed Charge Coverage Ratio. A Fixed Charge
Coverage Ratio of not less than 1.25 to 1 for each 12-month period ending on
each of March 31, 2003, June 30, 2003, and September 30, 2003, and 1.75 to 1 for
each 12-month period ending on the end of each fiscal quarter thereafter.

               Section 5.3.   Total Funded Debt Ratio. A Total Funded Debt Ratio
of not more than 2.75 to 1 for each 12-month period ending on the end of each
fiscal quarter of the Parent.

               Section 5.4.   Senior Funded Debt Ratio. As of the end of each
12-month period ending on the end of each fiscal quarter of the Parent, a Senior
Funded Debt Ratio of not greater than 1.50 to 1.

               Section 5.5.   Minimum EBITDA. EBITDA of the Parent and its
Consolidated Subsidiaries will, on the last day of each fiscal quarter of the
Parent, equal or exceed $2,000,000.00 for such quarter.

               Section 5.6.   Minimum Liquidity. The total of cash and cash
equivalents of the Parent and its Consolidated Subsidiaries shall at all times
equal or exceed $10,000,000.00.

                                   ARTICLE VI
                                 OTHER COVENANTS

               Each Borrower agrees that so long as the Bank is committed to
make Loans hereunder or any amount payable hereunder or under the Note, any
Application, or any Collateral Document remains unpaid:

               Section 6.1.   Information. The Borrowers will deliver or cause
to be delivered to the Bank:

                       (i)    as soon as available and in any event within 91
         days after the end of each fiscal year of the Parent, a consolidated
         and consolidating balance sheet of the Parent and its Consolidated
         Subsidiaries as of the end of such fiscal year and the related
         statements of financial condition, income, cash flows, and changes in
         shareholdres' equity for such fiscal year, setting forth in each case
         in

                                      -19-

<PAGE>

         comparative form the figures for the previous fiscal year, all in
         reasonable detail and accompanied by an opinion thereon by
         PricewaterhouseCoopers LLP, or other independent public accountants
         satisfactory to the Bank, which opinion shall state that such
         consolidated financial statements present fairly the consolidated
         financial position of the Parent and its Consolidated Subsidiaries as
         of the date of such financial statements and the results of their
         operations for the period covered by such financial statements in
         conformity with GAAP applied on a consistent basis (except for changes
         in the application of which such accountants concur) and shall not
         contain any "going concern" or like qualification or exception or
         qualifications arising out of the scope of the audit;

                       (ii)   as soon as available and in any event within 46
         days after the end of each quarter of each fiscal year of the Parent,
         an unaudited consolidated balance sheet of the Parent and its
         Consolidated Subsidiaries and the related unaudited consolidated
         statement of income for such quarter and for the portion of the
         Parent's fiscal year ended at the end of such quarter, setting forth in
         each case in comparative form the figures for the corresponding quarter
         and the corresponding portion of the Parent's previous fiscal year, all
         certified (subject to normal year-end audit adjustments) as complete
         and correct by the chief financial officer or chief accounting officer
         of the Parent;

                       (iii)  simultaneously with the delivery of each set of
         financial statements referred to in clauses (i) and (ii) above, a
         certificate of the chief financial officer or chief accounting officer
         of the Parent, (A) setting forth in reasonable detail the calculations
         required to establish whether the Borrowers were in compliance with the
         requirements of Sections 5.2 through 5.6, inclusive, on the date of
         such financial statements, (B) stating whether there exists on the date
         of such certificate any Default and, if any Default then exists,
         setting forth the details thereof and the action which the Borrowers
         are taking or propose to take with respect thereto and (C) stating
         whether, since the date of the most recent previous delivery of
         financial statements pursuant to clause (i) or (ii) of this Section,
         there has been any material adverse change in the business, financial
         position, results of operations or prospects of the Parent and its
         Consolidated Subsidiaries, considered as a whole, and, if so, the
         nature of such material adverse change;

                       (iv)   simultaneously with the delivery of each set of
         financial statements referred to in clause (i) above, a statement of
         the firm of independent public accountants that reported on such
         statements (A) stating that their audit examination has included a
         review of this Agreement, all outstanding Applications and the Note as
         they relate to financial or accounting matters, (B) whether anything
         has come to their attention to cause them to believe that there existed
         on the date of such statements any Default and (C) confirming the
         calculations set forth in the officer's certificate delivered
         simultaneously therewith pursuant to clause (iii) above;

                       (v)    simultaneously with the delivery of each set of
         financial statements referred to in clause (i) above, annual
         projections of the Parent and its Consolidated Subsidiaries, on a
         consolidated basis, with quarterly detail;

                                      -20-

<PAGE>

                       (vi)   on or before 30 days after the end of each
         calendar quarter, a report of the aging of the Borrowers' domestic
         accounts receivable as of said month and, if requested by the Bank, a
         manifest of related invoices;

                       (vii)  forthwith upon obtaining knowledge of the
         occurrence of any Default, a certificate of the chief financial
         officer, treasurer, or chief accounting officers of the Borrowers
         setting forth the details thereof and the action which the Borrowers
         are taking or propose to take with respect thereto;

                       (viii) as soon as reasonably practicable after obtaining
         knowledge of the commencement of, or of a material threat of the
         commencement of, an action, suit or proceeding against any Borrower or
         any of its Subsidiaries which could reasonably be expected to
         materially adversely affect the business, properties, financial
         position, results of operations or prospects of said Borrower and its
         Consolidated Subsidiaries, considered as a whole, or which in any
         manner questions the validity of this Agreement, the Note, any of the
         Applications, any Collateral Document or any of the other transactions
         contemplated hereby or thereby, the nature of such pending or
         threatened action, suit or proceeding and such additional information
         as may be reasonably requested by the Bank;

                       (ix)   promptly upon transmission thereof, copies of all
         press releases and other statements made available generally by any of
         the Borrowers or its Subsidiaries to the public concerning material
         developments in the results of operations, financial condition,
         business or prospects of said Borrower or its Subsidiaries;

                       (x)    promptly upon the Bank's request therefor, copies
         of each report submitted to any Borrower or any of its Consolidated
         Subsidiaries by independent public accountants in connection with any
         annual, interim or special audit made by them of the books of said
         Borrower or any of its Consolidated Subsidiaries including, without
         limitation, each report submitted to said Borrower or any of its
         Consolidated Subsidiaries concerning its accounting practices and
         systems and any final comment letter submitted by such accountants to
         management in connection with the annual audit of said Borrower and its
         Consolidated Subsidiaries;

                       (xi)   promptly upon the sending or filing thereof,
         copies of all proxy statements, financial statements and similar
         reports which the Parent sends to its stockholders, and copies of all
         regular, periodic, and special reports, and all registration statements
         which said Borrower or Subsidiary files with the U.S. Securities and
         Exchange Commission or any governmental authority which may be
         substituted therefor, or with any national securities exchange; and

                       (xii)  from time to time such additional information
         regarding the financial position, results of operations or business of
         any Borrower or any of its Domestic Subsidiaries as the Bank may
         reasonably request.

                                      -21-

<PAGE>

               Section 6.2.   Payment of Obligations. Said Borrower will, and
will cause each of its Subsidiaries to, pay and discharge, as the same shall
become due and payable, (i) all their respective obligations and liabilities,
including all due and proper claims or demands of materialmen, mechanics,
carriers, warehousemen, landlords and other like persons which, in any such
case, if unpaid, could reasonably be expected to, by law, give rise to a Lien
upon any material portion of the combined properties or assets of the Parent and
its Subsidiaries, taken as a whole, other than Permitted Liens, and (ii) all
material lawful Taxes, assessments and charges or levies made upon their
properties or assets, by any governmental body, agency or official except where
any of the items in clause (i) or (ii) of this Section 6.2 may be diligently
contested in good faith by appropriate proceedings, and said Borrower or such
Subsidiary shall have set aside on its books, if required under GAAP,
appropriate reserves for the accrual of any such items.

               Section 6.3.   Maintenance of Property; Insurance.

               (a)   Said Borrower will keep, and will cause each of its
Domestic Subsidiaries to keep, all property useful and necessary in their
respective businesses in good working order and condition, subject to ordinary
wear and tear; will maintain (either in the name of the Borrower or in such
Subsidiary's own name or in the name of the Bank if required by any Security
Agreement) with financially sound and reputable insurance companies, insurance
on all their respective properties in at least such amounts and against at least
such risks (and with such risk retentions) as are usually insured against by
companies engaged in the same or a similar business; and will furnish to the
Bank upon request full information as to the insurance carried. With respect to
Foreign Subsidiaries, said Subsidiaries need only maintain such insurance with
respect to their material property, if it is usual and customary to maintain
such insurance in their applicable foreign jurisdictions.

               (b)   In addition to the general requirements of subparagraph
(a), said Borrower will keep the Collateral in such condition and will maintain
in effect such insurance on the Collateral as is required by the terms of the
Collateral Documents.

               Section 6.4.   Conduct of Business and Maintenance of Existence.
Said Borrower will continue, and will cause each of its Subsidiaries to
continue, to engage in business of the same general type as now conducted by
said Borrower or such Subsidiary, and will preserve, renew and keep in full
force and effect, and will cause each of its Subsidiaries to preserve, renew and
keep in full force and effect, their respective corporate existence and their
respective rights, privileges and franchises necessary or desirable in the
normal conduct of business.

               Section 6.5.   Compliance with Laws; Contracts. Said Borrower
will comply, and will cause each of its Subsidiaries to comply, with all
applicable laws, ordinances, rules, regulations, and requirements of
governmental authorities (including, without limitation, ERISA and the rules and
regulations thereunder, as applicable) except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings, or could not
reasonably be expected to result in a material adverse effect on the Borrowers
and their Subsidiaries, taken as a whole. Said Borrower will perform and comply,
and will cause each of its Subsidiaries to perform and comply, with each
provision of all material contracts to which it is a party, except where the
failure to perform or comply could not reasonably be expected to result in a
material adverse effect on the Borrowers and their Subsidiaries, taken as a
whole.

                                      -22-

<PAGE>

               Section 6.6.   Accounting; Inspection of Property, Books and
Records. Said Borrower will keep, and will cause each of its Subsidiaries to
keep, proper books of record and account in which full, true and correct entries
in conformity with GAAP shall be made of all dealings and transactions in
relation to their respective businesses and activities, will maintain, and will
cause each of its Subsidiaries to maintain, their respective fiscal reporting
periods on the present basis and will permit, and will cause each of its
Domestic Subsidiaries to permit, representatives of the Bank to visit and
inspect any of their respective properties, to examine and make abstracts and
copies from any of their respective books and records and to discuss their
respective affairs, finances and accounts with their officers, employees and
independent public accountants, all at such reasonable times and as often as may
reasonably be desired.

               Section 6.7.   Debt. Said Borrower and its Subsidiaries will not
incur or at any time be liable with respect to any Debt except that the
following shall be permitted, without duplication, (i) Debt outstanding under
this Agreement and the Note, (ii) Debt secured by a Lien pursuant to Section
6.8(iii), (iii) the Debt set forth on Schedule 6.7 hereto, (iv) Debt by and
between any Borrower and any other Borrower, (v) Debt by and between any
Borrower and any Subsidiary of the Parent which is not a Borrower, provided that
at no time shall (y) the outstanding principal amount of such Debt owing by any
such non-Borrower Subsidiary to a Borrower, less (z) the outstanding principal
amount of such Debt owing by any Borrower to any such non-Borrower Subsidiary,
when aggregated with all other Inter-company Transactions then outstanding, on a
net basis, exceed $3,000,000, (vi) Debt of any Foreign Subsidiary, other than as
set forth in clause (v) hereof, (vii) Debt permitted under Section 6.12, (viii)
Guarantees by any Borrower of any obligation of any other Borrower, to the
extent such obligation is not a Debt of the latter which is prohibited
hereunder, (ix) Debt which is subordinated in priority of lien (if secured) and
right of payment to Debt to the Bank pursuant to a subordination agreement to
which the Bank is a party, (x) Debt incurred from financing insurance premiums
of the Borrowers and their Subsidiaries, and (xi) other unsecured Debt of any
Borrower in an aggregate principal amount outstanding at any time not to exceed
$500,000 of all such Debt of all Borrowers in the aggregate.

               Section 6.8.   Restriction on Liens.

               (a)    Said Borrower will not, and will not permit any of its
Domestic Subsidiaries to at any time create, assume or suffer to exist any Lien
on any property or asset now owned or hereafter acquired by said Borrower or any
of its Domestic Subsidiaries or assign or subordinate any present or future
right to receive assets except as follows or otherwise permitted herein:

                      (i)     Liens existing on the date of this Agreement and
         described on Schedule 6.8(a) hereto securing Debt outstanding on the
         date of this Agreement;

                      (ii)    any Liens created by the Collateral Documents;

                      (iii)   any purchase money security interest on, or
         capitalized lease with respect to, any capital asset of the Borrower or
         any of its Subsidiaries if such purchase money security interest or
         capitalized lease attaches to such capital asset concurrently with the
         acquisition thereof and if the Debt secured by such purchase money
         security interest does not exceed 100% of the lesser of the cost or
         fair market value as of the time of acquisition of the asset covered
         thereby to said Borrower or such Subsidiary; provided, that the
         aggregate principal amount of Debt secured by all such Liens does not
         exceed $1,000,000.00 in the aggregate principal

                                      -23-

<PAGE>

         amount at any one time outstanding and provided, that no such purchase
         money security interest shall extend to or cover any property or asset
         of said Borrower or such Subsidiary other than the related asset,
         accessions thereto and proceeds thereof;

                      (iv)    Liens securing Taxes, assessments or governmental
         charges or levies or the claims or demands of materialmen, mechanics,
         carriers, warehousemen, landlords and other like persons; provided (A)
         with respect to Liens securing state and local Taxes, such Taxes are
         not yet payable or are being contested in good faith, (B) with respect
         to Liens securing claims or demands of materialmen, mechanics,
         carriers, warehousemen, landlords and the like, such Liens are unfiled
         and no other action has been taken to enforce the same, or are being
         contested in good faith, or (C) with respect to Taxes, assessments or
         governmental charges or levies or claims or demands secured by such
         Liens, payment of which is not at the time required by Section 6.2, or
         are being contested in good faith;

                      (v)     Liens not securing Debt which are incurred in the
         ordinary course of business in connection with workmen's compensation,
         unemployment insurance, social security and other like laws, or in
         connection with security deposits;

                      (vi)    any Lien arising pursuant to any order of
         attachment, distraint or similar legal process arising in connection
         with court proceedings so long as the execution or other enforcement
         thereof is effectively stayed and the claims secured thereby are being
         contested in good faith by appropriate proceedings;

                      (vii)   interests under licenses granted in the ordinary
         course of business;

                      (viii)  Liens securing Debt which is subordinated in
         priority of lien and right of payment to Debt to the Bank pursuant to a
         subordination agreement to which the Bank is a party;

                      (ix)    Liens incurred from the financing of insurance
         premiums of the Borrowers and their Subsidiaries, to the extent such
         Liens are typical in insurance premium financing; and

                      (x)     any interests of lessees in excess furniture or
         equipment, or subleases of excess real estate, under leases in which
         any Borrower or Subsidiary is the lessor.

               (b)    Except as contained in the agreements described on
Schedule 6.8(b) hereto, said Borrower will not, and will not permit any of its
Domestic Subsidiaries to, at any time enter into any covenant or other agreement
that restricts or is intended to restrict it from pledging, granting a security
interest in, mortgaging, encumbering, or otherwise creating a Lien on, any of
its intellectual property or stock in any Foreign Subsidiary, whether now
existing or owned or hereafter arising or acquired, in favor of the Bank.

                                      -24-

<PAGE>

               Section 6.9.   Consolidations, Mergers and Sales of Assets.
Except as set forth on Schedule 6.9, or otherwise approved by the Bank in
advance in writing, said Borrower will not (i) consolidate or merge with or into
any other Person (other than a Borrower) or (ii) sell, lease or otherwise
transfer all or any substantial part of its assets to any other Person. Said
Borrower will not permit any of its Subsidiaries to consolidate or merge with or
into, or transfer all or any substantial part of its assets to, any Person other
than another Borrower or a Wholly-Owned Consolidated Subsidiary. Nothing in this
section 6.9 shall limit or prohibit the Borrowers or their Subsidiaries from (a)
consummating transactions permitted under Section 6.16 hereof, (b) making sales
or transfers of assets either (without duplication) (1) between Borrowers, (2)
between Foreign Subsidiaries, and (3) between any Borrower and any Subsidiary
which is not a Borrower, provided that at no time shall (y) the amount of all
such sales and transfers by any Borrower to any such non-Borrower Subsidiary,
less (z) the amount of all such sales and transfers by any such non-Borrower
Subsidiary to a Borrower, when aggregated with all other Inter-company
Transactions then outstanding, exceed $3,000,000, on a net basis, (c) the sale,
transfer or other disposition of assets of, or interests in, the Alarm.com and
Angel.com businesses which are currently business units of Parent, (d) licenses
granted by the Borrower or any of its Subsidiaries in the ordinary course of
business, (e) the dissolution of MicroStrategy GmbH in Liquidation and
MicroStrategy Schweiz AG in Liquidation and transfer of their assets to any
Borrower or Subsidiary of a Borrower which is not a Borrower, or merger of
MicroStrategy GmbH in Liquidation and MicroStrategy Schweiz AG in Liquidation
into any other Subsidiary of a Borrower which is not a Borrower, and (f) sale,
transfer of other disposition of assets of any Borrower (not otherwise permitted
under clauses (c) through (e), above) not to exceed $250,000 in book value.

               Section 6.10.  Transactions with Affiliates. Except as set forth
on Schedule 6.10 or otherwise permitted in Sections 6.7, 6.9, 6.11, 6.12 or
6.16, the Borrowers will not, and will not permit any of their respective
Subsidiaries to, directly or indirectly, pay any funds to or for the account of,
make any investment in, engage in any transaction with or effect any transaction
in connection with any joint enterprise or other joint arrangement with, any
Affiliate of any Borrower or any of its Subsidiaries, except that a Borrower or
any Subsidiary of said Borrower may make payment or provide compensation
(including without limitation the establishment of customary employee benefit
plans) for personal services rendered by employees and other Persons on terms
approved by the applicable Borrower's board of directors, by its management, or
on terms fair and reasonable in light of the circumstances under which such
services were or are to be rendered.

               Nothing in this Section 6.10 shall prohibit a Borrower or any
Subsidiary of said Borrower from making sales to or purchases from any Borrower,
any Subsidiary of a Borrower or any Affiliate and, in connection therewith,
extending credit or making payments, or from making payments for services
rendered by any Borrower, any Subsidiary of a Borrower or any Affiliate, if such
sales or purchases are made or such services are rendered in the ordinary course
of business and on terms and conditions at least as favorable to said Borrower
or such Subsidiary as the terms and conditions which would apply in a similar
transaction with a Person not a Borrower, any Subsidiary of a Borrower or any
Affiliate, or prohibit said Borrower or any Subsidiary of said Borrower from
participating in, or effecting any transaction in connection with, any joint
enterprise or other joint arrangement with any Borrower, any Subsidiary of a
Borrower or any Affiliate if said Borrower or such Subsidiary participates in
the ordinary course of its business and on a basis no less advantageous than on
the basis on which such Borrower, any Subsidiary of a Borrower or any Affiliate
participates.

                                      -25-

<PAGE>

               Section 6.11.  Restricted Payments. Except as set forth on
Schedule 6.11 or otherwise permitted under Section 6.16, said Borrower will not,
and will not permit any of its Subsidiaries to, (i) declare or pay any dividend
or other distribution on any shares of said Borrower's or such Subsidiary's
capital stock (except dividends payable solely in shares of said Borrower's or
such Subsidiary's capital stock or dividends payable to a Borrower by another
Borrower or payable by a Subsidiary which is not a Borrower to another
Subsidiary which is not a Borrower or to a Borrower), (ii) make any payment on
account of the purchase, redemption, retirement or acquisition of (A) any shares
of said Borrower's or such Subsidiary's capital stock (except shares acquired
upon the conversion thereof into other shares of said Borrower's or such
Subsidiary's capital stock) or (B) any option, warrant or other right to acquire
shares of said Borrower's or such Subsidiary's capital stock, other than
repurchases of a Borrower's or a Subsidiary's capital stock not to exceed
$250,000.00 in the aggregate in any fiscal year for all Borrowers and
Subsidiaries considered as a whole. Notwithstanding anything to the contrary
herein, the Borrowers and their Subsidiaries shall be permitted to repurchase,
redeem or retire the Class Action Notes (i) for cash, so long as after giving
effect thereto, the Borrowers shall be in compliance with Article V, and (ii)
for stock of the Parent, at any time.

               Section 6.12.  Investments. Said Borrower will not, and will not
permit any of its Domestic Subsidiaries to, make or acquire after the Effective
Date any investment in any Person (whether by share purchase, capital
contribution, loan, time deposit or otherwise) other than (i) in direct
obligations of the United States or any agency thereof, or obligations
guaranteed by the United States or any agency thereof, (ii) in commercial paper
rated in the highest grade by a nationally recognized credit rating agency,
(iii) in time deposits with, including certificates of deposit issued by, any
office located in the United States of any bank or trust company which is
organized under the laws of the United States or any state thereof and has
capital, surplus and undivided profits aggregating at least $200,000,000,
provided in each case that such investment matures within one year from the date
of acquisition thereof by said Borrower, (iv) loans and advances to employees
for travel in the ordinary course of business and in an amount consistent with
past practice, and (v) in Wholly-Owned Subsidiaries existing on the date hereof;
provided that nothing herein shall prohibit or restrict loans, advances and
other investments (without duplication) (A) by and between any Borrower and any
other Borrower, (B) by and between any Borrower and any Subsidiary of the Parent
which is not a Borrower, provided that at no time shall (y) the outstanding
principal amount of said loans, advances and other investments by any Borrower
to any such non-Borrower Subsidiary, less (z) the outstanding principal amount
of said loans, advances and other investments by any such non-Borrower
Subsidiary to a Borrower, when aggregated with all other Inter-company
Transactions then outstanding, on a net basis, exceed $3,000,000, and (C) by and
between any Foreign Subsidiary and any other Foreign Subsidiary.

               Section 6.13.  Transactions with Other Persons. Said Borrower
will not, and will not permit any of its Subsidiaries to, enter into any
agreement with any Person whereby any of them shall agree to any restriction on
said Borrower's right to amend or waive any of the provisions of this Agreement.

               Section 6.14.  Use of Proceeds. The proceeds of the Loans will be
used by the Borrowers for their temporary working capital needs and to provide
letters of credit. None of the proceeds of the Loans will be used, directly or
indirectly, for the purpose, whether immediate, incidental or ultimate, of
purchasing or carrying any "margin stock" within the meaning of Regulation U.

               Section 6.15.  [Intentionally Deleted]

                                      -26-

<PAGE>

               Section 6.16.  Restrictions with Respect to Subsidiaries. Except
as contemplated or otherwise permitted by this Agreement or any other Loan
Document:

               (a)    Said Borrower will not, and will not permit any of its
Subsidiaries to, sell, assign, encumber, pledge, transfer or otherwise dispose
of (except to a Borrower or to a Wholly-Owned Subsidiary and except to directors
for the purpose of qualifying them as directors, if required, and except
pursuant to presently outstanding warrants, options or other rights) any shares
of stock of any class of any Subsidiary unless all of the capital stock and the
entire Debt of such Subsidiary at the time owing to said Borrower and to all
other Subsidiaries shall be sold, assigned, transferred or otherwise disposed of
at the same time if permissible under Section 6.11.

               (b)    Said Borrower will not permit any of its Subsidiaries (i)
to issue or sell any shares of preferred stock except to a Borrower or to a
Wholly-Owned Subsidiary or (ii) to issue or sell any shares of its common stock
(except to directors for the purpose of qualifying them as directors, if
required) unless, after such issue or sale, said Borrower and its Subsidiaries,
taken together, shall retain the same proportionate interest in such Subsidiary.

               (c)    Except as set forth on Schedule 6.16, as permitted under
Section 6.8, or as provided in any pledge under any Loan Document, said Borrower
will not, and will not permit any of its Subsidiaries to, after the date hereof,
sell, assign, encumber, pledge, transfer or otherwise dispose of (except to a
Borrower or to a Wholly-Owned Subsidiary) any shares of stock of any class, or
any other ownership interest, of any Foreign Subsidiary, or any material portion
of the assets of such Foreign Subsidiary.

               (d)    Said Borrower shall not, and will not permit any of its
Subsidiaries to, enter into any agreement substantially similar to any agreement
set forth in this Section 6.16, but only with respect to its intellectual
property or stock in any Foreign Subsidiary, with any Person other than the
Bank.

               Section 6.17.  Additional Borrowers. Each Domestic Subsidiary and
that is formed or acquired on or after the Effective Date, shall become a
Borrower, and the Borrowers shall cause each such Subsidiary to satisfy each of
the following conditions on or before the date on which such Subsidiary is
formed or acquired:

                      (i)     Such Subsidiary shall execute and deliver to the
         Bank a joinder agreement on the Bank's form therefor, along with a
         Security Agreement and all documents and agreements reasonably required
         by the Security Agreement to be executed and delivered.

                      (ii)    All legal matters incident to such Subsidiary's
         becoming a Borrower shall be reasonably satisfactory to counsel for the
         Bank and the Subsidiary shall execute and deliver to the Bank, within
         10 Business Days after its acquisition or formation, such additional
         documents and certificates relating to the Loans as the Bank reasonably
         may request.

                      (iii)   The Bank shall have received an opinion of counsel
         to such Subsidiary, addressed to the Bank, covering such matters as the
         Bank may reasonably request, in form and substance reasonably
         satisfactory to the Bank.

                                      -27-

<PAGE>

                      (iv)    Financing statements in form and substance
         reasonably satisfactory to the Bank shall have been properly filed in
         each office where necessary to perfect the security interest
         (consistent with the requirements hereof as of the Effective Date) of
         the Bank in the Collateral of such Subsidiary, and, within 30 days
         after said acquisition or formation, (A) termination statements shall
         have been filed with respect to any other financing statements covering
         all or any material portion of such Collateral (except with respect to
         Liens permitted by this Agreement), (B) all Taxes and fees with respect
         to such recording and filing shall have been paid by such Subsidiary or
         the Borrower and (C) the Bank shall have received such Lien searches or
         reports as it shall require confirming that the foregoing filings and
         recordings have been completed.

                      (v)     Such Subsidiary shall have delivered the following
         documents to the Bank, each of which shall be certified as of the date
         on which such Subsidiary is to become a Borrower, by its secretary or
         representative performing similar functions: (A) copies of evidence of
         all actions taken by such Subsidiary to authorize the execution and
         delivery of the applicable Loan documents; (B) copies of the articles
         or certificate of incorporation and bylaws (or the organizational
         documents for a Borrower that is not a corporation) of such Subsidiary;
         and (C) a certificate as to the incumbency and signatures of the
         officers of such Subsidiary executing the Loan documents.

                      (vi)    The Bank shall have received current certificates
         of good standing and qualification issued by the appropriate state
         official of the state of formation of such Subsidiary and in each
         jurisdiction in which it is qualified to do business.

                      (vii)   The Bank shall have received, within 10 days after
         the acquisition or formation, such information and documents the Bank
         may reasonably request with respect to the Collateral of such
         Subsidiary.

               Section 6.18.  Establishment of New Subsidiaries. Borrowers have
advised the Bank that they may need or desire to establish Subsidiaries for
operational, business or other reasons. Accordingly, it is understood and
acknowledged that the Borrowers may, from time to time, establish one or more
new Subsidiaries and conduct transactions for the purposes thereof subject to
the terms of this Agreement or as otherwise permitted by the Bank in writing. In
this regard, the Bank hereby consents to the establishment of the Subsidiary
contemplated by Exhibit 6.18 attached hereto and, notwithstanding anything
herein otherwise to the contrary, consents and agrees to the related
transactions and other matters concerning formation, capitalization,
contribution, investment, licensing, financing, employment, and services, as
more fully described on such Exhibit 6.18.

                                   ARTICLE VII
                             EMPLOYEE BENEFIT PLANS

               Section 7.1.   Certain Definitions. As used in this Article VII,
the following terms have the following meanings:

                                      -28-

<PAGE>

               "Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with a Borrower, are treated as a single employer
under Section 414(b) or 414(c) of the Code.

               "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.

               "PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.

               "Plan" means at any time an employee pension benefit plan which
is covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code and is either (i) maintained by a member of the
Controlled Group for employees of a member or members of the Controlled Group or
(ii) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding five plan years made
contributions.

               "Unfunded Vested Liabilities" means, with respect to any Plan at
any time, the amount (if any) by which (i) the present value of all vested
nonforfeitable benefits under such Plan exceeds (ii) the fair market value of
all Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan, but only to the extent that such excess
represents a potential liability of a member of the Controlled Group to the PBGC
or the Plan under Title IV of ERISA.

               Section 7.2.   Compliance with ERISA. Each member of the
Controlled Group has fulfilled its obligations under the minimum funding
standards of ERISA and the Code with respect to each Plan and is in compliance
in all material respects with provisions of ERISA and the Code presently
applicable to each Plan. No member of the Controlled Group has incurred any
liability in excess of $250,000, or has entered into any transaction that is
reasonably likely to cause any liability in excess of $250,000 to be incurred,
to the PBGC or any Plan under Title IV of ERISA. No Lien has been attached and
no Person has threatened to attach a Lien on any property of any Borrower as a
result of any Borrower's failure to comply with ERISA.

               Section 7.3.   Prohibited Transactions. No Borrower shall at any
time permit any Plan to:

                       (i)    engage in any "prohibited transaction", as such
         term is defined in Section 4975 of the Code or in Section 406 of ERISA;

                       (ii)   incur any "accumulated funding deficiency", as
         such term is defined in Section 302 of ERISA, whether or not waived; or

                       (iii)  be terminated in a manner which could result in
         the imposition of a Lien on the property of said Borrower pursuant to
         Section 4068 of ERISA.

               Section 7.4.   Information. The Borrowers agree that so long as
the Bank is committed to make Loans hereunder, or the Note remains unpaid, each
Borrower will deliver or cause to be delivered to the Bank if and when any
member of the Controlled Group (i) gives or is required to give

                                      -29-

<PAGE>

notice to the PBGC of any "reportable event" (as defined in Section 4043 of
ERISA) with respect to any Plan which might constitute grounds for a termination
of such Plan under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such reportable event, a
copy of the notice of such reportable event given or required to be given to the
PBGC; (ii) receives notice of complete or partial withdrawal liability under
Title IV of ERISA, a copy of such notice; or (iii) receives notice from the PBGC
under Title IV of ERISA of an intent to terminate or appoint a trustee to
administer any Plan, a copy of such notice.

                                  ARTICLE VIII
                                    DEFAULTS

               Section 8.1.   Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:

                       (i)    any Borrower shall fail to pay when due any
         principal of or interest on any Loan, any fee or any other amount
         payable hereunder, under any Application, or under the Note;

                       (ii)   any Borrower shall fail to observe or perform any
         covenant or agreement contained in Article V or in any of Sections 6.7,
         6.8, 6.9, 6.11, 6.12, 6.14 or 6.16;

                       (iii)  any Borrower shall fail to observe or perform any
         covenant or agreement contained in any Application or in this Agreement
         (other than those covered by clauses (i) or (ii) above), and such
         failure continues for thirty (30) calendar days after the earlier to
         occur of (A) the date notice thereof is given by the Bank to the
         Borrowers and (B) the date notice thereof should have been given to the
         Bank pursuant to Section 6.1(vii);

                       (iv)   any representation, warranty, certification or
         statement made by any Borrower in this Agreement, any Application, or
         any Collateral Document to which it is a party, or by any Borrower in
         any certificate, financial statement or other document delivered
         pursuant hereto or thereto shall prove to have been incorrect in any
         material respect when made;

                       (v)    any Borrower or any Domestic Subsidiary of said
         Borrower shall fail to make any payment in respect of any Debt (other
         than the Note or an Application) in excess of $500,000 when due or
         within any applicable grace period;

                       (vi)   any event or condition shall occur which results
         in the acceleration of the maturity of any Debt in excess of $500,000
         of any Borrower or any Domestic Subsidiary of said Borrower or enables
         (or, with the giving of notice or lapse of time or both, would enable)
         the holder of such Debt or any Person acting on such holder's behalf to
         accelerate the maturity thereof;

                       (vii)  any Borrower or any Subsidiary of said Borrower
         shall commence a voluntary case or other proceeding seeking
         liquidation, reorganization or other relief with respect to itself or
         its debts under any bankruptcy, insolvency or

                                      -30-

<PAGE>

         other similar law now or hereafter in effect or seeking the appointment
         of a trustee, receiver, liquidator, custodian or other similar official
         of it or any substantial part of its property, or shall consent to any
         such relief or to the appointment of or taking possession by any such
         official in an involuntary case or other proceeding commenced against
         it, or shall make a general assignment for the benefit of creditors, or
         shall fail generally to pay its debts as they become due, or shall take
         any corporate action to authorize any of the foregoing; provided,
         however, that any of the foregoing actions in this clause (vii) which
         is taken with respect to a Foreign Subsidiary, where such action would
         not have a material adverse effect on the Borrowers and their
         Subsidiaries, taken as a whole, shall not be a Default or an Event of
         Default;

                       (viii)  an involuntary case or other proceeding shall be
         commenced against any Borrower or any Subsidiary of said Borrower
         seeking liquidation, reorganization or other relief with respect to it
         or its debts under any bankruptcy, insolvency or other similar law now
         or hereafter in effect or seeking the appointment of a trustee,
         receiver, liquidator, custodian or other similar official of it or any
         substantial part of its property, and such involuntary case or other
         proceeding shall remain undismissed and unstayed for a period of 60
         days; or an order for relief shall be entered against any Borrower or
         any Subsidiary of said Borrower under the federal bankruptcy laws as
         now or hereafter in effect; provided, however, that any of the
         foregoing actions in this clause (viii) which is taken with respect to
         a Foreign Subsidiary, where such action would not have a material
         adverse effect on the Borrowers and their Subsidiaries, taken as a
         whole, shall not be a Default or an Event of Default;

                       (ix)    any member of the Controlled Group shall fail to
         pay when due an amount or amounts aggregating in excess of $250,000.00
         which it shall have become liable to pay to the PBGC, any Plan or any
         Plan trustee under Title IV of ERISA or ss. 412 of the Code; or notice
         of intent to terminate a Plan or Plans having aggregate Unfunded Vested
         Liabilities in excess of $250,000.00 (collectively, a "Material Plan")
         shall be provided under Title IV of ERISA by any member of the
         Controlled Group, any plan administrator or any combination of the
         foregoing; or the PBGC shall institute proceedings under Title IV of
         ERISA to terminate or to cause a trustee to be appointed to administer
         any Material Plan or a proceeding shall be instituted by a fiduciary of
         any Material Plan against any member of the Controlled Group to enforce
         Section 515 of ERISA; or a condition shall exist by reason of which the
         PBGC would be entitled to obtain a decree adjudicating that any
         Material Plan must be terminated;

                       (x)     one or more final, non-appealable judgments or
         orders for the payment of money in excess of $1,000,000.00 shall be
         rendered against any Borrower or any Subsidiary of said Borrower and
         such judgment or order shall continue unsatisfied and unstayed for a
         period of 20 days;

                       (xi)    (A) any Collateral Document shall cease for any
         reason to be in full force and effect or shall cease to be effective to
         grant a perfected security interest in the Collateral with the priority
         stated to be created thereby or such

                                      -31-

<PAGE>

         security interest shall cease to be in full force and effect or shall
         be declared null and void, or the validity or enforceability of such
         security interest or any Collateral Document shall be contested by any
         Borrower or any Subsidiary of said Borrower, or any Borrower or any
         Subsidiary of said Borrower shall deny that it has any further
         liability or obligation under a Collateral Document to which it is a
         party, or any Borrower or any Subsidiary of said Borrower shall fail to
         perform any of its obligations under the Collateral Documents, or (B)
         any creditor of any Borrower or any Subsidiary of said Borrower (other
         than a creditor having a purchase money security interest permitted by
         Section 6.8(iii) and then solely with respect to the related asset)
         shall obtain possession of any of the Collateral by any means,
         including, without limitation, levy, distraint, replevin or self-help,
         or any such creditor shall establish or obtain any right in the
         Collateral which is equal to or senior to the security interests of the
         Bank in such Collateral;

                       (xii)   any Change in Control of the Parent shall have
         occurred ("Change in Control", as used herein, shall mean (A) any
         Person other than Permitted Holders shall have acquired beneficial
         ownership or the power to vote 30% or more of the voting power of the
         stock of the Parent on an as converted basis; or (B) the majority of
         seats (other than vacant seats) on the board of directors of the Parent
         cease to be occupied by Persons who either (a) were members of the
         board of directors of the Parent on the Effective Date or (b) were
         elected by or nominated for election by the board of directors of the
         Parent, a majority of which was comprised of directors on the Effective
         Date or directors whose election or nomination for election was
         previously approved by a majority of such directors or directors who
         were previously so elected or nominated); or

                       (xiii)  (A) the expiration of 30 days after the Bank has
         given the Borrowers notice of the Bank's good faith determination that
         (y) a material adverse change in the financial condition of the
         Borrowers and their Subsidiaries, taken as a whole, has occurred since
         the date hereof or (z) that the Bank's prospect of payment hereunder
         has been impaired, or (B) the reasonable suspicion by the Bank that one
         or more Events of Default shall have occurred and the failure of the
         Borrowers, upon 30 days' notice thereof from the Bank, to provide
         reasonably satisfactory evidence to the Bank that such Events of
         Default have not in fact occurred;

then, and in every such event, the Bank, at its option, may by notice to the
Borrowers terminate the Revolving Commitment and it shall thereupon terminate,
and may, at its option, by notice to the Borrowers declare the Note (together
with accrued interest thereon) to be, and the Note shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers; provided that in
the case of any of the Events of Default specified in paragraph (vii) or (viii)
above with respect to any Borrower, without any notice to the Borrowers or any
other act by the Bank, the Revolving Commitment shall thereupon terminate and
the Note (together with accrued interest thereon) shall become immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrowers. Upon the occurrence of any
Event of Default, then, or at any time after the happening of the same, the Bank
may, at its option, demand that the Borrowers, within ten (10) days of such
demand, arrange for the cancellation of each outstanding Letter of Credit such
that the Bank has no further liability under any Letter of Credit, or in the
event the Borrowers fail to procure the cancellation of any

                                      -32-

<PAGE>

Letter of Credit within such ten (10) day period, demand that the Borrowers pay
to the Bank, as cash collateral, the remaining amounts available to be drawn, if
any, under all Letters of Credit not so canceled and such amounts shall
thereupon become immediately due and payable. In the event the Borrowers pay to
the Bank or the Bank collects from the Borrowers sums representing the remaining
amounts available to be drawn under said outstanding Letters of Credit, the Bank
shall hold such sums in a non-interest-bearing account as security for the
Borrowers' obligation to reimburse the Bank for amounts paid by the Bank under
the Letters of Credit or otherwise due hereunder. Upon the expiration of each of
the Letters of Credit and the Bank's reasonable determination that it has no
further liability thereunder, and provided the Borrowers shall have no other
unpaid debt to the Bank under this Agreement or any Application, the Bank shall
repay such sums to the Borrowers to the extent they exceed the remaining amounts
actually paid by the Bank under said Letter of Credit. The Bank's rights under
this Section 8.1 are in addition to other rights and remedies which the Bank may
have.

                                      -33-

<PAGE>

                                   ARTICLE IX
                                  MISCELLANEOUS

               Section 9.1.   Notices. All notices, requests and other
communications to a party hereunder shall be in writing and shall be given to
such party at its address set forth on the signature pages hereof or such other
address as such party may hereafter specify for the purpose by notice to the
other. Each such notice, request or other communication shall be effective (i)
if given by mail, 5 days after such communication is deposited in the mails with
first class postage prepaid, addressed as aforesaid or (ii) if given by any
other means, when received at the address specified in this Section; provided
that notices to the Bank under Section 2.2, 2.5 and 2.6 shall not be effective
until received.

               Section 9.2.   No Waivers. No failure or delay by the Bank or any
Borrower in exercising any right, power or privilege hereunder or under either
Note shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.

               Section 9.3.   Expenses.

               (a)   The Borrowers shall pay (i) all reasonable out-of-pocket
expenses of the Bank, including fees and disbursements of special counsel for
the Bank, in connection with the preparation (up to an aggregate of $43,294.60)
and administration of this Agreement and the other Loan Documents, any waiver or
consent hereunder or any amendment hereof or any Default or alleged Default
hereunder and (ii) if an Event of Default occurs, all reasonable out-of-pocket
expenses incurred by the Bank, including fees and disbursements of counsel, in
connection with such Event of Default and collection and other enforcement
proceedings resulting therefrom. The Borrowers shall indemnify the Bank against
any transfer taxes, documentary taxes, assessments or charges made by any
governmental authority by reason of the execution and delivery of this Agreement
or the Note (but excluding the effects of any Taxes imposed on the Bank's
income).

               (b)   If, after the Effective Date, any applicable law, rule,
regulation or guideline is adopted regarding capital adequacy, or any change
occurs in any of the foregoing or in the interpretation or administration of any
of the foregoing by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Bank with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on the
Bank's capital or the capital of any Person controlling the Bank as a
consequence of the Bank's obligations hereunder to a level below that which the
Bank or such Person would have achieved but for such law, change or compliance
(taking into consideration the Bank's policies with respect to capital adequacy)
by an amount deemed by the Bank to be material, then from time to time within
ten days after demand by the Bank (provided the Borrowers shall have received
the certificate described in the next sentence prior to or contemporaneously
with such demand), the Borrowers shall pay to the Bank such additional amount or
amounts (but without duplicating any amount paid as additional commitment fee
pursuant to Section 2.5(e)) as will compensate the Bank for such reduction. A
certificate of the Bank (i) claiming compensation under this Section 9.3(b) and
setting forth the additional amount or amounts to be paid to it hereunder, along
with the method and means of calculating such amounts, and (ii) delivered to the
Borrowers within 45 days after the Bank has received a notice from said
governmental authority, central bank or comparable agency that such amounts are
owing, shall be conclusive in the absence of

                                      -34-

<PAGE>

manifest error. In determining any such amount, the Bank may use any reasonable
averaging and attribution methods.

               Section 9.4.   Right of Set-Off. Upon the occurrence of any Event
of Default, the Bank is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by the Bank to or for the credit or the
account of any Borrower against any and all of the obligations now or hereafter
existing under this Agreement, the Note, any Application, or any Collateral
Document, irrespective of whether or not the Bank shall have made any demand
hereunder or under the Note and although such obligation may be unmatured. The
rights of the Bank under this Section 9.4 are in addition to other rights and
remedies (including, without limitation, other rights of set-offs) which the
Bank may have. The Borrowers agree, to the fullest extent they may effectively
do so under applicable law, that any holder of a participation in the Note may
exercise rights of set-off or counterclaim or other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrowers in the amount of such participation.

               Section 9.5.   Amendments and Waivers. Any provision of this
Agreement, or of the Note or any Application, may be amended or waived if, but
only if, such amendment or waiver is in writing and is signed by the Borrowers
and the Bank.

               Section 9.6.   Successors and Assigns.

               (a)   The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, except that no Borrower may assign or otherwise transfer any of its
rights under this Agreement without the prior written consent of the Bank.

               (b)   The Bank may at any time with the consent of the Borrowers
(which shall not be unreasonably withheld, conditioned or delayed), grant to one
or more banks or other institutions (each a "Participant") participating
interests in the Revolving Commitment or in any or all of the Loans or the Note.
In the event of any such grant by the Bank of a participating interest to a
Participant, whether or not upon notice to the Borrowers, the Bank shall remain
responsible for the performance of its obligations hereunder, and the Bank shall
continue to deal solely and directly with the Borrowers in connection with the
Bank's rights and obligations under this Agreement. Any agreement pursuant to
which the Bank may grant such a participating interest shall provide that the
Bank shall retain the sole right and responsibility to enforce the obligations
of the Borrowers hereunder including, without limitation, the right to approve
any amendment, modification or waiver of any provision of this Agreement and the
Collateral Documents; provided that such participation agreement may provide
that the Bank will not agree to any modification, amendment or waiver of this
Agreement or the Collateral Documents which would have the effect of (i)
increasing, decreasing or extending the Revolving Commitment or subjecting the
Bank to any additional obligation, (ii) reducing the principal of or rate of
interest on any Loan, (iii) postponing the date fixed for any payment of
principal of or interest on any Loan or fees hereunder or under the Note, (iv)
extending the Revolving Credit Period, (v) releasing any substantial part of the
Collateral or other direct or indirect security for the Loans without the
consent of the Participant. An assignment or other transfer which is not
permitted by subsection (c) or (d) below shall be given effect for purposes of
this Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).

                                      -35-

<PAGE>

               (c)   The Bank may at any time assign to one or more banks or
other institutions (each an "Assignee") all, or a proportionate part of all, of
its rights and obligations under this Agreement and the Note, and such Assignee
shall assume such rights and obligations, pursuant to an instrument executed by
such Assignee and the Bank, with (and subject to) the prior written consent of
the Borrowers (which shall not be unreasonably withheld, conditioned or
delayed); provided that if an Assignee is an affiliate of the Bank, no such
consent shall be required. Upon execution and delivery of such an instrument and
payment by such Assignee to the Bank of an amount equal to the purchase price
agreed between the Bank and such Assignee, such Assignee shall become a Bank
party to this Agreement and shall have all the rights and obligations of a Bank
with a Revolving Commitment as set forth in such instrument of assumption, and
the transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank and the Borrowers shall make appropriate arrangements
so that, if required, a new Note or Notes is issued to the Assignee. If the
Assignee is not incorporated under the laws of the United States of America or a
state thereof, it shall, prior to the first date on which interest or fees are
payable hereunder for its account deliver to the Borrowers certification as to
exemption from deduction or withholding of any United States federal income
taxes.

               (d)   The Bank may at any time assign all or any portion of its
rights under this Agreement and the Note to a Federal Reserve Bank. No such
assignment shall release the Bank from its obligations hereunder.

               (e)   The Bank may furnish any information concerning the
Borrowers in its possession from time to time to Assignees and Participants
(including prospective Assignees and Participants) and may furnish such
information in response to credit inquiries consistent with general banking
practice.

               Section 9.7.   Virginia Law. This Agreement and the Note shall be
governed by and construed in accordance with the laws of the Commonwealth of
Virginia.

               Section 9.8.   Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when the Bank shall have
received counterparts hereof signed by all parties.

               Section 9.9.   Enforcement of Arbitration; Submission to
Jurisdiction. Any legal action or proceeding to enforce an arbitration award
pursuant to Section 9.10 shall be brought in the courts of the Commonwealth of
Virginia in Fairfax County, Virginia, or of the United States of America for the
Eastern District of Virginia and in no other courts, and by execution and
delivery of this Agreement the Bank and each Borrower hereby accepts for itself
and in respect of its property, generally and unconditionally, the jurisdiction
of the aforesaid courts. Each Borrower and the Bank hereby irrevocably and
unconditionally waives any objection, including without limitation, any
objection to the laying of venue or based on the grounds of the forum non
conveniens which it now or hereafter may have to the bringing of any action or
proceeding in such respective jurisdictions.

               Section 9.10.  ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR
AMONG THE PARTIES HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR DOCUMENTS,
INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL BE
DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION ACT
(OR IF NOT

                                      -36-

<PAGE>

APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR
THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR ANY SUCCESSOR
THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN THE EVENT OF
ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON ANY
ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY TO
THIS AGREEMENT MAY BRING AN ACTION, INCLUDING A SUMMARY OR EXPEDITED PROCEEDING,
TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT
APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH ACTION.

               (i)     SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN
FAIRFAX COUNTY, VIRGINIA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN
ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE
ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL
ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR
ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.

               (ii)    RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION
PROVISION SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE
APPLICABLE STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS
AGREEMENT OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF THE BANK (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. THE BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
AGREEMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES NOR THE INSTITUTION OR
MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES
SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN
ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING
RESORT TO SUCH REMEDIES.

               Section 9.11.  Joint and Several Obligations. All obligations of
the Borrowers under this Agreement, the Note, the Applications and the
Collateral Documents shall be joint and several.

               Section 9.12.  Entire Agreement; Conflicts. This Agreement, the
Note, the Applications and the Collateral Documents set forth the entire
agreement of the parties with respect to the subject matter hereof and thereof
and supersede all previous understandings, written or oral, in respect thereof.
Any conflict between a term of this Agreement and a term of any Application
shall be resolved in favor of the term as set forth in this Agreement.

               Section 9.13.  Confidentiality. The Bank agrees with the
Borrowers to use commercially reasonable efforts to keep confidential all
non-public information. The Bank and each of its affiliates, directors,
officers, employees and representatives (a) shall not use such information
except in connection with the Revolving Commitment and proposed modifications
thereto and (b) shall, in accordance with its customary procedures for handling
confidential information and in accordance with safe and sound banking
practices, keep such information confidential, provided that nothing herein
shall limit the disclosure of any such information (i) to the extent required by
statute, rule, regulation or judicial process, (ii) to counsel for the Bank,
(iii) to bank examiners, auditors or accountants, (iv) to the

                                      -37-

<PAGE>

Bank, (v) in connection with any litigation to which the Bank is a party, (vi)
to a subsidiary or affiliate of the Bank, or (vii) to any Assignee or
Participant (or prospective Assignee or Participant) so long as the parties
identified in (vi) and (vii) agree in writing when provided with such
information to maintain the confidentiality of such information; provided,
further, that unless specifically prohibited by applicable law or court order,
the Bank agrees, prior to disclosure thereof, to notify the Borrowers of any
request for disclosure of any such non-public information (A) by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the Bank's financial condition by such
governmental agency) or (B) pursuant to legal process. The confidentiality
provisions of this Section 9.13 shall survive the termination of this Agreement.

               IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the day and
year first above written.

                                    MICROSTRATEGY INCORPORATED      [SEAL]

                                    By     /s/ Eric F. Brown
                                      ---------------------------------
                                           Name:  Eric F. Brown
                                           Title:  President and CFO

                                    (as to all Borrowers):
                                    1861 International Drive
                                    McLean, Virginia 22102

                                    STRATEGY.COM INCORPORATED       [SEAL]

                                    By     /s/ Eric F. Brown
                                      ---------------------------------
                                           Name:  Eric F. Brown
                                           Title:  CFO, VP Finance and Treasurer

                                    MICROSTRATEGY SERVICES CORPORATION    [SEAL]

                                    By     /s/ Eric F. Brown
                                      ---------------------------------
                                           Name:  Eric F. Brown
                                           Title:  Vice President and Treasurer

                                      -38-

<PAGE>

                                    MICROSTRATEGY MANAGEMENT
                                    CORPORATION                           [SEAL]

                                    By       /s/ Eric F. Brown
                                      ---------------------------------
                                             Name:  Eric F. Brown
                                             Title:  Treasurer

                                    MICROSTRATEGY ADMINISTRATION
                                    CORPORATION                           [SEAL]

                                    By       /s/ Eric F. Brown
                                      ---------------------------------
                                             Name:  Eric F. Brown
                                             Title:  President and Treasurer

                                    BANK OF AMERICA, N.A.                 [SEAL]

                                    By       /s/ Michael J. Landini
                                      ---------------------------------
                                             Michael J. Landini
                                             Senior Vice President

                                    1101 Wootton Parkway
                                    MD9-978-04-01
                                    Rockville, Maryland 20852

                                      -39-<PAGE>

                                                                    Exhibit 10.2

                               SECURITY AGREEMENT

               This SECURITY AGREEMENT (as amended, supplemented or modified
from time to time, this "Security Agreement") is dated as of May 19, 2003, and
is between MICROSTRATEGY INCORPORATED, a Delaware corporation, MICROSTRATEGY
SERVICES CORPORATION, a Delaware corporation, MICROSTRATEGY MANAGEMENT
CORPORATION, a Delaware corporation, MICROSTRATEGY ADMINISTRATION CORPORATION, a
Delaware corporation, and STRATEGY.COM INCORPORATED, a Delaware corporation
(individually and collectively, the "Debtor"); and BANK OF AMERICA, N.A., a
national banking association (the "Bank").

         The Debtor and the Bank are parties to a Secured Credit Agreement dated
as of May 19, 2003 (as amended to the date hereof and as further amended,
modified or supplemented from time to time, the "Credit Agreement," the terms
defined therein and not otherwise defined herein being used herein as therein
defined). It is a condition precedent to the making of Loans by the Bank under
the Credit Agreement that the Debtor shall have granted a security interest in
certain property to the Bank in accordance with this Security Agreement.
Accordingly, the parties hereto agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

               Section 1.1. Defined Terms. As used in this Security Agreement,
terms defined in the Credit Agreement shall have their defined meanings when
used herein, and the following terms shall have the following meanings:

               "Account Debtor" means, with respect to any Receivable or Other
Intangible, any Person obligated to make payment thereunder, including without
limitation any account debtor thereon.

               "Business Day" means a day other than a Saturday, Sunday or other
day on which commercial banks are authorized to close under the laws of the
Commonwealth of Virginia.

               "Collateral" has the meaning assigned to it in Section 2.1 of
this Security Agreement.

               "Equipment" means all goods (other than inventory, consumer goods
and farm products) now owned or hereafter acquired by the Debtor, including all
items of machinery, equipment, furnishings and fixtures of every kind, whether
affixed to real property or not, as well as all automobiles, trucks and vehicles
of every description, trailers, handling and delivery equipment, all additions
to, substitutions for, replacements of or accessions to any of the foregoing,
all attachments, components, parts (including spare parts) and accessories
whether installed thereon or affixed thereto and all fuel for any thereof.

               "Excluded Securities" means securities or other ownership
interests in a business entity (i) formed, organized or chartered under the laws
of a foreign country, or (ii) in which the Debtor has a minority interest.

               "Inventory" means all inventory now owned or hereafter acquired
by the Debtor, including (i) all goods and other personal property which are
held for sale or lease or are furnished or are to be furnished under a contract
of service or which constitute raw materials, work in process or materials

                                      -1-

<PAGE>

used or consumed or to be used or consumed in the Debtor's business, (ii) all
inventory, wherever located, evidenced by negotiable and non-negotiable
documents of title, warehouse receipts and bills of lading, (iii) all of the
Debtor's rights in, to and under all purchase orders now owned or hereafter
received or acquired by it for goods or services and (iv) all rights of the
Debtor as an unpaid seller, including rescission, replevin, reclamation and
stopping in transit.

               "License" means, with respect to any Patent, any agreement
granting any right to practice any invention covered by any Patent and, with
respect to any Trademark, any agreement granting any right to use any Trademark,
and "Licenses" means all of such Licenses.

               "Obligations" means (i) all amounts now or hereafter payable by
the Debtor to the Bank on the Note and the Applications, (ii) all other
obligations or liabilities now or hereafter payable by the Debtor pursuant to
the Credit Agreement, (iii) all obligations and liabilities now or hereafter
payable by the Debtor under, arising out of or in connection with this Security
Agreement or any other Collateral Document and (iv) all other indebtedness,
obligations and liabilities of the Debtor to the Bank, now existing or hereafter
arising or incurred, whether or not evidenced by notes or other instruments, and
whether such indebtedness, obligations and liabilities are direct or indirect,
fixed or contingent, liquidated or unliquidated, due or to become due, secured
or unsecured, joint, several or joint and several, related or unrelated to the
Loans, and arising out of or in connection with the Credit Agreement.

               "Other Intangibles" means all accounts, accounts receivable,
contract rights, documents, instruments, chattel paper (whether tangible or
electronic), investment property (other than Excluded Securities), money,
deposit accounts, software, commercial tort claims, letter-of-credit rights
(whether or not the letter of credit is evidenced by a writing), payment
intangibles and general intangibles now owned or hereafter acquired by the
Debtor including, without limitation, all customer lists, permits, federal and
state tax refunds, reversionary interests in pension plan assets, Trademarks,
Patents, Licenses, copyrights and other rights in intellectual property, other
than Receivables; together with all supporting obligations thereto.

               "Patent" means all letters patent of the United States or any
other county, and all applications for letters patent of the United States or
any other county, in which the Debtor may now or hereafter have any right, title
or interest and all reissues, continuations, continuations-in-part or extensions
thereof.

               "Proceeds" means all proceeds, including (i) whatever is received
upon any collection, exchange, sale or other disposition of any of the
Collateral and any property into which any of the Collateral is converted,
whether cash or non-cash, (ii) any and all payments or other property (in any
form whatsoever) made or due and payable on account of any insurance, indemnity,
warranty or guaranty payable to the Debtor with respect to any of the
Collateral, (iii) any and all payments (in any form whatsoever) made or due and
payable in connection with any requisition, confiscation, condemnation, seizure
or forfeiture of all or any part of the Collateral by any governmental body,
authority, bureau or agency (or any person, corporation, agency, authority or
other entity acting under color of any governmental authority), (iv) any claim
of the Debtor against third parties for past, present or future infringement of
any Patent or for past, present or future infringement or dilution of any
Trademark or for injury to the goodwill associated with any Trademark or for the
breach of any License and (v) any and all other amounts from time to time paid
or payable under or in connection with any of the Collateral.

               "Real Estate" means all real property and all buildings, plants,
furnishing or fixtures or other improvements to or construction on real property
now owned or hereafter acquired by the Debtor, and all leasehold interests now
owned or hereafter acquired by the Debtor in real property.

                                      -2-

<PAGE>

               "Receivables" means all accounts now or hereafter owing to the
Debtor, and all accounts receivable, contract rights, documents, instruments or
chattel paper (whether tangible or electronic) representing amounts payable or
monies due or to become due to the Debtor, whether or not earned by performance,
(i) for property that has been or is to be sold, leased, licensed, assigned or
otherwise disposed of, (ii) for services rendered or to be rendered, (iii) for a
policy or policies of insurance issued or to be issued (iv) for a secondary
obligation incurred or to be incurred, (v) for energy provided or to be
provided, (vi) for the use or hire of a vessel under a charter or other
contract, (vii) arising out of the use of a credit or charge card or information
contained on or for use with the card, and (viii) rights to
health-care-insurance receivables; together with all Inventory returned by or
reclaimed from customers wherever such Inventory is located, and all guaranties,
securities and liens held for the payment of any such account, account
receivable, contract right, document, instrument or chattel paper; together with
all other supporting obligations thereto; provided, however, that "Receivables"
shall not include accounts arising out of sales to an Account Debtor outside the
United States.

               "Trademark" means all right, title or interest which the Debtor
may now or hereafter have in any or all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
service marks, logos, other source of business identifiers, prints and labels on
which any of the foregoing have appeared or appear, designs and general
intangibles of like nature, now existing or hereafter adopted or acquired, all
registration and recordings thereof and all applications in connection
therewith, including without limitation, registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any State thereof or any other country or
political subdivision thereof and all reissues, extensions or renewals thereof.

               "UCC" means at any time the Uniform Commercial Code as the same
may from time to time be in effect in the Commonwealth of Virginia, provided
that, if, by reason of mandatory provisions of law, the validity or perfection
of any security interest granted herein is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than Virginia then, as to the validity
or perfection of such security interest, "UCC" shall mean the Uniform Commercial
Code in effect in such other jurisdiction.

               Section 1.2. UCC Definitions. The uncapitalized terms "account",
"account debtor", "chattel paper", "commercial tort claim", "contract right",
"document", "warehouse receipt", "bill of lading", "document of title",
electronic chattel paper", "equipment", "general intangible",
"health-care-insurance receivables", "instrument", "inventory", "investment
property", "Letter of credit rights", "money", "payment intangible", "proceeds",
"purchase money security interest", "securities", "software" and "supporting
obligations", as used in Section 1.1 or elsewhere in this Agreement, have the
meanings of such terms as defined in the UCC.

                                      -3-

<PAGE>

                                   ARTICLE II
                               SECURITY INTERESTS

               Section 2.1. Grant of Security Interests. To secure the due and
punctual payment of all Obligations, howsoever created, arising or evidenced,
whether direct or indirect, absolute or contingent, now or hereafter existing or
due or to become due, in accordance with the terms thereof and to secure the due
and punctual performance of all of the obligations of the Debtor contained in
the Credit Agreement and in the other Collateral Documents to which it is a
party and in order to induce the Bank to enter into the Credit Agreement and
make the loans provided for therein in accordance with the terms thereof, the
Debtor hereby grants to the Bank a security interest in all of the Debtor's
right, title and interest in, to and under all of the Debtor's assets,
including, without limitation, the following, whether now existing or hereafter
acquired (all of which are herein collectively called the "Collateral"):

                       (i)    all Receivables;

                       (ii)   all Other Intangibles;

                       (iii)  all Equipment;

                       (iv)   all Inventory;

                       (v)    to the extent not included in the foregoing, all
         other personal property, whether tangible or intangible, and wherever
         located, including, but not limited to, the balance of every deposit
         account now or hereafter existing of the Debtor with any financial
         institution and all monies of the Debtor and all rights to payment of
         money of the Debtor;

                       (vi)   to the extent not included in the foregoing, all
         books, ledgers and records and all computer programs, tapes, discs,
         data processing software, transaction files, master files and related
         property and rights (including computer and peripheral equipment)
         necessary or helpful in enforcing, identifying or establishing any item
         of Collateral; and

                       (vii)  to the extent not otherwise included, all Proceeds
         and products of any or all of the foregoing, whether existing on the
         date hereof or arising hereafter.

Notwithstanding the foregoing or anything to the contrary herein, "Collateral"
shall not include, and shall specifically exclude, all Excluded Securities, all
of the Debtor's rights, title and interest in the items set forth on Schedule 6
hereto, and all accounts arising out of sales to an Account Debtor outside the
United States.

               Section 2.2. Continuing Liability of the Debtor. Anything herein
to the contrary notwithstanding, the Debtor shall remain liable to observe and
perform all the terms and conditions to be observed and performed by it under
any contract, agreement, warranty or other obligation with respect to the
Collateral, and shall do nothing to impair the security interests herein
granted. The Bank shall not have any obligation or liability under any such
contract, agreement, warranty or obligation by reason of or arising out of this
Security Agreement or the receipt by the Bank of any payment relating to any
Collateral, nor shall the Bank be required to perform or fulfill any of the
obligations of the Debtor with respect to the Collateral, to make any inquiry as
to the nature or sufficiency of any payment received by it or the sufficiency of
the performance of any party's obligations with respect to any Collateral.

                                      -4-

<PAGE>

Furthermore, the Bank shall not be required to file any claim or demand to
collect any amount due or to enforce the performance of any party's obligations
with respect to, the Collateral.

               Section 2.3. Sales and Collections.

               (a)    The Debtor is authorized (i) to sell (Y) in the ordinary
course of its business for fair value and on an arm's-length basis any of its
Inventory normally held by it for such purpose and (Z) such other assets or
properties as permitted under Section 6.9 of the Credit Agreement, and (ii) to
use and consume, in the ordinary course of its business, any raw materials,
supplies and materials normally held by it for such purpose. The Bank may upon
the occurrence of any Event of Default, without cause or notice, curtail or
terminate such authority at any time.

               (b)    The Debtor is authorized to collect amounts owing to it
with respect to the Collateral. However, the Bank may at any time after the
occurrence of an Event of Default, notify Account Debtors obligated to make
payments under any or all Receivables or Other Intangibles that the Bank has a
security interest in such Collateral and that payments shall be made directly to
the Bank. Upon the request of the Bank at any time after the occurrence of an
Event of Default, the Debtor will so notify such account debtors. The Debtor
will use all reasonable efforts to cause each account debtor to comply with the
foregoing instruction. In furtherance of the foregoing, the Debtor authorizes
the Bank, after the occurrence of an Event of Default, (i) to ask for, demand,
collect, receive and give acquittances and receipts for any and all amounts due
and to become due under any Collateral and, in the name of the Debtor or its own
name or otherwise, (ii) to take possession of, indorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of moneys due
under any Collateral and (iii) to file any claim or take any other action in any
court of law or equity or otherwise which it may deem appropriate for the
purpose of collecting any amounts due under any Collateral.

               Section 2.4. Segregation of Proceeds.

               (a)    The Bank shall have the right at any time (regardless of
whether or not an Event of Default shall have occurred) to cause to be opened
and maintained at the principal office of the Bank a non-interest bearing bank
account (the "Cash Collateral Account") which will contain only Proceeds. Any
cash proceeds (as such term is defined in Section 9A-102(a)(9) of the UCC)
received by the Bank directly from Account Debtors obligated to make payments
under Receivables or Other Intangibles to the Bank pursuant to Section 2.3 or
from the Debtor pursuant to clause (b) of this Section 2.4, whether consisting
of checks, notes, drafts, bills of exchange, money orders, commercial paper or
other Proceeds received on account of any Collateral, shall be promptly
deposited in the Cash Collateral Account, and until so deposited shall be held
in trust for and as the Bank's property and shall not be commingled with any
funds of the Debtor not constituting Proceeds of Collateral. The name in which
the Cash Collateral Account is carried shall clearly indicate that the funds
deposited therein are the property of the Debtor, subject to the security
interest of the Bank hereunder. Such Proceeds, when deposited, shall continue to
be security for the Obligations and shall not constitute payment thereof until
applied as hereinafter provided. The Bank shall have sole dominion and control
over the funds deposited in the Cash Collateral Account, and such funds may be
withdrawn therefrom only by the Bank; provided, however, that until an Event of
Default shall occur, all collected funds on deposit in the Cash Collateral
Account, or so much thereof as is not required to make payment of the
Obligations which have become due and payable, shall be withdrawn by the Bank on
the Business Day next following the day on which the Bank considers the funds
deposited therein to be collected funds and disbursed to the Debtor or its
order.

               (b)    Upon notice by the Bank to the Debtor after the occurrence
of an Event of Default that the Cash Collateral Account has been opened, the
Debtor shall cause all cash Proceeds

                                      -5-

<PAGE>

collected by it to be delivered to the Bank forthwith upon receipt, in the
original form in which received (with such indorsements or assignments as may be
necessary to permit collection thereof by the Bank), and for such purpose the
Debtor hereby irrevocably authorizes and empowers the Bank, its officers,
employees and authorized agents to indorse and sign the name of the Debtor on
all checks, drafts, money orders or other media of payment so delivered, and
such indorsements or assignments shall, for all purposes, be deemed to have been
made by the Debtor prior to any indorsement or assignment thereof by the Bank.
The Bank may use any convenient or customary means for the purpose of collecting
such checks, drafts, money orders or other media of payment.

               Section 2.5.  [Intentionally Deleted]

               Section 2.6.  Release of Collateral.

               (a)    The Debtor may sell or realize upon or transfer or
otherwise dispose of Collateral as permitted by Section 4.13 or as allowed under
the Credit Agreement, and the security interests of the Bank in such Collateral
so sold, realized upon or disposed of (but not in the Proceeds arising from such
sale, realization or disposition) shall cease immediately upon such sale,
realization or disposition, without any further action on the part of the Bank.
The Bank, if requested in writing by the Debtor but at the expense of the
Debtor, is hereby authorized and instructed to deliver to the Account Debtor or
the purchaser or other transferee of any such Collateral a certificate stating
that the Bank no longer has a security interest therein, and such Account Debtor
or such purchaser or other transferee shall be entitled to rely conclusively on
such certificate for any and all purposes.

               (b)    Upon the payment in full of all of the Obligations and if
there is no commitment by the Bank to make further advances, incur obligations
or otherwise give value, the Bank will (as soon as reasonably practicable after
receipt of notice from the Debtor requesting the same but at the expense of the
Debtor) send the Debtor, for each jurisdiction in which a UCC financing
statement is on file to perfect the security interests granted to the Bank
hereunder, a termination statement to the effect that the Bank no longer claims
a security interest under such financing statement.

               Section 2.7.  Security Interests Absolute. All rights of the Bank
and security interests hereunder, and all obligations of the Debtor hereunder,
shall be absolute and unconditional (subject to the provisions hereof and of the
other Loan Documents) and, without limiting the generality of the foregoing,
shall not be released, discharged or otherwise affected by:

                      (i)    any extension, renewal, settlement, compromise,
waiver or release in respect of any Obligation, the Note or any other document
evidencing or securing such Obligation, by operation of law or otherwise;

                      (ii)   any modification or amendment or supplement to the
Note or any indorsement or guaranty of the Note or any other document evidencing
or securing any Obligation;

                      (iii)  any release, non-perfection or invalidity of any
direct or indirect security for any Obligation;

                      (iv)   any change in the existence, structure or ownership
of any Debtor, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting any Debtor or its assets or any resulting disallowance,
release or discharge of all or any portion of the Obligations;

                                      -6-

<PAGE>

                      (v)    the existence of any claim, set-off or other right
which any Debtor may have at any time against any other Debtor, the Bank or any
other corporation or person, whether in connection herewith or any unrelated
transactions; provided, that nothing herein shall prevent the assertion of any
such claim by separate suit or compulsory counterclaim;

                      (vi)   any invalidity or unenforceability relating to or
against any Debtor for any reason of any Obligation, or any provision of
applicable law or regulation purporting to prohibit the payment by any Debtor of
the Obligations;

                      (vii)  any failure by the Bank (A) to file or enforce a
claim against any Debtor or its estate (in a bankruptcy or other proceeding),
(B) to give notice of the existence, creation or incurring by any Debtor of any
new or additional indebtedness or obligation under or with respect to the
Obligations, (C) to commence any action against any Debtor, (D) to disclose to
any Debtor any facts which the Bank may now or hereafter know with regard to any
other Debtor, or (E) to proceed with due diligence in the collection, protection
or realization upon any collateral securing the Obligations; or

                      (viii) any other act or omission to act or delay of any
kind by any Debtor, the Bank, or any other corporation or person, or any other
circumstance whatsoever which might, but for the provisions of this clause,
constitute a legal or equitable discharge of any Debtor's obligations hereunder.

                                   ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

               The Debtor represents and warrants that:

               Section 3.1.   Existence and Power. The Debtor is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware, and no other jurisdiction. The name of the Debtor, as set
forth on the signature pages of this Security Agreement, is as said name appears
in the public records of said jurisdiction. The Debtor has all organizational
powers and all material governmental licenses, authorizations, consents and
approvals required to carry on its business as now conducted. The Debtor is duly
qualified as a foreign corporation, licensed and in good standing in each
jurisdiction where qualification or licensing is required by the nature of its
business or the character and location of its property, business or customers
and in which the failure to so qualify or be licensed, as the case may be, in
the aggregate, could have a material adverse effect on the business, financial
position, results of operations, properties or prospects of the Debtor and their
Consolidated Subsidiaries, taken as a whole.

               Section 3.2.   Validity of Security Agreement; Consents. The
execution, delivery and performance of this Security Agreement and the creation
of the security interests provided for herein (i) are within the Debtor's
corporate power, (ii) have been duly authorized by all necessary corporate
action, including action of its shareholders, where required, of the Debtor,
(iii) are not in contravention of any provision of the Debtor's articles of
incorporation or by-laws, do not violate any law or regulation or any order or
decree of any court or governmental instrumentality applicable to the Debtor, do
not conflict with or result in a breach of, or constitute a default under, any
indenture, mortgage, deed of trust, lease, agreement or other instrument to
which the Debtor is a party or by which it or any of its properties is bound, in
the case of each of the foregoing under this clause (iii), except as would not
have a material adverse effect on the business, financial position, results of
operations, properties or prospects of the Debtor, the Debtors and their
Consolidated Subsidiaries, taken as a whole, (iv) do not result in the

                                      -7-

<PAGE>

creation or imposition of any Lien upon any material portion of the property of
the Debtor other than in favor of the Bank or Permitted Liens and (v) do not
require the consent or approval of any governmental body, agency or official or
other person other than those that have been obtained or as may be required by
applicable foreign law. This Security Agreement has been duly executed and
delivered by the Debtor and constitutes the legal, valid and binding obligation
of the Debtor, enforceable against it in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or affecting the
enforceability of creditors' rights generally and by general provisions of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).

               Section 3.3.  Title to Collateral. Except for the security
interests granted to the Bank pursuant to this Security Agreement, the Debtor is
the sole owner of each item of the Collateral, having good and marketable title
thereto, free and clear of any and all Liens except Permitted Liens.

               Section 3.4.  Validity, Perfection and Priority of Security
Interests.

               (a)    By complying with Section 4.1, the Debtor will have
created a valid security interest in favor of the Bank in all existing
Collateral and in all identifiable Proceeds of such Collateral, which security
interest (except (1) in respect of motor vehicles for which the exclusive manner
of perfecting a security interest therein is by noting such security interest in
the certificate of title in accordance with local law, (2) to the extent filings
are required with the U.S. Patent and Trademark Office or the Register of
Copyrights to perfect a security interest, (3) to the extent control agreements
are required to perfect a security interest, and (4) as may be required under
applicable foreign law) would be prior to the claims of a trustee in bankruptcy
under Section 544(a) of the United States federal Bankruptcy Code. Continuing
compliance by the Debtor with the provisions of Section 4.2 will also (i) create
valid security interests in all Collateral acquired after the date hereof and in
all identifiable Proceeds of such Collateral and (ii) cause such security
interests in all Collateral and in all Proceeds which are (A) identifiable cash
Proceeds of Collateral covered by financing statements required to be filed
hereunder, (B) identifiable Proceeds in which a security interest may be
perfected by such filing under the UCC and (C) any Proceeds in the Cash
Collateral Account to be duly perfected under the UCC, in each case prior to the
claims of a trustee in bankruptcy under the United States federal Bankruptcy
Code (except (1) in respect of motor vehicles for which the exclusive manner of
perfecting a security interest therein is by noting such security interest in
the certificate of title in accordance with local law, (2) to the extent filings
are required with the U.S. Patent and Trademark Office or the Register of
Copyrights to perfect a security interest, (3) to the extent control agreements
are required to perfect a security interest, and (4) as may be required under
applicable foreign law).

               (b)    The security interests of the Bank in the Collateral rank
first in priority (except (1) in respect of motor vehicles for which the
exclusive manner of perfecting a security interest therein is by noting such
security interest in the certificate of title in accordance with local law, (2)
to the extent filings are required with the U.S. Patent and Trademark Office or
the Register of Copyrights to perfect a security interest, (3) to the extent
control agreements are required to perfect a security interest, and (4) as may
be required under applicable foreign law), except that the priority of the
security interests may be subject to Permitted Liens. Other than financing
statements or other similar documents perfecting the security interests or deed
of trust liens of the Bank, no financing statements, deeds of trust, mortgages
or similar documents covering all or any part of the Collateral are on file or
of record in any government office in any jurisdiction in which such filing or
recording would be effective to perfect a security interest in such Collateral
(except in favor of Foothill Capital Corporation or regarding Permitted Liens),

                                      -8-

<PAGE>

nor is any of the Collateral in the possession of any Person (other than the
Debtor) asserting any claim thereto or security interest therein.

               Section 3.5. Enforceability of Receivables and Other Intangibles.
To the best knowledge of the Debtor, each Receivable and Other Intangible is a
valid and binding obligation of the related Account Debtor in respect thereof,
enforceable in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
general provisions of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and complies with any
applicable legal requirements, subject to ordinary course adjustments.

               Section 3.6. Place of Business; Location of Collateral. Schedule
1 correctly sets forth the Debtor's chief executive office and the offices of
the Debtor where records concerning Receivables and Other Intangibles are kept.
Schedule 2 correctly sets forth the location of all Equipment and Inventory,
other than rolling stock, aircraft, goods in transit, Inventory sold in the
ordinary course of business as permitted by Section 4.13 of this Security
Agreement, and goods which are moveable in the ordinary course. Except as
otherwise specified in Schedule 2, all Inventory and Equipment has been located
at the address specified on Schedule 2 at all times during the four-month period
prior to the date hereof while owned by the Debtor (except with respect to such
which is in transit or moveable in the ordinary course). All Inventory has been
and will be produced in compliance with the Fair Labor Standards Act, 29 U.S.C.
ss.ss. 201-219. No Inventory is evidenced by a negotiable document of title,
warehouse receipt or bill of lading. No non-negotiable document of title,
warehouse receipt or bill of lading has been issued to any person other than the
Debtor, and the Debtor has retained possession of all of such non-negotiable
documents, warehouse receipts and bills of lading. No amount payable under or in
connection with any of the Collateral is evidenced by promissory notes or other
instruments, except to the extent the Debtor has notified the Bank thereof. The
real estate listed in Schedule 3 constitutes all existing Real Estate.

               Section 3.7. Trade Names. Any and all trade names, division
names, assumed names or other names under which the Debtor transacts, or within
the four-month period prior to the date hereof has transacted, business are
specified on Schedule 4.

               Section 3.8. Nature of Collateral and Obligations. None of the
Obligations has been incurred for personal, family or household purposes. None
of the Collateral is or is to be used, acquired, or held for personal, family,
or household use.

                                   ARTICLE IV
                                    COVENANTS

               The Debtor covenants and agrees with the Bank that until the
payment in full of all Obligations and until there is no commitment by the Bank
to make further advances, incur obligations or otherwise give value under the
Credit Agreement or the Note, the Debtor will comply with the following.

               Section 4.1. Perfection of Security Interests. The Debtor will,
at it expense, cause all filings and recordings and other actions specified on
Schedule 5 to have been completed on or prior to the date of the first Loan
under the Credit Agreement.

                                      -9-

<PAGE>

               Section 4.2. Further Actions.

               (a)    At all times after the date of the first Loan under the
Credit Agreement, the Debtor will, at its expense, comply with the following:

                      (i)    as to all Receivables, Other Intangibles, Equipment
         and Inventory, it will authorize the Bank to file UCC financing
         statements and continuation statements and to keep the same on file in
         all applicable jurisdictions as required to perfect the security
         interests granted to the Bank hereunder, to the extent that applicable
         law permits perfection of a security interest by filing under the UCC;

                      (ii)   as to all Proceeds, it will authorize the Bank to
         cause all UCC financing statements and continuation statements filed in
         accordance with clause (i) above to include a statement or a checked
         box indicating that Proceeds of all items of Collateral described
         therein are covered, if required under state law;

                      (iii)  upon the request of the Bank, it will ensure that
         the provisions of Section 2.4 are complied with;

                      (iv)   as to (A) any amount payable under or in connection
         with any of the Collateral which shall be or shall become evidenced by
         any promissory note or other instrument, or tangible chattel paper, or
         (B) any negotiable document or certificated security, the Debtor will
         immediately pledge and deliver such property to the Bank as part of the
         Collateral, duly indorsed or assigned in a manner satisfactory to the
         Bank if required;

                      (v)    as to all Real Estate acquired after the date
         hereof, the Debtor will execute and record such additional mortgages,
         deeds of trust or other real estate security documents (other than
         leasehold mortgages or landlord waivers) in such form as shall be
         satisfactory to the Bank so as to create a valid first priority lien
         thereon in favor of the Bank;

                      (vi)   as to all electronic chattel paper and
         letter-of-credit rights, the Debtor shall cause the Bank to obtain
         "control" (within the meaning of Sections 8.9A-105 and 8.9A-107,
         respectively, of the UCC) of such property, with any agreements
         establishing control to be in form and substance satisfactory to the
         Bank; and

                      (vii)  as to commercial tort claims, if the Debtor shall
         at any time acquire a "commercial tort claim", as defined in Section
         8.9A-102(a)(13) of the UCC, in excess of $250,000, the Debtor shall
         immediately notify the Bank in a writing signed by the Debtor of the
         brief details thereof and grant to the Bank in such writing a security
         interest therein and in the proceeds thereof, all upon the terms of
         this Security Agreement, with such writing to be in form and substance
         satisfactory to the Bank.

               (b)    The Debtor will, from time to time and at its expense,
authorize the Bank to execute, deliver, file or record such financing statements
pursuant to the Uniform Commercial Code,

                                      -10-

<PAGE>

applications for certificates of title and such other statements, assignments,
instruments, documents, agreements or other papers (other than (1) in respect of
motor vehicles for which the exclusive manner of perfecting a security interest
therein is by noting such security interest in the certificate of title in
accordance with local law, (2) control agreement, landlord waivers, leasehold
mortgages and bailee acknowledgments, (3) as may be required under applicable
foreign law, and (4) prior to the occurrence of an Event of Default, filings
with the U.S. Patent and Trademark Office or the Register of Copyrights), and
take any other action that may be necessary, or that the Bank may reasonably
request, in order to create, preserve, perfect, confirm or validate the security
interests, to enable the Bank to obtain the full benefits of this Security
Agreement or to enable it to exercise and enforce any of its rights, powers and
remedies hereunder, including, without limitation, its right to take possession
of the Collateral.

               (c)    To the fullest extent permitted by law, the Bank may at
any time and from time to time, file financing statements, continuation
statements and amendments thereto that describe the Collateral as all assets of
the Debtor or words of similar effect and which contain any other information
required by the UCC for the sufficiency or filing office acceptance of any
financing statement, continuation statement or amendment, including whether the
Debtor is an organization, the type of organization and any organization
identification number issued to the Debtor. The Debtor agrees to furnish any
such information to the Bank promptly upon request. Any such financing
statements, continuation statements or amendments may be signed by the Bank on
behalf of the Debtor, and may be filed at any time in any jurisdiction whether
or not Revised Article 9 is then in effect in that jurisdiction. The Debtor
hereby irrevocably appoints the Bank as the Debtor's attorney-in-fact, coupled
with an interest, for the purposes of this Section 4.2. As used herein, "Revised
Article 9" means the revised Article 9 of he Uniform Commercial Code in the form
or substantially in the form approved in 1998 by the American Law Institute and
the National Conference of Commissioners on Uniform State Law

               Section 4.3. Change of Name, Identity or Structure. The Debtor
will not change its name, identity or organizational structure in any manner
and, except as set forth on Schedule 4, will not conduct its business under any
trade, assumed or fictitious name unless it shall have given the Bank at least
thirty days' prior written notice thereof and shall have taken all action (or
made arrangements to take such action substantially simultaneously with such
change if it is impossible to take such action in advance) necessary or
reasonably requested by the Bank to amend any financing statement or
continuation statement relating to the security interests granted hereby in
order to preserve such security interests and to effectuate or maintain the
priority thereof against all Persons.

               Section 4.4. State of Organization, Place of Business and
Collateral. The Debtor will not change the state of its organization, or become
organized under the laws of any additional state. The Debtor will not change the
location of (i) its places of business, (ii) its chief executive office or (iii)
the office or other locations where it keeps or holds any Collateral or any
records relating thereto from the applicable location listed on Schedule 1 or 2
hereto, or any locations permitted under Section 3.6, unless, prior to such
change, it notifies the Bank of such change, makes all UCC filings required by
Section 4.2 and takes all other action necessary or that the Bank may reasonably
request (other than (1) in respect of motor vehicles for which the exclusive
manner of perfecting a security interest therein is by noting such security
interest in the certificate of title in accordance with local law, (2) control
agreement, landlord waivers, leasehold mortgages and bailee acknowledgments, (3)
as may be required under applicable foreign law, and (4) prior to the occurrence
of an Event of Default, filings with the U.S. Patent and Trademark Office or the
Register of Copyrights) to preserve, perfect, confirm and protect the security
interests granted hereby. The Debtor will in no event change the location of any
Collateral if such change would cause the security interest granted hereby in
such Collateral to lapse or cease to be perfected. The Debtor will at all times
maintain its chief executive office within the United States.

                                      -11-

<PAGE>

               Section 4.5.  Fixtures. The Debtor will not permit any Equipment
to become a fixture unless it shall have given the Bank at least ten days' prior
written notice thereof and shall have taken all such action and delivered or
caused to be delivered to the Bank all instruments and documents, including,
without limitation, waivers and subordination agreements by any landlords and
mortgagees, and filed all financing statements necessary or reasonably requested
by the Bank, to preserve and protect the security interest granted herein and to
effectuate or maintain the priority thereof against all Persons.

               Section 4.6.  Maintenance of Records. The Debtor will keep and
maintain at its own cost and expense complete books and records, consistent with
the requirements of GAAP, relating to the Collateral which are reasonably
satisfactory to the Bank including, without limitation, a record of all payments
received and all credits granted with respect to the Collateral and all of its
other dealings with the Collateral. The Debtor will mark its books and records
pertaining to the Collateral to evidence this Security Agreement and the
security interests granted hereby. For the Bank's further security, the Debtor
agrees that the Bank shall have a special property interest in all of the
Debtor's books and records pertaining to the Collateral and the Debtor shall
deliver and turn over any such books and records to the Bank or to its
representatives at any time on demand of the Bank.

               Section 4.7.  Compliance with Laws, etc. The Debtor will comply,
in all material respects, with all acts, rules, regulations, orders, decrees and
directions of any governmental body, agency or official applicable to the
Collateral or any part thereof or to the operation of the Debtor's business
except to the extent that the failure to comply would not have a material
adverse effect on the financial or other condition of the Debtor, the Debtors
and their Consolidated Subsidiaries, taken as a whole; provided, however, that
the Debtor may contest any act, regulation, order, decree or direction in any
reasonable manner which shall not in the sole reasonable opinion of the Bank
adversely affect the Bank's rights or the first priority (subject to Permitted
Liens) of its security interest in the Collateral.

               Section 4.8.  Payment of Taxes, etc. The Debtor will pay promptly
when due, all taxes, assessments and governmental charges or levies imposed upon
the Collateral or in respect of its income or profits therefrom, as well as all
claims of any kind (including claims for labor, materials and supplies), except
that no such charge need be paid if (i) the validity thereof is being contested
in good faith by appropriate proceedings and (ii) such charge is adequately
reserved against in accordance with GAAP.

               Section 4.9.  Compliance with Terms of Accounts, Contracts and
Licenses. The Debtor will perform and comply in all material respects with all
of its obligations under and, all agreements relating to the Collateral to which
it is a party or by which it is bound, except as may be contested in good faith
and in the exercise of the Debtor's reasonable business judgment.

               Section 4.10. Limitation on Liens on Collateral and Excluded
Securities. The Debtor will not create, permit or suffer to exist, and will
defend the Collateral and Excluded Securities and the Debtor's rights with
respect thereto against and take such other action as is necessary to remove,
any Lien, security interest, encumbrance, or claim in or to the Collateral and
Excluded Securities other than the security interests created hereunder, and
except for Permitted Liens.

               Section 4.11. Limitations on Modifications of Receivables and
Other Intangibles; No Waivers or Extensions. The Debtor will not, except in the
exercise of the Debtor's reasonable business judgment, (i) amend, modify,
terminate or waive any provision of any material Receivable or Other Intangible
in any manner which might have a materially adverse effect on the value of such
Receivable or Other Intangible as Collateral, (ii) fail to exercise promptly and
diligently each and every

                                      -12-

<PAGE>

material right which it may have under each Receivable and Other Intangible or
(iii) fail to deliver to the Bank a copy of each material demand, notice or
document received by it relating in any way to any Receivable or Other
Intangible. The Debtor will not, without the Bank's prior written consent, grant
any extension of the time of payment of any Receivable or amounts due under any
material Other Intangible, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any person liable for the
payment thereof or allow any credit or discount whatsoever thereon other than
trade discounts granted in the normal course of business, except such as in the
reasonable judgment of the Debtor are advisable.

               Section 4.12. Maintenance of Insurance. The Debtor will maintain
with financially sound insurance companies licensed to do business in Virginia
insurance policies (i) insuring the Inventory and Equipment against loss by
fire, explosion, theft and such other casualties as are usually insured against
by companies engaged in the same or similar business for an amount reasonably
satisfactory to the Bank and (ii) insuring the Debtor and the Bank against
liability for personal injury arising from, and property damage relating to,
such Inventory and Equipment, such policies to be in such form and to cover such
amounts as may be satisfactory to the Bank, with losses payable to the Debtor
and the Bank as their respective interests may appear. The Debtor shall, if so
requested by the Bank, deliver to the Bank as often as the Bank may reasonably
request a report of the Debtor or, if requested by the Bank, of an insurance
broker reasonably satisfactory to the Bank of the insurance on the Inventory and
Equipment. All insurance with respect to the Inventory and the Equipment shall
(i) contain a standard mortgagee clause in favor of the Bank, (ii) provide that
any loss shall be payable in accordance with the terms thereof notwithstanding
any act of the Debtor which might otherwise result in forfeiture of such
insurance and that the insurer waives all rights of set-off, counterclaim,
deduction or subrogation against the Debtor, (iii) provide that no cancellation,
reduction in amount or change in coverage therefor shall be effective until at
least 30 days after receipt by the Bank of written notice thereof and (iii)
provide that the Bank may, but shall not be obligated to, pay premiums in
respect thereof.

               Section 4.13. Limitations on Dispositions of Collateral and
Excluded Securities . The Debtor will not directly or indirectly (through the
sale of stock, merger or otherwise) without the prior written consent of the
Bank sell, transfer, lease or otherwise dispose of any of the Collateral or
Excluded Securities, or attempt, offer or contract to do so except for (i) sales
of Inventory in the ordinary course of its business for fair value in
arm's-length transactions; (ii) so long as no Default has occurred and is
continuing, dispositions in a commercially reasonable manner of Equipment which
has become redundant, worn out or obsolete or which should be replaced so as to
improve productivity, so long as the proceeds of any such disposition which
would cause the aggregate of all such dispositions to exceed $250,000 are (A)
used to acquire replacement equipment which has comparable or better utility and
equivalent or better value and which is subject to a first priority security
interest in favor of the Bank therein, except as permitted by Section 4.9 and
except for Permitted Liens, or (B) applied to repay the Obligations; and (iii)
such transactions as are permitted under the Loan Agreement. The inclusion of
Proceeds of the Collateral under the security interests granted hereby shall not
be deemed a consent by the Bank to any sale or disposition of any Collateral
other than as permitted by this Section 4.13.

               Section 4.14. Further Identification of Collateral. The Debtor
will furnish to the Bank from time to time statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as the Bank may reasonably request.

               Section 4.15. Notices. The Debtor will advise the Bank promptly
and in reasonable detail, (i) of any Lien, security interest, encumbrance or
claim made or asserted against any material portion of the Collateral, (ii) of
any material change in the composition of the Collateral, and (iii) of the

                                      -13-

<PAGE>

occurrence of any other event which would have a material effect on the
aggregate value of the Collateral or on the security interests granted to the
Bank in this Security Agreement.

               Section 4.16. [Intentionally Deleted]

               Section 4.17. Right of Inspection. The Bank shall, upon prior
notice, during normal business hours and at reasonable intervals prior to the
occurrence of a Default, have access to all the books, correspondence and
records of the Debtor, and the Bank or its representatives may examine the same,
take extracts therefrom, make photocopies thereof and have such discussions with
officers, employees and public accountants of the Debtor as the Bank may deem
necessary, and the Debtor agrees to render to the Bank, at the Debtor's cost and
expense, such clerical and other assistance as may be reasonably requested with
regard thereto. The Bank and its representatives shall, upon prior notice,
during normal business hours and at reasonable intervals prior to the occurrence
of a Default, also have the right to enter into and upon any premises where any
of the Inventory or Equipment is located for the purpose of inspecting the same,
observing its use or protecting interests of the Bank therein.

               Section 4.18. Maintenance of Equipment. The Debtor will, at its
expense, generally maintain the Equipment in good operating condition, ordinary
wear and tear excepted.

               Section 4.19. Covenants Regarding Patent and Trademark
Collateral.

               (a)    At such time as the Debtor shall acquire any Patents or
Trademarks, it will comply with the terms, covenants and warranties of this
Section 4.19.

               (b)    The Debtor (either itself or through licensees) will,
unless the Debtor shall reasonably determine to the contrary in the exercise of
its reasonable business judgment, (A) continue to use each Trademark on each and
every Trademark class of goods applicable to its current products and services
and applicable to such Trademark as reflected in its current catalogs, brochures
and price lists in order to maintain each Trademark in full force and free from
any claim of abandonment for non-use, (B) maintain as in the past the quality of
products and services offered under each Trademark, (C) employ each Trademark
with the appropriate notice of registration, (D) not adopt or use any mark which
is confusingly similar or a colorable imitation of any Trademark and (E) not
(and not permit any licensee or sublicensee thereof to) do any act or knowingly
omit to do any act whereby any Trademark may become invalidated.

               (c)    The Debtor will not, unless the Debtor shall reasonably
determine to the contrary in the exercise of its reasonable business judgment,
do any act, or omit to do any act, whereby any Patent necessary for its business
may be abandoned or dedicated.

               (d)    The Debtor shall notify the Bank immediately if its knows,
or has reason to know, that any application or registration relating to any
Patent or Trademark that is necessary to its business may become abandoned or
dedicated, or of any material and adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in any proceeding in the United States Patent and Trademark Office
or any court or tribunal in any country) regarding the Debtor's ownership of any
Patent or Trademark, its right to register the same or keep and maintain the
same.

               (e)    In no event shall the Debtor, either itself or through any
agent, employee, licensee or designee, file an application for registration of
any Patent or Trademark with the United

                                      -14-

<PAGE>

States Patent and Trademark Office or any similar office or agency in any other
country or any political subdivision thereof, unless it promptly informs the
Bank and, upon request of the Bank, executes and delivers any and all
agreements, instruments, documents and papers (provided, that until an Event of
Default shall have occurred, there shall be no obligation to make any filings
with the United States Patent and Trademark Office) as the Bank may reasonably
request to evidence the Bank's security interest in such Patent or Trademark and
the goodwill and general intangibles of the Debtor relating thereto or
represented thereby, and the Debtor hereby constitutes the Bank its
attorney-in-fact to execute and file all such writings for the foregoing
purposes, all such acts of such attorney being hereby ratified and confirmed.
Such power being coupled with an interest is irrevocable until the Obligations
are paid and satisfied in full.

               (f)    The Debtor will take all necessary steps, including,
without limitation, in any proceeding before the United States Patent and
Trademark Office or any similar office or agency in any other country or any
political subdivision thereof, to maintain and pursue each application (and to
obtain the relevant registration) and to maintain each registration of the
Patents and Trademarks which are necessary to the Debtor's business, including
without limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability, unless the Debtor shall reasonably determine to
the contrary in the exercise of its reasonable business judgment.

               (g)    If any of the Patent and Trademark Collateral that is
material to the Debtor's business is infringed, misappropriated or diluted by a
third party, the Debtor shall promptly notify the Bank after it learns thereof
and shall, unless the Debtor shall reasonably determine to the contrary in the
exercise of its reasonable business judgment, promptly sue for infringement,
misappropriation or dilution, seek injunctive relief where appropriate and to
recover any and all damages for such infringement, misappropriation or dilution,
or to take such other action as the Debtor shall reasonably deem appropriate
under the circumstances to protect such Patent and Trademark Collateral.

               Section 4.20. Reimbursement Obligation. Should the Debtor fail to
comply with the provisions of the Credit Agreement, this Security Agreement, any
other Collateral Document to which it is a party or any other agreement relating
to the Collateral such that the value of any Collateral or the validity,
perfection, rank or value of any security interest granted to the Bank hereunder
or thereunder is thereby diminished or potentially diminished or put at risk (as
reasonably determined by the Bank, but consistent with the initial undertakings
hereunder), the Bank on behalf of the Debtor may, but shall not be required to,
effect such compliance on behalf of the Debtor, and the Debtor shall reimburse
the Bank for the reasonable cost thereof on demand, and interest shall accrue on
such reimbursement obligation from the date the relevant costs are incurred
until reimbursement thereof in full at the interest rate then applicable under
the Note.

                                    ARTICLE V
                          REMEDIES; RIGHTS UPON DEFAULT

               Section 5.1.  UCC Rights. If any Event of Default shall have
occurred, the Bank may in addition to all other rights and remedies granted to
it in this Security Agreement and in any other instrument or agreement securing,
evidencing or relating to the Obligations, exercise all rights and remedies of a
secured party under the UCC and all other rights available to the Bank at law or
in equity.

               Section 5.2.  Payments on Collateral. Without limiting the rights
of the Bank under any other provision of the Security Agreement, upon the
occurrence of an Event of Default:

                                      -15-

<PAGE>

                       (i)    upon the written request of the Bank to do so, all
         payments received by the Debtor under or in connection with any of the
         Collateral shall be held by the Debtor in trust for the Bank, shall be
         segregated from other funds of the Debtor and shall forthwith upon
         receipt by the Debtor be turned over to the Bank, in the same form as
         received by the Debtor (duly indorsed by the Debtor to the Bank, if
         required to permit collection thereof by the Bank); and

                       (ii)   all such payments received by the Bank (whether
         from the Debtor or otherwise) may, in the sole discretion of the Bank,
         be held by the Bank as collateral security for, and/or then or at any
         time thereafter applied in whole or in part by the Bank to the payment
         of, the expenses and Obligations as set forth in Section 5.10.

               Section 5.3. Possession of Collateral. In furtherance of the
foregoing, the Debtor expressly agrees that, if an Event of Default shall occur
and be continuing, the Bank may (i) by judicial powers, or without judicial
process if it can be done without breach of the peace, enter any premises where
any of such Collateral is or may be located, and without charge or liability to
the Bank seize and remove such Collateral from such premises and (ii) have
access to and use of the Debtor's books and records relating to such Collateral.

               Section 5.4. Sale of Collateral.

               (a)    The Debtor expressly agrees that if an Event of Default
shall occur and be continuing, the Bank, without demand of performance or other
demand or notice of any kind (except the notice specified below of the time and
place of any public or private sale) to the Debtor or any other Person (all of
which demands and/or notices are hereby waived by the Debtor), may forthwith
collect, receive, appropriate and realize upon the Collateral and/or forthwith
sell, lease, assign, give an option or options to purchase or otherwise dispose
of and deliver the Collateral (or contract to do so) or any part thereof in one
or more parcels at public or private sale, at any exchange, broker's board or at
any office of the Bank or elsewhere in such manner as is commercially reasonable
and as the Bank may deem best, for cash or on credit or for future delivery
without assumption of any credit risk. The Bank shall have the right upon any
such public sale, and, to the extent permitted by law, upon any such private
sale, to purchase the whole or any part of the Collateral so sold. The Debtor
further agrees, at the Bank's request, to assemble the Collateral, and to make
it available to the Bank at places which the Bank may reasonably select. To the
extent permitted by applicable law, the Debtor waives all claims, damages and
demands against the Bank arising out of the foreclosure, repossession, retention
or sale of the Collateral, so long as such is done in a commercially reasonable
manner.

               (b)    Unless the Collateral is perishable, threatens to decline
speedily in value or is of a type customarily sold in a recognized market, the
Bank shall give the Debtor ten business days' notice of its intention to make
any such public or private sale or sale at a broker's board or on a securities
exchange. The Bank shall not be required or obligated to make any such sale
pursuant to any such notice. The Bank may adjourn any public or private sale or
cause the same to be adjourned from time to time by announcement at the time and
place fixed for the sale, and such sale may be made at any time or place to
which the same may be so adjourned. In the case of any sale of all or any part
of the Collateral for credit or for future delivery, the Collateral so sold may
be retained by the Bank until the selling price is paid by the purchaser
thereof, but the Bank shall not incur any liability in case of failure of such
purchaser to pay

                                      -16-

<PAGE>

for the Collateral so sold and, in the case of such failure, such Collateral may
again be sold upon like notice.

               Section 5.5. Rights of Purchasers. Upon any sale of the
Collateral (whether public or private) in accordance with this Security
Agreement and applicable law, the Bank shall have the right to deliver, assign
and transfer to the purchaser thereof the Collateral so sold. Each purchaser
(including the Bank) at any such sale shall hold the Collateral so sold free
from any claim or right of whatever kind, including any equity or right of
redemption of the Debtor, and the Debtor, to the extent permitted by law, hereby
specifically waives all rights of redemption and any right to a judicial or
other stay or approval which it has or may have under any law now existing or
hereafter adopted.

               Section 5.6. Additional Rights of the Bank.

               (a)    After the occurrence of an Event of Default, the Bank
shall have the right and power to institute and maintain such suits and
proceedings as reasonably necessary to protect and enforce the rights vested in
it by this Security Agreement and may proceed by suit or suits at law or in
equity to enforce such rights and to foreclose upon and sell the Collateral or
any part thereof pursuant to the judgment or decree of a court of competent
jurisdiction.

               (b)    After the occurrence of an Event of Default, the Bank
shall, to the extent permitted by law and without regard to the solvency or
insolvency at the time of any Person then liable for the payment of any of the
Obligations or the then value of the Collateral, and without requiring any bond
from any party to such proceedings, be entitled to the appointment of a special
receiver or receivers (who may be the Bank) for the Collateral or any part
thereof and for the rents, issues, tolls, profits, royalties, revenues and other
income therefrom, which receiver shall have such powers as the court making such
appointment shall confer, and to the entry of an order directing that the rents,
issues, tolls, profits, royalties, revenues and other income of the property
constituting the whole or any part of the Collateral be segregated, sequestered
and impounded for the benefit of the Bank, and the Debtor irrevocably consents
to the appointment of such receiver or receivers and to the entry of such order.

               Section 5.7. Remedies Not Exclusive.

               (a)    No remedy conferred upon or reserved to the Bank in this
Security Agreement is intended to be exclusive of any other remedy or remedies,
but every such remedy shall be cumulative and shall be in addition to every
other remedy conferred herein or now or hereafter existing at law, in equity or
by statute. Except as prohibited by applicable law, all remedies conferred upon
or reserved to the Bank may be exercised simultaneously.

               (b)    If the Bank shall have proceeded to enforce any right,
remedy or power under this Security Agreement and the proceeding for the
enforcement thereof shall have been discontinued or abandoned for any reason or
shall have been determined adversely to the Bank, the Debtor and the Bank shall,
subject to any determination in such proceeding, severally and respectively be
restored to their former positions and rights under this Security Agreement, and
thereafter all rights, remedies and powers of the Bank shall continue as though
no such proceedings had been taken.

               (c)    All rights of action under this Security Agreement may be
enforced by the Bank without the possession of any instrument evidencing any
Obligation or the production thereof at any trial or other proceeding relative
thereto, and any suit or proceeding instituted by the Bank shall be brought in
its name and any judgment shall be held as part of the Collateral.

                                      -17-

<PAGE>

               Section 5.8. Waiver and Estoppel.

               (a)    The Debtor, to the extent it may lawfully do so, agrees
that it will not at any time in any manner whatsoever claim or take the benefit
or advantage of any appraisement, valuation, stay, extension, moratorium,
turnover or redemption law, or any law now or hereafter in force permitting it
to direct the order in which the Collateral shall be sold which may delay,
prevent or otherwise affect the performance or enforcement of this Security
Agreement and the Debtor hereby waives the benefits or advantage of all such
laws, and covenants that it will not hinder, delay or impede the execution of
any power granted to the Bank in this Security Agreement but will permit the
execution of every such power as though no such law were in force; provided that
nothing contained in this Section 5.8 shall be construed as a waiver of any
rights of the Debtor under any applicable federal bankruptcy law.

               (b)    The Debtor, to the extent it may lawfully do so, on behalf
of itself and all who may claim through or under it, including without
limitation any and all subsequent creditors, vendees, assignees and lienors,
waives and releases all rights to demand or to have any marshalling of the
Collateral upon any sale, whether made under any power of sale granted herein or
pursuant to judicial proceedings or upon any foreclosure or any enforcement of
this Security Agreement and consents and agrees that all the Collateral may at
any such sale be offered and sold as an entirety.

               (c)    The Debtor, to the extent it may lawfully do so, waives
presentment, demand, protest and any notice of any kind (except notices
explicitly required hereunder) in connection with this Security Agreement and
any action taken by the Bank with respect to the Collateral, except as provided
in any other Loan Document.

               Section 5.9. Power of Attorney. The Debtor hereby irrevocably
constitutes and appoints the Bank, with full power of substitution, as its true
and lawful attorney-in-fact with full irrevocable power and authority in the
place and stead of the Debtor and in the name of the Debtor or in its own name,
from time to time after the occurrence of an Event of Default, in the Bank's
reasonable discretion for the purpose of carrying out the terms of this Security
Agreement, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Security Agreement and, without limiting the generality of the
foregoing, hereby gives the Bank the power and right, on behalf of the Debtor,
without notice to or assent by the Debtor to do the following:

                      (i)    to pay or discharge taxes, liens, security
         interests or other encumbrances levied or placed on or threatened
         against the Collateral;

                      (ii)   to effect any repairs or any insurance called for
         by the terms of this Security Agreement and to pay all or any part of
         the premiums therefor and the costs thereof; and

                      (iii)  upon the occurrence and continuance of any Event of
         Default and otherwise to the extent provided in this Security
         Agreement, (A) to direct any party liable for any payment under any of
         the Collateral to make payment of any and all moneys due and to come
         due thereunder directly to the Bank or as the Bank shall direct; (B) to
         receive payment of and receipt for any and all moneys, claims and other
         amounts due and to become due at any time in respect of or arising out
         of any Collateral; (C) to sign and indorse any invoices, freight or
         express bills,

                                      -18-

<PAGE>

         bills of lading, storage or warehouse receipts, drafts against debtors,
         assignments, verifications and notices in connection with accounts and
         other documents relating to the Collateral; (D) to commence and
         prosecute any suits, actions or proceedings at law or in equity in any
         court of competent jurisdiction to collect the Collateral or any
         thereof and to enforce any other right in respect of any Collateral;
         (E) to defend any suit, action or proceeding brought against the Debtor
         with respect to any Collateral; (F) to settle, compromise and adjust
         any suit, action or proceeding described above and, in connection
         therewith, to give such discharges or releases as the Bank may deem
         appropriate; (G) to assign any Patent or Trademark (along with the
         goodwill of the business to which such Trademark pertains), for such
         term or terms, on such conditions, and in such manner, as the Bank
         shall in its sole discretion determine; and (H) generally to sell,
         transfer, pledge, make any agreement with respect to or otherwise deal
         with any of the Collateral as fully and completely as though the Bank
         were the absolute owner thereof for all purposes, and to do, at the
         Bank's option and the Debtor's expense, at any time, or from time to
         time, all acts and things which the Bank deems necessary to protect,
         preserve or realize upon the Collateral and the Bank's security
         interest therein, in order to effect the intent of this Security
         Agreement, all as fully and effectively as the Debtor might do.

               The Debtor hereby ratifies all that said attorneys shall lawfully
do or cause to be done by virtue hereof. This power of attorney is a power
coupled with an interest and shall be irrevocable.

               Section 5.10. Application of Proceeds. After the occurrence of an
Event of Default, until the Obligations are paid in full, the Bank shall retain
the net cash proceeds of any collection, recovery, receipt, appropriation,
realization or sale of the Collateral and, after deducting all reasonable costs
and expenses of every kind incurred therein or incidental to the care and
safekeeping of any or all of the Collateral or in any way relating to the rights
of the Bank hereunder, including reasonable attorneys' fees and legal expenses,
apply such net proceeds to the payment in whole or in part of the Obligations in
such order as the Bank may elect, the Debtor remaining liable for any amount
remaining unpaid (and any attorneys' fees paid by the Bank in collecting such
deficiency) after such application. Only after applying such net cash proceeds
and after the payment by the Bank of any other amount required by any provision
of law, including Sections 8.9A-608(a)(1) and 8.9A-615(a)(1), as applicable, of
the UCC, need the Bank account for the surplus, if any, to the Debtor or to
whomsoever may be lawfully entitled to the same. Unless required by applicable
law, the Bank, in its sole discretion, may elect not to apply or pay over for
application non-cash proceeds of any collection, recovery, receipt,
appropriation, realization or sale of the Collateral.

                                   ARTICLE VI
                                  MISCELLANEOUS

               Section 6.1. Notices. Unless otherwise specified herein, all
notices, requests or other communications to any party hereunder shall be in
writing and shall be given to such party at its address set forth on the
signature pages hereof or any other address or which such party shall have
specified for the purpose of communications hereunder by notice to the other
parties hereunder. Each such notice, request or other communication shall be
effective (i) if given by mail, five days after such communication is received,
or (ii) if given by other means, when delivered at the address specified in this
Section 6.1.

                                      -19-

<PAGE>

               Section 6.2. No Waivers. No failure on the part of the Bank to
exercise, no course of dealing with respect to, and no delay in exercising any
right, power or privilege under this Security Agreement or any document or
agreement contemplated hereby shall operate as a waiver thereof or shall any
single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.

               Section 6.3. Compensation and Expenses of the Bank. The Debtor
shall pay to the Bank from time to time upon demand, all of the reasonable fees,
costs and expenses incurred by the Bank (including, without limitation, the
reasonable fees and disbursements of counsel and any amounts payable by the Bank
to any of its agents, whether on account of fees, indemnities or otherwise) (i)
arising in connection with the preparation (up to an aggregate of $43,294.60),
administration, modification, amendment, waiver or termination of this Security
Agreement or any document or agreement contemplated hereby or any consent or
waiver hereunder or thereunder or (ii) incurred in connection with the
administration of this Security Agreement, or any document or agreement
contemplated hereby, or in connection with the administration, sale or other
disposition of Collateral hereunder or under any document or agreement
contemplated hereby or the preservation, protection or defense of the rights of
the Bank in and to the Collateral.

               Section 6.4. Indemnification. The Debtor shall at all times
hereafter indemnify, hold harmless and, on demand, reimburse the Bank, its
subsidiaries, affiliates, successors, assigns, officers, directors, employees
and agents, and their respective heirs, executors, administrators, successors
and assigns (all of the foregoing parties, including, but not limited to, the
Bank, being hereinafter collectively referred to as the "Indemnities" and
individually as an "Indemnitee") from, against and for any and all liabilities,
obligations, claims, damages, actions, penalties, causes of action, losses,
judgments, suits, costs, expenses and disbursements, including, without
limitation, attorney's fees (any and all of the foregoing being hereinafter
collectively referred to as the "Liabilities" and individually as a "Liability")
which the Indemnitees, or any of them, might be or become subjected, by reason
of, or arising out of the preparation, execution, delivery, modification,
administration or enforcement of, or performance of the Bank's rights under,
this Security Agreement or any other document, instrument or agreement
contemplated hereby or executed in connection herewith; provided that the Debtor
shall not be liable to any Indemnitee for any Liability caused solely by the
gross negligence or willful misconduct of such Indemnitee. In no event shall any
Indemnitee, as a condition to enforcing its rights under this Section 6.4 or
otherwise, be obligated to make a claim against any other Person (including,
without limitation, the Bank) to enforce its rights under this Section 6.4.

               Section 6.5. Amendments, Supplements and Waivers. The parties
hereto may, from time to time, enter into written agreements supplemental hereto
for the purpose of adding any provisions to this Security Agreement, waiving any
provisions hereof or changing in any manner the rights of the parties.

               Section 6.6. Successors and Assigns. This Security Agreement
shall be binding upon and inure to the benefit of each of the parties hereto and
shall inure to the benefit of the Bank's successors and assigns in accordance
with the Loan Agreement. Nothing herein is intended or shall be construed to
give any other Person any right, remedy or claim under, to or in respect of this
Security Agreement or any Collateral.

               Section 6.7. Limitation of Law; Severability. (a) All rights,
remedies and powers provided in this Security Agreement may be exercised only to
the extent that the exercise thereof does

                                      -20-

<PAGE>

not violate any applicable provision of law, and all the provisions of this
Security Agreement are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Security Agreement invalid,
unenforceable in whole or in part, or not entitled to be recorded, registered or
filed under the provisions of any applicable law.

               (b)    If any provision hereof is invalid and unenforceable in
any jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible; and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provisions in any other jurisdiction.

               Section 6.8.  Governing Law. This Security Agreement shall be
governed by and construed in accordance with the laws of the Commonwealth of
Virginia.

               Section 6.9.  Counterparts; Effectiveness. This Security
Agreement may be signed in any number of counterparts with the same effect as if
the signatures thereto and hereto were upon the same instrument. This Security
Agreement shall become effective when the Bank shall receive counterparts
executed by itself and the Debtor.

               Section 6.10. Termination; Survival. This Security Agreement
shall terminate when the security interests granted hereunder have terminated
and the Collateral has been released as provided in Section 2.6, provided that
the obligations of the Debtor under any of Section 4.20, 6.3, and 6.4 shall
survive any such termination.

               IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.

                                   MICROSTRATEGY INCORPORATED            [SEAL]

                                   By      /s/ Eric F. Brown
                                     ---------------------------------
                                           Name:  Eric F. Brown
                                           Title:  President and CFO

                                   (as to all Debtors):
                                   1861 International Drive
                                   McLean, Virginia 22102

                                   STRATEGY.COM INCORPORATED             [SEAL]

                                   By      /s/ Eric F. Brown
                                     ---------------------------------
                                           Name:  Eric F. Brown
                                           Title:  CFO, VP Finance and Treasurer

                                      -21-

<PAGE>

                                   MICROSTRATEGY SERVICES CORPORATION    [SEAL]

                                   By       /s/ Eric F. Brown
                                     ---------------------------------
                                            Name:  Eric F. Brown
                                            Title:  Vice President and Treasurer

                                   MICROSTRATEGY MANAGEMENT
                                   CORPORATION                        [SEAL]

                                   By       /s/ Eric F. Brown
                                     ---------------------------------
                                            Name:  Eric F. Brown
                                            Title:  Treasurer

                                   MICROSTRATEGY ADMINISTRATION
                                   CORPORATION                        [SEAL]

                                   By       /s/ Eric F. Brown
                                     ---------------------------------
                                            Name:  Eric F. Brown
                                            Title:  President and Treasurer

                                      -22-

<PAGE>

                                   BANK OF AMERICA, N.A.                 [SEAL]

                                   By       /s/ Michael J. Landini
                                     ------------------------------------
                                            Michael J. Landini
                                            Senior Vice President

                                   1101 Wootton Parkway
                                   MD9-978-04-01
                                   Rockville, Maryland 20852

                                      -23-

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