Document:

Ex992 Loan docs

	
    CHORDIANT SOFTWARE, INC.

    AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT is entered into as of
August 16, 2000, by and between IMPERIAL BANK ("Bank") and CHORDIANT SOFTWARE,
INC., formerly known as J. FRANK CONSULTING, INC. ("Borrower").

RECITALS

	Bank and Borrower are parties to that certain Security and Loan
    Agreement (Accounts Receivable) dated September 10, 1996, as amended from
    time to time (the "Original Agreement").
	Borrower and Bank wish to amend and restate the terms of the Original
    Agreement. This Agreement sets forth the terms on which Bank will advance
    credit to Borrower, and Borrower will repay the amounts owing to Bank.

AGREEMENT

The parties agree as follows:

    	DEFINITIONS AND CONSTRUCTION.
    

      
	Definitions.
      As used in this Agreement, the following terms shall have the following
      definitions:
      "Accounts" means all presently existing and hereafter arising accounts,
      contract rights, and all other forms of obligations owing to Borrower
      arising out of the sale or lease of goods (including, without limitation,
      the licensing of software and other technology) or the rendering of
      services by Borrower, whether or not earned by performance, and any and
      all credit insurance, guaranties, and other security therefor, as well as
      all merchandise returned to or reclaimed by Borrower and Borrower's Books
      relating to any of the foregoing.

      "Advance" or "Advances" means a cash advance or cash advances under the
      Revolving Facility.

      "Affiliate" means, with respect to any Person, any Person that owns or
      controls directly or indirectly such Person, any Person that controls or
      is controlled by or is under common control with such Person, and each of
      such Person's senior executive officers, directors, and partners.

      "Bank Expenses" means all: reasonable costs or expenses (including
      reasonable attorneys' fees and expenses) incurred in connection with the
      preparation, negotiation, administration, and enforcement of the Loan
      Documents; reasonable Collateral audit fees; and Bank's reasonable
      attorneys' fees and expenses incurred in amending, enforcing or defending
      the Loan Documents (including fees and expenses of appeal), incurred
      before, during and after an Insolvency Proceeding, whether or not suit is
      brought.

      "Borrower's Books" means all of Borrower's books and records including:
      ledgers; records concerning Borrower's assets or liabilities, the
      Collateral, business operations or financial condition; and all computer
      programs, or tape files, and the equipment, containing such information.

      "Borrowing Base" means an amount equal to eighty percent (80%) of
      Eligible Accounts, as determined by Bank with reference to the most recent
      Borrowing Base Certificate delivered by Borrower.

      "Business Day" means any day that is not a Saturday, Sunday, or other
      day on which banks in the State of California are authorized or required
      to close.

      "Change in Control" shall mean a transaction in which any "person" or
      "group" (within the meaning of Section 13(d) and 14(d)(2) of the
      Securities Exchange Act of 1934) becomes the "beneficial owner" (as
      defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly
      or indirectly, of a sufficient number of shares of all classes of stock
      then outstanding of Borrower ordinarily entitled to vote in the election
      of directors, empowering such "person" or "group" to elect a majority of
      the Board of Directors of Borrower, who did not have such power before
      such transaction.

      "Closing Date" means the date of this Agreement.

      "Code" means the California Uniform Commercial Code.

      "Collateral" means the property described on Exhibit A attached
      hereto.

      "Committed Revolving Line" means a credit extension of up to Eleven
      Million Five Hundred Thousand Dollars ($11,500,000).

      "Contingent Obligation" means, as applied to any Person, any direct or
      indirect liability, contingent or otherwise, of that Person with respect
      to (i) any indebtedness, lease, dividend, letter of credit or other
      obligation of another, including, without limitation, any such obligation
      directly or indirectly guaranteed, endorsed, co-made or discounted or sold
      with recourse by that Person, or in respect of which that Person is
      otherwise directly or indirectly liable; (ii) any obligations with respect
      to undrawn letters of credit issued for the account of that Person; and
      (iii) all obligations arising under any interest rate, currency or
      commodity swap agreement, interest rate cap agreement, interest rate
      collar agreement, or other agreement or arrangement designated to protect
      a Person against fluctuation in interest rates, currency exchange rates or
      commodity prices; provided, however, that the term "Contingent Obligation"
      shall not include endorsements for collection or deposit in the ordinary
      course of business. The amount of any Contingent Obligation shall be
      deemed to be an amount equal to the stated or determined amount of the
      primary obligation in respect of which such Contingent Obligation is made
      or, if not stated or determinable, the maximum reasonably anticipated
      liability in respect thereof as determined by such Person in good faith;
      provided, however, that such amount shall not in any event exceed the
      maximum amount of the obligations under the guarantee or other support
      arrangement.

      "Copyrights" means any and all copyright rights, copyright
      applications, copyright registrations and like protections in each work or
      authorship and derivative work thereof, whether published or unpublished
      and whether or not the same also constitutes a trade secret, now or
      hereafter existing, created, acquired or held.

      "Credit Extension" means each Advance, Equipment Advance, Term Advance,
      Letter of Credit or any other extension of credit by Bank for the benefit
      of Borrower hereunder.

      "Current Assets" means, as of any applicable date, all amounts that
      should, in accordance with GAAP, be included as current assets on the
      consolidated balance sheet of Borrower and its Subsidiaries as at such
      date.

      "Current Liabilities" means, as of any applicable date, all amounts
      that should, in accordance with GAAP, be included as current liabilities
      on the consolidated balance sheet of Borrower and its Subsidiaries, as at
      such date, plus, to the extent not already included therein, all
      outstanding Credit Extensions made under this Agreement, including all
      Indebtedness that is payable upon demand or within one year from the date
      of determination thereof unless such Indebtedness is renewable or
      extendible at the option of Borrower or any Subsidiary to a date more than
      one year from the date of determination.

      "Daily Balance" means the amount of the Obligations owed at the end of
      a given day.

      "Eligible Accounts" means those Accounts that arise in the ordinary
      course of Borrower's business that comply with all of Borrower's
      representations and warranties to Bank set forth in Section 5.4,
      including, but not limited to, maintenance revenue subject to a renewal
      rate of at least eighty-five percent (85%) and certified on a quarterly
      basis; provided, that standards of eligibility may be fixed and revised
      from time to time by Bank as a consequence of any Collateral audits done
      pursuant to Section 6.3 in Bank's reasonable judgment and upon
      notification thereof to Borrower in accordance with the provisions hereof.
      Unless otherwise agreed to by Bank, Eligible Accounts shall not include
      the following:
	Accounts that the account debtor has failed
        to pay within ninety (90) days of invoice date;
	Accounts with respect to an account debtor, twenty-five percent
        (25%) of whose Accounts the account debtor has failed to pay within
        ninety (90) days of invoice date;
	Accounts with respect to which the account
        debtor is an officer, employee, or agent of Borrower;
	Accounts with respect to which goods are placed on consignment,
        guaranteed sale, sale or return, sale on approval, bill and hold, or
        other terms by reason of which the payment by the account debtor may be
        conditional;
	Accounts with respect to which the account debtor is an Affiliate of
        Borrower;
	Accounts with respect to which the account debtor does not have its
        principal place of business in the United States, except for Eligible
        Foreign Accounts;
	Accounts with respect to which the account debtor is the United
        States or any department, agency, or instrumentality of the United
        States;
	Accounts with respect to which Borrower is liable to the account
        debtor for goods sold or services rendered by the account debtor to
        Borrower, but only to the extent of any amounts owing to the account
        debtor against amounts owed to Borrower;
	Accounts with respect to an account debtor, including Subsidiaries
        and Affiliates, whose total obligations to Borrower exceed twenty-five
        percent (25%) of all Accounts, to the extent such obligations exceed the
        aforementioned percentage, except as approved in writing by Bank;
	Accounts with respect to which the account debtor disputes liability
        or makes any claim with respect thereto as to which Bank believes, in
        its sole discretion, that there may be a basis for dispute (but only to
        the extent of the amount subject to such dispute or claim), or is
        subject to any Insolvency Proceeding, or becomes insolvent, or goes out
        of business; and
	Accounts the collection of which Bank reasonably determines to be
        doubtful.
        "Eligible Foreign Accounts" means Accounts with respect to which the
        account debtor does not have its principal place of business in the
        United States and that (i) are supported by one or more letters of
        credit in an amount and of a tenor, and issued by a financial
        institution, acceptable to Bank, or (ii) that Bank approves on a
        case-by-case basis.

        "Equipment" means all present and future machinery, equipment, tenant
        improvements, furniture, fixtures, vehicles, tools, parts and
        attachments in which Borrower has any interest.

        "Equipment Advance" has the meaning set forth in Section 2.1(b).

        "Equipment Line" means a credit extension of up to Two Million
        Dollars ($2,000,000).

        "Equipment Maturity Date" means June 30, 2003.

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

        "Event of Default" has the meaning assigned in Article 8.

        "GAAP" means generally accepted accounting principles as in effect
        from time to time.

        "Indebtedness" means (a) all indebtedness for borrowed money or the
        deferred purchase price of property or services, including without
        limitation reimbursement and other obligations with respect to surety
        bonds and letters of credit, (b) all obligations evidenced by notes,
        bonds, debentures or similar instruments, (c) all capital lease
        obligations and (d) all Contingent Obligations.

        "Insolvency Proceeding" means any proceeding commenced by or against
        any person or entity under any provision of the United States Bankruptcy
        Code, as amended, or under any other bankruptcy or insolvency law,
        including assignments for the benefit of creditors, formal or informal
        moratoria, compositions, extension generally with its creditors, or
        proceedings seeking reorganization, arrangement, or other relief.

        "Intellectual Property Collateral" means all of Borrower's right,
        title, and interest in and to the following:

	Copyrights, Trademarks and Patents;
	Any and all trade secrets, and any and all intellectual property
        rights in computer software and computer software products now or
        hereafter existing, created, acquired or held;
	Any and all design rights which may be available to Borrower now or
        hereafter existing, created, acquired or held;
	Any and all claims for damages by way of past, present and future
        infringement of any of the rights included above, with the right, but
        not the obligation, to sue for and collect such damages for said use or
        infringement of the intellectual property rights identified above;
	All licenses or other rights to use any of the Copyrights, Patents
        or Trademarks, and all license fees and royalties arising from such use
        to the extent permitted by such license or rights; 
	All amendments, renewals and extensions of any of the Copyrights,
        Trademarks or Patents; and
	All proceeds and products of the foregoing, including without
        limitation all payments under insurance or any indemnity or warranty
        payable in respect of any of the foregoing.
        "Interest Period" means for each LIBOR Rate Advance, a period of
        approximately one, two, three or six months as Borrower may elect,
        provided that the last day of an Interest Period for a LIBOR Rate
        Advance shall be determined in accordance with the practices, of the
        LIBOR interbank market as from time to time in effect, provided,
        further, in all cases such period shall expire not later than the
        applicable Revolving Maturity Date.

        "Inventory" means all present and future inventory in which Borrower
        has any interest, including merchandise, raw materials, parts, supplies,
        packing and shipping materials, work in process and finished products
        intended for sale or lease or to be furnished under a contract of
        service, of every kind and description now or at any time hereafter
        owned by or in the custody or possession, actual or constructive, of
        Borrower, including such inventory as is temporarily out of its custody
        or possession or in transit and including any returns upon any accounts
        or other proceeds, including insurance proceeds, resulting from the sale
        or disposition of any of the foregoing and any documents of title
        representing any of the above, and Borrower's Books relating to any of
        the foregoing.

        "Investment" means any beneficial ownership of (including stock,
        partnership interest or other securities) any Person, or any loan,
        advance or capital contribution to any Person.

        "IRC" means the Internal Revenue Code of 1986, as amended, and the
        regulations thereunder.

        "LIBOR Base Rate" means, for any Interest Period for a LIBOR Rate
        Advance, the rate of interest per annum determined by Bank to be the per
        annum rate of interest at which deposits in United States Dollars are
        offered to Bank in the London interbank market in which Bank customarily
        participates at 11:00 a.m. (local time in such interbank market) three
        (3) Business Days before the first day of such Interest Period for a
        period approximately equal to such Interest Period and in an amount
        approximately equal to the amount of such Advance.

        "LIBOR Rate" shall mean, for any Interest Period for a LIBOR Rate
        Advance, a rate per annum (rounded upwards, if necessary, to the nearest
        1/16 of 1%) equal to (i) the LIBOR Base Rate for such Interest Period
        divided by (ii) 1 minus the Reserve Requirement for such Interest
        Period.

        "LIBOR Rate Advances" means any Advances made or a portion thereof on
        which interest is payable based on the LIBOR Rate in accordance with the
        terms thereof.

        "Lien" means any mortgage, lien, deed of trust, charge, pledge,
        security interest or other encumbrance.

        "Loan Documents" means, collectively, this Agreement, any note or
        notes executed by Borrower, and any other agreement entered into between
        Borrower and Bank in connection with this Agreement, all as amended or
        extended from time to time.

        "Material Adverse Effect" means a material adverse effect on (i) the
        business operations or condition (financial or otherwise) of Borrower
        and its Subsidiaries taken as a whole or (ii) the ability of Borrower to
        repay the Obligations or otherwise perform its obligations under the
        Loan Documents.

        "Negotiable Collateral" means all of Borrower's present and future
        letters of credit of which it is a beneficiary, notes, drafts,
        instruments, securities, documents of title, and chattel paper, and
        Borrower's Books relating to any of the foregoing.

        "New Equity" means the receipt by Borrower of cash proceeds from the
        sale or issuance of its equity securities to investors or Subordinated
        Debt.

        "Obligations" means all debt, principal, interest, Bank Expenses and
        other amounts owed to Bank by Borrower pursuant to this Agreement or any
        other agreement, whether absolute or contingent, due or to become due,
        now existing or hereafter arising, including any interest that accrues
        after the commencement of an Insolvency Proceeding and including any
        debt, liability, or obligation owing from Borrower to others that Bank
        may have obtained by assignment or otherwise.

        "Patents" means all patents, patent applications and like protections
        including without limitation improvements, divisions, continuations,
        renewals, reissues, extensions and continuations-in-part of the same.

        "Periodic Payments" means all installments or similar recurring
        payments that Borrower may now or hereafter become obligated to pay to
        Bank pursuant to the terms and provisions of any instrument, or
        agreement now or hereafter in existence between Borrower and Bank.

        "Permitted Indebtedness" means:

	Indebtedness of Borrower in favor of Bank arising under
        this Agreement or any other Loan Document;
	Indebtedness existing on the Closing Date and disclosed in the
        Schedule;
	Indebtedness secured by a lien described in clause (c) of the
        defined term "Permitted Liens," provided such Indebtedness does not
        exceed the lesser of the cost or fair market value of the equipment
        financed with such Indebtedness; and
	Subordinated Debt.
        "Permitted Investment" means:

	Investments existing on the Closing Date disclosed in the
        Schedule; and
	(i) marketable direct obligations issued or unconditionally
        guaranteed by the United States of America or any agency or any State
        thereof maturing within one (1) year from the date of acquisition
        thereof, (ii) commercial paper maturing no more than one (1) year from
        the date of creation thereof and currently having rating of at least A-2
        or P-2 from either Standard & Poor's Corporation or Moody's Investors
        Service, (iii) certificates of deposit maturing no more than one (1)
        year from the date of investment therein issued by Bank and (iv) Bank's
        money market accounts.
        "Permitted Liens" means the following:

	Any Liens existing on the Closing Date and disclosed in
        the Schedule or arising under this Agreement or the other Loan
        Documents;
	Liens for taxes, fees, assessments or other governmental charges or
        levies, either not delinquent or being contested in good faith by
        appropriate proceedings, provided the same have no priority over any of
        Bank's security interests;
	Liens (i) upon or in any equipment acquired
        or held by Borrower or any of its Subsidiaries to secure the purchase
        price of such equipment or indebtedness incurred solely for the purpose
        of financing the acquisition of such equipment, or (ii) existing on such
        equipment at the time of its acquisition, provided that the Lien is
        confined solely to the property so acquired and improvements thereon,
        and the proceeds of such equipment;
	Liens incurred in connection with the extension, renewal or
        refinancing of the indebtedness secured by Liens of the type described
        in clauses (a) through (c) above, provided that any extension, renewal
        or replacement Lien shall be limited to the property encumbered by the
        existing Lien and the principal amount of the indebtedness being
        extended, renewed or refinanced does not increase.

      "Person" means any individual, sole proprietorship, partnership,
      limited liability company, joint venture, trust, unincorporated
      organization, association, corporation, institution, public benefit
      corporation, firm, joint stock company, estate, entity or governmental
      agency.

      "Prime Rate" means the variable rate of interest, per annum, most
      recently announced by Bank, as its "prime rate," whether or not such
      announced rate is the lowest rate available from Bank.

      "Quick Assets" means, at any date as of which the amount thereof shall
      be determined, the unrestricted cash and cash-equivalents, accounts
      receivable and investments with maturities not to exceed 90 days, of
      Borrower determined in accordance with GAAP.

      "Reserve Requirement" means, for any Interest Period, the average
      maximum rate at which reserves (including any marginal, supplemental or
      emergency reserves) are required to be maintained during such Interest
      Period under Regulation D against "Eurocurrency liabilities" (as such term
      is used in Regulation D) by member banks of the Federal Reserve System.
      Without limiting the effect of the foregoing, the Reserve Requirement
      shall reflect any other reserves required to be maintained by Bank by
      reason of any regulatory change against (i) any category of liabilities
      which includes deposits by reference to which the LIBOR Rate is to be
      determined as provided in the definition of "LIBOR Base Rate" or (ii) any
      category of extensions of credit or other assets which include Advances.

      "Responsible Officer" means each of the Chief Executive Officer, the
      Chief Operating Officer, the Chief Financial Officer and the Controller of
      Borrower.

      "Revolving Facility" means the facility under which Borrower may
      request Bank to issue Advances, as specified in Section 2.1(a) hereof.

      "Revolving Maturity Date" means the day immediately preceding the first
      anniversary of the Closing Date.

      "Schedule" means the schedule of exceptions attached hereto, if any.

      "Subordinated Debt" means any debt incurred by Borrower that is
      subordinated to the debt owing by Borrower to Bank on terms reasonably
      acceptable to Bank (and identified as being such by Borrower and Bank).

      "Subsidiary" means any corporation, company or partnership in which (i) any
      general partnership interest or (ii) more than 50% of the stock or other
      units of ownership which by the terms thereof has the ordinary voting
      power to elect the Board of Directors, managers or trustees of the entity,
      at the time as of which any determination is being made, is owned by
      Borrower, either directly or through an Affiliate.

      "Tangible Net Worth" means at any date as of which the amount thereof
      shall be determined, the sum of the capital stock and additional paid-in
      capital plus retained earnings (or minus accumulated deficit) of Borrower
      and its Subsidiaries minus Total Liabilities and intangible assets, plus
      Subordinated Debt, on a consolidated basis determined in accordance with
      GAAP.

      "Total Liabilities" means at any date as of which the amount thereof
      shall be determined, all obligations that should, in accordance with GAAP
      be classified as liabilities on the consolidated balance sheet of
      Borrower, including in any event all Indebtedness.

      "Trademarks" means any trademark and servicemark rights, whether
      registered or not, applications to register and registrations of the same
      and like protections, and the entire goodwill of the business of Borrower
      connected with and symbolized by such trademarks.

	Accounting Terms. All accounting terms not specifically defined
      herein shall be construed in accordance with GAAP and all calculations
      made hereunder shall be made in accordance with GAAP. When used herein,
      the terms "financial statements" shall include the notes and schedules
      thereto.

    	LOAN AND TERMS OF PAYMENT.
    	Credit Extensions.
      Borrower promises to pay to the order of Bank, in lawful money of the
      United States of America, the aggregate unpaid principal amount of all
      Credit Extensions made by Bank to Borrower hereunder. Borrower shall also
      pay interest on the unpaid principal amount of such Credit Extensions at
      rates in accordance with the terms hereof.
	Revolving Advances.
        	Subject to and upon the terms and conditions of this Agreement,
          Borrower may request Advances in an aggregate outstanding amount not
          to exceed the lesser of (i) the Committed Revolving Line or (ii) the
          Borrowing Base minus the aggregate face amount of all outstanding
          Letters of Credit and availability used under the Committed Revolving
          Line for FX Forward Contracts; provided, however, that Borrower may
          request Advances in an aggregate outstanding amount of Three Million
          Dollars ($3,000,000) without regard to the Borrowing Base; provided
          further that once outstanding Advances, including the face amount of
          all outstanding Letters of Credit and availability used under the
          Committed Revolving Line for FX Forward Contracts, exceed Three
          Million Dollars ($3,000,000), then all outstanding and future Credit
          Extensions under the Committed Revolving Line shall be subject to the
          Borrowing Base. Subject to the terms and conditions of this Agreement,
          amounts borrowed pursuant to this Section 2.1(a) may be repaid and
          reborrowed at any time prior to the Revolving Maturity Date, at which
          time all Advances under this Section 2.1(a) shall be immediately due
          and payable. Borrower may prepay any Advances without penalty or
          premium.
	Whenever Borrower desires an Advance, Borrower will notify Bank by
          facsimile transmission or telephone no later than 3:00 p.m. Pacific
          time, on the Business Day that the Advance is to be made. Each such
          notification shall be promptly confirmed by a Payment/Advance Form in
          substantially the form of Exhibit B hereto. Bank is authorized
          to make Advances under this Agreement, based upon instructions
          received from a Responsible Officer or a designee of a Responsible
          Officer, or without instructions if in Bank's discretion such Advances
          are necessary to meet Obligations which have become due and remain
          unpaid. Bank shall be entitled to rely on any telephonic notice given
          by a person who Bank reasonably believes to be a Responsible Officer
          or a designee thereof, and Borrower shall indemnify and hold Bank
          harmless for any damages or loss suffered by Bank as a result of such
          reliance. Bank will credit the amount of Advances made under this
          Section 2.1(a) to Borrower's deposit account.

        
	Equipment Advances.
        	Subject to and upon the terms and conditions of this Agreement, at
          any time from the date hereof through the Revolving Maturity Date,
          Bank agrees to make advances (each an "Equipment Advance" and,
          collectively, the "Equipment Advances") to Borrower in an aggregate
          outstanding amount not to exceed the Equipment Line provided that the
          aggregate amount of all Equipment Advances for software shall not
          exceed the lesser of (A) thirty percent (30%) of the aggregate amount
          of the outstanding Equipment Advances, or (B) Five Hundred Thousand
          Dollars ($500,000). Each Equipment Advance shall not exceed one
          hundred percent (100%) of the invoice amount of equipment, furniture,
          software license and corporate purposes approved by Bank from time to
          time (which Borrower shall, in any case, have purchased within 90 days
          of the date of the corresponding Equipment Advance), excluding taxes,
          shipping, warranty charges, freight discounts, soft costs, and
          installation expense, provided that the initial Equipment Advance
          (which must be requested by Borrower on or before September 15, 2000)
          shall not exceed one hundred percent (100%) of the invoice amount of
          equipment, furniture, software license and corporate purposes approved
          by Bank from time to time (which Borrower shall, in any case, have
          purchased within 180 days of the date of the corresponding Equipment
          Advance), excluding taxes, shipping, warranty charges, freight
          discounts, soft costs, and installation expense.
	Interest shall accrue from the date of each Equipment Advance at
          the rate specified in Section 2.3(a), and shall be payable monthly on
          the fifteenth (15th) day of each month through August 15, 2003. Any
          Equipment Advances that are outstanding on September 15, 2000, shall
          be payable in thirty-five (35) equal monthly installments of
          principal, plus all accrued interest, beginning on September 15, 2000,
          and continuing on the same day of each month thereafter through
          August 15, 2003. Any Equipment Advances that are outstanding on
          December 31, 2000 (which are not outstanding on September 15, 2000)
          shall be payable in thirty (30) equal monthly installments of
          principal, plus all accrued interest, beginning on January 15, 2001,
          and continuing on the same day of each month thereafter through
          August 15, 2003. Any Equipment Advances that are outstanding on
          June 30, 2001 (which were not outstanding on September 15, 2000 or
          December 31, 2000) shall be payable in twenty-four (24) equal monthly
          installments of principal, plus all accrued interest, beginning on
          July 15, 2001, and continuing on the same day of each month thereafter
          through the Equipment Maturity Date, at which time all amounts due
          under this Section 2.1(b) and any other amounts due under this
          Agreement shall be immediately due and payable. Equipment Advances,
          once repaid, may not be reborrowed. Notwithstanding the foregoing, all
          Equipment Advances used for software license purposes must be
          requested by Borrower on or prior to June 30, 2001 and shall each be
          payable in twenty-four (24) equal monthly installments of principal,
          plus all accrued interest, but in any event shall be immediately due
          and payable no later than the Equipment Maturity Date. Borrower may
          prepay any Equipment Advances without penalty or premium.
	When Borrower desires to obtain an Equipment Advance, Borrower
          shall notify Bank (which notice shall be irrevocable) by facsimile
          transmission to be received no later than 3:00 p.m. Pacific time one
          (1) Business Day before the day on which the Equipment Advance is to
          be made. Such notice shall be substantially in the form of 
          Exhibit B. The notice shall be signed by a Responsible Officer or
          its designee and include a copy of the invoice for any Equipment to be
          financed.

        
	Letters of Credit
        	Subject to the terms and conditions of this Agreement, Bank agrees
          to issue or cause to be issued letters of credit for the account of
          Borrower (each, a "Letter of Credit" and collectively, the "Letters of
          Credit") in an aggregate outstanding face amount not to exceed Four
          Million Dollars ($4,000,000). All Letters of Credit shall be in form
          and substance acceptable to Bank in its sole discretion and shall be
          subject to the terms and conditions of Bank's form of standard
          application and letter of credit agreement, including any
          then-applicable fee. On any drawn but unreimbursed Letter of Credit,
          the unreimbursed amount shall be deemed an Advance under Section
          2.1(a).
	The obligation of Borrower to immediately reimburse Bank for
          drawings made under Letters of Credit shall be absolute, unconditional
          and irrevocable, and shall be performed strictly in accordance with
          the terms of this Agreement and such Letters of Credit, under all
          circumstances whatsoever. Borrower shall indemnify, defend, protect,
          and hold Bank harmless from any loss, cost, expense or liability,
          including, without limitation, reasonable attorneys' fees, arising out
          of or in connection with any Letters of Credit, except for expenses
          caused by Bank's gross negligence or willful misconduct.

        
	Foreign Exchange Sublimit. If there is availability under the
        Committed Revolving Line, Borrower may enter in foreign exchange forward
        contracts with the Bank under which Borrower commits to purchase from or
        sell to Bank a set amount of foreign currency more than one business day
        after the contract date (the "FX Forward Contract"). Bank will subtract
        10% of each outstanding FX Forward Contract from the foreign exchange
        sublimit which is a maximum of $2,500,000 (the "FX Sublimit"). Such
        subtracted amount shall be deducted from availability under the
        Committed Revolving Line for other Credit Extensions. The total FX
        Forward Contracts at any one time may not exceed 10 times the amount of
        the FX Sublimit. Bank may terminate the FX Forward Contracts if an Event
        of Default occurs.
	Term Advances. "Equipment Advances"
        in the aggregate principal amount of $1,310,663 were made to Borrower
        under the Original Agreement (which shall be referred to hereunder as
        the "Term Advances"). Borrower shall not request or receive any further
        Term Advances. Interest shall accrue on such Term Advances at the rate
        set forth in Section 2.3(a). All Term Advances shall continue to be paid
        on the terms set forth in the Original Agreement. All Term Advances
        under this Section 2.1(e) shall be immediately due and payable on or
        before January 21, 2002. Term Advances once repaid, may not be
        reborrowed. Borrower may prepay all Term Advances without penalty or
        premium.

      
	Overadvances. If the aggregate amount of the outstanding Advances
      exceeds the lesser of the Committed Revolving Line or the Borrowing Base
      at any time, Borrower shall immediately pay to Bank, in cash, the amount
      of such excess.
	Interest Rates, Payments, and Calculations.
      	Interest Rates.
        

          
	Advances. Except as set forth in Section 2.3(b), the Advances
          shall bear interest, on the outstanding daily balance thereof, at a
          rate equal to the Prime Rate; provided, however, upon Borrower's
          election, Advances shall bear interest on the outstanding daily
          balance thereof, as provided in Section 2.5 below. 
	Equipment Advances. Except as set forth in Section  2.3(b),
          the Equipment Advances shall bear interest, on the outstanding daily
          balance thereof, at a rate equal to the Prime Rate. 
	Term Advances. Except as set forth in Section  2.3(b), the
          Term Advances shall bear interest, on the outstanding daily balance
          thereof, at a rate equal to one-quarter of one percent (0.25%) above
          the Prime Rate.

        
	Late Fee; Default Rate. If any
        payment is not made within ten (10) days after the date such payment is
        due, Borrower shall pay Bank a late fee equal to the lesser of (i) five
        percent (5%) of the amount of such unpaid amount or (ii) the maximum
        amount permitted to be charged under applicable law. All Obligations
        shall bear interest, from and after the occurrence and during the
        continuance of an Event of Default, at a rate equal to five (5)
        percentage points above the interest rate applicable immediately prior
        to the occurrence of the Event of Default. 
	Payments. Interest hereunder shall be due and payable on the
        fifteenth (15th) calendar day of each month during the term hereof. Bank
        shall, at its option, charge such interest, all Bank Expenses, and all
        Periodic Payments against any of Borrower's deposit accounts or against
        the Committed Revolving Line, in which case those amounts shall
        thereafter accrue interest at the rate then applicable hereunder. Any
        interest not paid when due shall be compounded by becoming a part of the
        Obligations, and such interest shall thereafter accrue interest at the
        rate then applicable hereunder. 
	Computation. In the event the Prime Rate is changed from time to
        time hereafter, the applicable rate of interest hereunder shall be
        increased or decreased, effective as of the day the Prime Rate is
        changed, by an amount equal to such change in the Prime Rate. All
        interest chargeable under the Loan Documents shall be computed on the
        basis of a three hundred sixty (360) day year for the actual number of
        days elapsed.

      
	Crediting Payments. Prior to the occurrence of an Event of
      Default, Bank shall credit a wire transfer of funds, check or other item
      of payment to such deposit account or Obligation as Borrower specifies.
      After the occurrence of an Event of Default, the receipt by Bank of any
      wire transfer of funds, check, or other item of payment shall be
      immediately applied to conditionally reduce Obligations, but shall not be
      considered a payment on account unless such payment is of immediately
      available federal funds or unless and until such check or other item of
      payment is honored when presented for payment. Notwithstanding anything to
      the contrary contained herein, any wire transfer or payment received by
      Bank after 12:00 noon Pacific time shall be deemed to have been received
      by Bank as of the opening of business on the immediately following
      Business Day. Whenever any payment to Bank under the Loan Documents would
      otherwise be due (except by reason of acceleration) on a date that is not
      a Business Day, such payment shall instead be due on the next Business
      Day, and additional fees or interest, as the case may be, shall accrue and
      be payable for the period of such extension. 
	Libor/Prime Rate Advances. Whenever Borrower desires an Advance,
      Borrower will notify Bank by facsimile transmission or telephone no later
      than 11:00 a.m. Pacific time, on the Business Day that a Prime Advance is
      to be made, and noon Pacific time on the Business Day that is three (3)
      Business Days prior to the Business Day on which a LIBOR Rate Advance is
      made. Each such notification shall be promptly confirmed by a
      Payment/Advance Form in substantially the form of Exhibit B-2 hereto. Bank
      is authorized to make Advances under this Agreement, based upon
      instructions received from a Responsible Officer, or a designee of a
      Responsible Officer designated in writing and signed by such Responsible
      Officer, or without instructions if in Bank's discretion such Advances are
      necessary to meet Obligations which have become due and remain unpaid.
      Bank shall be entitled to rely on any telephonic notice given by a person
      who Bank reasonably believes to be a Responsible Officer or a designee
      thereof, and Borrower shall indemnify and hold Bank harmless for any
      damages or loss suffered by Bank as a result of such reliance. Bank will
      credit the amount of Advances made under this Section 2.1 to a Borrower's
      deposit account, as specified by such Borrower.
      Each such notice shall specify:
      

	the date such Advance is to be made, which shall be a Business
          Day;
	the amount of such Advance;
	whether such Advance is to be a Prime Rate Advance or a LIBOR Rate
          Advance; and
	if the Advance is to be a LIBOR Rate Advance, the Interest Period
          for such Advance;

        Each written request for an Advance, and each confirmation of a
        telephone request for such an Advance, shall be in substantially the
        form of Exhibit B-2 hereto executed by Borrower.

        
        
	Prime Rate Advances. Each Prime Rate Advance shall be
        in an amount of not less than Twenty-Five Thousand Dollars ($25,000).
        The outstanding principal balance of each Prime Rate Advance shall bear
        interest until principal is due (computed daily on the basis of a 360
        day year and actual days elapsed), at a rate per annum equal to the
        Prime Rate. Prime Rate Advances shall be payable as set forth in Section
        2.3(c), with the entire outstanding principal amount of all Prime Rate
        Advances due and payable on the Revolving Maturity Date. 
	LIBOR Rate Advances. Each LIBOR Rate Advance shall be in an
        amount of not less than Five Hundred Thousand Dollars ($500,000). The
        outstanding principal balance of each LIBOR Rate Advance shall bear
        interest until principal is due (computed daily on the basis of a 360
        day year and actual days elapsed) at a rate per annum equal to the LIBOR
        Rate plus 250 basis points for such LIBOR Rate Advance. The entire
        outstanding principal amount of each LIBOR Rate Advance shall be due and
        payable on the earlier of (i) the last day of the LIBOR Rate Interest
        Period for such LIBOR Rate Advance, and (ii) Revolving Maturity Date. 
        
	Prepayment of the Advances. Borrower may at any time prepay any
        Prime Rate Advance or any LIBOR Rate Advance, in full or in part. Each
        partial prepayment for a LIBOR Rate Advance shall be in an amount not
        less than Twenty-Five Thousand Dollars ($25,000). Each prepayment shall
        be made upon the irrevocable written or telephone notice of Borrower
        received by Bank not later than 10:00 a.m. California time on the date
        of the prepayment of a Prime Rate Advance, and not less than three (3)
        Business Days prior to the date of the prepayment of a LIBOR Rate
        Advance. The notice of prepayment shall specify the date of the
        prepayment, the amount of the prepayment, and the Advance or Advances
        prepaid. Each prepayment of a LIBOR Rate Advance shall be accompanied by
        the payment of accrued interest on the amount prepaid and any amount
        required by Section 2.8.

      	Fees. Borrower shall pay to Bank the following:
      	Facility Fee.
        

          
	Committed Revolving Line. On the Closing Date, a Facility Fee
          equal to $15,000, which shall be non-refundable. 
	Equipment Line. On the Closing Date, a Facility Fee equal to
          $4,000, which shall be non-refundable.

        
	Bank Expenses. On the Closing Date, all Bank Expenses incurred
        through the Closing Date, including reasonable attorneys' fees and
        expenses and, after the Closing Date, all Bank Expenses, including
        reasonable attorneys' fees and expenses, as and when they become due.

      	Conversion/Continuation of Advances.
      	A Borrower may from time to time submit in writing a request that
        Prime Rate Advances be converted to LIBOR Rate Advances or that any
        existing LIBOR Rate Advances continue for an additional Interest Period.
        Such request shall specify the amount of the Prime Rate Advances which
        will constitute LIBOR Rate Advances (subject to the limits set forth
        below) and the Interest Period to be applicable to such LIBOR Rate
        Advances. Each written request for a conversion to a LIBOR Rate Advance
        or a continuation of a LIBOR Rate Advance shall be substantially in the
        form of a Libor Rate Conversion/Continuation Certificate as set forth on
        Exhibit B-3, which shall be duly executed by a Responsible Officer.
        Subject to the terms and conditions contained herein, three (3) Business
        Days after Bank's receipt of such a request from Borrower, such Prime
        Rate Advances shall be converted to LIBOR Rate Advances or such LIBOR
        Rate Advances shall continue, as the case may be provided that:
        	no Event of Default or event which with notice or passage of time
          or both would constitute an Event of Default exists;
	no party hereto shall have sent any notice of termination of the
          Agreement;
	Borrower shall have complied with such customary procedures as
          Bank has established from time to time for Borrower's requests for
          LIBOR Rate Advances;
	the amount of a LIBOR Rate Advance shall be $500,000 or such
          greater amount which is an integral multiple of $50,000; and
	Bank shall have determined that the Interest Period or LIBOR Rate
          is available to Bank as of the date of the request for such LIBOR Rate
          Advance (no more than four Interest Periods may be in effect at any
          one time under the Revolving Line).

        Any request by Borrower to convert Prime Rate Advances to LIBOR Rate
        Advances or continue any existing LIBOR Rate Advances shall be
        irrevocable. Notwithstanding anything to the contrary contained herein,
        Bank shall not be required to purchase United States Dollar deposits in
        the London interbank market or other applicable LIBOR Rate market to
        fund any LIBOR Rate Advances, but the provisions hereof shall be deemed
        to apply as if Bank had purchased such deposits to fund the LIBOR Rate
        Advances.

	Any LIBOR Rate Advances shall automatically convert to Prime Rate
        Advances upon the last day of the applicable Interest Period, unless
        Bank has received and approved a complete and proper request to continue
        such LIBOR Rate Advance at least three (3) Business Days prior to such
        last day in accordance with the terms hereof. Any LIBOR Rate Advances
        shall, at Bank's option, convert to Prime Rate Advances in the event
        that an Event of Default shall exist. Borrower shall pay to Bank, upon
        demand by Bank any amounts required to compensate Bank for any loss
        (including loss of anticipated profits), cost or expense incurred by
        such person, as a result of the conversion of LIBOR Rate Advances to
        Prime Rate Advances pursuant to any of the foregoing.

      
	Additional Requirements/Provisions Regarding LIBOR Rate Advances.
      	If for any reason (including voluntary or mandatory prepayment or
        acceleration, other than under section 2.8(e), Bank receives all or part
        of the principal amount of a LIBOR Rate Advance prior to the last day of
        the Interest Period for such LIBOR Rate Advance, Borrower shall on
        demand by Bank, pay Bank the amount (if any) by which (i) the additional
        interest which would have been payable on the amount so received had it
        not been received until the last day of such Interest Period or term
        exceeds (ii) the interest which would have been recoverable by Bank by
        placing the amount so received on deposit in the certificate of deposit
        markets or the offshore currency interbank markets or United States
        Treasury investment products, as the case may be, for a period starting
        on the date on which it was so received and ending on the last day of
        such Interest Period or term at the interest rate determined by Bank.
        Bank's determination as to such amount shall be presumptive evidence of
        such additional costs and binding for all purposes if made reasonably
        and in good faith.
	Borrower shall pay to Bank, upon demand by Bank, from time to time
        such amounts as Bank may reasonably determine to be necessary to
        compensate it for any costs incurred by Bank that Bank determines are
        attributable to its making or maintaining of any amount receivable by
        Bank hereunder in respect of any Advances relating thereto (such
        increases in costs and reductions in amounts receivable being herein
        called "Additional Costs"), in each case resulting from any regulatory
        change that:
        	changes the basis of taxation of any amounts payable to Bank under
          this Agreement in respect of any Advances (other than changes which
          affect taxes measured by or imposed on the overall net income of Bank
          by the jurisdiction in which Bank has its principal office); or
	imposes or modifies any reserve, special deposit or similar
          requirements relating to any extensions of credit or other assets of,
          or any deposits with or other liabilities of Bank (including any
          Advances or any deposits referred to in the definition of "LIBOR Base
          Rate"); or
	imposes any other material condition affecting this Agreement (or
          any of such extensions of credit or liabilities).

        Bank will notify Borrower of any event occurring after the date of
        the Agreement which will entitle Bank to compensation pursuant to this
        section as promptly as practicable after it obtains knowledge thereof
        and determines to request such compensation. Bank will furnish Borrower
        with a statement setting forth the basis and amount of each request by
        Bank for compensation under this Section 2.8. Determinations and
        allocations by Bank for purposes of this Section 2.8 of the effect of
        any regulatory change on its costs of maintaining its obligations to
        make Advances or of making or maintaining Advances or on amounts
        receivable by it in respect of Advances, and of the additional amounts
        required to compensate Bank in respect of any Additional Costs, shall be
        conclusive absent manifest error.

	Borrower shall pay to Bank, upon the request of Bank, such amount or
        amounts as shall be sufficient (in the sole good faith opinion of Bank)
        to compensate it for any reasonable loss, costs or expense incurred by
        it as a result of any failure by Borrower to borrow a LIBOR Rate Advance
        on the date for such borrowing specified in the relevant notice of
        borrowing hereunder.
	If Bank shall determine that the adoption or implementation of any
        applicable law, rule, regulation or treaty regarding capital adequacy,
        or any change therein, or any change in the interpretation or
        administration thereof by any governmental authority, central bank or
        comparable agency charged with the interpretation or administration
        thereof, or compliance by Bank (or its applicable lending office) with
        any respect 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 capital of Bank or any person or entity controlling Bank (a
        "Parent") as a consequence of its obligations hereunder to a level below
        that which Bank (or its Parent) could have achieved but for such
        adoption, change or compliance (taking into consideration its policies
        with respect to capital adequacy) by an amount deemed by Bank to be
        material, then from time to time, within 15 days after demand by Bank,
        Borrower shall pay to Bank such additional amount or amounts as will
        compensate Bank for such reduction. A statement of Bank claiming
        compensation under this Section and setting forth the additional amount
        or amounts to be paid to it hereunder shall be conclusive absent
        manifest error.
	If at any time Bank, in its sole and absolute discretion, determines
        that: (i) the amount of the LIBOR Rate Advances for periods equal to the
        corresponding Interest Periods or any other period are not available to
        Bank in the offshore currency interbank markets, or (ii) the LIBOR Rate
        does not accurately reflect the cost to Bank of lending the LIBOR Rate
        Advance, then Bank shall promptly give notice thereof to Borrower, and
        upon the giving of such notice Bank's obligation to make the LIBOR Rate
        Advances shall terminate, unless Bank and Borrower agree in writing to a
        different interest rate applicable to LIBOR Rate Advances. If it shall
        become unlawful for Bank to continue to fund or maintain any Advances,
        or to perform its obligations hereunder, upon demand by Bank, Borrower
        shall prepay the Advances in full with accrued interest thereon and all
        other amounts payable by Borrower hereunder.

      
	Term. This Agreement shall become effective on the Closing Date
      and, subject to Section 12.7, shall continue in full force and effect for
      a term ending on the Equipment Maturity Date. Notwithstanding the
      foregoing, Bank shall have the right to terminate its obligation to make
      Credit Extensions under this Agreement immediately and without notice upon
      the occurrence and during the continuance of an Event of Default.
      Notwithstanding termination, Bank's Lien on the Collateral shall remain in
      effect for so long as any Obligations are outstanding.

    	CONDITIONS OF LOANS.
    

      
	Conditions Precedent to Initial Credit Extension. The obligation
      of Bank to make the initial Credit Extension is subject to the condition
      precedent that Bank shall have received, in form and substance
      satisfactory to Bank, the following:
      	this Agreement;
	a certificate of the Secretary of Borrower with respect to
        incumbency and resolutions authorizing the execution and delivery of
        this Agreement;
	a financing statement (Form UCC-1);
	an intellectual property security agreement;
	agreement to provide insurance;
	payment of the fees and Bank Expenses then due specified in
        Section 2.6 hereof;
	an audit of the Collateral, the results of which shall be
        satisfactory to Bank; and
	such other documents, and completion of such other matters, as Bank
        may reasonably deem necessary or appropriate.

      
	Conditions Precedent to all Credit
      Extensions. The obligation of Bank to make each Credit Extension,
      including the initial Credit Extension, is further subject to the
      following conditions:
      	timely receipt by Bank of the Payment/Advance Form as provided in
        Section 2.1; and
	the representations and warranties contained in Section 5 shall be
        true and correct in all material respects on and as of the date of such
        Payment/Advance Form and on the effective date of each Credit Extension
        as though made at and as of each such date, and no Event of Default
        shall have occurred and be continuing, or would exist after giving
        effect to such Credit Extension (provided, however, that those
        representations and warranties expressly referring to another date shall
        be true, correct and complete in all material respects as of such date).
        The making of each Credit Extension shall be deemed to be a
        representation and warranty by Borrower on the date of such Credit
        Extension as to the accuracy of the facts referred to in this
        Section 3.2.

      

    	CREATION OF SECURITY INTEREST.
    

      
	Grant of Security Interest. Borrower grants and pledges to Bank a
      continuing security interest in all presently existing and hereafter
      acquired or arising Collateral in order to secure prompt repayment of any
      and all Obligations and in order to secure prompt performance by Borrower
      of each of its covenants and duties under the Loan Documents. Except as
      set forth in the Schedule, such security interest constitutes a valid,
      first priority security interest in the presently existing Collateral, and
      will constitute a valid, first priority security interest in Collateral
      acquired after the date hereof.
	Delivery of Additional Documentation
      Required. Borrower shall from time to time execute and deliver to
      Bank, at the request of Bank, all Negotiable Collateral, all financing
      statements and other documents that Bank may reasonably request, in form
      satisfactory to Bank, to perfect and continue perfected Bank's security
      interests in the Collateral and in order to fully consummate all of the
      transactions contemplated under the Loan Documents. 
	Right to Inspect. Bank (through any of its officers, employees, or
      agents) shall have the right, upon reasonable prior notice, from time to
      time during Borrower's usual business hours but no more than once a year
      (unless an Event of Default has occurred and is continuing), to inspect
      Borrower's Books and to make copies thereof and to check, test, and
      appraise the Collateral in order to verify Borrower's financial condition
      or the amount, condition of, or any other matter relating to, the
      Collateral.
	REPRESENTATIONS AND WARRANTIES.
    Borrower represents and warrants as follows:

      
	Due Organization and Qualification. Borrower and each Subsidiary
      is a corporation duly existing under the laws of its state of
      incorporation and qualified and licensed to do business in any state in
      which the conduct of its business or its ownership of property requires
      that it be so qualified. 
	Due Authorization; No Conflict. The execution, delivery, and
      performance of the Loan Documents are within Borrower's powers, have been
      duly authorized, and are not in conflict with nor constitute a breach of
      any provision contained in Borrower's Certificate of Incorporation or
      Bylaws, nor will they constitute an event of default under any material
      agreement to which Borrower is a party or by which Borrower is bound.
      Borrower is not in default under any agreement to which it is a party or
      by which it is bound, which default could have a Material Adverse Effect.
      
	No Prior Encumbrances. Borrower has good and marketable title to
      the Collateral, free and clear of Liens, except for Permitted Liens.
	Bona Fide Eligible Accounts. The
      Eligible Accounts are bona fide existing obligations. The property and
      services giving rise to such Eligible Accounts has been delivered or
      rendered to the account debtor or to the account debtor's agent for
      immediate and unconditional acceptance by the account debtor. Borrower has
      not received notice of actual or imminent Insolvency Proceeding of any
      account debtor that is included in any Borrowing Base Certificate as an
      Eligible Account. 
	Merchantable Inventory. All Inventory is in all material respects
      of good and marketable quality, free from all material defects, except for
      Inventory for which adequate reserves have been made. 
	Intellectual Property Collateral. Borrower is the sole owner of
      the Intellectual Property Collateral, except for non-exclusive licenses
      granted by Borrower to its customers in the ordinary course of business.
      Each of the Patents is valid and enforceable, and no part of the
      Intellectual Property Collateral has been judged invalid or unenforceable,
      in whole or in part, and no claim has been made that any part of the
      Intellectual Property Collateral violates the rights of any third party.
      Borrower's rights as a licensee of intellectual property do not give rise
      to more than five percent (5%) of its gross revenue in any given month,
      including without limitation revenue derived from the sale, licensing,
      rendering or disposition of any product or service. Except as set forth in
      the Schedule, Borrower is not a party to, or bound by, any agreement that
      restricts the grant by Borrower of a security interest in Borrower's
      rights under such agreement.
	Name; Location of Chief Executive Office.
      Except as disclosed in the Schedule, Borrower has not done business under
      any name other than that specified on the signature page hereof. The chief
      executive office of Borrower is located at the address indicated in
      Section 10 hereof.
	Litigation. Except as set forth in the
      Schedule, there are no actions or proceedings pending by or against
      Borrower or any Subsidiary before any court or administrative agency in
      which an adverse decision could have a Material Adverse Effect, or a
      material adverse effect on Borrower's interest or Bank's security interest
      in the Collateral. 
	No Material Adverse Change in Financial Statements. All
      consolidated financial statements related to Borrower and any Subsidiary
      that are delivered by Borrower to Bank fairly present in all material
      respects Borrower's consolidated financial condition as of the date
      thereof and Borrower's consolidated results of operations for the period
      then ended. There has not been a material adverse change in the
      consolidated financial condition of Borrower since the date of the most
      recent of such financial statements submitted to Bank. 
	Solvency, Payment of Debts. Borrower is solvent and able to pay
      its debts (including trade debts) as they mature. 
	Regulatory Compliance. Borrower and each Subsidiary have met the
      minimum funding requirements of ERISA with respect to any employee benefit
      plans subject to ERISA. No event has occurred resulting from Borrower's
      failure to comply with ERISA that is reasonably likely to result in
      Borrower's incurring any liability that could have a Material Adverse
      Effect. Borrower is not an "investment company" or a company "controlled"
      by an "investment company" within the meaning of the Investment Company
      Act of 1940. Borrower is not engaged principally, or as one of the
      important activities, in the business of extending credit for the purpose
      of purchasing or carrying margin stock (within the meaning of
      Regulations T and U of the Board of Governors of the Federal Reserve
      System). Borrower has complied with all the provisions of the Federal Fair
      Labor Standards Act. Borrower has not violated any statutes, laws,
      ordinances or rules applicable to it, violation of which could have a
      Material Adverse Effect. 
	Environmental Condition. Except as disclosed in the Schedule, none
      of Borrower's or any Subsidiary's properties or assets has ever been used
      by Borrower or any Subsidiary or, to the best of Borrower's knowledge, by
      previous owners or operators, in the disposal of, or to produce, store,
      handle, treat, release, or transport, any hazardous waste or hazardous
      substance other than in accordance with applicable law; to the best of
      Borrower's knowledge, none of Borrower's properties or assets has ever
      been designated or identified in any manner pursuant to any environmental
      protection statute as a hazardous waste or hazardous substance disposal
      site, or a candidate for closure pursuant to any environmental protection
      statute; no lien arising under any environmental protection statute has
      attached to any revenues or to any real or personal property owned by
      Borrower or any Subsidiary; and neither Borrower nor any Subsidiary has
      received a summons, citation, notice, or directive from the Environmental
      Protection Agency or any other federal, state or other governmental agency
      concerning any action or omission by Borrower or any Subsidiary resulting
      in the releasing, or otherwise disposing of hazardous waste or hazardous
      substances into the environment. 
	Taxes. Borrower and each Subsidiary have filed or caused to be
      filed all tax returns required to be filed, and have paid, or have made
      adequate provision for the payment of, all taxes reflected therein. 
      
	Subsidiaries. Borrower does not own any stock, partnership
      interest or other equity securities of any Person, except for Permitted
      Investments. 
	Government Consents. Borrower and each Subsidiary have obtained
      all consents, approvals and authorizations of, made all declarations or
      filings with, and given all notices to, all governmental authorities that
      are necessary for the continued operation of Borrower's business as
      currently conducted, the failure to obtain which could have a Material
      Adverse Effect. 
	Investment Accounts. None of Borrower's property is maintained or
      invested with a Person other than Bank. 
	Full Disclosure. No representation, warranty or other statement
      made by Borrower in any certificate or written statement furnished to Bank
      contains any untrue statement of a material fact or omits to state a
      material fact necessary in order to make the statements contained in such
      certificates or statements not misleading.
	AFFIRMATIVE COVENANTS.
    Borrower covenants and agrees that, until payment in full of all
    outstanding Obligations, and for so long as Bank may have any commitment to
    make a Credit Extension hereunder, Borrower shall do all of the following:

      
	Good Standing. Borrower shall maintain its and each of its
      Subsidiaries' corporate existence in its jurisdiction of incorporation and
      maintain qualification in each jurisdiction in which the failure to so
      qualify could have a Material Adverse Effect. Borrower shall maintain, and
      shall cause each of its Subsidiaries to maintain, in force all licenses,
      approvals and agreements, the loss of which could have a Material Adverse
      Effect. 
	Government Compliance. Borrower shall meet, and shall cause each
      Subsidiary to meet, the minimum funding requirements of ERISA with respect
      to any employee benefit plans subject to ERISA. Borrower shall comply, and
      shall cause each Subsidiary to comply, with all statutes, laws, ordinances
      and government rules and regulations to which it is subject, noncompliance
      with which could have a Material Adverse Effect, or a material adverse
      effect on the Collateral or the priority of Bank's Lien on the Collateral.
	Financial Statements, Reports, Certificates.
      Borrower shall deliver to Bank: (a) as soon as available, but in any event
      within thirty (30) days after the end of each calendar month, a company
      prepared consolidated balance sheet and income statement covering
      Borrower's consolidated operations during such period, prepared in
      accordance with GAAP, consistently applied, in a form acceptable to Bank
      and certified by a Responsible Officer; (b) as soon as available, but in
      any event within one hundred twenty (120) days after the end of Borrower's
      fiscal year, an annual report and audited consolidated financial
      statements of Borrower prepared in accordance with GAAP, consistently
      applied, together with an unqualified opinion on such financial statements
      of an independent certified public accounting firm reasonably acceptable
      to Bank; (c) if applicable, copies of all statements, reports and notices
      sent or made available generally by Borrower to its security holders or to
      any holders of Subordinated Debt and all reports on Forms 10-K and 10-Q
      filed with the Securities and Exchange Commission within five (5) days of
      filing (or 95 days of calendar quarter end for the from 10-K or 50 days of
      calendar quarter end for the form 10-Q); (d) promptly upon receipt of
      notice thereof, a report of any legal actions pending or threatened
      against Borrower or any Subsidiary that could result in damages or costs
      to Borrower or any Subsidiary of One Hundred Thousand Dollars ($100,000)
      or more; (e) such budgets, sales projections, operating plans or other
      financial information as Bank may reasonably request from time to time
      generally prepared by Borrower in the ordinary course of business; and
      (f) within thirty (30) days of the last day of each fiscal quarter, a
      report signed by Borrower, in form reasonably acceptable to Bank, listing
      any applications or registrations that Borrower has made or filed in
      respect of any Patents, Copyrights or Trademarks and the status of any
      outstanding applications or registrations, as well as any material change
      in Borrower's intellectual property, including but not limited to any
      subsequent ownership right of Borrower in or to any Trademark, Patent or
      Copyright not specified in Exhibits A, B, and C of
      the Intellectual Property Security Agreement delivered to Bank by Borrower
      in connection with this Agreement.
      If Advances under the Committed Revolving Line, including Letters of
      Credits and availability used under the Committed Revolving Line for FX
      Forward Contracts, exceed Three Million Dollars ($3,000,000), then within
      twenty (20) days after the last day of each month, Borrower shall deliver
      to Bank a Borrowing Base Certificate signed by a Responsible Officer in
      substantially the form of Exhibit C hereto, together with aged
      listings of accounts receivable and accounts payable and a report of
      deferred revenue.

      Borrower shall deliver to Bank with the 10-Q reports a Compliance
      Certificate signed by a Responsible Officer in substantially the form of
      Exhibit D hereto.

      Bank shall have a right from time to time hereafter to audit Borrower's
      Accounts and appraise Collateral at Borrower's expense, provided that such
      audits will be conducted no more often than every twelve (12) months
      unless an Event of Default has occurred and is continuing; provided,
      however, that if Advances under the Committed Revolving Line, including
      Letters of Credit and availability used under the Committed Revolving Line
      for FX Forward Contracts, exceed Three Million Dollars ($3,000,000), then
      such audits may be conducted no more often than every six (6) months
      unless an Event of Default has occurred and is continuing.

	Inventory; Returns. Borrower shall keep all Inventory in good and
      marketable condition, free from all material defects except for Inventory
      for which adequate reserves have been made. Returns and allowances, if
      any, as between Borrower and its account debtors shall be on the same
      basis and in accordance with the usual customary practices of Borrower, as
      they exist at the time of the execution and delivery of this Agreement.
      Borrower shall promptly notify Bank of all returns and recoveries and of
      all disputes and claims, where the return, recovery, dispute or claim
      involves more than Fifty Thousand Dollars ($50,000). 
	Taxes. Borrower shall make, and shall cause each Subsidiary to
      make, due and timely payment or deposit of all material federal, state,
      and local taxes, assessments, or contributions required of it by law, and
      will execute and deliver to Bank, on demand, appropriate certificates
      attesting to the payment or deposit thereof; and Borrower will make, and
      will cause each Subsidiary to make, timely payment or deposit of all
      material tax payments and withholding taxes required of it by applicable
      laws, including, but not limited to, those laws concerning F.I.C.A.,
      F.U.T.A., state disability, and local, state, and federal income taxes,
      and will, upon request, furnish Bank with proof satisfactory to Bank
      indicating that Borrower or a Subsidiary has made such payments or
      deposits; provided that Borrower or a Subsidiary need not make any payment
      if the amount or validity of such payment is contested in good faith by
      appropriate proceedings and is reserved against (to the extent required by
      GAAP) by Borrower.
	Insurance.
      	Borrower, at its expense, shall keep the Collateral insured against
        loss or damage by fire, theft, explosion, sprinklers, and all other
        hazards and risks, and in such amounts, as ordinarily insured against by
        other owners in similar businesses conducted in the locations where
        Borrower's business is conducted on the date hereof. Borrower shall also
        maintain insurance relating to Borrower's business and ownership and use
        of the Collateral in amounts and of a type that are customary to
        businesses similar to Borrower's.
	All such policies of insurance shall be in such form, with such
        companies, and in such amounts as reasonably satisfactory to Bank. All
        such policies of property insurance shall contain a lender's loss
        payable endorsement, in a form satisfactory to Bank, showing Bank as an
        additional loss payee thereof, and all liability insurance policies
        shall show the Bank as an additional insured and shall specify that the
        insurer must give at least twenty (20) days notice to Bank before
        canceling its policy for any reason. Upon Bank's request, Borrower shall
        deliver to Bank certified copies of such policies of insurance and
        evidence of the payments of all premiums therefor. All proceeds payable
        under any such policy shall, at the option of Bank, be payable to Bank
        to be applied on account of the Obligations.

      
	Principal Depository. Borrower shall maintain its principal
      depository and operating accounts with Bank. 
	Quick Ratio. Borrower shall maintain, as of the last day of each
      calendar quarter, a ratio of Quick Assets to Current Liabilities less
      deferred revenue of at least 2.50 to 1.00. 
	Tangible Net Worth. Borrower shall maintain, as of the last day of
      each fiscal quarter, a Tangible Net Worth of not less than Twenty-Five
      Million Dollars ($25,000,000) plus sixty percent (60%) of any New Equity.
	Registration of Intellectual Property
      Rights.
      	Borrower shall register or cause to be registered on an expedited
        basis (to the extent not already registered) with the United States
        Patent and Trademark Office or the United States Copyright Office, as
        applicable: (i) those intellectual property rights listed on 
        Exhibits A, B and C to the Intellectual Property
        Security Agreement delivered to Bank by Borrower in connection with this
        Agreement, within thirty (30) days of the date of this Agreement,
        (ii) all registerable intellectual property rights Borrower has
        developed as of the date of this Agreement but heretofore failed to
        register, within thirty (30) days of the date of this Agreement, and
        (iii) those additional intellectual property rights developed or
        acquired by Borrower from time to time in connection with any product or
        service, prior to the sale or licensing of such product or the rendering
        of such service to any third party, and prior to Borrower's use of such
        product (including without limitation major revisions or additions to
        the intellectual property rights listed on such Exhibits A, B
        and C). Borrower shall give Bank notice of all such applications
        or registrations.
	Borrower shall execute and deliver such additional instruments and
        documents from time to time as Bank shall reasonably request to perfect
        Bank's security interest in the Intellectual Property Collateral.
	Borrower shall (i) protect, defend and maintain the validity and
        enforceability of the Trademarks, Patents and Copyrights, (ii) use its
        best efforts to detect infringements of the Trademarks, Patents and
        Copyrights and promptly advise Bank in writing of material infringements
        detected and (iii) not allow any material Trademarks, Patents or
        Copyrights to be abandoned, forfeited or dedicated to the public without
        the written consent of Bank, which shall not be unreasonably withheld.
	Bank may audit Borrower's Intellectual Property Collateral to
        confirm compliance with this Section, provided such audit may not occur
        more often than once per year, unless an Event of Default has occurred
        and is continuing. Bank shall have the right, but not the obligation, to
        take, at Borrower's sole expense, any actions that Borrower is required
        under this Section to take but which Borrower fails to take, after
        fifteen (15) days' notice to Borrower. Borrower shall reimburse and
        indemnify Bank for all reasonable costs and reasonable expenses incurred
        in the reasonable exercise of its rights under this Section.

      
	Further Assurances. At any time and from time to time Borrower
      shall execute and deliver such further instruments and take such further
      action as may reasonably be requested by Bank to effect the purposes of
      this Agreement.
	NEGATIVE COVENANTS.
    Borrower covenants and agrees that, so long as any credit hereunder shall
    be available and until payment in full of the outstanding Obligations or for
    so long as Bank may have any commitment to make any Credit Extensions,
    Borrower will not do any of the following:

      
	Dispositions. Convey, sell, lease, transfer or otherwise dispose
      of (collectively, a "Transfer"), or permit any of its Subsidiaries to
      Transfer, all or any part of its business or property, other than: (i) Transfers
      of Inventory in the ordinary course of business; (ii) Transfers of
      non-exclusive licenses and similar arrangements for the use of the
      property of Borrower or its Subsidiaries in the ordinary course of
      business; or (iii) Transfers of surplus, worn-out or obsolete Equipment.
      
	Change in Business; Change in Control or Executive Office. Engage
      in any business, or permit any of its Subsidiaries to engage in any
      business, other than the businesses currently engaged in by Borrower and
      any business substantially similar or related thereto (or incidental
      thereto). Borrower will not suffer or permit a Change in Control or
      without thirty (30) days prior written notification to Bank, relocate its
      chief executive office. Borrower will not change the date on which its
      fiscal year ends without Bank's prior written consent. 
	Mergers or Acquisitions. Merge or consolidate, or permit any of
      its Subsidiaries to merge or consolidate, with or into any other business
      organization, or acquire, or permit any of its Subsidiaries to acquire,
      all or substantially all of the capital stock or property of another
      Person (collectively, "Merger and Acquisition Activities").
      Notwithstanding the foregoing, Borrower may engage in Merger and
      Acquisition Activities in which (i) such Merger and Acquisition Activities
      are generally in Borrower's industry and do not exceed an aggregate
      consideration of Seventy-Five Million Dollars ($75,000,000) through the
      Revolving Maturity Date, (ii) Borrower is the surviving entity as a result
      of such transaction and there is no substantial change in Borrower's
      executive management and (iii) the consideration consists of its common
      stock or cash, provided that the aggregate amount of cash paid in
      connection with Merger and Acquisition Activity may not exceed Ten Million
      Dollars ($10,000,000) through the Revolving Maturity Date (and Twenty
      Million Dollars ($20,000,000) per calendar year during the term of this
      Agreement) and further provided that Borrower may not engage in any Merger
      and Acquisition Activity if an Event of Default has occurred and is
      continuing at the time of such a proposed transaction or if an Event of
      Default would exist after giving effect to such transaction. 
	Indebtedness. Create, incur, assume or be or remain liable with
      respect to any Indebtedness, or permit any Subsidiary so to do, other than
      Permitted Indebtedness. 
	Encumbrances. Create, incur, assume or suffer to exist any Lien
      with respect to any of its property, or assign or otherwise convey any
      right to receive income, including the sale of any Accounts, or permit any
      of its Subsidiaries so to do, except for Permitted Liens. 
	Distributions. Pay any dividends (other than dividends payable in
      stock) or make any other distribution or payment on account of or in
      redemption, retirement or purchase of any capital stock (in excess of Five
      Hundred Thousand Dollars ($500,000) per fiscal year), or permit any of its
      Subsidiaries to do so, except that Borrower may repurchase the stock of
      former employees pursuant to stock repurchase agreements as long as an
      Event of Default does not exist prior to such repurchase or would not
      exist after giving effect to such repurchase. 
	Investments. Directly or indirectly acquire or own, or make any
      Investment in or to any Person, or permit any of its Subsidiaries so to
      do, other than Permitted Investments. Maintain or invest any of its
      property with a Person other than Bank unless such Person has entered into
      a control agreement with Bank, in form and substance satisfactory to Bank.
      
	Transactions with Affiliates. Directly or indirectly enter into or
      permit to exist any material transaction with any Affiliate of Borrower
      except for transactions that are in the ordinary course of Borrower's
      business, upon fair and reasonable terms that are no less favorable to
      Borrower than would be obtained in an arm's length transaction with a
      non-affiliated Person. 
	Subordinated Debt. Make any payment in respect of any Subordinated
      Debt, or permit any of its Subsidiaries to make any such payment, except
      in compliance with the terms of such Subordinated Debt, or amend any
      provision contained in any documentation relating to the Subordinated Debt
      without Bank's prior written consent. 
	Inventory and Equipment. Store the Inventory or the Equipment with
      a bailee, warehouseman, or similar party unless Bank has received a pledge
      of the warehouse receipt covering such Inventory. Except for Inventory
      sold in the ordinary course of business and except for such other
      locations as Bank may approve in writing, Borrower shall keep the
      Inventory and Equipment only at the location set forth in Section 10
      hereof and such other locations of which Borrower gives Bank prior written
      notice and as to which Borrower signs and files a financing statement
      where needed to perfect Bank's security interest. 
	Compliance. Become an "investment company" or be controlled by an
      "investment company," within the meaning of the Investment Company Act of
      1940, or become principally engaged in, or undertake as one of its
      important activities, the business of extending credit for the purpose of
      purchasing or carrying margin stock, or use the proceeds of any Credit
      Extension for such purpose. Fail to meet the minimum funding requirements
      of ERISA, permit a Reportable Event or Prohibited Transaction, as defined
      in ERISA, to occur, fail to comply with the Federal Fair Labor Standards
      Act or violate any law or regulation, which violation could have a
      Material Adverse Effect, or a material adverse effect on the Collateral or
      the priority of Bank's Lien on the Collateral, or permit any of its
      Subsidiaries to do any of the foregoing. 
	Negative Pledge Agreements. Permit the inclusion in any contract
      to which it becomes a party of any provisions that could restrict or
      invalidate the creation of a security interest in Borrower's rights and
      interests in any Collateral.
	EVENTS OF DEFAULT.
    Any one or more of the following events shall constitute an Event of
    Default by Borrower under this Agreement:

      
	Payment Default. If Borrower fails to pay, when due, any of the
      Obligations; 
	Covenant Default. If Borrower fails to perform any obligation
      under Article 6 or violates any of the covenants contained in Article 7 of
      this Agreement, or fails or neglects to perform, keep, or observe any
      other material term, provision, condition, covenant, or agreement
      contained in this Agreement, in any of the Loan Documents, or in any other
      present or future agreement between Borrower and Bank and as to any
      default under such other term, provision, condition, covenant or agreement
      that can be cured, has failed to cure such default within ten (10) days
      after Borrower receives notice thereof or any officer of Borrower becomes
      aware thereof; provided, however, that if the default cannot by its nature
      be cured within the ten (10) day period or cannot after diligent attempts
      by Borrower be cured within such ten (10) day period, and such default is
      likely to be cured within a reasonable time, then Borrower shall have an
      additional reasonable period (which shall not in any case exceed thirty
      (30) days) to attempt to cure such default, and within such reasonable
      time period the failure to have cured such default shall not be deemed an
      Event of Default (provided that no Credit Extensions will be required to
      be made during such cure period); 
	Material Adverse Change. If there occurs a material adverse change
      in Borrower's business or financial condition, or if there is a material
      impairment of the prospect of repayment of any portion of the Obligations
      or a material impairment of the value or priority of Bank's security
      interests in the Collateral; 
	Attachment. If any material portion of Borrower's assets is
      attached, seized, subjected to a writ or distress warrant, or is levied
      upon, or comes into the possession of any trustee, receiver or person
      acting in a similar capacity and such attachment, seizure, writ or
      distress warrant or levy has not been removed, discharged or rescinded
      within ten (10) days, or if Borrower is enjoined, restrained, or in any
      way prevented by court order from continuing to conduct all or any
      material part of its business affairs, or if a judgment or other claim
      becomes a lien or encumbrance upon any material portion of Borrower's
      assets, or if a notice of lien, levy, or assessment is filed of record
      with respect to any of Borrower's assets by the United States Government,
      or any department, agency, or instrumentality thereof, or by any state,
      county, municipal, or governmental agency, and the same is not paid within
      ten (10) days after Borrower receives notice thereof, provided that none
      of the foregoing shall constitute an Event of Default where such action or
      event is stayed or an adequate bond has been posted pending a good faith
      contest by Borrower (provided that no Credit Extensions will be required
      to be made during such cure period);
	Insolvency. If Borrower becomes
      insolvent, or if an Insolvency Proceeding is commenced by Borrower, or if
      an Insolvency Proceeding is commenced against Borrower and is not
      dismissed or stayed within thirty (30) days (provided that no Credit
      Extensions will be made prior to the dismissal of such Insolvency
      Proceeding); 
	Other Agreements. If there is a default in any agreement to which
      Borrower is a party with a third party or parties resulting in a right by
      such third party or parties, whether or not exercised, to accelerate the
      maturity of any Indebtedness in an amount in excess of Fifty Thousand
      Dollars ($50,000) or that could have a Material Adverse Effect; 
	Subordinated Debt. If Borrower makes any payment on account of
      Subordinated Debt, except to the extent such payment is allowed under any
      subordination agreement entered into with Bank; 
	Judgments. If a judgment or judgments for the payment of money in
      an amount, individually or in the aggregate, of at least Fifty Thousand
      Dollars ($50,000) shall be rendered against Borrower and shall remain
      unsatisfied and unstayed for a period of ten (10) days (provided that no
      Credit Extensions will be made prior to the satisfaction or stay of such
      judgment); or 
	Misrepresentations. If any material misrepresentation or material
      misstatement exists now or hereafter in any warranty or representation set
      forth herein or in any certificate delivered to Bank by any Responsible
      Officer pursuant to this Agreement or to induce Bank to enter into this
      Agreement or any other Loan Document.

    	BANK'S RIGHTS AND REMEDIES.
    	Rights and Remedies. Upon the
      occurrence and during the continuance of an Event of Default, Bank may, at
      its election, without notice of its election and without demand, do any
      one or more of the following, all of which are authorized by Borrower:
      	Declare all Obligations, whether evidenced by this Agreement, by any
        of the other Loan Documents, or otherwise, immediately due and payable
        (provided that upon the occurrence of an Event of Default described in
        Section 8.5, all Obligations shall become immediately due and payable
        without any action by Bank);
	Cease advancing money or extending credit to or for the benefit of
        Borrower under this Agreement or under any other agreement between
        Borrower and Bank;
	Settle or adjust disputes and claims directly with account debtors
        for amounts, upon terms and in whatever order that Bank reasonably
        considers advisable;
	Make such payments and do such acts as Bank considers necessary or
        reasonable to protect its security interest in the Collateral. Borrower
        agrees to assemble the Collateral if Bank so requires, and to make the
        Collateral available to Bank as Bank may designate. Borrower authorizes
        Bank to enter the premises where the Collateral is located, to take and
        maintain possession of the Collateral, or any part of it, and to pay,
        purchase, contest, or compromise any encumbrance, charge, or lien which
        in Bank's determination appears to be prior or superior to its security
        interest and to pay all expenses incurred in connection therewith. With
        respect to any of Borrower's owned premises, Borrower hereby grants Bank
        a license to enter into possession of such premises and to occupy the
        same, without charge, in order to exercise any of Bank's rights or
        remedies provided herein, at law, in equity, or otherwise;
	Set off and apply to the Obligations any and all (i) balances and
        deposits of Borrower held by Bank, or (ii) indebtedness at any time
        owing to or for the credit or the account of Borrower held by Bank;
	Ship, reclaim, recover, store, finish, maintain, repair, prepare for
        sale, advertise for sale, and sell (in the manner provided for herein)
        the Collateral. Bank is hereby granted a license or other right, solely
        pursuant to the provisions of this Section 9.1, to use, without charge,
        Borrower's labels, patents, copyrights, rights of use of any name, trade
        secrets, trade names, trademarks, service marks, and advertising matter,
        or any property of a similar nature, as it pertains to the Collateral,
        in completing production of, advertising for sale, and selling any
        Collateral and, in connection with Bank's exercise of its rights under
        this Section 9.1, Borrower's rights under all licenses and all franchise
        agreements shall inure to Bank's benefit;
	Dispose of the Collateral by way of one or more contracts or
        transactions, for cash or on terms, in such manner and at such places
        (including Borrower's premises) as Bank determines is commercially
        reasonable, and apply any proceeds to the Obligations in whatever manner
        or order Bank deems appropriate;
	Bank may credit bid and purchase at any public sale; and
	Any deficiency that exists after disposition of the Collateral as
        provided above will be paid immediately by Borrower.

      
	Power of Attorney. Effective only upon the occurrence and during
      the continuance of an Event of Default, Borrower hereby irrevocably
      appoints Bank (and any of Bank's designated officers, or employees) as
      Borrower's true and lawful attorney to: (a) send requests for verification
      of Accounts or notify account debtors of Bank's security interest in the
      Accounts; (b) endorse Borrower's name on any checks or other forms of
      payment or security that may come into Bank's possession; (c) sign
      Borrower's name on any invoice or bill of lading relating to any Account,
      drafts against account debtors, schedules and assignments of Accounts,
      verifications of Accounts, and notices to account debtors; (d) dispose of
      any Collateral; (e) make, settle, and adjust all claims under and
      decisions with respect to Borrower's policies of insurance; (f) settle and
      adjust disputes and claims respecting the accounts directly with account
      debtors, for amounts and upon terms which Bank determines to be
      reasonable; (g) to modify, in its sole discretion, any intellectual
      property security agreement entered into between Borrower and Bank without
      first obtaining Borrower's approval of or signature to such modification
      by amending Exhibits A, B, and C, thereof, as
      appropriate, to include reference to any right, title or interest in any
      Copyrights, Patents or Trademarks acquired by Borrower after the execution
      hereof or to delete any reference to any right, title or interest in any
      Copyrights, Patents or Trademarks in which Borrower no longer has or
      claims to have any right, title or interest; (h) to file, in its sole
      discretion, one or more financing or continuation statements and
      amendments thereto, relative to any of the Collateral without the
      signature of Borrower where permitted by law; and (i) to transfer the
      Intellectual Property Collateral into the name of Bank or a third party to
      the extent permitted under the California Uniform Commercial Code;
      provided Bank may exercise such power of attorney to sign the name of
      Borrower on any of the documents described in Section 4.2 regardless of
      whether an Event of Default has occurred. The appointment of Bank as
      Borrower's attorney in fact, and each and every one of Bank's rights and
      powers, being coupled with an interest, is irrevocable until all of the
      Obligations have been fully repaid and performed and Bank's obligation to
      provide Credit Extensions hereunder is terminated. 
	Accounts Collection. At any time during the term of this
      Agreement, Bank may notify any Person owing funds to Borrower of Bank's
      security interest in such funds and verify the amount of such Account.
      Borrower shall collect all amounts owing to Borrower for Bank, receive in
      trust all payments as Bank's trustee, and immediately deliver such
      payments to Bank in their original form as received from the account
      debtor, with proper endorsements for deposit. 
	Bank Expenses. If Borrower fails to pay any amounts or furnish any
      required proof of payment due to third persons or entities, as required
      under the terms of this Agreement, then Bank may do any or all of the
      following after reasonable notice to Borrower: (a) make payment of the
      same or any part thereof; (b) set up such reserves under a Facility in
      Section 2.1 as Bank deems necessary to protect Bank from the exposure
      created by such failure; or (c) obtain and maintain insurance policies of
      the type discussed in Section 6.6 of this Agreement, and take any action
      with respect to such policies as Bank deems prudent. Any amounts so paid
      or deposited by Bank shall constitute Bank Expenses, shall be immediately
      due and payable, and shall bear interest at the then applicable rate
      hereinabove provided, and shall be secured by the Collateral. Any payments
      made by Bank shall not constitute an agreement by Bank to make similar
      payments in the future or a waiver by Bank of any Event of Default under
      this Agreement. 
	Bank's Liability for Collateral. So long as Bank complies with
      reasonable banking practices, Bank shall not in any way or manner be
      liable or responsible for: (a) the safekeeping of the Collateral; (b) any
      loss or damage thereto occurring or arising in any manner or fashion from
      any cause; (c) any diminution in the value thereof; or (d) any act or
      default of any carrier, warehouseman, bailee, forwarding agency, or other
      person whomsoever. All risk of loss, damage or destruction of the
      Collateral shall be borne by Borrower. 
	Remedies Cumulative. Bank's rights and remedies under this
      Agreement, the Loan Documents, and all other agreements shall be
      cumulative. Bank shall have all other rights and remedies not inconsistent
      herewith as provided under the Code, by law, or in equity. No exercise by
      Bank of one right or remedy shall be deemed an election, and no waiver by
      Bank of any Event of Default on Borrower's part shall be deemed a
      continuing waiver. No delay by Bank shall constitute a waiver, election,
      or acquiescence by it. No waiver by Bank shall be effective unless made in
      a written document signed on behalf of Bank and then shall be effective
      only in the specific instance and for the specific purpose for which it
      was given. 
	Demand; Protest. Borrower waives demand, protest, notice of
      protest, notice of default or dishonor, notice of payment and nonpayment,
      notice of any default, nonpayment at maturity, release, compromise,
      settlement, extension, or renewal of accounts, documents, instruments,
      chattel paper, and guarantees at any time held by Bank on which Borrower
      may in any way be liable.

    
	NOTICES.
    Unless otherwise provided in this Agreement, all notices or demands by
    any party relating to this Agreement or any other agreement entered into in
    connection herewith shall be in writing and (except for financial statements
    and other informational documents which may be sent by first-class mail,
    postage prepaid) shall be personally delivered or sent by a recognized
    overnight delivery service, certified mail, postage prepaid, return receipt
    requested, or by telefacsimile to Borrower or to Bank, as the case may be,
    at its addresses set forth below:

    If to Borrower: Chordiant Software, Inc.

    20400 Stevens Creek Boulevard, Suite 400

    Cupertino, CA 95014

    Attn: Chief Financial Officer/Chief Executive Officer

    FAX: (408) 517-0270

    If to Bank: Imperial Bank

    226 Airport Parkway

    San Jose, CA 95110-1024

    Attn: Corporate Banking Center

    FAX: (408) 451-8586

    with a copy to: Imperial Bank

    3000 El Camino Real, 8th Floor

    Palo Alto, CA 94301

    Attn: Robin W. Steinbach

    FAX: (650) 213-1710

    The parties hereto may change the address at which they are to receive
    notices hereunder, by notice in writing in the foregoing manner given to the
    other.

	CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.
    This Agreement shall be governed by, and construed in accordance with,
    the internal laws of the State of California, without regard to principles
    of conflicts of law. Each of Borrower and Bank hereby submits to the
    exclusive jurisdiction of the state and Federal courts located in the County
    of Santa Clara, State of California. BORROWER AND BANK EACH HEREBY WAIVE
    THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
    BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE
    TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
    BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH
    PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL
    INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT. EACH PARTY REPRESENTS AND
    WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT
    KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
    CONSULTATION WITH LEGAL COUNSEL.

	GENERAL PROVISIONS.
    

      
	Successors and Assigns. This Agreement shall bind and inure to the
      benefit of the respective successors and permitted assigns of each of the
      parties; provided, however, that neither this Agreement nor any rights
      hereunder may be assigned by Borrower without Bank's prior written
      consent, which consent may be granted or withheld in Bank's sole
      discretion. Bank shall have the right without the consent of or notice to
      Borrower to sell, transfer, negotiate, or grant participation in all or
      any part of, or any interest in, Bank's obligations, rights and benefits
      hereunder.
	Indemnification. Borrower shall defend,
      indemnify and hold harmless Bank and its officers, employees, and agents
      against: (a) all obligations, demands, claims, and liabilities claimed or
      asserted by any other party in connection with the transactions
      contemplated by this Agreement; and (b) all losses or Bank Expenses in any
      way suffered, incurred, or paid by Bank as a result of or in any way
      arising out of, following, or consequential to transactions between Bank
      and Borrower whether under this Agreement, or otherwise (including without
      limitation reasonable attorneys' fees and expenses), except for losses
      caused by Bank's gross negligence or willful misconduct. 
	Time of Essence. Time is of the essence for the performance of all
      obligations set forth in this Agreement. 
	Severability of Provisions. Each provision of this Agreement shall
      be severable from every other provision of this Agreement for the purpose
      of determining the legal enforceability of any specific provision. 
      
	Amendments in Writing, Integration. This Agreement cannot be
      amended or terminated orally. All prior agreements, understandings,
      representations, warranties, and negotiations between the parties hereto
      with respect to the subject matter of this Agreement, if any, are merged
      into this Agreement and the Loan Documents. 
	Counterparts. This Agreement may be executed in any number of
      counterparts and by different parties on separate counterparts, each of
      which, when executed and delivered, shall be deemed to be an original, and
      all of which, when taken together, shall constitute but one and the same
      Agreement.
	Survival. All covenants,
      representations and warranties made in this Agreement shall continue in
      full force and effect so long as any Obligations remain outstanding. The
      obligations of Borrower to indemnify Bank with respect to the expenses,
      damages, losses, costs and liabilities described in Section 12.2 shall
      survive until all applicable statute of limitations periods with respect
      to actions that may be brought against Bank have run.

    	JUDICIAL REFERENCE.
	Other than (i) nonjudicial foreclosure and all matters in connection
        therewith regarding security interests in real or personal property; or
        (ii) the appointment of a receiver, or the exercise of other provisional
        remedies (any and all of which may be initiated pursuant to applicable
        law), each controversy, dispute or claim between the parties arising out
        of or relating to this document, which controversy, dispute or claim is
        not settled in writing within thirty (30) days after the "Claim Date"
        (defined as the date on which a party subject to this Agreement gives
        written notice to all other parties that a controversy, dispute or claim
        exists), will be settled by a reference proceeding in California in
        accordance with the provisions of Section 638 et seq. of the
        California Code of Civil Procedure, or their successor section ("CCP"),
        which shall constitute the exclusive remedy for the settlement of any
        controversy, dispute or claim concerning this Agreement, including
        whether such controversy, dispute or claim is subject to the reference
        proceeding and except as set forth above, the parties waive their rights
        to initiate any legal proceedings against each other in any court or
        jurisdiction other than Santa Clara County (the "Court"). The
        referee shall be a retired Judge of the Court selected by mutual
        agreement of the parties, and if they cannot so agree within forty-five
        (45) days after the Claim Date, the referee shall be promptly selected
        by the Presiding Judge of the Court (or his representative). The referee
        shall be appointed to sit as a temporary judge, with all of the powers
        for a temporary judge, as authorized by law, and upon selection should
        take and subscribe to the oath of office as provided for in Rule 244 of
        the California Rules of the Court (or any subsequently enacted Rule).
        Each party shall have one peremptory challenge pursuant to CCP section 170.6.
        The referee shall (a) be requested to set the matter for hearing within
        sixty (60) days after the date of selection of the referee and (b) try
        any and all issues of law or fact and report a statement of decision
        upon them, if possible, within ninety (90) days of the Claim Date. Any
        decision rendered by the referee will be final, binding and conclusive
        and judgment shall be entered pursuant to CCP section 644 in any court in the
        State of California having jurisdiction. Any party may apply for a
        reference proceeding at any time after thirty (30) days following notice
        to any other party of the nature of the controversy, dispute or claim,
        by filing a petition for a hearing and/or trial. All discovery permitted
        by this Agreement shall be completed no later than fifteen (15) days
        before the first hearing date established by the referee. The referee
        may extend such period in the event of a party's refusal to provide
        requested discovery or unavailability of a witness due to absence or
        illness. No party shall be entitled to "priority" in conducting
        discovery. Depositions may be taken by either party upon seven (7) days
        written notice, and request for production or inspection of documents
        which cannot be resolved by the parties shall be submitted to the
        referee as provided herein, the Superior Court is empowered to issue
        temporary and/or provisional remedies, as appropriate.
	Except as expressly set forth in this Agreement, the referee shall
        determine the manner in which the reference proceeding is conducted
        including the time and place of all hearings, the order of presentation
        of evidence, and all other questions that arise with respect to the
        course of the reference proceeding. All proceedings and hearings
        conducted before the referee, except for trial, shall be conducted
        without a court reporter except that when any party so requests, a court
        reporter will be used at any hearing conducted before the referee. The
        party making such a request shall have the obligation to arrange for and
        pay for the court reporter. The costs of the court reporter at the trial
        shall be borne equally by the parties.
	The referee shall be required to determine all issues in accordance
        with existing case law and the statutory laws of the State of
        California. The rules of evidence applicable to proceedings at law in
        the State of California will be applicable to the reference proceeding.
        The referee shall be empowered to enter equitable as well as legal
        relief, to provide all temporary and/or provisional remedies and to
        enter equitable orders that will be binding upon the parties. The
        referee shall issue a single judgment at the close of the reference
        proceeding which shall dispose of all of the claims of the parties that
        are the subject of the reference. The parties hereto expressly reserve
        the right to contest or appeal from the final judgment or any appealable
        order or appealable judgment entered by the referee. The parties hereto
        expressly reserve the right to findings of fact, conclusions of laws, a
        written statement of decision, and the right to move for a new trial or
        a different judgment, which new trial, if granted, is also to be a
        reference proceeding under this provision.
	In the event that the enabling legislation which provides for
        appointment of a referee is repealed (and no successor statute is
        enacted), any dispute between the parties that would otherwise be
        determined by the reference procedure herein described will be resolved
        and determined by arbitration. The arbitration will be conducted by a
        retired judge of the Court, in accordance with the California
        Arbitration Act, section 1280 through section 1294.2 of the CCP as amended from time
        to time. The limitations with respect to discovery as set forth
        hereinabove shall apply to any such arbitration proceeding.

    
    

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

	 	 	CHORDIANT SOFTWARE, INC.
	 	 	 
	 	 	 
	 	 	By: 
	 	 	 
	 	 	Title: 
	 	 	 
	 	 	 
	 	 	IMPERIAL BANK
	 	 	 
	 	 	 
	 	 	By: 
	 	 	 
	 	 	Title: 
	 	 	 

DEBTOR CHORDIANT SOFTWARE, INC.

SECURED PARTY: IMPERIAL BANK

EXHIBIT A

COLLATERAL DESCRIPTION ATTACHMENT

TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

All personal property of Borrower (herein referred to as "Borrower" or
"Debtor") whether presently existing or hereafter created, written, produced or
acquired, including, but not limited to:

(i) all accounts receivable, accounts, chattel paper, contract rights
(including, without limitation, royalty agreements, license agreements and
distribution agreements), documents, instruments, money, deposit accounts and
general intangibles, including, without limitation, returns, repossessions,
books and records relating thereto, and equipment containing said books and
records, all financial assets, all investment property, including securities and
securities entitlements;

(ii) all software, computer source codes and other computer programs
(collectively, the "Software Products"), and all common law and statutory
copyrights and copyright registrations, applications for registration, now
existing or hereafter arising, United States of America and foreign, obtained or
to be obtained on or in connection with the Software Products, or any parts
thereof or any underlying or component elements of the Software Products
together with the right to copyright and all rights to renew or extend such
copyrights and the right (but not the obligation) of Bank (herein referred to as
"Bank" or "Secured Party") to sue in its own name and/or the name of the Debtor
for past, present and future infringements of copyright;

(iii) all goods, including, without limitation, equipment and inventory
(including, without limitation, all export inventory);

(iv) all guarantees and other security therefor;

(v) all trademarks, service marks, trade names and service names and the
goodwill associated therewith;

(vi) (a) all patents and patent applications filed in the United States
Patent and Trademark Office or any similar office of any foreign jurisdiction,
and interests under patent license agreements, including, without limitation,
the inventions and improvements described and claimed therein, (b) licenses
pertaining to any patent whether Debtor is licensor or licensee, (c) all income,
royalties, damages, payments, accounts and accounts receivable now or hereafter
due and/or payable under and with respect thereto, including, without
limitation, damages and payments for past, present or future infringements
thereof, (d) the right (but not the obligation) to sue for past, present and
future infringements thereof, (e) all rights corresponding thereto throughout
the world in all jurisdictions in which such patents have been issued or applied
for, and (f) the reissues, divisions, continuations, renewals, extensions and
continuations-in-part with any of the foregoing (all of the foregoing patents
and applications and interests under patent license agreements, together with
the items described in clauses (a) through (f) in this paragraph are sometimes
herein individually and collectively referred to as the "Patents"); and

(vii) all products and proceeds, including, without limitation, insurance
proceeds, of any of the foregoing.

EXHIBIT B

LOAN PAYMENT/ADVANCE TELEPHONE REQUEST FORM

DEADLINE FOR SAME DAY PROCESSING IS 3:00 P.M., PACIFIC TIME

TO: EMERGING GROWTH DIVISION DATE: _______________

FAX #: 650-846-6840 Attn: Compliance TIME: _______________

	FROM: CHORDIANT SOFTWARE,
    INC. 
	
    CLIENT NAME (BORROWER)

	REQUESTED BY: 
	
    AUTHORIZED SIGNER'S NAME

	 
	AUTHORIZED SIGNATURE: 
    
	 
	PHONE NUMBER: 
	 
	FROM ACCOUNT #
    ______________________ TO ACCOUNT # 
	 
		
	REQUESTED
    TRANSACTION TYPE	
    REQUEST DOLLAR AMOUNT
		$ 
    
	PRINCIPAL INCREASE
    (ADVANCE)	$ 
    
	PRINCIPAL PAYMENT
    (ONLY)	$ 
    
	INTEREST PAYMENT
    (ONLY)	$ 
    
	PRINCIPAL AND
    INTEREST (PAYMENT)	$ 
    
	 
	OTHER INSTRUCTIONS: 
	
	 
	All representations and
    warranties of Borrower stated in the Amended and Restated Loan and Security
    Agreement are true, correct and complete in all material respects as of the
    date of the telephone request for an Advance confirmed by this Borrowing
    Certificate; provided, however, that those representations and warranties
    expressly referring to another date shall be true, correct and complete in
    all material respects as of such date. 
	 
	
    BANK USE ONLY

	TELEPHONE REQUEST:
	 
	The following person is
    authorized to request the loan payment transfer/loan advance on the advance
    designated account and is known to me.
	 
		
	
    	
	
    Authorized Requester
	
    Phone #

		
		
	
    	
	
    Received By (Bank)
	
    Phone #

		
	 
	
    _____________________________________________

	
    Authorized Signature (Bank)

	 

 

EXHIBIT C

BORROWING BASE CERTIFICATE

	Borrower: Chordiant Software, Inc. Lender:
    Imperial BankCommitment Amount: $11,500,000 *borrowing base certificate
                not required if aggregate outstanding Advances are less than
                $3,000,000

              
            
          
        
      
    
    

	ACCOUNTS RECEIVABLE	 	 
	
    
        1. Accounts Receivable Book Value as of ___

      
    
    	 	$___________
	
    
        2. Additions (please explain on reverse)

      
    
    	 	$___________
	
    
        3. TOTAL ACCOUNTS RECEIVABLE

      
    
    	 	$___________
	 	 	 
	ACCOUNTS RECEIVABLE DEDUCTIONS
    (without duplication)	 	 
	
    
        4. Amounts over 90 days due

      
    
    	$___________	 
	
    
        5. Balance of 25% over 90 day accounts

      
    
    	$___________	 
	
    
        6. Concentration Limits

      
    
    	 	 
	
    
        7. Foreign Accounts

      
    
    	$___________	 
	
    
        8. Governmental Accounts

      
    
    	$___________	 
	
    
        9. Contra Accounts

      
    
    	$___________	 
	
    
        10. Demo Accounts

      
    
    	$___________	 
	
    
        11. Intercompany/Employee Accounts

      
    
    	$___________	 
	
    
        12. Other (please explain on reverse)

      
    
    	$___________	 
	
    
        13. TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS

      
    
    	 	$___________
	
    
        14. Eligible Accounts (#3 minus #13)

      
    
    	 	$___________
	
    
        15. LOAN VALUE OF ACCOUNTS (80% of #14)

      
    
    	 	$___________
	 	 	 
	BALANCES	 	 
	
    
        16. Maximum Loan Amount

      
    
    	 	$___________
	
    
        17. Total Funds Available [Lesser of #16 or #15]

      
    
    	 	$___________
	
    
        18. Present balance owing on Line of Credit

      
    
    	 	$___________
	
    
        19. Outstanding under Sublimits (Letters of Credit)

      
    
    	 	$___________
	
    
        20. Outstanding under Sublimits (Foreign Exchange)

      
    
    	 	$___________
	
    
        21. RESERVE POSITION (#17 minus #18 and #19 and #20)

      
    
    	 	 

The undersigned represents and warrants that the foregoing is true, complete
and correct, and that the information reflected in this Borrowing Base
Certificate complies with the representations and warranties set forth in the
Amended and Restated Loan and Security Agreement between the undersigned and
Imperial Bank.

	CHORDIANT SOFTWARE, INC.	 	 
	 	 	 
	 	 	 
	By: 	 	 
	
    
          Authorized Signer

        
      
    
    	 	 
	 	 	 

 

EXHIBIT D

COMPLIANCE CERTIFICATE

TO: IMPERIAL BANK

        FROM: CHORDIANT SOFTWARE, INC.

      
    
  

The undersigned authorized officer of CHORDIANT SOFTWARE, INC. hereby
certifies that in accordance with the terms and conditions of the Amended and
Restated Loan and Security Agreement between Borrower and Bank (the
"Agreement"), (i) Borrower is in complete compliance for the period ending
_______________ with all required covenants except as noted below and (ii) all
representations and warranties of Borrower stated in the Agreement are true and
correct in all material respects as of the date hereof. Attached herewith are
the required documents supporting the above certification. The Officer further
certifies that these are prepared in accordance with Generally Accepted
Accounting Principles (GAAP) and are consistently applied from one period to the
next except as explained in an accompanying letter or footnotes.

Please indicate compliance status by circling Yes/No under
"Complies" column.

	Reporting Covenant	Required	
    Complies

	 	 	 	 
	Monthly financial statements	Monthly within 30
    days	Yes	No
	Annual (CPA Audited)	FYE within 120 days	Yes	No
	10K and 10Q	within 5 days of SEC
    filing (or 95 days/50 days of quarter end)	Yes	No
	A/R & A/P Agings, Borrowing Base
    Cert.	Monthly within 20
    days*	Yes	No
	A/R Audit	Annual or
    Semi-Annual*	Yes	No
	IP Report	Quarterly within 30
    days	Yes	No
	*if Advances+LC+FX > $3,000,000	 	 	 
	 	 	 	 
	Financial Covenant	Required	
    Actual
	
    Complies

	 	 	 	 	 
	Maintain on a Quarterly Basis:	 	 	 	 
	
    
      Minimum Quick Ratio

    
    	
    2.50:1.00
	
    _____:1.00
	Yes	No
	
    
      Minimum Tangible Net Worth

    
    	$25,000,000 + 60%
    New Equity	$________	Yes	No
	 	 	 	 	 
	 
	 
	 
	Comments
    Regarding Exceptions: See Attached.	BANK USE ONLY
	 	 
	 	Received by: 
    
	Sincerely,	
    AUTHORIZED SIGNER

	 	 
	 	Date: 
	 	 
		Verified: 
    
	SIGNATURE	
    AUTHORIZED SIGNER

	 	 
	 	 
		Date: 
	TITLE	 
	 	Compliance Status	Yes	No
		 
	DATE	 

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness (Section 1.1)

 

Permitted Investments (Section 1.1)

 

Permitted Liens (Section 1.1)

 

Prior Names (Section 5.7)

 

Litigation (Section 5.8)

 

CORPORATE RESOLUTIONS TO BORROW

	Borrower: CHORDIANT SOFTWARE, INC.

I, the undersigned Secretary or Assistant Secretary of CHORDIANT SOFTWARE,
INC. (the "Corporation"), HEREBY CERTIFY that the Corporation is organized and
existing under and by virtue of the laws of the State of Delaware.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and
complete copies of the Certificate of Incorporation, as amended, and the
Restated Bylaws of the Corporation, each of which is in full force and effect on
the date hereof.

I FURTHER CERTIFY that at a meeting of the Directors of the Corporation, duly
called and held, at which a quorum was present and voting (or by other duly
authorized corporate action in lieu of a meeting), the following resolutions
were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, employees,
or agents of this Corporation, whose actual signatures are shown below:

	
    NAMES
	
    POSITION
	
    ACTUAL SIGNATURES

	 	 	 
			
	 	 	 
			
	 	 	 
			
	 	 	 
			
	 	 	 

acting for and on behalf of this Corporation and as its act and deed be, and
they hereby are, authorized and empowered:

Borrow Money. To borrow from time to time from Imperial Bank ("Bank"), on
such terms as may be agreed upon between the officers, employees, or agents of
the Corporation and Bank, such sum or sums of money as in their judgment should
be borrowed, without limitation, including such sums as are specified in that
certain Amended and Restated Loan and Security Agreement dated as of August 16,
2000 (the "Loan Agreement").

Execute Loan Documents. To execute and deliver to Bank the Loan Agreement
and any other agreement entered into between Corporation and Bank in connection
with the Loan Agreement, all as amended or extended from time to time
(collectively, with the Loan Agreement, the "Loan Documents"), and also to
execute and deliver to Bank one or more renewals, extensions, modifications,
refinancings, consolidations, or substitutions for the Loan Documents, or any
portion thereof.

Grant Security. To grant a security interest to Bank in the Collateral
described in the Loan Documents, which security interest shall secure all of the
Corporation's Obligations, as described in the Loan Documents.

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

Letters of Credit; Foreign Exchange. To execute letters of credit
applications, foreign exchange agreements and other related documents pertaining
to Bank's issuance of letters of credit and foreign exchange contracts.

Further Acts. In the case of lines of credit, to designate additional or
alternate individuals as being authorized to request advances thereunder, and in
all cases, to do and perform such other acts and things, to pay any and all fees
and costs, and to execute and deliver such other documents and agreements as
they may in their discretion deem reasonably necessary or proper in order to
carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these
resolutions and performed prior to the passage of these resolutions are hereby
ratified and approved, that these Resolutions shall remain in full force and
effect and Bank may rely on these Resolutions until written notice of their
revocation shall have been delivered to and received by Bank. Any such notice
shall not affect any of the Corporation's agreements or commitments in effect at
the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are
duly elected, appointed, or employed by or for the Corporation, as the case may
be, and occupy the positions set forth opposite their respective names; that the
foregoing Resolutions now stand of record on the books of the Corporation; and
that the Resolutions are in full force and effect and have not been modified or
revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on August 16, 2000 and attest
that the signatures set opposite the names listed above are their genuine
signatures.

	 	 	CERTIFIED AND ATTESTED BY:
	 	 	 
	 	 	 
	 	 	X 
	 	 	 

IMPERIAL BANK

Member FDIC

ITEMIZATION OF AMOUNT FINANCED

DISBURSEMENT INSTRUCTIONS

(Revolver)

	
    Name(s): CHORDIANT SOFTWARE, INC. Date: August 16, 2000

	 	 
	
    
      $

    
    	credited to deposit account No.
    ___________ when Advances are requested by Borrower
	 
	Amounts paid to others on your
    behalf:
	
    
      $15,000

    
    	to Imperial Bank for Loan Fee
	
    
      $

    
    	to Imperial Bank for Document
    Fee
	
    
      $ 

    
    	to Imperial Bank for accounts
    receivable audit (estimate)
	
    
      $ 

    
    	to Bank counsel fees and
    expenses
	
    
      $

    
    	to _______________
	
    
      $

    
    	to _______________
	
    
      $

    
    	TOTAL (AMOUNT FINANCED)
	 	 

Upon consummation of this transaction, this document will also serve as the
authorization for Imperial Bank to disburse the loan proceeds as stated above.

	 	 	 
		 	
	
    Signature
	 	
    Signature

	 	 	 

 

IMPERIAL BANK

Member FDIC

ITEMIZATION OF AMOUNT FINANCED

DISBURSEMENT INSTRUCTIONS

(Equipment Loan)

	
    Name(s): CHORDIANT SOFTWARE, INC. Date: August 16, 2000

	 	 
	
    
      $

    
    	credited to deposit account No.
    ___________ when Advances are requested by Borrower
	 	 
	Amounts paid to others on your
    behalf:
	
    
      $4,000

    
    	to Imperial Bank for Loan Fee
	
    
      $

    
    	to Imperial Bank for Document
    Fee
	
    
      $ 

    
    	to Imperial Bank for accounts
    receivable audit (estimate)
	
    
      $ 

    
    	to Bank counsel fees and
    expenses
	
    
      $

    
    	to _______________
	
    
      $

    
    	to _______________
	
    
      $

    
    	TOTAL (AMOUNT FINANCED)
	 	 

Upon consummation of this transaction, this document will also serve as the
authorization for Imperial Bank to disburse the loan proceeds as stated above.

	 	 	 
		 	
	
    Signature
	 	
    Signature

	 	 	 

 

 

AGREEMENT TO PROVIDE INSURANCE

TO: IMPERIAL BANK Date: August 16, 2000

c/o Hibernia Mitchel Insurance Services

Post Office Box 8061

Walnut Creek, CA 94596-8061 Borrower: CHORDIANT SOFTWARE, INC.

In consideration of a loan in the amount of $14,810,663, secured by all
tangible personal property including inventory and equipment.

I/We agree to obtain adequate insurance coverage to remain in force during
the term of the loan.

I/We also agree to advise the below named agent to add Imperial Bank as
lender's loss payable on the new or existing insurance policy, and to furnish
Bank at above address with a copy of said policy/endorsements and any subsequent
renewal policies.

I/We understand that the policy must contain:

1. Fire and extended coverage in an amount sufficient to cover:

(a) The amount of the loan, OR

(b) All existing encumbrances, whichever is greater,

But not in excess of the replacement value of the improvements on the real
property.

2. Lender's "Loss Payable" Endorsement Form 438 BFU in favor of Imperial
Bank, or any other form acceptable to Bank.

INSURANCE INFORMATION

Insurance Co./Agent Telephone No.:

Agent's Address:

Signature of Obligor: 

            
            Signature of Obligor: 

            
          
        
      
    
  

	
    FOR BANK USE ONLY

	INSURANCE VERIFICATION: Date: 
	Person Spoken to: 
	Policy Number: 
	Effective From: To: 
	Verified by: 
	 

 

	IMPERIAL BANK	 
	
    California's Business Banks
	
    AUTOMATIC DEBIT AUTHORIZATION

	
    Member FDIC
	 
	 	 
	 	 
	To: Imperial Bank
	 
	Re: Loan #
    ___________________________________
	 
	You are hereby authorized and
    instructed to charge account No. _________________________ in the name of
    CHORDIANT SOFTWARE, INC.

	for principal and interest
    payments due on above referenced loan as set forth below and credit the loan
    referenced above.
	 
	
    
            _X_ Debit each interest payment as it becomes due
            according to the terms of the note and any renewals or amendments
            thereof.

          
        
      
    
    
	 
	
    
            ____ Debit each principal payment as it becomes due according to
            the terms of the note and any renewals or amendments thereof.

          
        
      
    
    
	 
	This Authorization is to remain
    in full force and effect until revoked in writing.
	 
	 
	Borrower Signature	Date: August 16, 2000
	 	 
	 	 

 

 

 

 

	IMPERIAL BANK	 
	
    California's Business Banks
	
    AUTOMATIC DEBIT AUTHORIZATION

	
    Member FDIC
	 
	 	 
	 	 
	To: Imperial Bank
	 
	Re: Loan #
    ___________________________________
	 
	You are hereby authorized and
    instructed to charge account No. _________________________ in the name of
    CHORDIANT SOFTWARE, INC.

	for principal and interest
    payments due on above referenced loan as set forth below and credit the loan
    referenced above.
	 
	
    
            _X_ Debit each interest payment as it becomes due
            according to the terms of the note and any renewals or amendments
            thereof.

          
        
      
    
    
	 
	
    
            _X_ Debit each principal payment as it becomes due
            according to the terms of the note and any renewals or amendments
            thereof.

          
        
      
    
    
	 
	This Authorization is to remain
    in full force and effect until revoked in writing.
	 
	 
	Borrower Signature	Date: August 16, 2000
	 	 
	 	 

DEBTOR: CHORDIANT SOFTWARE, INC.

SECURED PARTY: IMPERIAL BANK

EXHIBIT A

COLLATERAL DESCRIPTION ATTACHMENT

TO UCC-1 FINANCING STATEMENT

All personal property of Borrower (herein referred to as "Borrower" or
"Debtor") whether presently existing or hereafter created, written, produced or
acquired, including, but not limited to:

(i) all accounts receivable, accounts, chattel paper, contract rights
(including, without limitation, royalty agreements, license agreements and
distribution agreements), documents, instruments, money, deposit accounts and
general intangibles, including, without limitation, returns, repossessions,
books and records relating thereto, and equipment containing said books and
records, all financial assets, all investment property, including securities and
securities entitlements;

(ii) all software, computer source codes and other computer programs
(collectively, the "Software Products"), and all common law and statutory
copyrights and copyright registrations, applications for registration, now
existing or hereafter arising, United States of America and foreign, obtained or
to be obtained on or in connection with the Software Products, or any parts
thereof or any underlying or component elements of the Software Products
together with the right to copyright and all rights to renew or extend such
copyrights and the right (but not the obligation) of Bank (herein referred to as
"Bank" or "Secured Party") to sue in its own name and/or the name of the Debtor
for past, present and future infringements of copyright;

(iii) all goods, including, without limitation, equipment and inventory
(including, without limitation, all export inventory);

(iv) all guarantees and other security therefor;

(v) all trademarks, service marks, trade names and service names and the
goodwill associated therewith;

(vi) (a) all patents and patent applications filed in the United States
Patent and Trademark Office or any similar office of any foreign jurisdiction,
and interests under patent license agreements, including, without limitation,
the inventions and improvements described and claimed therein, (b) licenses
pertaining to any patent whether Debtor is licensor or licensee, (c) all income,
royalties, damages, payments, accounts and accounts receivable now or hereafter
due and/or payable under and with respect thereto, including, without
limitation, damages and payments for past, present or future infringements
thereof, (d) the right (but not the obligation) to sue for past, present and
future infringements thereof, (e) all rights corresponding thereto throughout
the world in all jurisdictions in which such patents have been issued or applied
for, and (f) the reissues, divisions, continuations, renewals, extensions and
continuations-in-part with any of the foregoing (all of the foregoing patents
and applications and interests under patent license agreements, together with
the items described in clauses (a) through (f) in this paragraph are sometimes
herein individually and collectively referred to as the "Patents"); and

(vii) all products and proceeds, including, without limitation, insurance
proceeds, of any of the foregoing.Ex992 Loan docs

    FIRST AMENDMENT

    TO

    AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

  

This First Amendment to Amended and Restated Loan and Security Agreement
(this "Amendment") is entered into as of October 19, 2001, by and between
COMERICA BANK-CALIFORNIA, SUCCESSOR IN INTEREST TO IMPERIAL BANK ("Bank") and
CHORDIANT SOFTWARE, INC. ("Borrower").

    RECITALS

  

Borrower and Bank are parties to that certain Amended and Restated Loan and
Security Agreement dated as of August 16, 2000 (the "Agreement"). The parties
desire to amend the Agreement in accordance with the terms of this Amendment.

NOW, THEREFORE, the parties agree as follows:

	The following defined terms in Section 1.1 of the Agreement are hereby
    amended to read as follows:
    "Equipment Maturity Date" October 18, 2004. 

    "Quick Assets" means, at any date as of which the amount thereof shall be
    determined, the unrestricted cash and cash-equivalents, plus net, booked
    accounts receivable of Borrower, determined in accordance with GAAP.

    "Revolving Maturity Date" means October 18, 2002. 

	Subsections (i) and (ii) of Section 2.1(b) of the Agreement are amended
    in its entirety to read as follows:
    (b) Equipment Advances.

    (i) Subject to and upon the terms and conditions of this Agreement, at
    any time from the date hereof through the Revolving Maturity Date, Bank
    agrees to make advances (each an "Equipment Advance" and, collectively, the
    "Equipment Advances") to Borrower in an aggregate outstanding amount not to
    exceed the Equipment Line. Each Equipment Advance shall not exceed one
    hundred percent (100%) of the invoice amount of equipment, furniture,
    software licenses and corporate purposes approved by Bank from time to time
    (which Borrower shall, in any case, have purchased within 90 days of the
    date of the corresponding Equipment Advance), excluding taxes, shipping,
    warranty charges, freight discounts, soft costs, and installation expense.
    The foregoing notwithstanding, the aggregate amount of all Equipment
    Advances used to finance software shall not exceed the lesser of (A)
    twenty-five percent (25%) of the aggregate amount of the outstanding
    Equipment Advances, or (B) $500,000. 

    (ii) Interest shall accrue from the date of each Equipment Advance at the
    rate specified in Section 2.3(a), and shall be payable monthly on the
    eighteenth (18th) day of each month. Any Equipment Advances
    (except for Equipment Advances used to finance software) that are
    outstanding on April 18, 2002 (the "First Term Date") shall be payable in
    thirty (30) equal monthly installments of principal, plus all accrued
    interest, beginning on May 18, 2002, and continuing on the same day of each
    month thereafter through the Equipment Maturity Date. Any Equipment Advances
    used to finance software that are outstanding on the First Term Date shall
    be payable in twenty-four (24) equal monthly installments of principal, plus
    all accrued interest, beginning on May 18, 2002, and continuing on the same
    day of each month thereafter until paid. Any Equipment Advances (except for
    Equipment Advances used to finance software) drawn after the First Term Date
    that are outstanding on the Revolving Maturity Date shall be payable in
    twenty-four (24) equal monthly installments of principal, plus all accrued
    interest, beginning on November 18, 2002, and continuing on the same day of
    each month thereafter through the Equipment Maturity Date. Any Equipment
    Advances used to finance software drawn after the First Term Date that are
    outstanding on the Revolving Maturity Date shall be payable in eighteen (18)
    equal monthly installments of principal, plus all accrued interest,
    beginning on November 18, 2002, and continuing on the same day of each month
    thereafter through the Equipment Maturity Date, at which time all amounts
    due under this Section 2.1(b) and any other amounts due under this Agreement
    shall be immediately due and payable. Equipment Advances, once repaid, may
    not be reborrowed. Borrower may prepay any Equipment Advances without
    penalty or premium.

	A new Section 2.1(f) is added to the Agreement, which shall read as
    follows:
    (f) Cash Management Sublimit. Subject to the terms and conditions
    of this Agreement, Borrower may utilize up to One Million Two Hundred
    Thousand Dollars ($1,200,000) (the "Cash Management Sublimit") for ACH and
    direct deposit of payroll services provided by Bank. All agreements executed
    in connection with the Cash Management Sublimit shall be, in form and
    substance, acceptable to Bank, in its sole discretion. Any amounts actually
    paid by Bank in respect of the Cash Management Sublimit shall, when paid,
    constitute an Advance under the Committed Revolving Line.

	Section 2.2 of the Agreement is amended to read as follows:
    2.2 Overadvances. If at any time or for any reason the aggregate
    amount of the outstanding Advances plus the aggregate face amount of all
    outstanding Letters of Credit plus the aggregate amount outstanding in
    respect of the FX Sublimit exceeds the lesser of (a) the Committed Revolving
    Line, or (b) the greater of (i) Three Million Dollars ($3,000,000) or (ii)
    the Borrowing Base, Borrower shall immediately pay to Bank, in cash, the
    amount of such excess.

	Subsections (i) and (ii) of Section 2.3(a) of the Agreement are amended
    to read as follows:
    (a) Interest Rates.

    (i) Advances. Except as set forth in Section 2.3(b), Advances
    which are Prime Rate Advances (as such term is used herein) shall bear
    interest, on the outstanding daily balance thereof, at a rate equal to the
    Prime Rate plus one and one-half percent (1.50%). Except as set forth in
    Section 2.3(b), Advances which are LIBOR Rate Advances shall bear interest
    at the rate specified in Section 2.5(b).

    (ii) Equipment Advances. Except as set forth in Section 2.3(b),
    the Equipment Advances shall bear interest, on the outstanding daily balance
    thereof, at a rate equal to the Prime Rate plus two percent (2.0%). 

	The second sentence of Section 2.5(b) of the Agreement is amended to
    read as follows:
    The outstanding principal balance of each LIBOR Rate Advance shall bear
    interest until principal is due (computed daily on the basis of a 360 day
    year and actual days elapsed) at a rate per annum equal to the LIBOR Rate
    plus 500 basis points for such LIBOR Rate Advance.

	The last paragraph of Section 6.3 is amended to read as follows:
    Bank shall have a right from time to time hereafter to audit Borrower's
    Accounts and appraise Collateral at Borrower's expense, provided that such
    audits will be conducted no more often than every twelve (12) months unless
    an Event of Default has occurred and is continuing.

	Section 6.8 of the Agreement is amended to read as follows:
    6.8 Quick Ratio. Borrower shall maintain, as of the last day of
    each fiscal quarter of Borrower, a ratio of Quick Assets to Current
    Liabilities less deferred revenue of at least 2.00 to 1.00.

	A new Section 6.12 is added to the Agreement, which shall read as
    follows:
    6.12 Total Liabilities-Tangible Net Worth. Borrower shall
    maintain, as of the last day of each fiscal quarter of Borrower, a ratio of
    Total Liabilities to Tangible Net Worth of not more than 2.00 to 1.00.

	The Compliance Certificate to be delivered after the date of this
    Amendment shall be in the form of Exhibit D hereto.
	As a condition precedent to the effectiveness of this Amendment,
    Borrower shall pay to Bank, on the date of this Amendment, a Facility Fee
    equal to $18,125. If, from the date of this Amendment through 90 days after
    the date of this Amendment, Borrower has transferred at least Twenty Million
    Dollars ($20,000,000) to one or more deposit accounts with Bank, Borrower
    shall not be liable for any additional Facility Fee. If, from the date of
    this Amendment through 90 days after the date of this Amendment, Borrower
    has transferred an amount equal to Zero Dollars ($0) or any amount less than
    Twenty Million Dollars ($20,000,000) to one or more deposit accounts with
    Bank, Borrower shall pay to Bank, within 90 days after the date of this
    Amendment, an additional Facility Fee equal to $18,125. 
	Unless otherwise defined, all initially capitalized terms in this
    Amendment shall be as defined in the Agreement. The Agreement, as amended
    hereby, shall be and remain in full force and effect in accordance with its
    respective terms and hereby is ratified and confirmed in all respects.
    Except as expressly set forth herein, the execution, delivery, and
    performance of this Amendment shall not operate as a waiver of, or as an
    amendment of, any right, power, or remedy of Bank under the Agreement, as in
    effect prior to the date hereof. Borrower ratifies and reaffirms the
    continuing effectiveness of all promissory notes, guaranties, security
    agreements, mortgages, deeds of trust, environmental agreements, and all
    other instruments, documents and agreements entered into in connection with
    the Agreement.
	Borrower represents and warrants that the representations and warranties
    contained in the Agreement are true and correct as of the date of this
    Amendment, and that no Event of Default has occurred and is continuing.
	This Amendment may be executed in two or more counterparts, each of
    which shall be deemed an original, but all of which together shall
    constitute one instrument.
	As a condition to the effectiveness of this Amendment, Bank shall have
    received, in form and substance satisfactory to Bank, the following:
    
	this Amendment, duly executed by Borrower;
	Corporate Resolutions to Borrow; 
	payment of the fees then due specified in Section 10 hereof; 
	all Bank Expenses incurred through the date of this Amendment;
	an audit of the Collateral, the results of which shall be
        satisfactory to Bank; and
	such other documents, and completion of such other matters, as Bank
        may reasonably deem necessary or appropriate.

    

    
  

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
first date above written.

	 	CHORDIANT SOFTWARE, INC. 

    By: 

    
    Title: 

	 	 
	 	COMERICA BANK-CALIFORNIA,
    SUCCESSOR IN INTEREST TO IMPERIAL BANK 

    By: 

    
    Title: 

EXHIBIT D

COMPLIANCE CERTIFICATE

TO: COMERICA BANK-CALIFORNIA, SUCCESSOR IN INTEREST TO IMPERIAL BANK

        FROM: CHORDIANT SOFTWARE, INC.

      
    
  

The undersigned authorized officer of CHORDIANT SOFTWARE, INC. hereby
certifies that in accordance with the terms and conditions of the Amended and
Restated Loan and Security Agreement between Borrower and Bank (the
"Agreement"), (i) Borrower is in complete compliance for the period ending
_______________ with all required covenants except as noted below and (ii) all
representations and warranties of Borrower stated in the Agreement are true and
correct in all material respects as of the date hereof. Attached herewith are
the required documents supporting the above certification. The Officer further
certifies that these are prepared in accordance with Generally Accepted
Accounting Principles (GAAP) and are consistently applied from one period to the
next except as explained in an accompanying letter or footnotes.

Please indicate compliance status by circling Yes/No under
"Complies" column.

	Reporting Covenant	
    Required
	
    Complies

	 	 	 	 
	Annual (CPA Audited)	FYE within 120 days	Yes	No
	10K and 10Q	within 5 days of
    filing (or 95 days/50 days of quarter end)	Yes	No
	A/R & A/P Agings, Borrowing Base
    Certificate, deferred revenue report 	Monthly within 20
    days (if Advances + LC + FX > $3,000,000) 	Yes 	No 
	A/R Audit 	Annual 	Yes	No 
	IP Report 	Quarterly within 30
    days 	Yes 	No 
	 	 	 	 
	 	 	 	 
	Financial Covenant	Required	Actual	
    Complies

	 	 	 	 	 
	Maintain on a Quarterly Basis:	 	 	 	 
	
    
      Minimum Adjusted Quick Ratio 

    
    	2.00:1.00	_____:1.00	Yes	No
	
    
      Minimum Tangible Net Worth 

    
    	$_________ *	$________	Yes	No
	
    
      Maximum Debt-TNW 

    
    	2.00:1.00	_____:1.00	Yes	No
	 	 	 	 	 
	 	 	 	 	 
	
    
      * $25,000,000 plus 60% of New Equity proceeds

    
    
	 
	 
	Comments
    Regarding Exceptions: See Attached.	BANK USE ONLY
	 	 
	 	Received by: 
    
	Sincerely,	
    AUTHORIZED SIGNER

	 	 
	 	Date: 
	 	 
		Verified: 
    
	SIGNATURE	
    AUTHORIZED SIGNER

	 	 
	 	 
		Date: 
	TITLE	 
	 	Compliance Status	Yes	No
		 
	DATE	 

CORPORATE RESOLUTIONS TO BORROW

	Borrower: CHORDIANT SOFTWARE, INC.

I, the undersigned Secretary or Assistant Secretary of CHORDIANT SOFTWARE,
INC. (the "Corporation"), HEREBY CERTIFY that the Corporation is organized and
existing under and by virtue of the laws of the State of Delaware.

I FURTHER CERTIFY that at a meeting of the Directors of the Corporation duly
called and held, at which a quorum was present and voting, (or by other duly
authorized corporate action in lieu of a meeting), the following resolutions
were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, employees,
or agents of this Corporation, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

acting for an on behalf of this Corporation and as its act and deed be, and
they hereby are, authorized and empowered:

Borrow Money. To borrow from time to time from Comerica Bank-California,
successor in interest to Imperial Bank ("Bank"), on such terms as may be agreed
upon between the officers, employees, or agents of the Corporation and Bank,
such sum or sums of money as in their judgment should be borrowed, without
limitation.

Execute Amendment. To execute and deliver to Bank that certain First
Amendment to Amended and Restated Loan and Security Agreement dated as of
October 19, 2001 (the "Amendment") and any related documents, and also to
execute and deliver to Bank one or more renewals, extensions, modifications,
consolidations, or substitutions therefor.

Grant Security. To grant a security interest to Bank in the Collateral
described in the Loan Documents, which security interest shall secure all of the
Corporation's Obligations, as described in the Loan Documents.

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

Further Acts. In the case of lines of credit, to designate additional or
alternate individuals as being authorized to request advances thereunder, and in
all cases, to do and perform such other acts and things, to pay any and all fees
and costs, and to execute and deliver such other documents and agreements as
they may in their discretion deem reasonably necessary or proper in order to
carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these
resolutions and performed prior to the passage of these resolutions are hereby
ratified and approved, that these Resolutions shall remain in full force and
effect and Bank may rely on these Resolutions until written notice of their
revocation shall have been delivered to and received by Bank. Any such notice
shall not affect any of the Corporation's agreements or commitments in effect at
the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are
duly elected, appointed, or employed by or for the Corporation, as the case may
be, and occupy the positions set forth opposite their respective names; that the
foregoing Resolutions now stand of record on the books of the Corporation; and
that the Resolutions are in full force and effect and have not been modified or
revoked in any manner whatsoever.

I FURTHER CERTIFY that attached hereto are true and correct copies of the
Certificate of Incorporation and Bylaws of the Corporation.

IN WITNESS WHEREOF, I have hereunto set my hand on October 19, 2001 and
attest that the signatures set opposite the names listed above are their genuine
signatures.

	 	CERTIFIED TO AND ATTESTED BY: 

    X

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