Document:

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                                                                   Exhibit 10.11

APRIL 28, 2004

CORPORATION RECRUITSOFT (CANADA) INC. AND ITS ENGLISH VERSION,
RECRUITSOFT (CANADA) CORPORATION INC., WHOSE COMPANY NAME WILL BE
CHANGED TO TALEO (CANADA) INC.
330 St-Vallier East, Suite 400
Quebec City, Quebec
G1K 9C5

                                                     THIS TEXT IS THE ENGLISH OF
                                                THE ORIGINAL FRENCH LETTER DATED
                                                     APRIL 28, 2004.  IN CASE OF
                                                     DISCREPANCY BETWEEN THE TWO
                                              VERSIONS, THE FRENCH VERSION SHALL
                                                                HAVE PRECEDENCE.

Attn.:  Mr. Jean Lavigueur, CA, CFO
--------------------------------------------------------------------------------
RE:   OFFER OF RENEWAL AND ADDITIONAL FINANCING
--------------------------------------------------------------------------------

Dear Mr. Lavigueur,

We are pleased to present to you the terms and conditions under which NATIONAL
BANK OF CANADA (THE "BANK") agrees to make the financing below available to
CORPORATION RECRUITSOFT (CANADA) INC AND ITS VERSION RECRUITSOFT (CANADA)
CORPORATION, WHOSE COMPANY NAME WILL BE CHANGED TO TALEO (CANADA) INC., (THE
"BORROWER") the following credit facilities:

<TABLE>
<S>   <C>               <C>
"A"      $500,000       Operating credit (renewal)
"B"       $49,999       Demand loan (capital expenditures) original amount:  $500,000 (existing)
"C"       $63,333       Letter of guarantee (new)
"D"    $2,250,000       Term loan (original amount:  $2,500,000) (existing)
"E"      $400,000       MasterCard Purchasing Card (increase)
"F"    $2,400,000       Term loan (capital expenditures) (new)
"G"    $1,900,000       Demand loan (refundable tax credit financing) (new)
"H"    $2,600,000       Demand loan (new) refinancing of White Amber debt (subsidiary)
"I"      $500,000       Exchange risk
-----------------
      $10,663,333
</TABLE>

Under the terms of the initial offer of financing dated November 24, 1999 (the
"Offer of Financing") and the addenda and/or amendments dated June 28, 2000 and
October 19, 2001, the Bank agrees to renew in favour of the Borrower the
$500,000 operating credit under the same terms and conditions as those contained
in the Offer of Financing and any addenda and amendments thereto, subject
hereto.
<PAGE>

1. FACILITY "A" - OPERATING CREDIT: $500,000

      1.1.  CREDIT FACILITY

            Subject to the provisions hereof, the Bank agrees to renew the
            operating credit facility made available to the Borrower for a
            principal amount not exceeding $500,000 IN CANADIAN DOLLARS AND/OR
            THE EQUIVALENT IN US DOLLARS, which is to be used to finance the
            Borrower's usual operating requirements.

      1.2.  FINANCING OPTIONS

            Subject to the terms and conditions hereof, the Borrower may use and
            re-use this credit facility, up to the maximum allowed, by means of
            VARIABLE-RATE advances.

      1.3.  INTEREST RATE

            The variable-rate advances shall bear interest, from the time of
            disbursement until payment in full, at the Canadian Prime rate of
            the Bank plus 0.50%, or 4.25% as at the date hereof. Interest shall
            be calculated daily and payable monthly on the 26th day of each
            month.

      1.4.  DISBURSEMENT AND REPAYMENT

            The credit facility is repayable on demand and may be reviewed
            periodically by the Bank, the next review being scheduled on or
            before MARCH 31, 2005.

            Disbursements and payments shall be made or collected in equal
            multiples of $5,000.

      1.5.  FINANCING CONDITIONS

            Notwithstanding the amount of the credit facility, the aggregate
            amount of advances shall at no time exceed the total of:

            -     75% of the Borrower's CANADIAN receivables net of its deferred
                  income or that of Taleo Corporation, based in San Francisco,
                  California, (excluding holdbacks receivable, contra accounts
                  and receivables of White Amber Inc. USA, accounts of doubtful
                  quality and those aged 90 days or more); and

            -     75% of the Borrower's U.S. receivables net of its deferred
                  income or that of Taleo Corporation, based in San Francisco,
                  California, or 90% IF INSURED BY EXPORT DEVELOPMENT CANADA
                  (EDC), (excluding holdbacks receivable, contra accounts and
                  receivables of White Amber Inc. USA accounts of doubtful
                  quality and those aged 90 days or more); and
<PAGE>
            -     90% of the Borrower's foreign accounts receivable (other than
                  US$) net of its deferred income or that of Taleo Corporation,
                  based in San Francisco, California, if they are insured by
                  EDC; otherwise no value will be taken into consideration
                  (excluding holdbacks receivable, contra accounts and
                  receivables of White Amber Inc. USA accounts of doubtful
                  quality and all accounts aged 90 days or more).

            The value of the Borrower's accounts receivable shall be established
            monthly by taking into account claims ranking prior to the security
            of the Bank e.g.: deductions at source, salaries, accrued vacation
            pay, taxes.

            Each month, on the 20TH day of the following month, the Borrower
            shall furnish to the Bank a detailed list of its accounts receivable
            by identifying accounts in Canadian, U.S. and foreign currencies,
            insured accounts and its accounts payable according to age, and a
            monthly statement form of the available credit limit accompanying
            proof of payment of deductions at source, duly signed by the
            party(ies) authorized to sign on behalf of the company.

2. FACILITY "B" - DEMAND LOAN: $49,999.91 (FOR CAPITAL EXPENDITURES)

      2.1.  CREDIT FACILITY

            The loan currently disbursed in full, the balance of which is
            $49,999.91 as at the date hereof, as per the renewal offer dated
            June 17, 2002 and the addendum dated October 19, 2001 is currently
            in force, the final payment being scheduled for June 30, 2004.

            The Borrower repays the principal of the present demand loan by
            means of equal and consecutive monthly installments of $16,666.67 on
            the 30th day of each month. Interest is payable on the 26th day of
            each month. The remaining amortization as at the date hereof is
            three months.

3. FACILITY " C " - LETTER OF GUARANTEE: $63,333.33

      3.1.  CREDIT FACILITY

            Subject to the provisions hereof, the Bank agrees to make available
            to the Borrower a credit facility in the form of an irrevocable
            letter of guarantee for an amount not exceeding $63,333.33 in
            Canadian dollars in favour of the lessor. This letter of guarantee
            was issued on April 8, 2004 in favour of the lessor "Societe en
            commandite edifice Le Soleil."

            This letter of guarantee, issued by the Bank as requested by the
            Borrower, meets the following conditions :

            -     The aggregate amount of the letters of guarantee shall at no
                  time exceed $63,333.33;

            -     The period shall be no less than 30 days and no more than 365
                  days;

            -     The issuance fees of 1.50% per annum were charged to the
                  Borrower by the Bank on issuance of the letter of guarantee.

      3.2.  TERM

            The letter of guarantee shall expire on April 1, 2005.
<PAGE>
4. FACILITY "D" - TERM LOAN: $2,250,000

      4.1.  CREDIT FACILITY

            The loan, currently disbursed in full, the balance of which
            $2,250,000 as at the date hereof, as per the offer of financing
            dated March 28, 2003, is currently in force.

      4.2.  TERM

            The loan shall expire on April 26, 2007.

5. FACILITY " E " - MASTERCARD PURCHASING CARD: $400,000

      5.1.  CREDIT FACILITY

            The Bank agrees to make available to the Borrower the MasterCard
            Purchasing Card for travel expenses and other purchases,
            automatically payable via direct debit on the 7th day following the
            end of each month.

6.    FACILITY "F" - TERM LOAN: $2,400,000 (FOR CAPITAL EXPENDITURES)

      6.1.  CREDIT FACILITY

            Subject to the provisions hereof, the Bank agrees to make available
            to the Borrower a term loan for a principal amount of $2,400,000 in
            Canadian dollars or the equivalent in U.S. dollars* to finance 80%
            of the costs before taxes of equipment to be used for the Borrower's
            operations (e.g., software, hardware, office automation processes,
            office furniture) in Canada and in the United States.

            *Equivalent in U.S. dollars: The rate of conversion will be
            established by the Bank on the date of disbursements.

      6.2.  TERM

            The loan is granted for a period of 36 months.

      6.3.  INTEREST RATE

            This variable-rate loan shall bear interest from the date of
            disbursement until payment in full, at the Canadian Prime rate of
            the Bank plus 1.00%, or 4.75% as at the date hereof, calculated
            daily. Interest shall be payable monthly on the 26th day of each
            month as of the 26th day of the month following the first
            disbursement(s).

      6.4.  DISBURSEMENT

            The Borrower shall use the amount made available to it by WAY OF A
            MAXIMUM OF TWO PROGRESS ADVANCES corresponding to 80% of the value
            of the cost before taxes, on or before July 31, 2004, subject to
            meeting the conditions specified herein and executing any document
            that may reasonably be requested by the Bank, including, but not
            limited to, a term note. Any sum hereunder which has not been
            advanced to the Borrower on that date
<PAGE>
            shall no longer be available to the Borrower and the Bank shall have
            no further obligation to advance such sum to the Borrower.

      6.5.  REPAYMENT

            The Borrower shall repay the principal of this term loan based on an
            amortization of 36 months in 36 equal and consecutive monthly
            installments of $66,666.67, which shall be payable on the 26th day
            of each month as of the month following the first disbursement. The
            balance of principal, interest, fees and incidental charges on the
            loan shall be repaid in full with the last installment, namely, on
            the term expiry date, without further notice.

      6.6.  PREPAYMENT

            The Borrower may repay all or part of the variable-rate term loan at
            any time without penalty, provided the repayment is from funds
            generated by the company or from the proceeds of a capital stock
            issue. If repayment is directly or indirectly from any other source,
            a penalty of three months' interest shall then be payable and
            deducted by the Bank from the repayment. Partial repayments shall be
            applied to the last installment of principal and/or interest or to
            any other sum due by the Borrower, at the Bank's discretion.

7. FACILITY "G" - TERM LOAN: $1,900,000 (TAX CREDITS)

      7.1.  CREDIT FACILITY

            Subject to the provisions hereof, the Bank agrees to make available
            to the Borrower a term loan for an amount of $1,900,000 in Canadian
            dollars to finance an amount not exceeding 75% of refundable federal
            and provincial tax credits for the fiscal year ending December 31,
            2003.

      7.2.  TERM

            The loan is repayable no later than October 31, 2004.
<PAGE>
      7.3.  INTEREST RATE

            This variable-rate loan shall bear interest from the time of
            disbursement until payment in full, at the Canadian Prime rate of
            the Bank plus 1.00%, or 4.75% as at the date hereof, calculated
            daily. Interest shall be payable monthly on the 26th day of each
            month as of the 26th day of the month following disbursement.

      7.4.  DISBURSEMENT

            7.4.1 The Borrower shall use the amount made available to it by way
                  a single advance subject to meeting the conditions stipulated
                  herein and executing any document that may reasonably be
                  requested by the Bank, including, but not limited to, a demand
                  note. Any sum hereunder which has not been advanced to the
                  Borrower by OCTOBER 31, 2004 shall no longer be available to
                  the Borrower and the Bank shall have no further obligation to
                  advance such sum to the Borrower.

            7.4.2 The loan disbursements shall not exceed seventy-five per cent
                  (75%) of refundable tax credits, less income taxes payable as
                  at December 31, 2003, and as indicated in the audited annual
                  financial statements as at December 31, 2003 (US $1,987,000
                  dollars X 75% = US $1,490,000, the maximum amount of
                  financing). This amount will be converted into Canadian
                  dollars on the day it is disbursed by the Bank and shall not
                  exceed the authorized amount, namely, $1,900,000 in Canadian
                  dollars.

      7.5.  REPAYMENT

            7.5.1. The Borrower shall repay the portion of the loan that was
                   granted in relation to the tax credits requested on the
                   earliest of the following dates but no later than OCTOBER 31,
                   2004:

                  7.5.1.1.  as of the date the Borrower files an income tax
                            return, if, at that time, there is compensation for
                            a tax credit receivable that is applied against
                            income tax otherwise payable; or

                  7.5.1.2.  as of the date the Borrower is required to file an
                            income tax return, if such return has not actually
                            been filed; or

                  7.5.1.3.  as of the date that a refund of an amount related to
                            a tax credit is received from the competent
                            authorities;

            7.5.2. The Borrower may, at its option, repay the Bank following the
                   initial public offering (IPO);

            7.5.3. The company may repay all or part of the loan at any time
                   without penalty provided the repayment is from funds
                   generated by the company. If the repayment is from a
                   refinancing from another financial institution, a penalty of
                   three months' interest shall then be payable.

            7.5.4. The company undertakes to apply any cheque or amount that it
                   receives in the form of a refundable tax credit in relation
                   to this loan solely to the balance of said loan, failing
                   which the Bank may demand that said loan be repaid within ten
                   (10)
<PAGE>
                   days of such default.

            7.5.5. The company's loan shall become due and payable within ten
                   (10) days of any event of default or failure to respect the
                   commitments or obligations under this loan and any amendment
                   thereto, as applicable.

8. FACILITY "H" - DEMAND LOAN: $2,600,000

      8.1.  CREDIT FACILITY

            Subject to the provisions hereof, the Bank agrees to make available
            to the Borrower a demand loan in the amount of $2,600,000 IN
            CANADIAN DOLLARS OR THE EQUIVALENT IN U.S. DOLLARS* to temporarily
            finance the repayment of the debt, prior to the IPO, owed by White
            Amber to Commerica (US$1,550,776) and Sunguard (US$433,776).

            *The equivalent in U.S. dollars: The rate of conversion shall be
            established by the Bank on the date of disbursement

            Any residual unpaid balance shall be paid directly by the Borrower
            from its working capital.

      8.2.  TERM

            The loan is repayable no later than September 30, 2004.

      8.3.  INTEREST RATE

            This variable-rate loan shall bear interest from the date of
            disbursement until payment in full, at the Canadian Prime rate of
            the Bank plus 1.50%, or 5.50% as at the date hereof, calculated
            daily. Interest shall be payable monthly on the 26th day of each
            month as of the 26th day of the month following the disbursement.

      8.4.  DISBURSEMENT

            8.4.1.1.  The Borrower shall use the amount made available to it by
                      way of a single advance to repay in full the advances of
                      the above creditors. The Bank shall, via the law firm
                      mandated by it, take charge of the final settlement of the
                      transaction.
<PAGE>
      8.5.  REPAYMENT

            8.5.1. The Borrower shall repay the portion of the loan that was
                   granted by September 30, 2004 or earlier, namely, on the date
                   of the Borrower's IPO.

            8.5.2. In the event of non-repayment on September 30, 2004, the
                   Borrower undertakes:

            -      to make a monthly payment on principal, starting on October
                   26, 2004, in the amount of $100,000;

            -      to apply against the principal the surplus tax credits
                   receivable for fiscal 2003, approximately $663,000 (after
                   repayment of Facility G);

            -      to repay the remaining balance of the loan in full no later
                   than October 31, 2005, namely, approximately $737,000, from
                   its tax credits refunded for fiscal 2004 or from the
                   company's working capital.

            8.5.3. The company may repay all or part of the loan at any time
                   without penalty provided the repayment is from internally
                   generated funds, proceeds of the IPO or other sources of cash
                   from shareholders. If the repayment is from refinancing
                   granted by another financial institution, a penalty of three
                   months' interest shall then be payable.

            8.5.4. The company's loan shall become due and payable within ten
                   (10) days of any event of default or failure to respect the
                   commitments or obligations under this loan and any amendment
                   thereto, as applicable.

9. FACILITY "I" - EXCHANGE RISK: $500,000

      9.1.  CREDIT FACILITY

            Subject to the terms and conditions hereof, the Bank agrees to make
            available to the Borrower a currency conversion risk facility in an
            amount not exceeding $500,000 IN CANADIAN DOLLARS, which shall serve
            to enable the Borrower to conclude transactions with the Bank for
            contracts with respect to the sale or purchase of foreign currencies
            freely negotiated by the Bank, the whole subject to the following
            conditions:

            9.1.1. The Borrower may buy or sell foreign currencies through the
                   Bank, giving prior notice thereof to the Bank, in accordance
                   with the customs and practices of the market, specifying the
                   amount, currency and effective date of delivery of the chosen
                   currency;

            9.1.2. The maximum amount of foreign currency that the Borrower may
                   buy or sell hereunder shall not exceed the permitted amount,
                   as determined hereinafter; the said permitted amount shall be
                   determined by the Bank by multiplying the face value of the
                   chosen currency by the level of risk, as per the schedule in
                   effect at the Bank expressed as a percentage.

            9.1.3. For information purposes only: exchange contracts for less
                   than 12 months (net risk exchange: 10%) $500,000 risks
                   exchange in Canadian dollars corresponding to $5,000,000 in
                   of foreign exchange contracts in Canadian dollars;
<PAGE>
            9.1.4. The Borrower undertakes to deposit in its current account,
                   sufficient amounts to pay for the foreign currencies bought
                   or sold, no later than the date of their delivery, failing
                   which, the Bank shall be authorized to make a variable-rate
                   advance in Canadian and/or U.S. dollars under Credit Facility
                   "A" hereof for an equivalent amount in US dollars/euros and/
                   or other currencies, which is necessary to pay for said
                   currencies and any fees and expenses incurred by the Bank due
                   to insufficient funds in the Borrower's US$ current account
                   on the date of delivery.

                   Moreover, if such advance exceeds the credit amount
                   authorized under Credit Facility "A" the Bank shall then be
                   authorized to debit said current account for an amount equal
                   to such excess amount; all overdrafts in the Borrower's
                   current account shall bear interest, until payment in full,
                   at the rate on overdrafts prevailing from time to time at the
                   Bank;

            9.1.5. The Borrower shall execute, upon presentation, any agreement,
                   contract, document or other writing required by the Bank,
                   including, without limitation, the International Swap and
                   Derivatives Association (ISDA) contract, the International
                   Foreign Exchange Master Agreement (IFEMA) and confirmation,
                   as applicable, of such contract, in accordance with the
                   documents in use at the Bank, providing for, inter alia, the
                   terms and conditions, amount, currency and fees payable to
                   the Bank;

            9.1.6. Acceptance by the Bank of any request for the sale or
                   purchase of foreign currencies is subject to the availability
                   of such funds on the foreign exchange market and approval of
                   each request is at the Bank's discretion.

      9.2.  TERM

            This credit facility may be reviewed from time to time by the Bank
            and may be revoked by the Bank at any time. The next review being
            scheduled on or before March 31, 2005.
<PAGE>
10. SECURITY CURRENTLY IN FORCE

      REPRESENTATIONS AND WARRANTIES

      The Borrower represents and warrants to the Bank that all representations
      and warranties made in the initial offer of financing, dated November 24,
      1999, and that all addenda and/or amendments dated June 28, 2000, as well
      as security documents, continue to be true and accurate as at this date.

      WITHOUT NOVATION

      This renewal is carried out without novation or derogation of the
      operating credit and all of the rights, mortgages, hypothecs guarantees,
      recourses and ranking resulting from the Offer of Financing dated November
      24, 1999 and its addenda and/or amendments dated June 28, 2000, as well as
      security documents and other related documents.

      10.1. FACILITY "A" - OPERATING CREDIT: $500,000$

            10.1.1. First-ranking general movable hypothec on the universality
                    of the Borrower's claims, present and future, wherever the
                    debtors of claims may be. (This hypothec was signed on
                    August 17, 2000 and published in the Register of Personal
                    and Movable Real Rights on August 18, 2000 under No.
                    00-0238407-0001 for an original amount of $1,460,000.)

            10.1.2. First-ranking general movable hypothec on the universality
                    of the Borrower's present and future inventories, wherever
                    they may be located. (This hypothec was signed on August 17,
                    2000 and published in the Register of Personal and Movable
                    Real Rights on August 18, 2000 under No. 00-0238407-0003 for
                    an original amount of $560,000.)

            10.1.3. First-ranking general movable hypothec in the amount of
                    $500,000 on the universality of the Borrower's movable
                    property, corporeal and incorporeal. (This hypothec was
                    signed on August 17, 2000 and published in the Register of
                    Personal and Movable Real Rights on August 18, 2000 under
                    No. 00-0238407-0004 and will be cancelled once the new
                    financing structure is put into place and Credit Facility
                    "B" is paid in full.)

            10.1.4. First-ranking security agreement on the accounts receivable
                    of Recruitsoft.Com Inc, San Francisco, CA (now known under
                    the name "Taleo Corporation") signed on August 17, 2000 in
                    the amount of $1,460,000.

            10.1.5. General Security Agreement of the Borrower on the
                    universality of the Borrower's movable property registered
                    PPSA concerning the following addresses 101 Rolland-
                    Therrien, Longueuil, Quebec J4H 4B9 and 5025/5045 Orbitor
                    Drive, Building 9, Suite 401, Mississauga, Ontario L4W 4Y4
                    signed on August 17, 2000. (New addresses: 625 President
                    Kennedy, Suite 1000, Montreal, Quebec H3A 1K2 and 20 Ducan
                    Street, Suite 2000, Toronto, Ontario M5H 3G8).

            10.1.6. First-ranking Security Agreement of Recruitsoft.Com Inc.,
                    San Francisco, CA (now known under the name of Taleo
                    Corporation) on the universality of the movable property in
                    the amount of $500,000 signed on August 17, 2000.
<PAGE>
            10.1.7. First-ranking Security Agreement of Recruitsoft.Com Inc.,
                    San Francisco, CA (now known under the name of Taleo
                    Corporation) on the universality of inventories signed on
                    August 17, 2000.

            10.1.8. First-ranking security on all stock in inventory on all
                    stock in inventory under section 427 of the Bank Act.

            10.1.9. Guarantee of Recruitsoft Inc. (now Taleo Corporation) signed
                    on November 27, 2001 in the amount of $500,000 (To be
                    discharged).

      10.2. FACILITY "B" - DEMAND LOAN (CAPITAL EXPENDITURES): $49,999.91

            10.2.1. Second-ranking general movable hypothec on the universality
                    of the Borrower's movable property, corporeal and
                    incorporeal, in Canada and the United States, including
                    intellectual property signed on November 27, 2001. (To be
                    discharged when repaid in full and required before the date
                    this offer of financing comes into force.)

            10.2.2. First-ranking general movable hypothec on specific equipment
                    signed on November 27, 2001. (To be discharged when repaid
                    in full and required before the date this offer of financing
                    comes into force.)

            10.2.3. Security Agreement of Recruitsoft Inc. (now Taleo
                    Corporation, San Francisco, CA) on the inventory (To be
                    discharged when repaid in full and required before the date
                    this offer of financing comes into force.)

            10.2.4. Commitment from Recruitsoft Inc. (now Taleo Corporation, San
                    Francisco, CA) to ensure the debt service. (To be discharged
                    when repaid in full and required before the date this offer
                    of financing comes into force.)

            10.2.5. Guarantee of Recruitsoft Inc. (now Taleo Corporation). (To
                    be discharged when repaid in full and required before the
                    date this offer of financing comes into force).

      10.3. FACILITY "C" - LETTER OF GUARANTEE: $63,333.33

            10.3.1. First-ranking deposit security in the amount of $63,333.33
                    signed on April 5, 2004 and published in the Register of
                    Personal and Movable Real Rights on April 7, 2004 under No.
                    04-0192613-0001;

      10.4. FACILITY "D" - TERM LOAN: $2,250,000 (CURRENTLY IN FORCE)

            WITHOUT NOVATION OR DEROGATION FROM THE TERM LOAN CURRENTLY IN FORCE
            AND ALL RIGHTS, HYPOTHECS, MORTGAGES, GUARANTEES, SURETYSHIPS,
            REMEDIES AND RANKINGS RESULTING FROM THE OFFER OF FINANCING DATED
            MARCH 28, 2003 AND AMENDMENT DATED MAY 21, 2003, AS WELL AS SECURITY
            DOCUMENTS AND ANY OTHER WRITINGS RELATED THERETO.

            10.4.1. First-ranking specific movable hypothec in the amount of
                    $2,500,000 on the Borrower's financed equipment (published
                    under No. 03-0327611-0001 dated
<PAGE>
                    June 26, 2003, covering the first disbursement).

            10.4.2. First-ranking specific movable hypothec in the amount of
                    $2,500,000 on the Borrower's financed equipment (published
                    under No. 03-0603554-0001 dated November 12, 2003, covering
                    the second disbursement).

            10.4.3. Security agreement under the Uniform Commercial Code "UCC"
                    covering specific assets (registered in United States) as
                    per respective registration districts.

            10.4.4. Guarantee of Recruitsoft Inc. (now Taleo Corporation) (to be
                    discharged).

      10.5. FACILITY "E" - MASTER CARD PURCHASING CARD: $400,000

            10.5.1. Movable hypothec on the universality of the present and
                    future claims, wherever the debtors of such claims may be,
                    in the amount of $250,000, signed on July 19, 2002 and
                    published in the Register of Personal and Movable Real
                    Rights on October 15, 2002 (to be discharged).

            10.5.2. First-ranking deposit security No. 559022683807 in the
                    amount of $125,000, signed on July 19, 2002 and published in
                    the Register of Personal and Movable Real Rights on October
                    11, 2002 under No. 02-0457393-0001 (to be cancelled).

            10.5.3. Guarantee of Recruitsoft Inc. (now Taleo Corporation),
                    signed on July 19, 2002, in the amount of $250,000 (to be
                    discharged).

11. SECURITY

      As general and continuing security for the performance by the Borrower of
      all its obligations, present and future, towards the Bank, including,
      without limitation, the repayment of advances granted hereunder and the
      payment of interest, fees and incidental charges provided for hereunder
      and under the security documents, the Borrower undertakes to grant to the
      Bank the following security, if deemed satisfactory by the Bank, in
      accordance with the forms in use at the Bank:

      11.1. FACILITY "A" OPERATING CREDIT: $500,000
            FACILITY "B" DEMAND LOAN:  $49,999.91 (UNTIL REPAYMENT DATE)
            FACILITY "C" LETTER OF GUARANTEE:  $63,333.33
            FACILITY "D" TERM LOAN:  $2,250,000
            FACILITY "E"  MASTERCARD PURCHASING CARD:  $400,000
            FACILITY "F" TERM LOAN FOR CAPITAL EXPENDITURES:  $2,400,000
            FACILITY "G" DEMAND LOAN:  $1,900,000
            FACILITY "H" DEMAND LOAN:  $2,600,000 AND
            FACILITY "I" EXCHANGE RISK: $500,000

            11.1.1. First-ranking general hypothec in the amount of $10,663,333
                    on the universality of the Borrower's movable and immovable
                    property, present and future.

            11.1.2. Guarantee from Taleo Corporation, San Francisco, California
                    supported by a security agreement in the amount of
                    $10,663,333 (universality of movable and immovable property,
                    present and future).
<PAGE>
            11.1.3. Guarantee from White Amber Inc., New York, USA supported by
                    a security agreement USA in the amount of $10,663,333
                    (universality of movable and immovable property, present and
                    future).

            11.1.4. Negative pledge: Commitment by the Borrower and Taleo
                    Corporation, San Francisco, CA not to pledge intellectual
                    property as security without the written consent of the
                    Bank.

            11.1.5. Guarantee from 9090-5415 Quebec Inc. in the amount of
                    $10,663,333.

            11.1.6. Commitment to the effect that Taleo Corporation, San
                    Francisco, California will ensure the debt service of Taleo
                    (Canada) Inc. (formerly Corporation Recruitsoft (Canada)
                    Inc. and its English version, Recruitsoft (Canada)
                    Corporation Inc.).

            11.1.7. First-ranking general hypothec on the universality of the
                    movable and immovable property, corporeal and incorporeal,
                    and the intellectual property, present and future, of the
                    Borrower and Taleo Corporation, San Francisco, CA, wherever
                    it may be, and whatever its purpose, type, form or format,
                    including, without limitation, all brand names, trademarks,
                    patents, licences, secrets, copyrights, industrial designs
                    and permits, registered or not, as well as any version,
                    present and future of computer software, or digital or
                    interactive programming products of Taleo Corporation, San
                    Francisco, CA, as well as the Security Agreement under the
                    Uniform Commercial Code ("UCC") on specific equipment
                    (registered in the United States) as per respective
                    registration districts.

                    The security described in 11.1.6 shall be registered only in
                    the event that an IPO for a minimum net amount of
                    $25,000,000 (i.e., after all dividends payable further to an
                    IPO), does not take place before September 30, 2004.

                    The security described in 11.1.6 shall be kept in escrow by
                    our lawyers.

            11.1.8. Security with respect to insurance policies on the property
                    given as security to the Bank, up to the full insurable
                    value thereof.

            11.1.9. Rider designating the Bank as beneficiary of all rights,
                    titles and interest in the proceeds of the insurance
                    covering all property given as security to the Bank, up to
                    the full insurable value thereof.

12. REPRESENTATIONS AND WARRANTIES OF THE BORROWER

      The Borrower represents and warrants to the Bank that:

      12.1. It is a duly constituted or incorporated, and registered and
            organized business in compliance with the legislation governing it,
            and that it has the powers, permits and licenses required to operate
            its business or enterprise and to own, manage and administer its
            property;

      12.2. It is not involved in any dispute or legal proceedings likely to
            materially affect its financial position or its capacity to operate
            its business;

      12.3. It has valid title to all its goods and property, which have a good
            market value and are free and clear of any prior claims, mortgages,
            hypothecs, charges or other similar encumbrances other than the
            mortgages, hypothecs and other charges previously granted to the
            Bank;
<PAGE>
      12.4. It is not in default under the contracts to which it is a party or
            under the applicable legislation and regulations governing the
            operation of its business or its property, including, without
            limitation, all environmental requirements; and

      12.5. Any taxes, assessments, deductions at source, income taxes or other
            levies, the payment of which is secured by a legal privilege, prior
            claim or legal hypothec, have been/will be paid by the Borrower
            without subrogation or consolidation.

13. CONDITIONS PRECEDENT TO ANY DISBURSEMENT OF FUNDS

      Before any disbursement, renewal or maintenance of this credit facility,
      the Borrower shall meet the following conditions to the satisfaction of
      the Bank:

      13.1. The Borrower shall sign all documents that the Bank may reasonably
            request in order to give full effect to the provisions hereof;

      13.2. The Borrower and the guarantors, as applicable, shall meet all of
            the conditions hereof and execute all documents that the Bank may
            reasonably request in order to give full effect to the provisions
            hereof;

      13.3. All collateral security shall be duly registered in accordance with
            the above-mentioned ranking and any other required formality shall
            be fulfilled, as applicable;

      13.4. The Borrower shall furnish to the Bank any other document,
            certificate and opinion that it may reasonably require, including,
            but not limited to, any incorporating instrument related to the
            Borrower and the guarantor, and any other document and opinion
            related to the hypothecated property, as applicable;

      13.5. The Borrower shall furnish to the Bank the annual financial
            statements of 9090-5415 Quebec Inc;

      13.6. Total repayment of Facility "B".

14. CONDITIONS PRECEDENT TO DISBURSEMENT OF FUNDS SPECIFIC TO FACILITY "F" TERM
LOAN: $2,400,000

      14.1. The Borrower shall furnish to the Bank its invoices and proof of
            payment by location of installation.

15. CONDITIONS PRECEDENT TO DISBURSEMENT OF FUNDS SPECIFIC TO FACILITY "G"
DEMAND LOAN: $1,900,000

      15.1. The Borrower shall furnish to the Bank its audited consolidated
            financial statements (received).

16. CONDITIONS PRECEDENT TO DISBURSEMENT OF FUNDS SPECIFIC TO FACILITY "H"
DEMAND LOAN: $2,600,000

      16.1. The Borrower shall furnish to the Bank the statements of account of
            Sungard and Comerica, for the repayment of advances using Credit
            Facility "H";

<PAGE>
      16.2. The Borrower shall furnish to the Bank written confirmation from the
            lenders (Sungard and Comerica) to the effect that once the advances
            are repaid, they undertake to disburse the cash amounts held as
            security and to cancel the registered security;

      16.3. The disbursement shall be controlled by a law firm mandated by the
            Bank;

      16.4. On signing hereof, the Borrower undertakes to disburse all surplus
            amounts required over and above the financing granted by the Bank
            (Credit Facility "H"), as applicable, to obtain cancellation of the
            security and repay the amount guaranteed by Taleo Corporation;

17. LOAN INSURANCE PROPOSAL

      Refer to Appendix 1.

18. POSITIVE COVENANTS

      During the entire term of this financing agreement, the Borrower shall:

      18.1. Use the proceeds of the financing for the purposes provided for
            herein;

      18.2. Operate its business in a diligent and continuous manner;

      18.3. Keep and maintain proper books of account and other accounting
            records in accordance with generally
                  accepted accounting principles;

      18.4. Furnish to the Bank its internal monthly financial statements within
            20 days of the end of each month together with the following lists:
            receivables by currency, EDC-insured receivables, uninsured
            receivables and consolidated receivables; accounts payable, proof of
            EDC insurability and copies of invoices for amounts in excess of
            $15,000, as well as a monthly statement of the available credit
            limit duly signed by the party(ies) authorized to sign on behalf of
            the company;

      18.5. The Borrower shall furnish to the Bank copies of all the usual
            documents concerning the administration of the EDC loan insurance
            policy;

      18.6. The Borrower undertakes to sign Form E6 to authorize EDC to forward
            all information required by the Bank;

      18.7. Furnish to the Bank two copies of its audited annual consolidated
            financial statements within 90 days of the end of its fiscal year
            together with monthly budget and cash flow projections for the
            following year;

      18.8. At all times, give the Bank's representatives the right to inspect
            its establishments and provide access thereto, and further permit
            the Bank's representatives to examine its books of account and other
            records, and take excerpts therefrom or make copies thereof;

      18.9. Maintain, at all times, insurance coverage on its property against
            loss or damage caused by fire and any other risk as is customarily
            maintained by companies carrying on a similar business;

      18.10. Maintain, at all times for the duration of this financing
             agreement, the following financial ratios:
<PAGE>
            18.10.1.  a WORKING CAPITAL RATIO GREATER THAN 1.0:1.0 (MINIMUM
                      $2,000,000 IN US DOLLARS), defined as total current assets
                      over total current liabilities;

            18.10.2.  NET SHAREHOLDERS' EQUITY GREATER THAN OR EQUAL TO
                      $6,000,000 IN US DOLLARS, defined as follows: (i) the
                      principal paid by the Borrower for capital stock issued,
                      paid and outstanding; (ii) the Borrower's retained
                      earnings; and (iii) the amount of the Borrower's
                      subordinated debt. The following are excluded from the
                      shareholders' equity: (a) the amount of all subsidies
                      (without excluding the amount of any such subsidy from
                      other balance sheet entries, such as retained earnings
                      and, as applicable, the cost of property acquired in full
                      or in part by way of such subsidy) received by the
                      Borrower; (b) all deferred income taxes, any component
                      resulting from a revaluation of assets; (c) all intangible
                      assets; and (d) all inter-company accounts;

            18.10.3.  a TOTAL DEBT RATIO (BEARING INTEREST) TO USD CONSOLIDATED
                      NET WORTH NO HIGHER THAN 1.25:1.00, defined as total
                      liabilities (excluding total non-interest bearing
                      liabilities such as accounts receivable and deferred
                      income) divided by the total of shareholders' equity plus
                      subordinated debt less intangible assets, advances to
                      directors and/or shareholders and accounts receivable from
                      or advances to affiliated companies;

      18.11. Pay, when due, all taxes, assessments, deductions at source, income
             tax or levies for which payment is guaranteed by legal privilege or
             legal hypothec, without subrogation or consolidation;

      18.12. Furnish to the Bank any other document that it may reasonably
             require;

      18.13. Conduct all or the greater part of its banking business with the
             Bank;

      18.14. Obtain and maintain in effect the permits and licences required for
             the operation of its company;

      18.15. Notify the Bank forthwith of any default or event which, following
             a notice or an expiry of a deadline, could constitute an event of
             default.

19. NEGATIVE COVENANTS

      The Borrower undertakes to refrain from carrying out the following
      transactions or operations without obtaining the prior written consent of
      the Bank:

      19.1. Materially change the nature of its operations or business;

      19.2. Change the control of the company, merge with another company,
            dissolve or wind up the company;

      19.3. Create or permit the existence of security interests in property
            granted as security to the Bank;

      19.4. Grant advances to its officers, directors, shareholders or related
            persons other than in the normal course of its business;

      19.5. Grant financial assistance, an investment or a guarantee on behalf a
            third party;
<PAGE>
      19.6. Declare or pay out dividends on its shares, purchase or sell its
            shares, or otherwise reduce its capital.

20. ENVIRONMENTAL OBLIGATIONS

      20.1. The Borrower shall comply with the requirements of all legislative
            and regulatory environmental provisions (the "Environmental
            Requirements") and shall at all times maintain the authorizations,
            permits and certificates required under these provisions.

      20.2. The Borrower shall immediately notify the Bank in the event a
            contaminant spill or emission occurs or is discovered with respect
            to its property, operations or those of any neighbouring property.
            In addition, it shall report to the Bank forthwith any notice,
            order, decree or fine that it may receive or be ordered to pay with
            respect to the Environmental Requirements relating to its business
            or property.

      20.3. At the request of and in accordance with the conditions set forth by
            the Bank, the Borrower shall, at its own cost, provide any
            information or document which the Bank may require with respect to
            its environmental situation, including any study or report prepared
            by a firm acceptable to the Bank. In the event that such studies or
            reports reveal that any Environmental Requirements are not being
            respected, the Borrower shall effect the necessary work to ensure
            that its business and property comply with the Environmental
            Requirements within a period acceptable to the Bank.

      20.4. The Borrower undertakes to indemnify the Bank for any damage which
            the Bank may suffer or any liability which it may incur as a result
            of any non-compliance with Environmental Requirements.

      20.5. The provisions, undertakings and indemnification set out in this
            section shall survive the satisfaction and release of the security,
            and payment and satisfaction of the indebtedness and liability of
            the Borrower to the Bank pursuant to the terms hereof.

21. DEFAULT

      21.1. EVENTS OF DEFAULT

      The occurrence of one or more of the following events shall constitute a
      default under this Offer:

            21.1.1.   If the Borrower fails to make a payment of principal,
                      interest, fees, incidental charges or any other amount
                      which may become due hereunder or under any of the
                      security documents, when they become due and payable;

            21.1.2.   If the Borrower and/or the guarantors fail to perform or
                      otherwise breach any obligation hereunder or pursuant to
                      any of the security documents or any other related
                      document;

            21.1.3.   If the Borrower and/or any guarantor, if applicable,
                      becomes insolvent, bankrupt or is in the process of
                      winding up, assigns its assets for the benefit of its
                      creditors, files a proposal or gives notice of its
                      intention to file such proposal or if a material, adverse
                      change occurs in the financial position or operations of
                      the Borrower;
<PAGE>
            21.1.4.   If proceedings are instituted by the Borrower and/or any
                      guarantor, if applicable, or a third party for the
                      Borrower's and/or any guarantor's dissolution, winding-up
                      or re-organization of its operations or the arrangement or
                      readjustment of its debts;

            21.1.5.   If a creditor, trustee in bankruptcy, sequestrator,
                      receiver or trustee takes possession of the Borrower's and
                      /or any guarantor's assets or, in the opinion of the Bank,
                      a major  portion thereof or if such assets are subject to
                      a prior notice of the exercise of a hypothecary right or a
                      notice to withdraw authorization to collect claims or are
                      seized;

            21.1.6.   If the Borrower and/or any guarantor is in default under
                      the terms of any other contracts, agreements or writings
                      with the Bank or any other bank or financial institution
                      or any other creditor with rights to the assets of the
                      Borrower and/or any guarantor, as applicable;

            21.1.7.   If any representation or warranty made by the Borrower
                      and/or any guarantor herein or in a security document or
                      any other document furnished to the Bank in connection
                      herewith proves to be incorrect or erroneous; or

            21.1.8.   If the Bank receives from any present or future guarantor
                      a notice proposing to terminate, limit or otherwise modify
                      such guarantor's liability hereunder, under a security
                      document, or under any other related document.

21.2. RIGHTS AND REMEDIES OF THE BANK IN THE EVENT OF DEFAULT

      Subject to its other rights and remedies, in the event of default:

      21.2.1.   The Bank may declare due and payable all of the Borrower's
                monetary obligations that have not matured and may claim from
                the Borrower and/or any guarantor, without any other notice, the
                immediate payment of principal, interest, fees and incidental
                charges, including all the expenses incurred by the Bank for the
                purposes of collecting or protecting the debt, and the execution
                of any other obligation of the Borrower and/or any guarantor;

      21.2.2.   The Borrower shall lose all rights and privileges hereunder,
                including, but not limited to, the right to receive additional
                advances;

      21.2.3.   The Bank may charge the Borrower reasonable fees for analysis,
                administration and follow-up and may even incur and pay any
                reasonable sum for services rendered (including legal,
                accounting and any other professional fees for which services
                may be required or deemed necessary) in relation to the
                realization, sale, transfer, delivery or payment to be made with
                respect to exercising all security held by the Bank and may
                retain such fees and disbursements from the proceeds of the
                realization of security;

      21.2.4.   Any amount collected or received by the Bank, including the
                balance of the proceeds of any security realized, may be
                retained by the Bank and may, at the Bank's option, be applied
                to any part of the debt owed by the Borrower to the Bank;

      21.2.5.   Any sum incurred and paid by the Bank in order to realize,
                protect or preserve any security pledged by the Borrower to the
                Bank under this agreement or required by law shall bear interest
                at the Canadian Prime rate of the Bank, plus X% annually
<PAGE>
                until said sum is paid;

      21.2.6.   The foregoing provisions shall be applied regardless of whether
                any of the bearers of bankers' acceptances, issued under the
                terms and conditions hereof, has requested full or partial
                payment or has requested only partial payment from the Bank.

21.3.    WAIVER, OMISSION AND CUMULATIVE REMEDIES

      21.3.1.   The Bank may set deadlines, take or waive security, accept
                compromises, grant a discharge and recognition of cancellation
                and do business with the Borrower as it deems appropriate
                without such action reducing the Borrower's responsibility or
                affecting the rights of the Bank with respect to the security
                provided hereunder.

      21.3.2.   Any omission on the part of the Bank to notify the Borrower and/
                or any guarantor of any case of default under the terms and
                conditions hereof or to exercise its rights hereunder shall not
                be considered a waiver on the part of the Bank of its right to
                exercise its recourse in such case of default or to exercise any
                right.

      21.3.3.   Acceptance by the Bank, following a default by the Borrower, of
                an amount owed to it, or the exercise by the Bank of any
                recourse or right shall not prevent the Bank from exercising any
                other right or recourse, the rights and recourses of the Bank
                being cumulative and non-interchangeable, and in addition to and
                not in substitution of, any other right or recourse by the Bank,
                whether by agreement or otherwise provided for by law.

22. SUNDRY

      22.1. DEFINITIONS

            For the purposes hereof, the terms and expressions hereinafter
            listed shall be defined as follows:

            "CANADIAN PRIME RATE" means the annual variable interest rate
            published by the Bank from time to time and used by the Bank to
            determine the interest rates on commercial loans granted by it in
            Canadian dollars in Canada.

      22.2. ACCOUNTING TERMS

            Each accounting term used herein shall have the meaning ascribed to
            it in accordance with the generally accepted accounting principles
            of the Canadian Institute of Chartered Accountants.

      22.3. CURRENCY AND PLACE OF PAYMENT

            All sums due by the Borrower hereunder must be paid by the Borrower
            to the Bank in Canadian dollars.

      22.4. CALCULATION OF INTEREST AND ARREARS

            22.4.1.   Unless otherwise provided for herein, interest on any
                      amount due hereunder shall be calculated daily and not in
                      advance on the basis of a 365-day year.
<PAGE>
            22.4.2.   For the purposes of the Interest Act (Canada) in the case
                      of a leap year, the annual interest rate corresponding to
                      the interest calculated on the basis of a 365-day year is
                      equal to the interest rate thus calculated multiplied by
                      366 and divided by 365.

            22.4.3.   Any amount of principal, interest, commission or discount
                      or an amount of any other nature remaining unpaid at
                      maturity shall bear interest at the rate provided for
                      herein, it being understood that said interest rate on
                      arrears shall not exceed the maximum rate provided for by
                      law, if applicable.

            22.4.4.   Interest on arrears shall be compounded monthly and
                      payable on demand.

      22.5. ADDITIONAL CHARGES

            The Borrower undertakes to pay the Bank the charges below, as
            determined by the Bank:

            22.5.1.   In the event that a law, regulation, administrative policy
                      or guideline results in an increase in the cost of credit
                      for the Bank (particularly as a result of the imposition
                      of reserves, taxes or requirements with respect to the
                      Bank's capital adequacy), the Borrower shall pay this
                      additional cost on demand; and

            22.5.2.   The Borrower shall pay all taxes or additional charges
                      that could result from the application of the goods and
                      services tax (Canada), the provincial sales tax (Quebec),
                      or any other similar federal, provincial or municipal law.

      22.6. ASSIGNMENT

            No rights or obligations of the Borrower hereunder and no proceeds
            of the loan may be transferred or assigned by the Borrower. Any such
            transfer or assignment shall be null and void insofar as the Bank is
            concerned and shall render any balance then outstanding on the loan
            immediately due and payable at the Bank's option and release the
            Bank from any and all obligations of making any further advances
            hereunder.

      22.7. RECORDS

            The Bank shall keep records evidencing the transactions performed
            hereunder. Such records shall be presumed to reflect these
            transactions and shall constitute conclusive evidence of the amounts
            due to the Bank.

      22.8. ACCOUNT DEBITS

            The Borrower irrevocably authorizes the Bank to debit periodically
            or from time to time any bank account it maintains at the Bank in
            order to pay all or part of the amounts it may owe to the Bank
            hereunder.

      22.9. NON-BUSINESS DAY

            If the date provided for an installment of principal or interest
            hereunder is not a business day, such installment shall be paid on
            the first business day thereafter.

      22.10.   FINAL AGREEMENT AND INTERPRETATION

            Upon its acceptance and execution by the Borrower, this Offer shall
            constitute the final agreement between the parties, with the
            exception of any subsequent written amendments agreed to by the
            parties, and shall supersede any other previous verbal or written
            agreement
<PAGE>
            between the parties with respect to the financing provided for
            herein.

            Notwithstanding the foregoing, this Offer does not create novation
            or an exception to the mortgages, hypothecs, rights and remedies of
            the Bank under the deeds, notes and security documents required
            hereunder which were signed by the Borrower or the guarantor prior
            to the date hereof. The Borrower hereby acknowledges and declares
            that the mortgages, hypothecs, rights and remedies of the Bank under
            said deeds, notes and security documents have not been amended and
            that they secure its obligations hereunder.

      22.11.   OTHER DOCUMENTS

            The Borrower and the guarantors, if applicable, shall do all things
            and execute all documents deemed necessary or appropriate by the
            Bank for the purposes of giving full force and effect to the terms,
            conditions, undertakings and security granted or to be granted
            hereunder.

      22.12.   JOINT AND SEVERAL LIABILITY/SOLIDARITY

            If more than one person is designated as the Borrower or the
            guarantor, each such person shall be jointly and severally or
            solidarily liable for the obligations set out herein and in the
            security documents.

      22.13.   VALIDITY OF PROVISIONS HEREOF

            Any court decision to the effect that any of the provisions hereof
            is null or void in no way affects the remaining provisions hereof or
            their validity or executory force.

      22.14.   REVIEW

            The terms and conditions of the credits granted by the Bank to the
            Borrower hereunder are subject to a periodic review, at the Bank's
            discretion.

      22.15.   AMENDMENTS

            Any amendment to this Offer or resulting waiver of a right hereunder
            is without effect unless it is explicitly stated in a written
            document signed by the parties.

      22.16.   COPIES

            This Offer may be signed in an indeterminate number of copies, each
            of which is deemed to constitute an original, but all of which
            constitute a single document.

23. ACCESS TO INFORMATION

      The Borrower and the guarantors hereby authorize any personal information
      agent, financial institution, creditor, tax authority, employer or any
      other person, including any public entity, holding information concerning
      the Borrower or its property, more particularly any financial information
      or information with respect to any undertaking or guarantee given by the
      Borrower, to supply such information to the Bank in order to verify the
      accuracy of all information furnished or to be furnished from time to time
      to the Bank and to ensure the solvency of the Borrower at all times.

24. FEES
<PAGE>
      The Borrower undertakes to pay non-refundable fees of $23,500 on
      acceptance of this Offer of Financing.

      The taking of security (in Canada and the United States) shall be
      completed by a law firm accredited and mandated by the Bank to do so at
      the Borrower's expense.

      Any fees and legal costs incurred in the preparation and registration or
      publication of the security documents and any other document related
      thereto shall be payable by the Borrower, whether or not the financing is
      completed.

25. GOVERNING LAW

      This Offer shall be governed and construed in accordance with the laws of
      the province of Quebec.

      If this Offer is satisfactory, please indicate your approval by returning
      to us the copy attached in this regard, duly signed and initialled on each
      page, before 5:00 p.m. on APRIL 28, 2004. After that date, the Bank
      reserves the right to cancel or modify this Offer without notice.

      We trust that our financial support will contribute to the success of your
      company.

Yours very truly,

[NATIONAL BANK OF CANADA LOGO]

By:   /s/ Allain Gallichan              /s/ Sylvie Pelletier
      ---------------------             -----------------------------------
      Allain Gallichan                  Sylvie Pelletier
      Senior Account Manager            Account Representative
      (514) 523-4742                    (514) 523-5045
      alain.gallichan@bnc.ca            sylvie.pelletier@bnc.ca

ACCEPTANCE

We declare that we have read this Offer, dated April 28, 2004 and we accept the
terms, conditions and obligations hereof.

EXECUTED AT _____________________, PROVINCE OF QUEBEC, THIS __________ DAY OF
________________, 200__.

CORPORATION RECRUITSOFT (CANADA) INC. AND ITS ENGLISH VERSION, RECRUITSOFT
(CANADA) CORPORATION INC., SOON TO BECOME TALEO (CANADA) INC.

By:   /s/ Jean Laviqueur                /s/ Sylvie Lauze
      ------------------------------    -------------------------------
      By:                               By:
      TITLE:                            TITLE:

<PAGE>
                             CONFIRMATORY AGREEMENT

BETWEEN:          NATIONAL BANK OF CANADA, chartered bank governed by the Bank
                  Act (1991, c. 46), having a place of business at 150, blvd.
                  Rene-Levesque East, Quebec, Province of Quebec, G1R 5B1,
                  herein represented by Mr. ALAIN GALLICHAN, Senior Account
                  Manager, and Mrs. SYLVIE PELLETIER, Accounting Agent, duly
                  authorized as they so declare;

                  (hereinafter called the "LENDER");

AND:              CORPORATION RECRUITSOFT (CANADA) INC. / RECRUITSOFT (CANADA)
                  CORPORATION INC., a corporation legally constituted under the
                  Quebec Companies Act (R.S.Q., c. C-38), having its head office
                  at 330, St-Vallier East, Suite 400, Quebec, Province of
                  Quebec, G1K 9C5, herein represented by MR. JEAN LAVIGUEUR,
                  Chief Financial Officer, and MRS. SYLVIE LAUZE, Director of
                  Finance, duly authorized to act herein by resolution of the
                  Board of Directors dated May 7, 2004;

                  (hereinafter called the "BORROWER");

AND:              TALEO CORPORATION., a corporation legally constituted under
                  the laws of the State of Delaware, having its head office at
                  182 Second Street, 5th Floor, San Francisco, CA, 94105, herein
                  represented by MR. JEAN LAVIGUEUR, Chief Financial Officer,
                  and MRS. SYLVIE LAUZE, Director of Finance, duly authorized to
                  act herein by a written action of the Board of Directors dated
                  May 4, 2004;

                  (hereinafter called "TALEO");

AND:              9090-5415 QUEBEC INC., a corporation legally constituted under
                  the Quebec Companies Act (R.S.Q., c. C-38), having its head
                  office at 330, St-Vallier East, Suite 400, Quebec (Quebec) G1K
                  9C5, herein represented by MR. JEAN LAVIGUEUR, Chief Financial
                  Officer, and MRS. SYLVIE LAUZE, Director of Finance, duly
                  authorized to act herein by a resolution of the Board of
                  Directors dated May 7, 2004;

                  (hereinafter called "9090");
<PAGE>
                                      -2-

AND:              WHITE AMBER, INC., a corporation legally constituted under the
                  laws of the State of Delaware, having its head office at 1010
                  Northern Blvd., Suite 328 Great Neck, NY, 11021, herein
                  represented by MR. JEAN LAVIGUEUR, Chief Financial Officer,
                  and MRS. SYLVIE LAUZE, Director of Finance, duly authorized to
                  act herein by a written action of the Board of Directors dated
                  May 5, 2004;

                  (hereinafter called "WHITE AMBER");

                  (Taleo, 9090 and White Amber are hereinafter collectively
                  called the "INTERVENING PARTY")

WHEREAS the Bank addressed to the Borrower and the Intervening Party, on April
28th, 2004, an offer to finance, which was accepted on the same day (hereinafter
called the "OFFER TO FINANCE")

WHEREAS under the terms of the Offer to Finance, the Lender agreed:

i)    to maintain in force an operating credit in an amount up to but not
      exceeding the aggregate amount of FIVE HUNDRED THOUSAND CANADIAN DOLLARS
      (CA$ 500,000) (the "CREDIT A") and/or the equivalent in US dollars;

ii)   to maintain in force a demand credit facility which was originally to the
      amount of FIVE HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 500,000) (the
      "CREDIT B"), for which there was an amount of FORTY NINE THOUSAND NINE
      HUNDRED NINETY-NINE CANADIAN DOLLARS (CA$ 49,999) still outstanding as of
      April 28th, 2004;

iii)  to grant a letter of guarantee for the aggregate amount of SIXTY THREE
      THOUSAND THREE HUNDRED THIRTY-THREE CANADIAN DOLLARS (CA$ 63,333) (the
      "CREDIT C");

iv)   to maintain in force a term financing which was originally for the amount
      of TWO MILLION FIVE HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 2,500,000) (the
      "CREDIT D") for which there is an amount of TWO MILLION TWO HUNDRED FIFTY
      THOUSAND CANADIAN DOLLARS (CA$ 2,250,000) still outstanding as of April
      28th, 2004;
<PAGE>
                                      -3-

v)    to maintain in force a Master Card business purchasing up to but not
      exceeding the aggregate amount of FOUR HUNDRED THOUSAND CANADIAN DOLLARS
      (CA$ 400,000) (the "CREDIT E");

vi)   to grant a term financing up to but not exceeding TWO MILLION FOUR HUNDRED
      THOUSAND CANADIAN DOLLARS (CA$ 2,400,000) (the "CREDIT F") and/or the
      equivalent in US dollars;

vii)  to grant a demand credit facility up to but not exceeding the amount of
      ONE MILLION NINE HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 1,900,000) (the
      "CREDIT G");

viii) to grant a demand credit facility up to but not exceeding the amount of
      TWO MILLION SIX HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 2,600,000) (the
      "CREDIT H") and/or the equivalent in US dollars;

ix)   to grant an Exchange Risk Credit up to but not exceeding FIVE HUNDRED
      THOUSAND CANADIAN DOLLARS (CA$ 500,000) (the "CREDIT I");

all in favor of the Borrower (collectively referred to as the "CREDIT
FACILITIES").

WHEREAS the Credit Facility A is not a new addition to the Credit Facilities but
rather a maintenance of the existing operating credit in the amount of FIVE
HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 500,000) previously granted by the Lender
in favor the Borrower;

WHEREAS the Credit Facility E is not a new addition to the Credit Facilities but
rather a maintenance of the Master Card business credit in the amount of FOUR
HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 400,000) previously granted by the Lender
in favor the Borrower;

WHEREAS Credits C, F, G, H, and I are new credit facilities granted in favor of
the Borrower in excess of all the credit facilities previously granted by the
Lender to the Borrower;

WHEREAS the parties, by this agreement, wish to confirm their respective
commitments under the Offer to Finance and to complete some aspects of the said
Offer to finance with regard to the Credit Facilities.
<PAGE>
                                      -4-

THE PARTIES AGREE TO THE FOLLOWING:

1.    CONFIRMATION

1.1   The Offer to Finance and this confirmatory agreement together form the
      credit agreement (the "CREDIT AGREEMENT") governing the terms, modes and
      conditions concerning the Credit Facilities;

1.2   The Credit Agreement can only be modified or amended by a written document
      signed by all the parties.

2.    BANKING DOCUMENTS AND USUAL FORMS

2.1   The Borrower agrees to consent and to sign the banking agreements and the
      usual forms in use from time to time for the Lender (collectively called
      the "ACCESSORY AGREEMENTS") to record, to establish or to specify
      different modes applicable to the Credit Facilities;

2.2   The Accessory Agreements are a part of the Credit Agreement, so novation
      doesn't occur to any of the Borrower's obligations in regard to any of the
      Credit Facilities, neither do they diminish the scope or the extent of the
      Securities as well as the securities previously granted by the Borrower
      and the Intervening Party in favor of the Lender regarding any of the
      Credit Facilities.

3.    SITUATION OF THE EXISTING CREDIT FACILITIES AND SECURITIES

3.1   The Credit A is not in addition to any operating financing previously
      granted by the Lender to the Borrower, which are included and continue
      through the Credit A;

3.2   The Credit E is not in addition to any Master Card business credit
      previously granted by the Lender to the Borrower, which are included and
      continue through the Credit E;

3.3   The Credits B and D, which were previously granted to the Borrower, are
      maintained in force and will, starting from the date of signature of this
      agreement, be governed by the terms and conditions of this agreement.

4.    SECURITIES

4.1   Concurrently with the signature of this agreement or, as the case may be,
      as soon as possible afterward, the Borrower and/or the Intervening Party
      commit to create,
<PAGE>
                                      -5-

      to consent and, if required, to maintain in force and to renew the
      securities described hereinafter (the "SECURITIES") in order to guarantee
      the Credit Facilities:

      CREDIT C

      4.1.1   A first ranking movable hypothec in the amount of CA$ 63,333.33
              charging a deposit registered at the Register of the Personal Real
              Rights Movable on April 7, 2004, under the registration number
              04-0192613-0001;

      ALL CREDIT FACILITIES

      4.1.2   A first ranking movable hypothec in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower
              excluding the intellectual property;

      4.1.3   A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower
              excluding the intellectual property;

      4.1.4   A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower
              excluding the intellectual property;

      4.1.5   A guarantee of Taleo in the amount of CA$ 10,663,333;

      4.1.6   A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable property of Taleo excluding
              the intellectual property;

      4.1.7   A guarantee of White Amber in the amount of CA$ 10,663,333;

      4.1.8   A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of the movable property of White Amber
              excluding the intellectual property;

      4.1.9   A guarantee of 9090 in the amount of CA$ 10,663,333;

      4.1.10  A negative pledge granted by the Borrower, Taleo and White Amber
              on the intellectual property;

      4.1.11  An undertaking of Taleo to make up insufficiency of the debt
              servicing;

      4.1.12  A first ranking movable hypothec in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower;
<PAGE>
                                      -6-

      4.1.13  A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower;

      4.1.14  A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of the Borrower;

      4.1.15  A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of Taleo;

      4.1.16  A first ranking security agreement in the amount of CA$ 10,663,333
              charging the universality of movable assets of White Amber;

      4.1.17  A guarantee in the amount of CA$ 10,663,333 concerning the
              insurance policies of the Borrower and the Intervening Party.

4.2   Notwithstanding any provisions of the security to the contrary, the
      hypothec and security agreements described in subsection 4.1.12, 4.1.13,
      4.1.14, 4.1.15 and 4.1.16 of this agreement will only become in force and
      be registered at the appropriate governmental agencies if the Borrower
      does not successfully complete an initial public offering of a minimum of
      CA$ 25,000,000 net on or before September 30, 2004. In the event of a
      valid registration of the hypothec and security agreements described in
      subsection 4.1.12, 4.1.13, 4.1.14, 4.1.15 and 4.1.16 the Lender agrees to
      discharge and release the hypothec and security agreements described in
      subsection 4.1.2, 4.1.3, 4.1.4, 4.1.6 and 4.1.8.

4.3   In the event that the Borrower and/or the Intervening Party acquire any
      immovable property, the Borrower and/or the Intervening Party agree to
      grant, without delay, the said immovable property in favor of the Lender
      in order to guarantee the reimbursement of the Credit Facilities.

5.    DISBURSEMENT OF THE CREDIT FACILITIES

5.1   The Lender may, in whole and/or in part, retain any advances on the Credit
      Facilities and, at its sole discretion, put a term to the Credit
      Facilities, if in its opinion:

      5.1.1   the Borrower and/or the Intervening Party does not respect the
              commitments, the representations, the securities or one or another
              conditions of the Credit Agreement or of any other documents
              constating the securities guaranteeing the reimbursement of the
              Credit Facilities; or

      5.1.2   the Borrower and/or its default under any provisions of the Credit
              Agreement or of any documents constating one of the Securities; or
<PAGE>
                                      -7-

      5.1.3   a material adverse effect change, be it actual or imminent, may
              happen, the appreciation of which is at the sole discretion of the
              Lender; or

      5.1.4   a pending litigation may have a negative effect on the Borrower's
              property or business.

6.    ADDITIONAL DOCUMENTS AND INFORMATION

6.1   The Borrower agrees to provide to the Lender, upon demand, all the
      documentation and information which may reasonably be required regarding
      the Borrower's business, including notably but not limitatively
      information concerning the respect by the Borrower of the environmental
      regulations.

7.    MISCELLANEOUS

7.1   The Borrower's rights under the Credit Agreement and the Credit Facilities
      can not be transferred without the Lender's previous written
      authorization. Any unauthorized transfer is non-invocable by the Lender
      and is renowned an event of default under the terms of the Credit
      Agreement as well as the documents constating the Securities;

7.2   In addition to the provisions of the Credit Agreement from the first
      disbursement of the Credit Facilities until the full reimbursement of the
      said Credit Facilities, the Borrower will consent to and sign all
      reasonable document and deeds required by the Lender: i) in order to make
      up or renew the Securities; ii) to timely execute its commitments
      following the Credit Agreement and the Accessory Agreements; iii) and if
      the case arises, to notice the potential amendment agreed upon with regard
      to any Credit Facilities granted by the Lender in favor of the Borrower;

7.3   The constating documents of the Securities as well as the Accessory
      Agreements are not supposed to contradict the terms and conditions of the
      Credit Agreement. Therefore, in case of incompatibility between the terms
      and conditions of the Accessory Agreements, the constating documents of
      the Securities and the Credit Agreement prevail over the Accessory
      Agreements and the Credit Agreement prevail over the documents constating
      the Securities;

7.4   Unless the Credit Agreement, the Accessory Agreements or the Securities
      expressly state the opposite, the accounting terms, the financial ratios
      and the calculations are established or, are applied in accordance with
      the accounting principles generally accepted by the Canadian Chartered
      Accountant Institute;

7.5   This agreement is binding for the signatory parties and their successors.
<PAGE>
                                      -8-

7.6   The parties commit themselves to consent, to sign or to do every
      reasonable action required in order to give effect or to complete this
      agreement as well as any other agreements which were referred to
      hereabove.

7.7   The parties hereto have expressly agreed that this agreement and all
      deeds, documents or notices relating thereto be executed in English. Les
      parties aux presentes ont expressement convenu que cet acte et tout autre
      acte, document ou avis y afferent soient rediges en anglais.

8.    INTERVENTION

8.1   The Intervening Party intervenes to this agreement, and by its
      intervention commits itself towards the Lender to execute its obligations
      in accordance with the present Credit Agreement and agrees to make no
      modification to the content of this agreement without obtaining the
      Lender's preliminary writtenconsent.

DULY SIGNED BY THE PARTIES in Quebec City, this May 7, 2004.

THE LENDER:                              THE BORROWER:

NATIONAL BANK OF CANADA                  CORPORATION RECRUITSOFT (CANADA) INC./
                                         RECRUITSOFT (CANADA) CORPORATION INC.

BY:                                      BY:

/s/ Alain Gallichan                      /s/ Jean Lavigueur
--------------------------------------   ---------------------------------------
ALAIN GALLICHAN                          JEAN LAVIGUEUR

/s/ Sylvie Pelletier                     /s/ Sylvie Lauze
--------------------------------------   ---------------------------------------
SYLVIE PELLETIER                         SYLVIE LAUZE

THE INTERVENING PARTY:                   THE INTERVENING PARTY:

TALEO CORPORATION                        9090-5415 QUEBEC INC.

BY:                                      BY:

/s/ Jean Lavigueur                       /s/ Jean Lavigueur
--------------------------------------   ---------------------------------------
JEAN LAVIGUEUR                           JEAN LAVIGUEUR

/s/ Sylvie Lauze                         /s/ Sylvie Lauze
--------------------------------------   ---------------------------------------
SYLVIE LAUZE                             SYLVIE LAUZE
<PAGE>
                                      -9-

THE INTERVENING PARTY:

WHITE AMBER, INC.

BY:

/s/ Jean Lavigueur
--------------------------------------
JEAN LAVIGUEUR

/s/ Sylvie Lauze
--------------------------------------
SYLVIE LAUZE
<PAGE>

                               SECURITY AGREEMENT

AGREEMENT dated as of May 7, 2004, by and between NATIONAL BANK OF CANADA, a
corporation organized under the laws of Canada, having a principal place of
business at 150, boulevard Rene-Levesque East, 19th Floor, Quebec, Province of
Quebec, Canada, G1R 5B1 (hereinafter referred to as the "SECURED PARTY") and
TALEO CORPORATION, a corporation organized under the laws of the State of
Delaware, United States of America, having its head office at 182 Second Street,
5th Floor, San Fransisco, CA 94105 USA (hereinafter sometimes referred to as the
"CORPORATION").

WHEREAS the Secured Party addressed to Corporation Recruitsoft (Canada) Inc. /
Recruitsoft (Canada) Corporation Inc. on April 28th, 2004 an offer to finance
the terms of which have been stated in a confirmatory agreement dated May 7,
2004 (hereinafter collectively called the "CREDIT AGREEMENT");

WHEREAS under the Credit Agreement the Secured Party has agreed to grant notably
an operating credit facility of FIVE HUNDRED THOUSAND CANADIAN DOLLARS (CA$
500,000) and/or the equivalent in US dollars, a demand credit facility which was
originally in the amount of FIVE HUNDRED THOUSAND CANADIAN DOLLARS (CA$
500,000), for which there was an amount of FORTY NINE THOUSAND NINE HUNDRED
NINETY-NINE CANADIAN DOLLARS (CA$ 49,999) still outstanding as of April 28th,
2004, a letter of guarantee of SIXTY THREE THOUSAND THREE HUNDRED THIRTY-THREE
CANADIAN DOLLARS (CA$ 63,333), a term financing of TWO MILLION FIVE HUNDRED
THOUSAND CANADIAN DOLLARS (CA$ 2,500,000) for which there is an amount of TWO
MILLION TWO HUNDRED FIFTY THOUSAND CANADIAN DOLLARS (CA$ 2,250,000) still
outstanding as of April 28th, 2004, a Master Card business purchasing of FOUR
HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 400,000), a term financing of TWO MILLION
FOUR HUNDRED THOUSAND CANADIAN DOLLARS (CA 2,400,000) and/or the equivalent in
US dollars, a demand credit facility of ONE MILLION NINE HUNDRED THOUSAND
CANADIAN DOLLARS (CA$ 1,900,000), a demand credit facility of TWO MILLION SIX
HUNDRED THOUSAND CANADIAN DOLLARS (CA$ 2,600,000) and/or the equivalent in US
dollars, an Exchange Risk Credit of FIVE HUNDRED THOUSAND CANADIAN DOLLARS (CA$
500,000) (the "CREDIT FACILITIES") to Corporation Recruitsoft (Canada) Inc. /
Recruitsoft (Canada) Corporation Inc. (hereinafter called the "BORROWER") for
the purposes described in the Credit Agreement, the Credit Facilities being
guaranteed by the Corporation pursuant to a guarantee for an amount of CA$
10,663,333 (the "GUARANTEE") of even date herewith in favor of the Secured
Party;

<PAGE>
                                                                              /2

WHEREAS the Secured Party agrees to make available the Credit Facilities but
only upon the condition, among others, that the Corporation executes and
delivers to the Secured Party for its benefit this security agreement;

WHEREAS this agreement evidences and sets forth the obligations of the
Corporation with respect to the Guarantee granted by the Corporation in favor of
the Secured Party (hereinafter referred to as the "CORPORATION'S OBLIGATION" and
"GUARANTEE" respectively) with respect to the Credit Agreement;

NOW, THEREFORE, in consideration of these premises and other good and valuable
consideration, the parties hereto agree as follows:

1.       DEFINITION

1.1      "LIABILITY" OR "LIABILITIES" shall mean all the obligations of the
         Corporation to the Secured Party, whether now existing or hereafter
         arising, direct or indirect, fixed or contingent, secured or unsecured,
         matured or unmatured, joint, several or joint and several, arising out
         of or in connection with the Guarantee or any other document executed
         in connection with the Guarantee, and any and all interest,
         commissions, obligations, liabilities, indebtedness, charges and
         expenses direct or indirect, primary, secondary, contingent, joint or
         several which are due or to become due or that may hereafter be
         contracted or acquired of the Corporation to the Secured Party, arising
         out of or in connection with the Guarantee or any other document
         executed in connection with the Guarantee, or on account of any of the
         foregoing and the performance and fulfillment by the Corporation of all
         the terms, conditions, promises, covenants and provisions contained in
         existing documents evidencing or securing the Corporation's Obligation,
         this Agreement, or in any future agreement or instrument between the
         Corporation and the Secured Party relating to the Corporation's
         Obligation or the Guarantee, together with reasonable attorney's fees,
         costs and expenses incurred by the Secured Party in the enforcement of
         its rights under the Corporation's Obligation or this Agreement.

1.2      "OBLIGOR" means the Corporation and the Borrower and, if any debt due
         to Secured Party hereunder is evidenced by a credit agreement, guaranty
         or other instrument, the makers and endorsers thereof.

1.3      "CORPORATION" means Taleo Corporation, with offices at 182 Second
         Street, 5th Floor, San Fransisco, CA 94105 USA, 636 Morris Twinpike,
         Suite 3B, Short Hills, NJ 07078 USA and One Energy Center, 40 Shuman
         Blvd., Suite 301, Naperville, IL 60563 USA.

<PAGE>

                                                                              /3

1.4      "DEFAULT RATE" means that rate established in the Credit Agreement.

1.5      "ADVANCES" shall mean the expenditure of money or incurring of
         obligations by the Borrower in connection with the Credit Agreement.

1.6      "UNIFORM COMMERCIAL CODE" ("UCC") shall mean the Uniform Commercial
         Code of the State of Delaware (except to the extent that the Uniform
         Commercial Code of the State of Delaware requires the application of
         the Uniform Commercial Code of another jurisdiction).

1.7      "CONSENT OF THE SECURED PARTY" means the written consent by an
         Authorized Officer of the Secured Party.

1.8      "ACCOUNTS" means any "Account", as such term is defined in the UCC, now
         or hereafter owned by the Corporation, including, in any event, without
         limitation, any right of the Corporation to payment for goods sold or
         leased or for services rendered which the Corporation may now have or
         hereafter acquire, whether or not such right has been earned by
         performance, including, without limitation, all accounts, accounts
         receivable, book debts, instruments and chattel paper, Credit
         Agreement, drafts, acceptances, payments under leases of Equipment or
         sales of Inventory and other forms of obligations now or hereafter
         received by or belonging or owing to the Corporation for goods sold or
         leased and/or services rendered by it, and all of the Corporation's
         rights in, to and under all purchase orders, instruments, and other
         documents now or hereafter received by it evidencing obligations for
         and representing payment for goods sold or leased and/or services
         rendered, and all monies due or to become due to the Corporation under
         all contracts for the sale or lease of goods and/or the performance of
         services by it, now in existence or hereafter arising, including
         without limitation the right to receive the Proceeds of said purchase
         orders and contracts.

1.9      "CONTRACTS" means all contracts, instruments, undertakings, chattel
         paper, documents or other agreements in or under which the Corporation
         may now or hereafter have any right, title or interest.

1.10     "EQUIPMENT" means any "equipment", as such term is defined in the UCC
         now or hereafter owned by the Corporation and, in any event, including,
         without limitation, all machinery, equipment, furnishings, fixtures,
         and vehicles now or hereafter owned by the Corporation, including,
         without limitation, all items of machinery and equipment of any kind,
         nature and description whether affixed to real property or not, as well
         as trucks and vehicles of every description, trailers, handling and
         delivery equipment, fixtures and office furniture and any and all
         additions to, substitutions for and replacements of or accessions to
         any of the foregoing, wherever located, together with all attachments,
         components, parts (including spare parts), equipment and accessories
         installed thereon or affixed thereto and all fuel for any thereof.

<PAGE>

                                                                              /4

1.11     "GENERAL INTANGIBLES" means any "general intangibles", as such term is
         defined in the UCC, now or hereafter owned by the Corporation and, in
         any event, including, without limitation, all customer lists,
         Trademarks, Patents, rights in intellectual property, licenses, permits
         and copyrights now or hereafter owned by the Corporation.

1.12     "INVENTORY" means any "inventory", as such term is defined in the UCC,
         now or hereafter owned by the Corporation, including, without
         limitation, all inventory, wherever located, now owned or hereafter
         acquired by the Corporation or in which the Corporation now has or
         hereafter may acquire any right, title or interest, including, without
         limitation, all goods and other personal property now or hereafter
         owned by the Corporation which are held for sale or lease or are
         furnished or are to be furnished under a contract of service or which
         constitute raw materials, work in process or materials used or consumed
         or to be used or consumed in the Corporation's business, or in the
         processing, packaging or shipping of the same, and all finished goods.

1.13     "INVESTMENT PROPERTY" means any "investment property", as such term is
         defined in the UCC, now or hereafter owned by the Corporation.

1.14     "PROCEEDS" means "Proceeds", as such term is defined in the UCC and, in
         any event, including, without limitation, the following at any time
         whatsoever arising or receivable (i) whatever is received upon any
         collection, exchange, sale or other disposition of any of the
         Collateral, and any property into which any of the Collateral is
         converted, whether cash or non-cash proceeds, (ii) any and all proceeds
         of any insurance, indemnity, warranty or guarantee payable to the
         Corporation from time to time with respect to any of the Collateral,
         (iii) any and all payments (in any form whatsoever) made or due and
         payable to the Corporation from time to time in connection with any
         requisition, confiscation, condemnations, seizure or forfeiture of all
         or any part of the Collateral by any governmental body, authority,
         bureau or agency (or any person, corporation, agency, authority or
         other entity acting under color of any governmental authority), (iv)
         any claim of the Corporation against third parties for past, present or
         future infringement of any Patent or breach of any Patent License or
         for past, present or future infringement or dilution of, any Trademark
         or for injury to the goodwill associated with any Trademark, or breach
         of any Trademark License and (v) any and all other amounts from time to
         time paid or payable under or in connection with any of the Collateral
         and General Intangibles.

1.15     "PATENTS" mean (i) all letters patent of the United States or any other
         country, and all applications for letters patent of the United States
         or any other country, and (ii) all reissues, continuations,
         continuations-in-part or extensions thereof, in each case now or
         hereafter owned by the Corporation.

1.16     "PATENT LICENSE" mean any written agreement, now or hereafter entered
         into by the Corporation, granting any right to practice any invention
         covered by a Patent.

<PAGE>

                                                                              /5

1.17     "TRADEMARKS" mean (i) all trademarks, trade names, corporate names,
         Corporation names, business names, fictitious business names, trade
         styles, service marks, logos, other source of business identifiers,
         prints and labels on which any of the foregoing have appeared or
         appear, designs and general intangibles of like nature, now existing or
         hereafter adopted or acquired, all registrations and recordings
         thereof, and all applications in connection therewith, including,
         without limitation, registrations, recordings and applications in the
         United States Patent and Trademark Office or in any similar office or
         agency of the United States, any State thereof or any other country or
         any political subdivision thereof, and (ii) all reissues, extensions or
         renewals thereof, in each case now or hereafter owned by the
         Corporation.

1.18     "TRADEMARK LICENSE" mean any written agreement, now or hereafter
         entered into by the Corporation, granting any right to use any
         Trademark.

1.19     "PERMITTED INDEBTEDNESS" means indebtedness secured by a lien permitted
         under clause (d) of the definition of Permitted Liens.

1.20     "PERMITTED LIENS" means (a) liens for taxes not yet delinquent or liens
         for taxes being contested in good faith and by appropriate proceedings
         for which adequate reserves have been established; (b) liens in respect
         of property or assets imposed by law which were incurred in the
         ordinary course of business, such as carriers', warehousemen's,
         materialmen's and mechanics' liens and other similar liens arising in
         the ordinary course of business which are not delinquent or remain
         payable without penalty or which are being contested in good faith and
         by appropriate proceedings; (c) liens incurred or deposits made in the
         ordinary course of business in connection with workers' compensation,
         unemployment insurance and other types of social security, and other
         liens to secure the performance of tenders, statutory obligations,
         contract bids, government contracts, performance and return of money
         bonds and other similar obligations, incurred in the ordinary course of
         business, whether pursuant to statutory requirements, common law or
         consensual arrangements; (d) liens upon any equipment acquired or held
         by the Corporation 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, so long as such lien
         extends only to the equipment financed, and any accessions,
         replacements, substitutions and proceeds (including insurance proceeds)
         thereof or thereto; (e) liens arising from judgments or attachments in
         circumstances not constituting an Event of Default under Section 5.6 of
         this Agreement; (f) liens in favor of customs and revenue authorities
         arising as a matter of law to secure payments of customs duties in
         connection with the importation of goods, (g) liens which constitute
         rights of setoff of a customary nature or banker's liens, whether
         arising by law or by contract; (h) liens on insurance proceeds in favor
         of insurance companies granted solely as security for financed
         premiums; and (i) leases or subleases and licenses or sublicenses
         granted in the ordinary course of the Corporation's business.

<PAGE>

                                                                              /6

1.21     "RELATED COMPANY" means the parent company (other than in reference to
         such parent company) and any of the parent company's wholly-owned
         subsidiaries.

2.       LOANS

2.1      LOAN. The parties hereto acknowledge that funds have been and may
         hereafter be loaned by the Secured Party to the Borrower pursuant to
         the Credit Agreement. The parties further acknowledge that the
         Corporation's undertaking to enter into the Guarantee was a condition
         of the Secured Party's making Advances to the Borrower, is a condition
         of continuing said Advances of credit to the Borrower, and is a
         condition of future Advances of credit to the Borrower.

2.2      EXCESS LOANS. In the event the Secured Party shall make Advances to the
         Borrower for an amount in excess of the face amount indicated in the
         Credit Agreement, or if the Corporation should directly or indirectly
         become indebted to the Secured Party in an amount which is in excess of
         the said amount, the indebtedness shall nevertheless be secured by the
         terms of this Security Agreement up to the amount guaranteed under the
         Guarantee.

2.3      LATE CHARGE AND MATURITY RATE. This Security Agreement shall also be
         deemed to secure Corporation's Obligation to make payments of any and
         all late charges set forth in the Guarantee.

3.       COLLATERAL

3.1      COLLATERAL. As collateral security for the prompt and complete payment
         and performance when due of all the Liabilities and in order to induce
         the Secured Party to enter into the Credit Agreement and make available
         the Credit Facilities to the Borrower in accordance with the terms
         thereof, the Corporation hereby pledges, hypothecates and grants to the
         Secured Party a security interest in all the Corporation's right, title
         and interest in, to and under the following (all of which being
         hereinafter collectively called the "COLLATERAL"):

         (i)      all Contracts;

         (ii)     all Accounts in which the Corporation has any right, title or
         interest, including, without limitation, (A) all moneys due and to
         become due under any Contract, (B) any damages arising out of or for
         breach or default in respect of any such Contract or Account, (C) all
         other amounts from time to time paid or payable under or in connection
         with any such Contract or Account, (D) the right of the Corporation to
         terminate any such Contract or to perform and to exercise all remedies
         thereunder;

<PAGE>

                                                                              /7

         (iii)    all General Intangibles to the exclusion of the intellectual
         property including Trademarks, Patents, Patent Licenses and Trademark
         Licenses without limitation;

         (iv)     all Equipment;

         (v)      all Inventory;

         (vi)     all Investment Property;

         (vii)    all other personal property of the Corporation whether
         tangible or intangible, or whether now or hereafter owned by the
         Corporation and wherever located, including, but not limited to, the
         balance of every deposit account, now or hereafter existing, of the
         Corporation with any lenders and all moneys of the Corporation and all
         rights to payment of money of the Corporation; and

         (viii)   to the extent not otherwise included, all Proceeds and
         products of any or all of the foregoing.

                  Notwithstanding the foregoing, the Collateral shall not be
         deemed to include (i) any copyrights, copyright applications, copyright
         registrations and like protection in each work of authorship and
         derivative work thereof, whether published or unpublished, now owned or
         hereafter acquired; any patents, patent applications and like
         protections including without limitation improvements, divisions,
         continuations, renewals, reissues, extensions and continuations-in-part
         of the same, trademarks, servicemarks and applications therefor,
         whether registered or not, and the goodwill of the business of
         Corporation connected with and symbolized by such trademarks, any trade
         secret rights, including any rights to unpatented inventions, know-how,
         operating manuals, license rights and agreements and confidential
         information, now owned or hereafter acquired; or any claims for damage
         by way of any past, present and future infringement of any of the
         foregoing; or (ii) any equipment or other property financed by a third
         party, provided that such third party's liens are liens of the type
         described in subsection (d) of the definition of Permitted Liens
         provided further that such equipment or other property shall be deemed
         "Collateral" hereunder if such third party's lien is released or
         otherwise terminated

3.2      CONTINUING PERFECTION. The Corporation will perform any and all steps
         requested by the Secured Party to create and maintain in the Secured
         Party's favor a first and valid lien on the Collateral or security
         interest in the Collateral or pledges of Collateral. Such steps
         include, without limitation, the execution, delivery, filing and
         recording of financing statements, notes and any other documents
         necessary, in the opinion of the Secured Party, necessary or advisable
         to secure payment of all Liabilities to the Secured Party.

<PAGE>

                                                                              /8

4.       REPRESENTATIONS, COVENANTS AND WARRANTIES

To induce the Secured Party to enter into this Agreement (and to accept this
Agreement in partial satisfaction of conditions to making Advances pursuant to
the Credit Agreement), the Corporation, covenants and warrants to the Secured
Party (and understands that the Secured Party shall rely thereon) as follows:

4.1      GOOD STANDING. The Corporation is a corporation duly organized, validly
         existing and in good standing under the laws of the State of Delaware
         and is authorized to do business in all states or jurisdictions in
         which it does business. The Corporation is specifically duly authorized
         to do business in and is in good standing under the laws of the State
         of Delaware.

4.2      CORPORATE AUTHORITY. The Corporation has the corporate power to
         execute, deliver and carry out this Agreement and all documents
         referred to herein and contemplated hereby, its board of directors
         (and, to the extent required by law, its stockholders) has duly
         authorized and approved the terms of the transactions described herein
         and the taking of any and all action contemplated herein by the
         Corporation and the consummation of the within transaction does not
         violate any provision of its articles of incorporation, its by-laws, or
         any agreement or undertaking to which the Corporation is a party or by
         which it is bound.

4.3      COMPLIANCE WITH LAW. The execution of this Agreement or any instruments
         or documents supplemental or incidental hereto and performance by the
         Corporation of its obligations hereunder, does not, at the date of
         execution hereof, violate any existing law or regulation or any writ or
         decree of any court or governmental agency or the charter or by-laws of
         the Corporation or any agreement or undertaking to which it is a party
         or by which it is bound Hereafter the Corporation will conduct its
         business in the United States in material compliance with all
         applicable U. S. federal, state and municipal statutes or ordinances
         and regulations.

4.4      NO LITIGATION. There are no judgments against the Corporation as of the
         date of this Agreement and no material litigation or administrative
         proceeding before any governmental body is presently pending now, or to
         the knowledge of Corporation, threatened, against the Corporation or
         any of its property or which could affect the Collateral or the lien
         created hereunder.

4.5      NO FINANCIAL CHANGE. The Corporation has furnished the Secured Party
         with current financial statements. Such financial statements are
         complete and correct and have been prepared in accordance with
         generally accepted accounting principles consistently followed
         throughout the periods specified

<PAGE>

                                                                              /9

         4.5.1    The Corporation warrants that there has been no material
                  adverse change in the financial condition of the Corporation,
                  since the date on which the most recent financial statements
                  of the Corporation were delivered to Secured Party.

         4.5.2    The Corporation has made no investment in, Advances to, or
                  guarantees of the obligations of any Corporation, individual
                  or other entity except (i) those disclosed in the financial
                  statements referred to above, and (ii) the guarantees
                  subsequently simultaneously or hereafter given to the Secured
                  Party.

4.6      TAX COMPLIANCE. The Corporation has filed, or caused to be filed, all
         tax returns required to be filed and has paid all taxes shown to be due
         and payable on said return or on any assessment made against it.

4.7      GOOD TITLE. On the date of the Agreement, the Corporation has good and
         marketable title to the Collateral, none of the Collateral is subject
         to any pledge, lien, security interest, encumbrance, charge or title
         retention or other security agreement or arrangement of any character
         whatsoever, other than Permitted Liens, and the security interest
         granted by the Corporation to the Secured Party herein shall constitute
         valid and enforceable first liens on the Collateral, subject only to
         Permitted Liens.

4.8      PLACE OF RECORDS. The Corporation represents that the offices where it
         keeps its records concerning the Collateral are at its place of
         business located at 182 Second Street, 5th Floor, San Fransisco, CA
         94105 USA. The Corporation will notify the Secured Party promptly in
         writing of any proposed change in location of the place referred to in
         this Paragraph.

4.9      FINANCIAL STATEMENTS AND CERTIFICATE OF NO DEFAULT. The financial
         statements of the Corporation, in form reasonably satisfactory to
         Secured Party, are to be provided to Secured Party as set forth in the
         Credit Agreement.

4.10     INSURANCE. The Corporation agrees to maintain, with financially sound
         and reputable insurers, insurance with respect to its properties and
         business against such casualties and contingencies, of such types
         (including public liability, larceny, embezzlement or other criminal
         misappropriation insurance) and in such amount both reasonably
         acceptable to the Secured Party and as is customary in the case of
         corporations of established reputations engaged in the same or a
         similar business and similarly situated (but not less than, in the case
         of casualty insurance, the fair market value of the insured property).
         If the Corporation fails to take the action called for herein, the
         Secured Party may, after giving the Corporation written notice of such
         failure and a reasonable time to correct same, in its discretion obtain
         insurance covering the Secured Party's interest in the Collateral and
         the amount of the premium for said insurance shall be added to the
         Liabilities of the Corporation to the Secured Party.

<PAGE>

                                                                             /10

         4.10.1     The Corporation will deliver the originals of all such
                    policies (or certificates evidencing insurance if the
                    policies are master policies) to the Secured Party, and not
                    less than fifteen (15) days prior to the expiration date of
                    each such policy, will deliver to the Secured Party a
                    renewal policy or policies (or certificates evidencing
                    insurance if the policies are master policies) marked
                    "premium paid" or accompanied by other evidence of payment
                    satisfactory to the Secured Party, all naming the Secured
                    Party as loss payee.

         4.10.2     All policies shall require that no less than thirty (30)
                    days' written notice of cancellation or material change will
                    be given to the Secured Party. All cost of insurance shall
                    be borne by the Corporation. Renewal policies, together with
                    evidence of payment of premiums, shall be deposited with the
                    Secured Party at least thirty (30) days before the
                    expiration of the prior existing policies. All insurance is
                    required commencing from the date hereof and is to be
                    continued throughout the term of this Agreement. The
                    Corporation shall not violate or permit to be violated any
                    of the conditions of the policies or insurance required to
                    be maintained hereunder.

         4.10.3     Damage to, destruction, or loss of all or any portion of the
                    Corporation's business which adversely affects the
                    Collateral shall not terminate this Agreement or cause any
                    abatement of or reduction in the payments to be made by the
                    Corporation hereunder, or otherwise alter the obligations of
                    the Corporation as set forth herein.

         4.10.4     In the event of any loss or change in circumstances which
                    would materially adversely affect Corporation's Collateral,
                    the Corporation shall give immediate written notice to the
                    Secured Party and shall perform all of its duties and
                    obligations set forth in each such policy. The Proceeds of
                    any insurance policies covering such damage or destruction
                    and shall be paid to the Borrower unless an Event of Default
                    exists, then to Secured Party, unless otherwise agreed to by
                    the Secured Party. The Secured Party shall have the right to
                    adjust losses with insurance companies and to settle or
                    adjudicate claims.

4.11     PAYMENT OF EXPENSES. The Corporation shall pay any and all expenses,
         including reasonable counsel fees and disbursements, filing and
         recording fees, and all other charges and expenses of the Secured Party
         which may be required in connection with the negotiation and processing
         of the within Agreement and the perfection of the security interest
         created hereunder, the enforcement of the Credit Agreement and payment
         of all Liabilities arising with respect hereto.

4.12     INSPECTION. The Corporation will permit any person designated by the
         Secured Party to inspect any properties, corporate books and financial
         records of the Corporation and to discuss the business affairs and
         finances of the Corporation with its principal officers and/or

<PAGE>

                                                                             /11

         its independent accountants, and/or to contact accounts receivable
         Corporations, all at such reasonable times as the Secured Party may
         request.

4.13     MAINTAIN CORPORATE EXISTENCE. The Corporation shall maintain in Good
         Standing, its corporate existence and will not, without the prior
         written Consent of the Secured Party, which consent will not be
         unreasonably withheld, dissolve or liquidate, nor merge or consolidate
         with or acquire or affiliate with any other business entity nor form
         any subsidiary.

4.14     DISCHARGE OF TAXES AND LIENS. The Secured Party may, after giving to
         the Corporation written notice, at its option, discharge any taxes,
         liens, security interests or other encumbrances at any time levied or
         placed on the Collateral and may pay for the maintenance of the
         Collateral and the Corporation will reimburse the Secured Party on
         demand for any payment made or any expense incurred by the Secured
         Party pursuant to the foregoing authority, with interest at the rate
         set forth in the Credit Agreement.

4.15     NOTICE OF ADVERSE CHANGE. The Corporation agrees to inform the Secured
         Party of any material adverse change in its business, including but not
         limited to: strikes; the bankruptcy of an important client or
         supplier; and filing of any lawsuit naming the Corporation in amounts
         exceeding $25,000.00.

4.16     NEGATIVE COVENANTS. So long as the Corporation is indebted to the
         Secured Party hereunder, the Corporation shall not, without the Consent
         of the Secured Party:

         4.16.1     Become liable upon the obligations of any corporation,
                    person or other entity except (i) to the Secured Party, or
                    (ii) as now existing and disclosed in the financial
                    statements previously delivered to the Secured Party.

         4.16.2     Merge with and/or consolidate any of its business operations
                    with another without notifying the Secured Party in writing
                    and obtaining written Consent of the Secured Party to make a
                    decision.

         4.16.3     Sell or dispose of any asset or property other than in the
                    ordinary course of business or to a wholly-owned subsidiary.

         4.16.4     Other than Permitted Liens, pledge or grant any further
                    security interest in the Collateral to any party other than
                    the Secured Party, without the Secured Party's prior written
                    Consent.

         4.16.5     Other than Permitted Indebtedness, incur any indebtedness
                    for borrowed money with any other bank or lending
                    institution or private lender.

<PAGE>

                                                                             /12

         4.16.6     Make loans, Advances or extension of credit to any
                    corporation, person or other entity except extensions of
                    credit, on normal terms, in connection with the sale of
                    products and services; Advances to employees for business
                    purposes if accounted for and repaid in a timely manner, and
                    loans, Advances or extensions of credit between the parent
                    company and any wholly-owned subsidiary or between such
                    subsidiaries.

         4.16.7     Change the principal nature of its business.

         4.16.8     Change its principal places of business or the place of
                    business at which the Collateral is located without prior
                    written notice to Secured Party.

5.       EVENTS OF DEFAULT

The occurrence of any of the following shall constitute an "Event of Default":

5.1      NON-PERFORMANCE. Failure on the part of the Corporation to perform any
         term, covenant or condition contained in this Agreement, the Guarantee
         or in any agreements between the Corporation and the Secured Party made
         with respect to the Credit Facilities within 10 days after written
         notice of such failure from Secured Party.

5.2      MISREPRESENTATION. Any representation or warranty made by the
         Corporation in this Agreement, in any written report, certificate or
         other instrument in writing furnished in connection with the Guarantee
         or in connection with any instrument of security furnished to the
         Secured Party proves to be inaccurate in any substantial and material
         respect as of the date or dates with respect to which it is deemed to
         have been made.

5.3      OTHER SECURITY INTEREST. Failure on the part of the Corporation, after
         written notice from the Secured Party to the Corporation, to take any
         action requested by the Secured Party to perfect or protect the
         security interests provided for herein.

5.4      INSOLVENCY. The Corporation shall have applied for or consented to the
         appointment of a receiver, trustee or liquidator of all or a
         substantial part of its assets; admitted in writing its inability to
         pay its debts as they mature; made a general assignment for the benefit
         of creditors; been adjudicated a bankrupt or insolvent; or filed a
         voluntary petition in bankruptcy, or a petition or an answer seeking
         reorganization or an arrangement with creditors or to take advantage of
         any insolvency law, or an answer admitting the material allegations of
         a petition in any bankruptcy, reorganization or insolvency proceeding,
         or taken corporate action for the purposes of effecting any of the
         foregoing; or an order, judgment or decree shall have been entered,
         without the application, approval or consent of the Corporation by any
         court of competent jurisdiction approving a petition seeking

<PAGE>

                                                                             /13

         reorganization of the Corporation, or appointing a receiver, trustee or
         liquidator of any Obligor, or of a substantial part of its assets and
         such order, judgment or decree shall have continued unstayed and in
         effect for any period of sixty (60) consecutive days; or a petition in
         bankruptcy shall have been filed against the Corporation and shall not
         have been dismissed for a period of sixty (60) consecutive days.

5.5      JUDGMENT OR LIEN. Entry of a judgment(s), issuance or any
         garnishment(s), attachment(s) or distraint(s) in excess of the
         aggregate sum of One Hundred Thousand Dollars ($100,000.00), the filing
         of any lien or of any governmental attachment against any property of
         the Corporation which entry, issuance, attachment or filing shall have
         continued unstayed and in effect for a period of thirty (30) days.

5.6      DEFAULT UNDER OTHER SECURITY INTERESTS - BORROWINGS OR OBLIGATIONS. The
         Corporation is in default under any security agreement permitted by or
         given to the Secured Party covering any of the Collateral provided for
         herein or any other Collateral owned by the Secured Party, which
         default is not cured within any permitted cure period.

6.       CONSEQUENCE OF EVENT OF DEFAULT

In case any Event of Default shall have occurred and be continuing, then and in
every such event of default, the Secured Party may take any or all of the
following actions, either simultaneously or separately:

6.1      ACCELERATION. Declare all Liabilities owing to the Secured Party from
         the Corporation under this Agreement and under the Guarantee to be
         forthwith due and payable, whereupon all such sums shall forthwith
         become due and payable, without presentment, demand, protest or other
         notice of any kind, all of which are hereby expressly waived by the
         Corporation.

         6.1.1    The Secured Party shall have, in addition to all other rights
                  and remedies, the rights and remedies of a secured party under
                  the Uniform Commercial Code, including without limitation, the
                  right to take possession of the Collateral, and for that
                  purpose the Secured Party may, as far as the Corporation can
                  give authority therefor, enter upon any premises on which
                  Collateral may be situated and remove the same therefrom.

6.2      POSSESSION. Proceed with or without judicial process to take possession
         of all or any part of the Collateral provided for herein not already in
         the possession of the Secured Party, and the Corporation agrees that
         upon receipt of notice of the Secured Party's intention to take
         possession of all or any part of said Collateral, the Corporation will
         do everything reasonably necessary to make same available to the
         Secured Party. The Secured Party may require the Corporation upon ten
         (10) days notice to the Corporation to assemble the Collateral and

<PAGE>

                                                                             /14

         Proceeds and make them available to the Secured Party at a place to be
         designated by the Secured Party.

6.3      METHODS OF SALE. So long as the Secured Party acts in a commercially
         reasonable manner, the Secured Party may assign, transfer and deliver
         at any time or from time to time the whole or any portion of the
         Collateral or any rights or interest therein in accordance with the
         Uniform Commercial Code, and without limiting the scope of the Secured
         Party's rights thereunder, the Secured Party may sell the Collateral at
         public or private sale, or in any other manner, at such price or prices
         as the Secured Party may deem best, and either for cash or credit, or
         for future delivery, at the option of the Secured Party, in bulk or in
         parcels and with or without having the Collateral at the sale or other
         disposition. In the event of a sale of the Collateral, Secured Party
         shall give the Corporation at least ten (10) days prior written notice
         of such sale, which notice the Corporation acknowledges is reasonable.
         In the event of a sale of the Collateral, or any other disposition
         thereof, the Secured Party shall apply all Proceeds first to all
         Advances and all costs and expenses of disposition, including
         attorney's fees and then to the Liabilities of the Corporation to the
         Secured Party.

6.4      RETENTION OF COLLATERAL. Elect to retain the Collateral or any part
         thereof in satisfaction of all Liabilities due from the Corporation to
         Secured Party upon notice of such proposed election to the Corporation
         and any other party as may be required by the Uniform Commercial Code.
         The Secured Party may at any time in its discretion transfer any
         securities or other property constituting Collateral into its own name
         or that of its nominee and receive the income thereon and hold the same
         as security for Liabilities or apply it to principal or interest due on
         Liabilities.

6.5      SET-OFF. Secured Party shall have the right immediately, and without
         notice or other action to set-off against any of the Corporation's
         Liabilities to the Secured Party any sum owed by the Secured Party in
         any capacity to the Corporation whether due or not, and Secured Party
         shall be deemed to have exercised such right of set-off and to have
         made a charge against any such sum immediately upon the occurrence of
         such event of default, even though the actual book entries may be made
         at some time subsequent thereto.

6.6      EXPENSES AND ATTORNEY'S FEES. The Corporation shall pay to the Secured
         Party on demand any and all reasonable expenses, including reasonable
         counsel fees, incurred or paid by the Secured Party in protecting or
         enforcing its rights with respect to the Collateral. After deducting
         all of such expenses the residue of any Proceeds of collection or sale
         of Collateral shall be applied to the payment of principal or interest
         on Liabilities in such order or preference as the Secured Party may
         determine, proper allowance for interest on Liabilities not then due
         being made, and any excess shall be returned to the Corporation and the
         Corporation shall remain liable for a deficiency.

<PAGE>

                                                                             /15

6.7      INTEREST. The Corporation shall pay to the Secured Party from and after
         an Event of Default, interest on any Liabilities owed by the
         Corporation at the Default Rate until all such Liabilities are paid to
         the Secured Party.

7.       MISCELLANEOUS

7.1      NO WAIVER. Corporation agrees that no delay on the part of the Secured
         Party in exercising any power or right hereunder shall operate as a
         waiver of any such power or right, preclude other or further exercise
         thereof, or the exercise of any other power or right. No waiver
         whatsoever shall be valid unless in writing signed by the Secured Party
         and then only to the extent set forth therein.

7.2      WAIVER OF NOTICE. Corporation waives presentment, dishonor and notice
         of dishonor, protest and notice of protest of all commercial papers at
         any time held by the Secured Party on which the Corporation is in any
         way liable.

7.3      ONE INSTRUMENT. The provisions of this Agreement will be in addition to
         those of the Credit Agreement or other evidence of Liability held by
         the Secured Party relating to this particular transaction, all of which
         shall be construed as one instrument.

7.4      CHOICE OF LAW. This Agreement and the rights of the parties hereto
         shall be governed by the laws of the State of Delaware except to the
         extent that enforcement of lien claims are governed by the laws of the
         state where the Collateral is located.

7.5      SUCCESSORS OR ASSIGNS. This Agreement shall be binding upon and shall
         inure to the benefit of the parties hereto, their respective successors
         and assigns.

7.6      RIGHTS CUMULATIVE. The rights and remedies herein expressed to be
         vested in or conferred upon the Secured Party shall be cumulative and
         shall be in addition to and not in substitution for or in derogation of
         the rights and remedies conferred upon secured creditors by the Uniform
         Commercial Code or any other applicable law.

7.7      NO ELECTION OF REMEDIES. Nothing herein shall require the Secured Party
         to proceed first under this Agreement to satisfy any Liabilities of the
         Guarantee to the Secured Party and the Secured Party may proceed
         directly against the Corporation under the Guarantee or under this
         Agreement, seriatim or simultaneously, as the Secured Party deems in
         its absolute discretion, and the taking of any one such action shall
         not constitute an election of remedies on its part.

<PAGE>

                                                                             /16

7.8      NOTIFICATION OF DISPOSITION OF COLLATERAL. Any notification of a sale
         or other disposition of the Collateral or of any other action by the
         Secured Party to the Corporation will be sufficient if given personally
         or mailed to the Corporation, by certified mail, at its address set
         forth herein not less than ten (10) days prior to the day on which such
         sales or other disposition will be made, and such notification shall be
         deemed reasonable notice.

7.9      TITLES. The titles and headings indicated herein are inserted for
         convenience only and shall not be considered a part of this Agreement
         or in any way limit the construction or interpretation of this
         Agreement.

7.10     ENGLISH. The parties hereto have expressly agreed that this agreement
         and all deeds, documents or notices relating thereto be executed in
         English. Les parties aux presentes ont expressement convenu que cet
         acte ou tout autre acte, document ou avis y afferent soient rediges en
         anglais.

7.11     PRIOR AGREEMENTS. This Agreement superseded any existing security
         agreement executed by the Corporation in favor of the Secured Party and
         such agreements shall be of no further force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their proper and duly authorized officers as of the day and
year first above written and the parties agree that they intend this Agreement
to be executed and delivered as an instrument under seal.

Attest:                                     NATIONAL BANK OF CANADA

                                            By: /s/ Alain Gallichan
                                                -------------------------------
                                                    Alain GALLICHAN

                                            By: /s/ Sylvie Pelletier
                                                -------------------------------
                                                    Sylvie PELLETIER

Attest:                                     TALEO CORPORATION

                                            By: /s/ Jean Lavigueur
                                                -------------------------------
                                                    Jean LAVIGUEUR

                                            By: /s/ Sylvie Lauze
                                                -------------------------------
                                                    Sylvie LAUZEexhibit10_1

Modification No. 2

Regarding 

Amended and Restated Loan Agreement 

Among 

Certain Lenders,

 HSBC Bank USA, As Agent 

And 

MOOG INC.

        This Modification No. 2 dated as of March 5, 2004 (“Modification”) to the Amended and Restated Loan Agreement dated as of March 3, 2003, as modified by Modification No. 1 thereto dated as of
August 6, 2003 (“Agreement”) is entered into by and among MOOG INC., a New York business corporation (“Borrower”), certain lenders which are currently parties to the
Agreement (“Lenders”), and HSBC BANK USA, a New York banking corporation, as agent for the Lenders (“Agent”). 

RECITALS 

        A.    Borrower has advised the Agent and the Lenders that Borrower has reviewed its capital expenditure plan for the next few years in light of recent events, including the recent acquisition of the
Poly-Scientific business of Litton Systems, Inc. by Moog Components Group Inc. and recent capital lease activity in Italy, and presently anticipates that it will be necessary to increase to $40,000,000 the current $30,000,000 limit on Consolidated
Capital Expenditures in the Agreement, and Borrower has requested that the Agent and the Lenders so modify the Agreement. 

        B.    The Agent and the Lenders are agreeable to the foregoing to the extent set forth in this Modification and subject to each of the terms and conditions stated herein. 

        C.    The Borrower and each of the guarantors under the Agreement (“Guarantors”) will benefit from the modification set forth herein. 

        NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth herein, and of the loans or other extensions of credit heretofore, now or
hereafter made by the Lenders, to, or for the benefit of the Borrower and its Subsidiaries, the parties hereto agree as follows: 

        1.     	Definitions. Except to the extent otherwise specified herein, capitalized terms used in this Modification shall have the
same meanings specified in the Agreement. 

- 2 - 

        2.     	Modification. The Agent and the Lenders hereby modify the Agreement as follows:

                (a) Section 9.10 entitled “Consolidated Capital Expenditures” is deleted in its entirety and replaced with the following: 

  
    

 	“9.10 Consolidated Capital Expenditures. Make Consolidated Capital 
Expenditures, other than for any Permitted Acquisition, exceeding in the aggregate $40,000,000 for the Borrower and all Subsidiaries in any one fiscal year of the Borrower.” 

    

  

                2.1     	Limitation on Modification. The foregoing modification is only applicable and shall only be effective in the specific
instance and for the specific purpose for which made, is expressly limited to the facts and circumstances referred to herein, and shall not operate as (i) a waiver of, or consent to non-compliance with any other provision of the Agreement or any
other Loan Document, (ii) a waiver, amendment or modification of any right, power or remedy of either the Agent or any Lender under the Agreement or any Loan Document, or (iii) a waiver, amendment or modification of, or consent to, any Event of
Default or Default under the Agreement or any Loan Document. 

        3.    	Conditions Precedent. The effectiveness of this Modification is subject to the satisfaction, in form and substance
satisfactory to the Agent, of each of the following conditions precedent: 

                 3.1     	Documentation. The parties hereto shall have duly executed and delivered to the Agent
fourteen (14) duplicate originals of this Modification. 

                 3.2     	No Default. As of the effective date of this Modification, no Default or Event of Default shall have occurred and be
continuing. 

                 3.3     	Representations and Warranties. The representation and warranties contained in Section 4 hereof and in the Agreement shall
be true correct and complete as of the effective date of this Modification as though made on such date. 

                 3.4     	Other. The Agent shall have received such other approvals or documents as any Lender through the Agent may reasonably
request, and all legal matters incident to the foregoing shall be satisfactory to the Agent and its counsel. 

         4.     	Representations and Warranties of Borrower. Borrower hereby represents and warrants as follows: 

- 3 - 

                 4.1     Each of the representations and warranties set forth in the Agreement is true, correct, and complete on and as of the date hereof as though made on the date
hereof, and the Agreement and each of the other Loan Documents remains in full force and effect. 

                 4.2     As of the date hereof, there exists and will exist no Default or Event of Default under the Agreement or any other Loan Document, and no event which, with the
giving of notice or lapse of time, or both, would constitute a Default or Event of Default. 

                4.3     The execution, delivery and performance by the Borrower of this 
Modification is within Borrower’s corporate powers, have been duly authorized by all necessary corporate action, and do not, and will not, (i) contravene Borrower’s certificate of incorporation or bylaws, (ii) violate
any law, including without limitation the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or any rule, regulation (including Regulations T, U or X of the Board of Governors of the Federal Reserve System)
order, writ, judgement, injunction, decree, determination or award, and (iii) conflict with or result in the breach of, or constitute a default under, any material contract, loan agreement, mortgage, deed of trust or any other material instrument or
agreement binding on Borrower or any Subsidiary or any of their properties or result in or require the creation or imposition of any lien upon or with respect to any of their properties. 

                 4.4     	This Modification has been duly executed and delivered by the Borrower and by the Guarantors, and is the legal, valid and binding obligation of the Borrower and
the Guarantors enforceable against the Borrower and each of the Guarantors in accordance with its terms. 

                 4.5     	No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or any other third party is
required for (i) the due execution, delivery or performance by the Borrower and the Guarantors of this Modification or any other agreement or document related hereto or contemplated hereby to which the Borrower or any of the Guarantors is or is to
be a party or is otherwise bound, or (ii) the exercise by the Agent or any Lender of its rights under the Agreement as modified by this Modification. 

 	        5.     	Acknowledgments and Reaffirmations. 

                 5.1     	The Borrower hereby reaffirms the Loan Documents to which it is a party and agrees that such Loan Documents remain in full force and effect. 

                 5.2     	By their signatures below, each of the Guarantors specifically consents to this Modification and reaffirms the continuing effectiveness of its respective guaranty
and general security agreement executed and delivered in connection with the Agreement, and the UCC financing statements filed in connection with the Agreement, and agrees that such guaranty and general security agreement cover payment of any and
all Obligations under the Agreement as modified hereby and under the notes executed and delivered in connection therewith. 

- 4 -

        6.     Other. 

                 6.1     Borrower agrees to pay all out-of-pocket expenses and fees of the Agent in connection with the negotiation, preparation and execution of this Modification
including the reasonable fees and disbursements of counsel to the Agent. 

                 6.2     	This Modification may be executed in any number of counterparts and by the parties hereto on separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute one and the same agreement. 

                 6.3     	This Modification shall be governed by and construed under the internal laws of the State of New York, as the same may be from time to time in effect, without
regard to principles of conflicts of laws. 

         The parties hereto have caused this Modification to be duly executed as of the date shown at the beginning of this Modification. 

	 	
HSBC BANK USA, as Agent and as a Lender 
    
	 	 
	 	
By /s/ William H. Graser
Name: William H. Graser

Title: First Vice President
	 	 
	 	
MANUFACTURERS AND TRADERS TRUST COMPANY 
    
	 	 
	 	
By /s/ Sean V. Timms
Name: Sean V. Timms

    Title:
Vice President
	 	
FLEET NATIONAL BANK 
    
	 	 
	 	
By /s/ John C. Wright
Name: John C. Wright
	 	
Title: Vice President
	 	 
	 	
KEYBANK NATIONAL ASSOCIATION 
    
	 	 
	 	
By /s/ William R. Perkins 
Name: William R.
Perkins

Title: Vice President

  

- 5 -

	 	BANK OF TOKYO-MITSUBISHI
	 	TRUST COMPANY
	 	 
	 	By /s/ Paresh R. Shah
	 	Name: Paresh R. Shah
	 	Title: Vice President
	 	 
	 	PNC BANK, NATIONAL ASSOCIATION
	 	 
	 	By /s/ Stephen W. Boyd
	 	Name: Stephen W. Boyd
	 	Title: Vice President
	 	 
	 	JPMORGAN CHASE BANK
	 	 
	 	By /s/ Michael E. Wolfram
	 	Name: Michael E. Wolfram
	 	Title: Vice President
	 	 
	 	CITIZENS BANK OF PENNSYLVANIA
	 	 
	 	By /s/ Edward J. Kloecker, Jr.
	 	Name: Edward J. Kloecker, Jr.
	 	Title: Vice President
	 	 
	 	COMERICA BANK
	 	 
	 	By /s/ Joel S. Gordon
	 	Name: Joel S. Gordon
	 	Title: Assistant Vice President
	 	 
	 	SOCIETE GENERALE
	 	 
	 	By /s/ Eric E. O. Siebert
	 	Name: Eric E. O. Siebert
	 	Title: Managing Director

	 	   - 6 -
	 	 
	 	 
	 	MOOG INC.
	 	 
	 	By /s/ Robert R. Banta
	 	Name: Robert R. Banta
	 	Title: Executive Vice President
	 	 
	 	MOOG FSC LTD., as a Guarantor
	 	 
	 	By /s/ Timothy P. Balkin
	 	Name: Timothy P. Balkin
	 	Title:  Treasurer
	 	 
	 	MOOG PROPERTIES, INC.,
	 	as a Guarantor
	 	 
	 	By /s/ Timothy P. Balkin
	 	Name: Timothy P. Balkin
	 	Title:  Treasurer
	 	 
	 	MOOG INDUSTRIAL CONTROLS
	 	CORPORATION, as a Guarantor
	 	 
	 	By /s/ Timothy P. Balkin
	 	Name: Timothy P. Balkin
	 	Title:  Treasurer
	 	 
	 	MOOG COMPONENTS GROUP INC.,
	 	as a Guarantor
	 	 
	 	By /s/ Timothy P. Balkin
	 	Name: Timothy P. Balkin
	 	Title:  Treasurer

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