AMERIQUEST TECHNOLOGIES INC, 10-K, 1995-10-13

AMERIQUEST TECHNOLOGIES INC
10-K, 1995-10-13
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the fiscal year ended June 30, 1995

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from ______to _______ .

Commission File No. 1-10397

AMERIQUEST TECHNOLOGIES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

DELAWARE 33-0244136
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION
INCORPORATION OR ORGANIZATION) NUMBER)

3 IMPERIAL PROMENADE, STE. 300 92707
SANTA ANA, CA 92707 (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES)

Registrant's telephone number, including area code: (714) 445-5000

Securities registered pursuant to Section 12(b) of the Act:

TITLE OF EACH CLASS
Common Stock, $.01 par value

NAME OF EACH EXCHANGE ON WHICH REGISTERED
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO
SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES [X] NO

The aggregate market value of the voting stock held by non-affiliates of the
Registrant as of September 29, 1995 is approximately $28,097,429. For purposes
of making this calculation only, the Registrant has defined "affiliates" as
including all officers, directors and beneficial owners of more than 10% of
the outstanding Common Stock of the Registrant.

The number of shares outstanding of the Registrant's Preferred and Common
Stock as of September 29, 1995: Common Stock, $.01 par value, 24,303,572
shares; Preferred Stock, $.01 par value, 2,596,525 shares.

INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM
405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO
THE BEST OF THE REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION
STATEMENTS INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY
AMENDMENT TO THIS FORM 10-K. [X]

Exhibit Index is on page 31.____________________________Page 1 of pages.
<PAGE>

PART I

ITEM 1. BUSINESS.

THE COMPANY

AmeriQuest Technologies, Inc., a Delaware corporation ("AmeriQuest" or the
"Company"), maintains its principal executive offices at 3 Imperial Promenade,
Santa Ana, California, and its telephone number is (714) 445-5000. AmeriQuest
conducts its business through its subsidiaries.

CDS Distribution, Inc., a Delaware corporation ("CDS Distribution") and
AmeriQuest/NCD, Inc., a Florida corporation ("AmeriQuest/NCD") and Robec,
Inc., a Pennsylvania corporation ("Robec") market and sell, as distributors,
hardware products for the personal computer market. AmeriQuest/Kenfil Inc.
("Kenfil"), markets and sells, as a distributor, software products for the
personal computer market. The domestic entertainment software business of
Kenfil was terminated in June 1995, such that its primary business currently
is derived from the sale of application software in Asia.

CMS Enhancements, Inc., a California corporation ("CMS Enhancements") is a
supplier of hard disk drive subsystems for IBM compatible and other leading
personal and business computers, including Apple, Compaq and others. Hard disk
drives allow personal computers, which otherwise often lack sufficient data
storage capacity, to perform many widely used, sophisticated business
applications. CMS Enhancements also offers disk array, magneto optical, CD-
ROM, floppy disk drives and magnetic tape back-up subsystems having a variety
of data storage capacities as well as personal computers, networking,
graphics, communications and connectivity and accessory products.

AmeriQuest currently markets more than 2,000 products to original equipment
manufacturers, value-added resellers and dealers throughout the United States
and in many foreign countries, including national and regional distributors
and large integrators such as Intelligent Electronics and ENTEX.

RECENT DEVELOPMENTS

On August 7, 1995, AmeriQuest Technologies, Inc. ("AmeriQuest") entered into
a purchase agreement with Computer 2000 AG and its wholly-owned subsidiary
Computer 2000, Inc. (herein referred to collectively as "Computer 2000")
pursuant to which, among other things:

1. On August 22, 1995, Computer 2000 exchanged an $18 million Promissory
Note from AmeriQuest 2000, Inc., a wholly-owned subsidiary of
AmeriQuest, in exchange for (i) 810,811 shares of AmeriQuest's Series A
Preferred Stock (convertible into 8,108,110 shares of AmeriQuest Common
Stock upon the authorization of the underlying Common Stock) and (ii)
warrants to purchase 657,289 shares of Series D Preferred Stock
(convertible into 6,572,890 shares of AmeriQuest Common Stock upon the
authorization of the underlying Common Stock) exercisable at $0.50 per
share of the Series D Preferred; and

2. On August 22, 1995, Computer 2000 purchased (i) 1,785,714 shares of
AmeriQuest's Series B Preferred Stock (convertible into 17,857,140
shares of AmeriQuest Common Stock upon the authorization of the
underlying Common Stock) and (ii) warrants to purchase 746,186 shares of
Series D Preferred Stock (convertible into 7,461,860 shares of
AmeriQuest Common Stock upon the authorization of the underlying Common
Stock) exercisable at $.50 per share of Series D Preferred Stock in
consideration of $31.25 million cash; and

3. In consideration for the debt conversion and the additional investment,
Computer 2000 was granted additional pari passu rights with respect to
other warrants and options issued by AmeriQuest, as well as a warrant to
purchase that number of shares equal to the total number of shares of
Common Stock issued and to be issued by AmeriQuest in excess of
2,800,000 shares in the acquisition of Robec, Inc. at an effective price
of $0.05 per share; and

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4. Computer 2000 assumed control of the Board of Directors (five of nine
directors, the Board being expanded to nine directors at that time),
control of the management of AmeriQuest (Chief Executive Officer and
Chief Operating Officer) and ownership of preferred stock which votes
with AmeriQuest's Common Stock with a voting power equal to
approximately 52.7 of all shares entitled to vote on matters presented
to shareholders. (The voting percentage can increase to approximately
62% of AmeriQuest voting shares upon the exercise of the warrants and
options referenced above.)

----------------

AmeriQuest acquired 50.1% of Robec in September 1994. The Amended and
Restated Agreement and Plan of Reorganization (the "Merger Agreement") between
AmeriQuest, Robec and certain principal shareholders of Robec provides that
AmeriQuest must issue additional shares upon the acquisition of the minority
shares pursuant to a merger between Robec and a wholly-owned subsidiary of
AmeriQuest, i.e. RI Acquisition, Inc. The shareholders of Robec approved the
merger on September 27, 1995, and the merger was to close on or before
September 29, 1995. However, due to the adjustment in merger consideration
based on the comparative market values of Robec's common stock in relation to
AmeriQuest Common Stock, the number of shares to be issued under the strict
terms of the Merger Agreement exceeds 20% of the prior outstanding AmeriQuest
Common Stock such that it may be necessary to secure the approval of
AmeriQuest shareholders to comply with New York Stock Exchange requirements
and possibly authorize an increase in authorized shares of AmeriQuest Common
Stock before the merger can be consummated. No assurance can be given as to
the likelihood or timing of the completion of the Robec merger.

----------------

In June 1995 Kenfil terminated its entertainment and educational software
business, such that Kenfil is now engaged primarily in the distribution of
business applications, utilities, graphics and communication software to the
Asian market.

----------------

At various dates during fiscal year 1995 and continuing into September 1995,
AmeriQuest was in default to its primary lender due to noncompliance with
certain financial ratio and covenant compliance. In October 1995, the Company
received waivers from its primary lender for non-compliance of the financial
covenants of the NCD credit agreement. The Company has also amended its credit
agreements covering its remaining borrowings to remove the financial covenants
which the Company was not in compliance with on June 30, 1995, pending
renegotiation of the financial covenants. The amendment also allows the lender
to cancel the credit agreement with 60 days notice. No assurance can be given
that AmeriQuest's primary lender will continue to forbear collection of the
debt owed to it. At October 13, 1995, AmeriQuest, through AmeriQuest/NCD, had
approximately $8 million available under its existing credit facilities based
upon then available collateral.

The Company is in the process of negotiating the refinancing of its credit
agreements. Management expects that the Company will complete this refinancing
by December 31, 1995. Management believes that improvements in operating cash
flows resulting from cost containment activities together with available
borrowings on current credit agreements and the expected refinancing will
allow the Company to meet its obligations and capital needs as they arise
through June 30, 1996.

AMERIQUEST DISTRIBUTION

CDS Distribution and AmeriQuest/NCD (collectively referred to hereinafter as
"AmeriQuest Distribution") are national valued-added wholesale distributors of
microcomputers and related products to value-added resellers ("VARs"), dealers
and computer retailers. AmeriQuest Distribution markets, sells and supports a
variety of products ranging from individual components, which are typically
sold in volume, to complete systems that have been fully configured, assembled
and tested prior to delivery to its customers. Strategy has been to emphasize
the sale of these complete systems and to provide a high level of value-added
services, including consultation on component selection and system
configuration and provision of system assembly and testing and technical
support services.

Vendors include leading manufacturers such as IBM, AST, NEC, Acer, Altos,
Western Digital, Telebit, and Multi-tech Systems. AmeriQuest Distribution
focuses its marketing efforts on the products of a limited number

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of key vendors in order to become one of the leading distributors for each of
its principal vendors. This enables AmeriQuest Distribution to develop product-
specific technical expertise that enhances its value-added support services.
AmeriQuest Distribution attempts to minimize competition among vendors'
products while maintaining some overlap to provide protection against product
shortages or discontinuations.

Price discounting by its competitors has forced AmeriQuest Distribution to
reduce its prices, resulting in deteriorating gross margins for commodity
products. The effects of such price discounting on the Company are reflected in
the periodic net sales and gross margins as reflected elsewhere herein.
AmeriQuest Distribution is pursuing a broad restructuring program which
includes, among other items cost reductions, the closing of certain offices and
warehouse locations, downsizing of the employee base, consolidation of
inventory and a change in emphasis among the methods by which sales are
obtained.

Products

AmeriQuest Distribution seeks to maintain products from nationally-recognized
vendors that provide all the components most VARs require to fully configure
their computer systems. All new products are extensively tested prior to
inclusion in AmeriQuest Distribution's distribution network.

The following is a description of the major categories of products currently
sold by AmeriQuest Distribution and the principal current vendors of those
products.

Microcomputers--AmeriQuest Distribution distributes desktop and portable
personal computers and multiuser microcomputers manufactured by Acer, Altos,
IBM, and AST.

Printers--AmeriQuest Distribution distributes a broad line of dot matrix,
laser and ink-jet printers manufactured by Lexmark, Canon and Citizen.

Monitors and Terminals--AmeriQuest Distribution distributes monitors and
terminals manufactured by CTX, Goldstar, AOC and Viewsonic.

Local Area Networks--A local area network ("LAN") permits microcomputers to
communicate with one another and to function on an integrated basis. AmeriQuest
Distribution distributes LAN software and specialized hardware products
manufactured by C Net, Microdyne and N.D.C.

Accessories and Supplies--AmeriQuest Distribution distributes hard and floppy
disk drives, board products, diskettes, stand-by power supplies, modems and
other communications products, accessories and supplies manufactured by
numerous companies including Boca Research, IBM, CMS, American Power, Tripplite
and Epson.

Vendor Relations

To maintain a strong relationship with its principal vendors, AmeriQuest
Distribution focuses on marketing the products of a limited number of key
vendors. AmeriQuest Distribution selects its product line to minimize
competition among vendors' products while maintaining some overlap to provide
protection against product shortages or discontinuations. In addition,
AmeriQuest Distribution enhances its relationship with its vendors by providing
feedback on products, assisting in new product development, working with
vendors to develop marketing programs and offering vendors the opportunity to
provide seminars to AmeriQuest Distribution's customers at AmeriQuest
Distribution facilities.

AmeriQuest Distribution, like most hardware distributors, sells products
throughout the United States for vendors on a non-exclusive basis without
geographic restrictions. AmeriQuest Distribution has distribution agreements
with most of its vendors and believes they are in the form customarily used by
each vendor and generally contain provisions which allow termination by either
party upon as little as 30 days' notice. Most of AmeriQuest Distribution's
major distribution agreements provide price protection by giving AmeriQuest
Distribution a credit, subject to specified limitations, in the amount of any
price reductions by the vendor between the time of the initial sale to
AmeriQuest Distribution and the subsequent sale by AmeriQuest Distribution to
its

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customer. Most of the major distribution agreements also give AmeriQuest
Distribution qualified return privileges on slow-moving inventory. AmeriQuest
Distribution's distribution agreements do not restrict AmeriQuest Distribution
from selling similar products manufactured by competitors. Any minimum purchase
provisions in AmeriQuest Distribution's distribution agreements are at levels
that AmeriQuest Distribution believes do not impose significant risk.

From time to time, the demand for certain products sold by AmeriQuest
Distribution exceeds the supply available from the vendor. AmeriQuest
Distribution believes that its ability to compete has not been adversely
affected to a material extent by these periodic shortages, although sales may
be adversely affected for an interim period. In order to limit the impact of
such shortages, AmeriQuest Distribution generally attempts to include
comparable products from more than one vendor in its product line and endeavors
to provide direction to its customers in their selection of products.

Sales and Distribution

AmeriQuest Distribution has divided its sales operations into five domestic
and three international regions, each covering a geographical section of the
country. Compensation is based, in part, on the gross profits generated from
sales. The regional manager is a technically-trained salesperson and is
responsible for opening new accounts and serving all established accounts in
the manager's customer base. AmeriQuest Distribution also utilizes volume sales
specialists at its offices who sell largely through telemarketing.

Customer orders are generally made by a toll-free telephone call to a sales
representative in AmeriQuest Distribution's sales offices, and the order is
entered onto AmeriQuest Distribution's computer system. The sales
representative has access to available information on inventory and customer
credit status and, upon reviewing this data, can enter the order immediately.
Shipment is usually made the same day, except on orders that require assembly
and testing. Customers also may pick up their orders at the designated
warehouse. All orders are handled on a prepayment, COD or credit basis
depending on the customer's creditworthiness and previous payment history. In
addition, AmeriQuest Distribution assists some resellers in obtaining equipment
financing through third-party floor planning programs.

AmeriQuest Distribution permits the return of products within certain time
limits and under certain conditions subject to a restocking charge, provided
that the products are unused. Products that are defective upon arrival are
handled on a manufacturers' warranty return basis without any restocking
charge.

AmeriQuest Distribution estimates that a majority of its sales are to VARs
and value-added dealers. No customer has accounted for more than 10% of
AmeriQuest Distribution's net sales during 1995, 1994 or 1993. Sales by
AmeriQuest Distribution are not seasonal to any material extent. Because of
AmeriQuest Distribution's prompt delivery times, it maintains no substantial
backlog of orders.

KENFIL

International Operations and Sales

AmeriQuest Distribution serves the international market place, primarily
South America, through its regional office and warehouse in Miami, Florida.
This business represents over 20% of total sales, and is a vital part of
AmeriQuest's growth strategy.

ROBEC

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The shareholders of Robec approved the merger on September 27, 1995, and the
merger was to close on or before September 29, 1995. However, due to the
adjustment in merger consideration based on the comparative market values of
Robec's common stock in relation to AmeriQuest Common Stock, the number of
shares to be issued under the strict terms of the Merger Agreement exceeds 20%
of the prior outstanding AmeriQuest Common Stock such that it may be necessary
to secure the approval of AmeriQuest shareholders to comply with New York
Stock Exchange requirements and possibly authorize an increase in authorized
shares of AmeriQuest Common Stock before the merger can be consummated. No
assurance can be given as to the likelihood or timing of the completion of the
Robec merger.

The predecessor of Robec, Inc. ("Robec") was incorporated in Nevada in 1977.
On August 16, 1989, this predecessor company was merged into a new
Pennsylvania corporation to form Robec. The authorized capital stock of Robec
consists of 10 million shares of Common Stock, $.01 par value per share, and 5
million shares of Preferred Stock, $.01 par value per share. In October 1989,
Robec completed the initial public offering of its Common Stock, receiving net
proceeds of approximately $12.7 million through the sale of 1,350,000 shares
of Common Stock. The net proceeds of the public offering were used to repay
bank borrowings, part of which were incurred to fund a dividend paid to
shareholders of record prior to the offering in connection with the
termination of Robec's status as a corporation subject to taxation under
Subchapter S of the Code. In February 1990, Robec acquired certain assets and
assumed certain liabilities of J. Crew, Inc., doing business as Electronic
Marketing Specialists, Inc., which was engaged in the distribution of
microcomputers.

Robec is primarily a national valued-added wholesale distributor of
microcomputers and related products to value-added resellers ("VARs"), dealers
and computer retailers and primarily operates in this one business segment.
Robec markets, sells and supports a variety of products ranging from
individual components, which are typically sold in volume, to complete systems
that have been fully configured, assembled and tested prior to delivery to its
customers. Robec's historic strategy has been to emphasize the sale of these
complete systems and to provide a high level of value-added services,
including consultation on component selection and system configuration and
provision of system assembly and testing and technical support services. As a
result of competitive pressures, reduced profit margins and the way in which
other, similar distributors have changed their businesses, Robec is now
placing more emphasis on telemarketing as its primary sales method. Robec also
provides a variety of training programs and educational seminars designed to
enhance its customers' technical capabilities. In March 1994, Robec began, in
respect to new customers, to discontinue its maintenance services and sales of
spare parts and supplies for microcomputers and related products. Robec
believes that the discontinuation of these services will not have a material
effect on its inventory or results of operations.

Robec's vendors include leading manufacturers such as Acer, Altos, Digi-
Board, Fujitsu, IBM, Okidata, Multi-tech Systems, Samsung, Texas Instruments,
Unisys and Wyse. Robec focuses its marketing efforts on the products of a
limited number of key vendors in order to become one of the leading
distributors for each of its principal vendors. This enables Robec to develop
product-specific technical expertise that enhances its value-added support
services. Robec attempts to minimize competition among vendors' products while
maintaining some overlap to provide protection against product shortages or
discontinuations.

Products

Robec seeks to maintain products from nationally-recognized vendors that
provide all the components most VARs require to fully configure their computer
systems. All new products are extensively tested prior to inclusion in Robec's
distribution network.

The following is a description of the major categories of products currently
sold by Robec and the principal current vendors of those products.

Microcomputers--Robec distributes desktop and portable personal computers
and multiuser microcomputers manufactured by Acer, Altos, IBM, Trigem and
Unisys.

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Printers--Robec distributes a broad line of dot matrix, laser and ink-jet
printers manufactured by Citizen, Fujitsu and Okidata.

Monitors and Terminals--Robec distributes monitors and terminals
manufactured by Acer, CTX, Link, Orchestra, Qume, Relisys, Samsung, Unisys and
Wyse.

Local Area Networks--A LAN permits microcomputers to communicate with one
another and to function on an integrated basis. Robec distributes LAN software
and specialized hardware products manufactured by Computone, Digi-Board, D-
Link, Samsung and Unisys. Many of these products are offered with Novell,
Moses Computers or EMEX software.

Accessories and Supplies--Robec distributes hard and floppy disk drives,
board products, diskettes, stand-by power supplies, modems and other
communications products, accessories and supplies manufactured by numerous
companies including Boca Research, Mountain Computer, Multi-Tech Systems, UDS
and 3M.

Software--Robec sells a variety of operating system and LAN software
products generally as part of its systems sales. Robec has also commenced the
sale of certain applications software. Among the manufacturers of these
software products are SCO, Data Access and Novell.

Vendor Relations

To maintain a strong relationship with its principal vendors, Robec focuses
on marketing the products of a limited number of key vendors. Robec selects
its product line to minimize competition among vendors' products while
maintaining some overlap to provide protection against product shortages or
discontinuations. In addition, Robec enhances its relationship with its
vendors by providing feedback on products, assisting in new product
development, working with vendors to develop marketing programs and offering
vendors the opportunity to provide seminars to Robec's customers at Robec
facilities.

Robec, like most hardware distributors, sells products throughout the United
States for vendors on a non-exclusive basis without geographic restrictions.
Robec has distribution agreements with most of its vendors and believes they
are in the form customarily used by each vendor and generally contain
provisions which allow termination by either party upon as little as 30 days'
notice. Most of Robec's major distribution agreements provide price protection
by giving Robec a credit, subject to specified limitations, in the amount of
any price reductions by the vendor between the time of the initial sale to
Robec and the subsequent sale by Robec to its customer. Most of the major
distribution agreements also give Robec qualified return privileges on slow-
moving inventory. Robec's distribution agreements do not restrict Robec from
selling similar products manufactured by competitors. Any minimum purchase
provisions in Robec's distribution agreements are at levels that Robec
believes do not impose significant risk.

From time-to-time, the demand for certain products sold by Robec exceeds the
supply available from the vendor. Robec believes that its ability to compete
has not been adversely affected to a material extent by these periodic
shortages, although sales may be adversely affected for an interim period. In
order to limit the impact of such shortages, Robec generally attempts to
include comparable products from more than one vendor in its product line and
endeavors to provide direction to its customers in their selection of
products.

Competition

Competition in the distribution of microcomputer products is intense.
Principal national distributors are Ingram Micro D, Inc., Merisel, Inc. and
Tech Data Corporation. AmeriQuest Distribution and Robec also compete with
numerous manufacturers, resellers, retailers and regional distributors. Most
of AmeriQuest Distribution's and Robec's major competitors have substantially
greater financial resources than AmeriQuest Distribution or Robec, even on a
combined basis.

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Competition is primarily based upon availability of product, price, speed of
delivery, convenience, technical support and other support services.
AmeriQuest Distribution believes that it is generally competitive with respect
to each of these factors and that its principal, competitive advantages are
its technical support and other support services, and speed of delivery.

The software distribution industry is highly competitive. Competition within
the industry is based primarily on price and product availability, and to a
lesser extent on the speed of delivery and the level of marketing and other
services provided. Certain of Kenfil's competitors have substantially greater
financial resources than Kenfil. Kenfil's principal competitors include
international distributors such as Ingram Micro Inc. and Merisel, Inc., both
of which distribute hardware products in addition to software. Because of the
intense competition within the industry, software distributors, including
Kenfil, have low gross and operating margins. Consequently, Kenfil's
profitability is highly dependent upon effective management and control of
costs.

The manner in which microcomputer software products are distributed and sold
is changing, and new methods of distribution may emerge or expand. Software
publishers have sold, and may intensify their efforts to sell, their products
directly to resellers and end-users, including certain major reseller
customers of Kenfil. From time to time certain publishers have instituted
programs for the direct sale of large-order quantities of software to major
corporate accounts, and these types of programs may continue to be used by
various publishers. In addition, certain major publishers have implemented
programs for master copy distribution of software (site licensing). These
programs generally grant an organization the right to make any number of
copies of software for distribution within the organization provided that the
organization pays a fee to the publisher for each copy made. Also, publishers
may attempt to increase the volume of software products distributed
electronically to end-user's microcomputers. These factors, among others, led
the Company's decision to terminate its entertainment software business.

Employees

As of September 30, 1995, AmeriQuest had 89 full-time employees, exclusive
of those persons employed by its subsidiaries, as identified below.

As of September 30, 1995, CMS Enhancements, Inc. had 34 full-time employees.

As of September 30, 1995, AmeriQuest Distribution had 171 full-time
employees, including 13 persons employed overseas. None of AmeriQuest
Distribution's employees are covered by a collective bargaining agreement.
AmeriQuest Distribution considers its relations with its employees to be good.

As of September 30, 1995, Kenfil had 74 full-time employees, all of which
are overseas personnel.

As of September 30, 1995, Robec had 129 full-time employees, including 79
persons employed in sales, sales support and marketing functions. None of
Robec's employees are covered by a collective bargaining agreement. Robec
considers its relations with its employees to be good.

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ITEM 2. PROPERTIES.

AMERIQUEST

AmeriQuest's principal offices are located in leased facilities in Santa
Ana, California. AmeriQuest, CDS Distribution and Kenfil are all housed
primarily in this facility, which consists of approximately 55,000 square feet
of office space, which occupy two floors of an eleven story office building.
The principal offices for CMS Enhancements, Inc. are located in a 62,428
square foot, single level office/warehouse facility in Anaheim, California.

AmeriQuest's distribution facilities previously were located in Irvine,
California and Wilmington, Ohio. The inventory previously maintained in
Irvine, California was relocated to Anaheim, California. Inventory for CDS
Distribution previously maintained in Wilmington, Ohio was relocated to an
AmeriQuest/NCD warehouse facility in Elk Grove Village, Illinois. Kenfil
products continue to be stored and shipped from Wilmington, Ohio. Presently,
there are a total of six warehouse distribution locations for AmeriQuest. One
of the six is located in Horsham, Pennsylvania, in a Robec facility. All
facilities are leased.

ROBEC

Robec's executive, administrative and main sales offices are located in
Robec's facility in suburban Philadelphia, Pennsylvania. This facility
consists of 36,000 square feet of office space and 69,000 square feet of
warehouse space. The current owner of this facility is a partnership
affiliated with the management of Robec.

Robec's branch offices generally consist of between 900 and 10,200 square
feet of office space, depending on market size. The Atlanta branch was
relocated to a 79,587 square foot facility in Lawrenceville, Georgia in July
1995. This facility is currently leased by AmeriQuest. Robec occupies
approximately 15,000 square feet of warehouse space and 3,000 square feet of
office space. The move was made as a planned consolidation of two facilities
located in the Atlanta area. Robec's branch offices are equipped with
standardized telephone, security and computer systems which Robec installs and
programs.

Robec leases all of its offices, two of which are leased from partnerships
affiliated with the management of Robec. The leases generally provide for a
base minimum rental per square foot. In addition, Robec is generally
responsible for its pro rata share of maintenance expenses for common areas,
real estate taxes and insurance. Robec is evaluating its current needs for
branch offices and expects to reduce both the number and sizes of its branch
offices during 1995. Robec's current leases generally permit the early
termination of the lease upon payment of a penalty equal to the amount of one
year's rent. If Robec should desire to extend any of the current leases, Robec
believes that extensions on satisfactory terms, or alternative locations,
generally would be available, although there can be no assurance that Robec
would be able to negotiate further extensions of any particular lease.

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SUMMARY TABLE

The following table sets forth information regarding the regional offices of
AmeriQuest and its subsidiaries.

<TABLE>
<CAPTION>
LOCATION SQUARE FEET LEASE EXPIRATION YEAR OPENED
-------- ----------- ---------------- -----------
<C> <S> <C> <C> <C>
AmeriQuest: Santa Ana, CA............ 55,000 3/31/06 1995
Anaheim, CA.............. 62,248 2/28/00 1995
Miami, FL................ 30,000 2/1/99 1995
Hollywood, FL............ 15,418 8/31/97 1995
Hollywood, FL............ 15,887 8/31/97 1994
Lawrenceville, GA........ 79,587 2/14/00 1995
Chicago, IL.............. 44,760 9/30/95 1995
Visalia, CA.............. 46,800 3/ /99 1994
Van Nuys, CA............. 21,829 7/31/95 1992
Hollywood, FL............ 3,963 9/30/97 1995
Alpharetta, GA........... 1,924 6/1/99 1994
Westboro, MA............. 7,800 1/31/97 1993
Hauppauge, NY............ 2,000 1/31/99 1994
Dallas, TX............... 13,520 3/31/96 1993
Robec: Boston, MA............... 15,100 2/28/99 1994
Chicago, IL.............. 1,775 12/31/95 1988
Kansas City, MO.......... 977 6/30/98 1993
Reston, VA............... 300 mo.to mo. 1984
Horsham, PA.............. 110,000 12/1/96 1978
Salt Lake City, UT....... 2,300 12/31/95 1990
Youngstown, OH........... 6,640 12/31/95 1993
</TABLE>

ITEM 3. LEGAL PROCEEDINGS.

AmeriQuest is both a plaintiff and defendant from time-to-time in lawsuits
incidental to its business. The management of AmeriQuest believes that none of
such current proceedings individually or in the aggregate, will have a
material adverse effect on AmeriQuest.

While not expected to be of material effect to the Company, Kenfil Inc. vs.
RLI Insurance Company, Superior Court of the State of California, County of
Los Angeles, No. BC 108564 filed July 12, 1994, involves litigation instituted
by Kenfil Inc. to recover additional monies for the damage it incurred in the
Northridge earthquake of January 17, 1994. The defendant cross-claimed on
August 12, 1994 for return of the $840,000 it had paid on claims submitted by
Kenfil Inc., based on affidavits from former Kenfil employees alleging that
they had been instructed following the earthquake to intentionally destroy
additional inventory. The defendant's theory is that it is not obligated to
even cover that portion of the damage cause by the earthquake because of the
possible fraud involved with such actions; while the management of Kenfil
maintains that only that portion of damages actually incurred by the
earthquake were submitted as claimed losses. There exists a question of fact
as to whether the actions of Kenfil's employees were instigated by upper-level
management and a question of law as to whether the managers of Kenfil are able
to take ultra vires actions which can be attributed to Kenfil. The testimony
to date appears fragmented and uncorroborated, such that a close examination
of the evidence deduced to date reveals no clear evidence that would allow one
to conclude that the defendant was in any way defrauded. Additionally, it
appears that the defendant insurance company failed to terminate the contract
upon discovery of the alleged "fraud," and merely chose to not renew the
contract upon its expiration. Although there are pictures available to prove
the actual damage immediately following the earthquake, no assurance can be
given that the defendant will not ultimately prevail. The ability of Kenfil
Inc. to satisfy any possible future judgement is dependent on the results of
its future operations. However, such a judgement would not directly impact the
other subsidiaries of AmeriQuest nor AmeriQuest itself.

10
<PAGE>

Richard M. Terrell, et al. vs. AmeriQuest Technologies, Inc., was filed
December 20, 1994 in the Circuit Court of the State of Oregon for the County
of Washington, Case No. C941228CV. The Company learned by happenstance during
the week of May 11, 1995 that default judgments in the amount of $15.9 million
were entered against it and its former Chief Executive Officer in the Circuit
Court of Washington County, Oregon on February 17, 1995 in favor of certain
shareholders of defunct Microware Corporation ("Microware"). The lawsuit
relates to the Company's decision not to proceed with the acquisition of
Microware in early 1993. The judgement has since been vacated. In the opinion
of management the suit is without merit. The Plaintiffs' claims are premised
on a Share Exchange Agreement dated January 14, 1993 by and between the
Company and the Plaintiffs, which was terminated on January 21, 1993 in light
of an ever continuing and accelerating deterioration in the operations of
Microware, which the Company believed to constitute a "material adverse
change" under the Share Exchange Agreement.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

On September 12, 1994, the shareholders of Kenfil and AmeriQuest approved
the proposed merger of "AmeriQuest/Kenfil Inc.," a wholly-owned subsidiary of
AmeriQuest, with and into Kenfil Inc. (the "Merger"). The Merger has since
become effective, and AmeriQuest is now the sole shareholder of
AmeriQuest/Kenfil Inc. In connection with the Merger, AmeriQuest issued
1,046,252 shares of its Common Stock to the Kenfil minority shareholders,
1,894,360 shares to the holders of Kenfil Inc's subordinated debt and
2,788,353 shares to Kenfil Inc's vendors. The vote on this matter was
6,636,184 shares FOR, 21,000 shares AGAINST and 2,815 shares ABSTAINED.

In order to accommodate the Merger, the shareholders of AmeriQuest also
approved an amendment to AmeriQuest's Certificate of Incorporation to increase
the number of authorized shares of Common Stock of AmeriQuest from 10,000,000
shares to 30,000,000 shares. The vote on this matter was 6,875,775 shares FOR,
25,129 shares AGAINST and 3,997 shares ABSTAINED. A total of 11,005,625 shares
were outstanding and entitled to vote on the record date.

ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT.

The following table sets forth certain information regarding the current
officers of AmeriQuest.

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<C> <C> <S>
Steve DeWindt.... 40 Chairman of the Board of Directors and Chief
Executive Officer
Mark Mulford..... 41 Director, President and Chief Operating Officer
Donald Resnick... 52 Chief Financial Officer
Dennis Fairchild. 45 Chief Accounting Officer
</TABLE>

The officers are elected by the Board of Directors and serve at the
discretion of the Board of Directors, subject, however, to the provisions of
their employment agreements, which generally provide for severance payments in
the event of termination for other than "cause," as defined in each employment
agreement. The severance rights range from one to two years of salary, during
which time they are prohibited from competing with AmeriQuest or its
subsidiaries.

Steve DeWindt (age 40) has served as one of four Co-Presidents of Computer
2000 and head of Group Sales & Marketing for Computer 2000 since May, 1992. He
is responsible for the geographic regions of Northern Europe, North America
and the Middle East. Prior to his affiliation with Computer 2000 Mr. DeWindt
served as Director of worldwide sales for the reseller channel at Intel from
May, 1984 to April, 1992. Mr. DeWindt also served as Director of Business
Affairs and International Marketing for the Records and Music Publishing Group
of the Walt Disney Company from June, 1979 to March, 1983. Mr. DeWindt holds
an Masters in Business Administration from the University of California at Los
Angeles ("UCLA").

11
<PAGE>

Mark Mulford (age 41) has served for the last nine years with Frontline
Distribution Ltd., Computer 2000's largest foreign subsidiary, which conducts
business in the United Kingdom, most recently as Managing Director. Mr.
Mulford holds a degree in Chemistry from Oxford University. Mr. Mulford is a
Chartered Accountant.

Donald Resnick (age 53) joined AmeriQuest as interim President in July 1995
and became Chief Financial Officer upon the consummation of the Computer 2000
purchase on August 22, 1995. Mr. Resnick was Chief Operating Officer of NCD
from August 1994 to June 1995. From June 1990 to August 1994 he was engaged in
various venture capital activities. From 1978 to June 1990 he served as the
International Chief Financial Officer for Digital Equipment Corporation and
the Executive Vice President for Schweber Electronics. Mr. Resnick has degrees
from New York University, Adelphi University and the Wharton School University
of Pennsylvania. Mr. Resnick is a Certified Public Accountant.

Dennis Fairchild (age 45) joined AmeriQuest upon its acquisition of NCD in
November 1994. Mr. Fairchild has served as Chief Financial Officer of NCD
since January 1994. From March 1990 to December 1993, Mr. Fairchild was a
partner in Coral Springs Connections, the owner of Southwest Frozen Foods, and
served as Chief Financial Officer of Southwest Frozen Foods. Mr. Fairchild
holds a Bachelor of Science degree in Accounting from Man Kato State
University. Mr. Fairchild is a Certified Public Accountant and a CMA.

12
<PAGE>

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The following table sets forth the market prices for the shares of Common
Stock of AmeriQuest. The prices reflect the high and low closing prices quoted
on the New York Stock Exchange for each calendar quarter since December 31,
1993.

AMERIQUEST

<TABLE>
<CAPTION>
1993 HIGH LOW
---- ----- ---
<S> <C> <C>
First Quarter.................................................... 3 3/8 2
Second Quarter................................................... 3 5/8 2
Third Quarter.................................................... 3 1/4 2
Fourth Quarter................................................... 5 3/4 2 1/2
<CAPTION>
1994
----
<S> <C> <C>
First Quarter.................................................... 6 4 1/8
Second Quarter................................................... 4 1/8 3
Third Quarter.................................................... 4 1/4 3 1/8
Fourth Quarter................................................... 4 2 5/8
<CAPTION>
1995
----
<S> <C> <C>
First Quarter.................................................... 3 1/4 2 1/2
Second Quarter................................................... 3 1/4 1 3/4
Third Quarter.................................................... 2 1/8 1 1/8
</TABLE>

On September 30, 1995, the stock of AmeriQuest closed at $1.25 per share on
the New York Stock Exchange. As of that date AmeriQuest had approximately
1,045 shareholders of record.

ITEM 6. SELECTED FINANCIAL DATA.

The following selected consolidated financial data has been derived from and
should be read in conjunction with the audited consolidated financial
statements of AmeriQuest, and the notes thereto, and with "Management's
Discussion and Analysis of Results of Operations and Financial Condition",
included elsewhere herein and incorporated herein by this reference (dollars
in thousands, except per share data).

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
-------------------------------------------------------
1995 1994 1993 1992 1991
---------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net sales (1)........... $416,571 $87,593 $73,082 $115,053 $130,062
Income (loss) before
taxes................... (67,566) (7,971) 236 (9,623) (12,027)
Net income (loss) (2)... (67,566) (7,971) 236 (8,893) (8,501)
Earnings (loss) per
share (2)............... (3.76) (1.33) 0.08 (3.04) (2.89)
Total assets............ 128,008 65,145 20,274 23,522 40,747
Long-term obligations... 24,515(3) 3,442 1,817 274 1,851
Stockholders' equity
(deficit)............... (25,709) 12,875 8,644 7,952 16,806
Weighted average shares
outstanding............. 17,993,440 5,973,511 3,060,908 2,921,588 2,941,666
</TABLE>
- ------
(1) The sales increase in 1995 was due primarily to acquisitions. The sales
increase in 1994 compared to 1993 was largely due to the initiation of a
broader distribution strategy. Year to year sales declines from 1991 to
1993 were principally due to an eroding customer base and reduced emphasis
on commodity products.

(2) The losses in 1995 were impacted by the Company's decision to terminate
the entertainment software business and costs incurred to integrate prior
acquisitions. Losses in 1994, 1992 and 1991 related principally to
corporate restructurings in 1994 and 1992 and erosion of the customer base
in 1991 to 1993 not offset by operating cost decreases.

(3) Includes the $18 million advance from Computer 2000 related to its equity
investment (see Note 8 to the Consolidated Financial Statements) and $5.8
million associated with the issuance of 6.8 million shares of the
Company's common stock required to complete the Robec merger (see Note 2
to the Consolidated Financial Statements).

13
<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION.

BUSINESS STRATEGY

AmeriQuest is in a single line of business, namely the distribution of
personal and other computing hardware and to a lesser extent software
products. AmeriQuest has followed a business strategy of growth by
acquisition, consistent with the consolidation that is occurring in the
maturing personal computer marketplace. For this strategy to be successful,
the Company must:

. Integrate the operations of Robec

. Combine the business cultures of diverse operations

. Obtain adequate capital resources to fund working capital required for
continuing operations

During the last half of fiscal 1994 and through fiscal 1995, the Company
completed the acquisitions of several regional distributors, Kenfil, Inc.,
NCD, Inc. and 50.1 percent of Robec, Inc. This completes the Company's
currently planned acquisitions except for the remaining 49.9 percent interest
in Robec, Inc. which management expects to complete in the first half of
fiscal 1996. During the fourth quarter of fiscal 1995 in anticipation of the
completion of Computer 2000's equity investment and with input from Computer
2000's management, the Company made the decision to terminate its
entertainment software business which was a substantial portion of Kenfil
Inc.'s U.S. operations. (See a further discussion below.) The Company still
operates Kenfil's application software distribution business in Asia.

The following reflects the net changes in each specified account as regards
to the implementation of the business strategy of the Company:

<TABLE>
<CAPTION>
INCREASE (DECREASE)
DURING THE YEAR
ENDED JUNE 30,
-----------------------
1995 1994
COMPARED TO COMPARED TO
1994 1993
----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Sales
Due to acquisitions................................... $333,016 $14,267
Continuing operations................................. (4,038) 244
Net change............................................ 328,978 14,511
Gross Profit
Due to acquisitions................................... 14,519 771
Continuing operations................................. (11,338) 256
Net change............................................ 3,181 1,027
</TABLE>

SIGNIFICANT FISCAL 1995 NET LOSS

The Company incurred significant losses during fiscal 1995 related to
acquired operations. The most substantial portion of this loss, $30.1 million,
resulted from the decision to terminate Kenfil's entertainment software
business ($20.3 million related to the write-off of intangible assets and $9.8
million of reserves to write down inventory to liquidation value and customer
and vendor receivables to their recoverable value). Additional operating
losses of $8.1 million were incurred to integrate operations, systems and
business practices, as well as consolidate warehouse facilities, reduce
headcount and eliminate redundant regional distribution operations. These
costs are summarized below:

<TABLE>
<S> <C>
Termination of entertainment software business:
Intangible write-off............................................... $20,339
Asset write-offs................................................... 9,800
Integration of acquired hardware distribution companies:
Intangible write-off............................................... 3,438
Property and equipment write-offs.................................. 2,183
Severance.......................................................... 2,500
-------
$38,260
=======
</TABLE>

14
<PAGE>

In addition to operating losses incurred directly related to current year
acquisition activity, significant operating losses were incurred at the
Company's CDS, NCD and Robec subsidiaries. These operating losses resulted
from significant competitive pricing pressures reducing sales prices and gross
margins, pre-integration operating costs related to redundant warehouse
facilities and personnel and, inventory write-downs due to elimination of
targeted product lines, loss of certain vendors and a fourth quarter
liquidation strategy required to raise sufficient levels of operating cash
flow (see liquidity section below).

In the fourth quarter of fiscal 1995, in anticipation of the completion of
Computer 2000's equity investment and with input from Computer 2000's
management, AmeriQuest management decided to refocus the strategic direction
of the Company. The new strategic direction is focused upon the higher margin
computer hardware and value-added manufacturing segments of the Company's
business. As such, the decision was made to terminate Kenfil's entertainment
software business.

Operating results from Kenfil's entertainment software business during
fiscal year 1995 are as follows (in thousands):

<TABLE>
<S> <C>
Net sales............................................................ $25,051
Gross margin......................................................... 3,677
Intangible write-off................................................. 20,339
Net loss............................................................. 25,885
</TABLE>

NET SALES

During the years ended June 30, 1995 and 1994, with emphasis upon a broader
based distribution strategy, net sales increased 373% and 20%, respectively,
as contrasted with the prior year. The majority of these sales increases were
directly associated with the operations of acquired businesses. AmeriQuest has
also emphasized value-added assembly of certain products, limited in fiscal
year 1995 and 1994 to mass storage devices.

Net sales at NCD and Robec during fiscal 1995 are below their pre-
acquisition levels experienced during comparable periods in the prior year.
This is due to significant competitive pricing pressures, lost product lines
and lost volume directly related to the Company's sales force integration
efforts.

An integral aspect of AmeriQuest's business is to exchange products sold to
customers which are either incompatible units or do not work for a variety of
technical and other reasons. If such products are ultimately determined to be
defective, AmeriQuest, under contract terms with its vendors, is able to
return such products to its vendors. Under such exchange arrangements
AmeriQuest's economic risk is nominal and generally limited to the costs of
freight and technical services, both current period charges to expense. An
aggregate warranty and returns reserve of approximately $2 million is
reflected in the balance sheet of AmeriQuest at June 30, 1995.

COST OF SALES AND GROSS PROFIT

Gross margin and operating results were negatively impacted during fiscal
1995 by significant costs and management efforts focused on the integration of
the acquired businesses. Gross margin has also been negatively impacted by
high levels of sales returns and very competitive pricing in its software and
certain

15
<PAGE>

regional hardware distribution businesses along with inventory losses of $17
million related primarily to the elimination of certain product lines, loss of
certain vendors and a fourth quarter liquidation strategy to raise sufficient
levels of operating cash flow.

The Company's gross margins also declined during fiscal 1994 and 1993 as
compared to prior periods due to intense price erosion on many AmeriQuest
product lines.

AmeriQuest anticipates that it will continue to experience downward pressure
on gross margins due to industry price competition. Although AmeriQuest
expects that it will be able to continue to reduce selling, general and
administrative expenses as a percentage of sales, no assurance can be given as
to whether such reductions will, in fact, occur or as to the actual amount of
any such reductions. To the extent gross margins continue to decline and the
Company is not successful in increasing sales and, reducing selling, general
and administrative expenses as a percentage of sales, the Company will
experience further negative operating results.

AmeriQuest manages its inventories by maintaining sufficient quantities to
achieve high order fill rates while at the same time attempting to stock only
those products in high demand with a rapid turnover rate. Inventory balances
will fluctuate as the Company adds new product lines and when appropriate,
makes large purchases from manufacturers when the terms of such purchases are
considered advantageous. The Company's contracts with certain vendors provide
price protection and stock return privileges to help reduce the risk of loss
to the Company due to manufacturer price reductions and slow moving or
obsolete inventory. In addition, the Company has the right to return a certain
percentage of purchases, subject to certain limitations.

In general, vendors provide various incentive programs to the Company. The
funds received under these programs are determined based on purchases and/or
sales of the vendors' product and the performance of certain training,
advertising and other market development activities. Revenue associated with
these funds is recorded when earned either as a reduction of selling, general
and administrative expenses or product cost, according to the specific nature
of the program. Market development funds received from vendors aggregated $2.7
million in fiscal year 1995 and were immaterial in fiscal years 1994 and 1993.

OPERATING EXPENSES

For the years ended June 30, 1995, 1994 and 1993, selling, general and
administrative expenses were approximately 13%, 16% and 14% of net sales, as
AmeriQuest expanded its employee base and acquired new facilities to support
additional product lines to accommodate revenue growth. During fiscal 1995,
the Company wrote off intangibles of $23.8 million associated with the
decision to terminate its entertainment software business and the elimination
of certain redundant regional distribution businesses. In addition, the
Company incurred significant costs associated with the closure of redundant
warehouse facilities and the reduction of personnel. The Company also wrote
off a significant amount of customer receivables related to the termination of
its entertainment software business and recorded bad debt reserves related to
lower volume and higher credit risk customers. In 1994 AmeriQuest restructured
its operations and related charges aggregated $5.7 million. The components of
the restructuring charge are as follows (dollars in thousands):

<TABLE>
<S> <C>
Employee terminations................................................ $ 500
Facilities abandonment............................................... 300
Discontinued product lines........................................... 4,900
------
$5,700
======
</TABLE>

As this restructuring was initiated in the middle of the fiscal year 1994,
the efforts were largely completed by year end and the related expenditures
were largely incurred at that date. The discontinued product lines related to
the then direct manufacture of personal computers utilizing proprietary design
features.

OPERATING RESULTS

The annual and quarterly operating results of the domestic operations of the
Company during the three years ended June 30, 1995, have varied considerably
due to the acquisition of distribution companies and a reduced emphasis on
manufacturing for all but mass storage assembly of disk drives.

16
<PAGE>

INTEREST EXPENSE

Interest expense increased during the years ended June 30, 1995, and 1994 to
1.5% and .8%, respectively, of net sales, as a result of AmeriQuest's reliance
on its bank line of credit to finance increased accounts receivable and
inventories. During the year ended June 30, 1993 interest expense was .5% of
net sales.

INCOME TAXES

In the years ended June 30, 1995, 1994 and 1993 no income tax expense
resulted due to losses or the availability of tax operating loss carry
forwards.

INFLATION

To date, AmeriQuest has not been significantly affected by inflation.
Moreover, technological changes in the electronics industry have generally
resulted in price reductions, despite increases in certain costs which may be
affected by inflation. In addition, many electronic components of comparable
quality can currently be purchased outside of the United States at favorable
prices.

LIQUIDITY AND CAPITAL RESOURCES

During fiscal year 1995, the Company has generated cash to meet its
operating needs by sales of common stock, subordinated indebtedness and bank
borrowings. At June 30, 1995, the Company had $970,000 in cash and had
borrowed approximately $73 million against its existing lines of credit.
During fiscal year 1995, the Company used $43.6 million of cash in operating
activities, compared to the use of $8.4 million in operating activities in the
prior year. The significant amount of cash used in operating activities
resulted from operating losses, investments of approximately $6 million in
business integration activities associated with the current year acquisitions,
conversion of approximately $13.3 million of trade payables into borrowings
under the Company's line of credit facility and investment in working capital
required to support the significant increase in business volume associated
with the acquired distribution companies. At June 30, 1995, the Company
incurred a net loss of $67.6 million, had a stockholders' deficit of $25.7
million and a working capital deficit of $21.4 million.

In November 1994, AmeriQuest and Computer 2000 entered into an agreement
pursuant to which Computer 2000 agreed to invest approximately $50 million in
AmeriQuest in exchange for a majority ownership interest in Ameriquest. Under
the agreement Computer 2000 initially loaned AmeriQuest $18 million. In August
1995, Computer 2000 exchanged the $18 million notes and provided the Company
with additional cash proceeds of approximately $31 million in exchange for the
issuance by AmeriQuest of certain shares of AmeriQuest's preferred stock,
convertible into common stock and warrants, all subject to adjustment for
certain defined activities (see Note 3 of the Notes to Consolidated Financial
Statements). Further, as consideration for Computer 2000's exchange of the
notes of $18 million and Computer 2000's additional investment of $31 million,
AmeriQuest also granted to Computer 2000 certain pari passu rights with
respect to other outstanding warrants, options and other rights to acquire
shares of AmeriQuest's common stock that AmeriQuest has previously granted, or
is obligated to grant in the future, to others. After the completion of the
Computer 2000 equity investment, Computer 2000's ownership of the Company
approximated 51 percent. Computer 2000 holds warrants allowing it to increase
its ownership in the Company to approximately 61 percent. The Company used
these proceeds to repay trade debt and borrowings under its line of credit
agreements.

In addition to the additional equity capital provided by Computer 2000, the
Company has begun a program to reduce operating costs through the closure of
unprofitable field sales offices and the consolidation of distribution
warehouses and the elimination of duplicate labor and non payroll operating
costs. In addition,

17
<PAGE>

administrative costs have been reduced through the flattening of the Company's
management structure. Management is continuing these cost reduction
activities. Further cost reductions should also result through the elimination
of duplicate administration and other operating costs once the Robec merger is
complete.

The Company maintains lines of credit with financial institutions which in
the aggregate provide for revolving credit of over $80 million at June 30,
1995 including a $20 million facility extended to Robec, Inc. Current lines of
credit totaling $27.5 million expire on December 31, 1995 relate to NCD.

Borrowings under these facilities are limited to a contractual percentage of
eligible inventories and receivables. At June 30, 1995, all inventories and
accounts receivable were pledged as collateral under these facilities and the
lenders hold liens on substantially all of the other assets owned by the
Company. The terms of the lending agreements include certain restrictive
covenants which require the maintenance of specified financial covenants
generally related to tangible net worth, working capital and total debt to
tangible net worth. Borrowings under these lines bear interest from 1 to 3
percent over the prime rate and are limited to specified percentages of
AmeriQuest's eligible accounts receivable (a borrowing base in excess of $27.5
million) and inventories (a borrowing base of over $27.5 million). At various
dates during fiscal year 1995 and continuing at September 1995, the Company
was in default to its primary lender due to noncompliance with certain
financial ratio and other covenant compliance. In October 1995, the Company
received a waiver from its primary lenders for non-compliance of the financial
covenants of the NCD credit agreement. The Company has also amended its credit
agreements covering its remaining borrowings to remove the financial covenants
which the Company was not in compliance with at June 30, 1995, pending
renegotiation of the financial covenants. The amendment also allows the lender
to cancel the credit agreement with 60 days notice. At September 30, 1995,
AmeriQuest, through NCD, had approximately $8 million available under its
existing credit facilities based upon then available collateral.

The Company is in the process of negotiating the refinancing of its credit
agreements. Management expects that the Company will complete this refinancing
by December 31, 1995. Management believes that improvements in operating cash
flows resulting from the cost containment activities discussed above, together
with available borrowings on current credit agreements and the expected
refinancing will allow the Company to meet its obligations and capital needs
as they arise through June 30, 1996.

Cash utilized in operations was approximately $8.4 million in fiscal 1994
and $1.2 million in fiscal 1993. In 1994 and 1993 property purchases were
limited to approximately $1.5 million and $1.3 million, respectively. Bank
borrowings increased by approximately $23 million in 1994, principally
utilized to fund acquired assets. Borrowings in 1993 were highly variable and
did not exceed $3.6 million during the year.

In 1995 and 1994 proceeds from stock issuances supplemented borrowed
resources and were largely required to complete the business acquisitions of
AmeriQuest and fund operations.

In August 1995 the Company sold its Singapore subsidiary ("CMS Singapore")
to a former officer and director of the Company. The Company exchanged all of
the stock of CMS Singapore for 350,000 shares of the Company's previously
issued common stock. The consideration received for CMS Singapore is
approximately equal to its net book value.

18
<PAGE>

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The financial statements, notes thereto, and the report of independent
public accountants thereon are included herein. Supplementary data, including
quarterly financial information, is included following the financial
statements.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

None

19
<PAGE>

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

The following table sets forth certain information regarding the current
directors and officers of AmeriQuest.

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<C> <C> <S>
Chairman of the Board of Directors and Chief Executive
Steve DeWindt..... 40 Officer
Harry Krischik.... 44 Co-Chairman of the Board of Directors
Marc L. Werner.... 38 Vice-Chairman of the Board of Directors
Mark Mulford...... 41 Director, President and Chief Operating Officer
Klaus J.M. Laufen. 52 Director
Holger Heims...... 32 Director
Harold L. Clark... 59 Director
Stephen G. Holmes. 49 Director
Donald Resnick.... 53 Chief Financial Officer
Dennis Fairchild.. 45 Chief Accounting Officer
</TABLE>

Dr. Harry Krischik (age 44) has served as one of the Co-Presidents of
Computer 2000 for more than the last five years, with responsibility for the
areas of logistics, electronic data processing and human resources. He also
has regional responsibility for Southern Europe and Latin America.

Marc L. Werner (age 38) has been employed by Werner Co. since 1986, and
currently serves as President and Director for Werner Financial, Inc. and
various companies affiliated with Werner Co. Mr. Werner is a Certified Public
Accountant, and holds a Bachelor of Science degree in Accounting from Northern
Illinois University.

Klaus J. M. Laufen (age 52) has served as one of the Co-Presidents of
Computer 2000 for more than the last five years, with responsibility for the
areas of finance, group investments and investor relations.

Holger Heims (age 32) has served with Computer 2000 since October, 1991,
most recently as Director of Investments, Tax & Legal. From May, 1989 to
October, 1991 he was a partner in the firm of Heims Tax Consultants. Mr. Heims
has a Masters of Business Administration degree from Munich University.

Harold L. Clark (age 59) was named President and Chief Executive Officer of
AmeriQuest on December 3, 1993. He was appointed to serve as a director on
March 4, 1994 and resigned as President and Chief Executive Officer on August
22, 1995. Prior to December 1993 he served as President and Chief Executive
Officer of CDS Distribution, Inc., a subsidiary of AmeriQuest, from April 1993
to December 1993. From February 1991 to December 1992, he served as President,
Chief Operating Officer and Director of Everex Systems, Inc. (L"Everex"). From
1989 through 1991, he served as a computer industry consultant. From 1984 to
1989, he served as the President of Ingram Micro, Inc. Dr. Clark received a
B.S. Degree from Bryant College, an MBA from Pepperdine University, and has
earned a Doctor of Education Degree from Nova University.

Stephen G. Holmes (age 49) joined AmeriQuest as its Chief Financial Officer,
Secretary and Treasurer in January 1992, after serving as a general partner
and a managing partner of Arthur Andersen & Co. from 1978 until 1992. Mr.
Holmes was appointed to serve as a Director on March 4, 1994. Effective August
22, 1995 Mr.

20
<PAGE>

Holmes is a consultant to AmeriQuest. Mr. Holmes was educated at the
University of Colorado and the University of Rochester, from which he received
a B.S. degree, and is licensed to practice as a Certified Public Accountant in
the State of California and other states.

21
<PAGE>

ITEM 11. EXECUTIVE COMPENSATION.

The following table provides information concerning the annual and long-term
compensation of the Chief Executive Officer of AmeriQuest and each of the four
other highest paid executive officers who served as such at the end of fiscal
year 1995 and for two of the other highest paid executive officers who had
left AmeriQuest prior to the end of fiscal year 1995 for services rendered to
AmeriQuest and its subsidiaries in all capacities during the fiscal years
1995, 1994 and 1993.

<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION(1) COMPENSATION
--------------------------- ------------
STOCK OPTION
AWARDS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS (SHARES)(2) COMPENSATION
- --------------------------- --------------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Harold L. Clark......... 1995 $ 214,117 0 200,000shs.(2) 0
Chief Executive Officer 1994 $134,861(3) 0 250,000shs.(2) 0
1993 $ 18,000(3) 0 0 0
Stephen G. Holmes....... 1995 $155,769 0 50,000shs.(2) 0
Secretary/Treasurer 1994 $130,819 0 100,000shs.(2) 0
Chief Financial Officer 1993 $100,000 0 0
Peter S.H. Grubstein.... 1995 $162,500 0 0 0
Senior Vice President 1994 0 0 0 0
1993 0 0 0 0
Howard B. Crystal....... 1995 $148,942 0 100,000shs.(2) 0
Senior Vice President--
Operation 1994 0 0 0 0
1993 0 0 0 0
Peter D. Lytle.......... 1995 $100,000 0 40,000shs.(2) 0
Senior Vice President--
Operations 1994 56,140 0 0 0
1993 0 0 0 0
Irwin Bransky(4)........ 1995 $271,631 0 0 0
Former President 1994 0 0 0 0
and Chief Executive
Officer of
Kenfil Inc. 1993 0 0 0 0
Carol L. Miltner(5)..... 1995 $184,560(5) 0 0 0
Executive Vice 1994 $ 75,000 $28,125 100,000shs.(5) 0
President--Sales and
Marketing 1993 0 0 0 0
</TABLE>
- --------
(1) In fiscal years 1995, 1994 and 1993, no executive officer received
perquisites or other personal benefits, securities or property which
exceeded the lesser of $50,000 or 10% of such executive officer's salary
and bonus.
(2) Stock awards were made during fiscal 1995 to Messrs. Clark and Holmes at
$2.50 per share, with the par value being paid in cash and the balance
represented by non-interest bearing Promissory Notes in the amounts of
$498,000 and $124,500, respectively. Stock options awarded in fiscal 1995
and 1994 were non-qualified stock options exercisable at $3.15 and $2.00
per share, respectively, and are subject to the approval of shareholders.
(3) Includes compensation received as a consultant in the applicable period in
the amounts of $59,861 and $18,000, respectively.
(4) Irwin Bransky left AmeriQuest in February, 1995.
(5) Carol Miltner left AmeriQuest in March, 1995. A consulting fee of $75,000
was paid at that time to The Consulting Group, which is wholly-owned by
Ms. Miltner, and the options subject to her Employment Agreement were
deemed to be fully vested, exercisable at $2.00 per share.

22
<PAGE>

OPTION GRANTS

The following table provides, as to the Chief Executive Officer and each of
the four other highest paid executive officers who served as such at the end
of fiscal year 1995 and for two of the other highest paid executive officers
who had left AmeriQuest prior to the end of fiscal year 1995, information
concerning individual grants of stock options made during fiscal year 1995.

<TABLE>
<CAPTION>
% OF TOTAL POTENTIAL REALIZABLE VALUE
NO. OF OPTIONS AT ASSUMED ANNUAL RATES
SECURITIES GRANTED TO OF STOCK APPRECIATION
UNDERLYING EMPLOYEES EXERCISE FOR OPTION TERM(4)(5)
OPTIONS IN FISCAL PRICE EXPIRATION ---------------------------
NAME GRANTED YEAR 1995 (PER SHARE) DATE 0% 5% 10%
- ---- ---------- ---------- ----------- ---------- ---------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Harold L.Clark (1)...... 0 0 0 -- $0 $ 0 $ 0
Stephen G. Holmes (1)... 0 0 0 -- $0 $ 0 $ 0
Peter S.H. Grubstein.... 0 0 0 -- $0 $ 0 $ 0
Howard B. Crystal....... 100,000(2) 100% $3.15 7/14/2000 $0 $110,000 $240,000
Peter D. Lytle.......... 0 0 0 -- $0 $ 0 $ 0
Irwin Bransky........... 0 0 0 -- $0 $ 0 $ 0
Carol L. Miltner (3).... 0 0 0 -- $0 $ 0 $ 0
</TABLE>
- --------
(1) Stock awards were made during fiscal 1995 to Messrs. Clark and Holmes at
$2.50 per share, with the par value being paid in cash and the balance
represented by non-interest bearing Promissory Notes in the amounts of
$498,000 and $124,500, respectively. The Notes are due September 30, 1996.
(2) The options granted are non-qualified stock options which vest in 25%
increments every 14 months, with the first 25% scheduled to vest on
September 14, 1995. Messrs. Crystal and Lytle left AmeriQuest at the end
of July, 1995, and received severance payments equal to ten months salary
in the amounts of $125,000 and $110,417, respectively. Additionally, the
options earlier granted were deemed to be fully vested, exercisable at
$3.15 per share and $2.00 per share respectively, but must be exercised
within 90 days after the execution of the severance agreements.
(3) Carol Miltner left AmeriQuest in March, 1995. A consulting fee of $75,000
was paid at that time to The Consulting Group, which is wholly-owned by
Ms. Miltner, and the options subject to her Employment Agreement were
deemed to be fully vested, exercisable at $2.00 per share.
(4) The potential realizable values shown in these columns illustrate the
results of hypothetical annual rates of appreciation compounded annually
from the date of grant until the end of the option term, assuming an
initial investment equal to the aggregate exercisable price shown for the
option grant. These amounts are reported net of the option exercise price
(which may be paid by delivery of already-owned shares of Common Stock),
but before any taxes associated with the exercise or subsequent sale of
the underlying shares.
(5) The dollar amounts in these columns are based on the hypothetical annual
rates of appreciation noted and are therefore not intended to forecast
possible future appreciation, if any, of the price of AmeriQuest's Common
Stock. Alternative formulas for determining potential realizable value
have not been utilized because AmeriQuest is not aware of any formula
which will determine with reasonable accuracy a present value based on
future unknown or volatile factors. There can be no assurance that the
dollar amounts reflected in these columns will be achieved. Actual gains,
if any, on stock option exercises are dependent on the future performance
of the Common Stock and overall market conditions, as well as the
executive officer's continued employment through the vesting period.

23
<PAGE>

OPTION EXERCISES AND FISCAL YEAR-END VALUES

The following table provides, as to the Chief Executive Officer of
AmeriQuest and each of the four other highest paid executive officers who
served as such at the end of fiscal year 1995 and for two of the other highest
paid executive officers who had left AmeriQuest prior to the end of fiscal
year 1995, information concerning unexercised stock options at June 30, 1995.
None of the executive officers exercised any stock options during fiscal year
1995.

<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
AT JUNE 30, 1995 JUNE 30, 1995(1)
------------------------- -------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Harold L. Clark............. 62,500 187,500 shs. $ 7,813 $23,438
Stephen G. Holmes........... 35,000 75,000 shs. 9,375 9,375
Peter S.H. Grubstein........ 0 0 0 0
Howard B. Crystal........... 0 100,000 shs 0 0
Peter D. Lytle.............. 40,000 0 $ 2,500 2,500
Irwin Bransky............... 0 0 0 0
Carol L. Miltner............ 100,000 0 $12,500 0
</TABLE>
- --------
(1) Based on the closing price of AmeriQuest's Common Stock on the New York
Stock Exchange onJune 30, 1995.
(2) Carol Miltner left AmeriQuest in March, 1995. A consulting fee of $75,000
was paid at that time toThe Consulting Group, which is wholly-owned by Ms.
Miltner, and the options subject to her Employment Agreement were deemed
to be fully vested, exercisable at $2.00 per share.

COMPENSATION OF OUTSIDE DIRECTORS

AmeriQuest paid Messrs. Walker T. Walker, Jr. and William N. Silvis $2,500
per quarter in their capacities as outside directors during fiscal 1995.
AmeriQuest has and will continue to pay the expenses of itsnon-employee
Directors in attending Board meetings. All directors are also eligible to
receive stock and/or stock options as a form of compensation.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During the fiscal year ended June 30, 1993 AmeriQuest granted options to
each of Messrs. Walker and Silvis to purchase 5,000 shares of AmeriQuest's
Common Stock at $1.50 per share. Such options were originally due to vest over
a three-year period; however, on December 3, 1993 the Board resolved that such
options should immediately vest, and be increased to 20,000 shares each
exercisable at $1.875 per share. Mr. Silvis has exercised his option in full,
but Mr. Walker still holds his option. On October 14, 1994, the Board resolved
to grant Messrs. Walker and Silvis additional three-year options relating to
15,000 shares each, exercisable at $3.375 per share. The proposal to adjust
the stock options arrangements in favor of Messrs. Walker and Silvis and the
grant of new options was proposed by new directors without regard to any
compensation that might be paid to others pursuant to recommendation of the
Compensation Committee. Additionally, on July 28, 1995, the Board resolved to
cancel the options outstanding in favor of Messrs. Walker and Silvis in the
respective amounts of 35,000 and 15,000 shares, respectively, and granted to
such individuals fully-paid shares in such amounts in recognition of their
long-standing service to AmeriQuest.

On March 4, 1994, the independent members of the Board of Directors
authorized AmeriQuest to grant five-year, non-qualified stock options to Mr.
Terren S. Peizer and Manufacturers Indemnity and Insurance Company of America
in the amounts of 400,000 shares and 150,000 shares, respectively, as
additional incentive for Messrs. Terren S. Peizer and Marc L. Werner to assist
AmeriQuest with its avowed policy of growth by acquisition. The options vested
when AmeriQuest's operations attained a sales "run rate" of $300 Million per
year. The exercise price is $4.50 per share.

24
<PAGE>

On October 14, 1994, Manufacturers Indemnity and Insurance Company of
America paid $456,000 for(i) 190,000 shares of AmeriQuest Common Stock and
(ii) a warrant to acquire an additional 190,000 shares of AmeriQuest Common
Stock, initially exercisable at $3.50 per share and subsequently adjusted to
$2.22 per share. Manufacturers indemnity and Insurance Company of America's
purchase was part of a private placement in October, 1994 to a larger group of
investors that provided funds necessary for AmeriQuest to acquire NCD. Also,
on October 14, 1994, Manufacturers Indemnity and Insurance Company of America
acquired 200,000 shares of AmeriQuest Common Stock in consideration of a
promise to pay $2.50 per share.

On June 28, 1995, Manufacturers Indemnity and Insurance Company of America
paid $1,190,000 for (i) 680,000 shares of AmeriQuest Common Stock and (ii) a
warrant to acquire an additional 1,360,000 shares of AmeriQuest Common Stock,
exercisable at $1.05 per share. Manufacturers Indemnity and Insurance Company
of America's purchase was part of a private placement in June, 1995 to a
larger group of investors that provided funds necessary for AmeriQuest to meet
working capital requirements occasioned by AmeriQuest being under
collateralized on its obligation to IBM Credit Corporation.

Messrs. Marc L. Werner, Terren S. Peizer and William N. Silvis serve on the
Compensation Committee. While there are no "interlocks" between such
individuals and other companies with which they are affiliated or associated,
AmeriQuest granted options during fiscal 1994 to Mr. Terren S. Peizer and
Manufacturers Indemnity and Insurance Company of America, a company affiliated
with Mr. Werner, to secure the services of Messrs. Peizer and Werner in
connection with the projected efforts they were to expend in assisting
AmeriQuest in its acquisition of other companies.

25
<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth, as of September 15, 1995, information
relating to the beneficial ownership of AmeriQuest's Preferred Stock and
Common Stock by (i) each person known to AmeriQuest to be the beneficial owner
of more than five percent of any such class of AmeriQuest's outstanding
securities, (ii) each director, (iii) each of the executive officers for which
executive compensation information is set forth above, and (iv) all directors
and executive officers as a group. AmeriQuest knows of no agreements among its
shareholders which relate to voting or investment power over its Common Stock.

<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP AS OF SEPTEMBER 15,
1995
-----------------------------------------------
NUMBER OF SHARES
----------------------
PREFERRED COMMON PERCENT OF CLASS(13)
--------- --------- --------------------
<S> <C> <C> <C>
NAME AND ADDRESS OF BENEFICIAL
OWNER
Computer 2000 AG............... 810,811(1) 100.00%
Wolfratshauser Strasse 84 1,785,714(1) 100.00%
81379 Munchen, Germany 532,000 2.19%
Manufacturers Indemnity and In-
surance Company of America.... 3,233,473(2) 12.51%
5775 Flatiron Parkway, Ste 205
Boulder, Co 80301
COMMON STOCK
DIRECTORS AND OFFICERS (11)(12)
Steve DeWindt.................. -0- -0- -0-
Harry Krischik................. 810,811(1) 100.00%
1,785,714(1) 100.00%
532,000(1) 2.19%
Klaus J.M. Laufen.............. 810,811(1) 100.00%
1,785,714(1) 100.00%
532,000(1) 2.19%
Marc L. Werner................. 3,693,473(2) 14.29%
Mark Mulford................... 0(1) 0
Holger Heims................... 0(1) 0
Donald W. Resnick.............. 150,000(3) *
Harold L. Clark................ 450,000(4) 1.83%
Stephen G. Holmes.............. 160,000(5) *
Peter S. H. Grubstein.......... 559,595(6) 2.29%
Howard B. Crystal.............. 100,000(7) *
Peter D. Lytle................. 40,000(8) *
Irwin Bransky.................. 471,579 1.94%
Carol L. Miltner............... 100,000(9) *
All officers and directors as a
group (15 persons)............ 810,811 100%
1,785,714 100%
6,297,745(10) 23.58%
</TABLE>
- --------
(1) On August 22, 1995, Computer 2000 acquired 810,811 shares of AmeriQuest
Series A Preferred Stock and 1,785,714 shares of AmeriQuest Series B
Preferred Stock. Each such share of Series A and Series B Preferred Stock
is convertible into ten (10) shares of AmeriQuest Common Stock once
shareholders increase the number of shares of AmeriQuest Common Stock
authorized for issuance. The Series A and Series B Preferred Stock are
entitled to one vote for each share of underlying Common Stock and vote
as a single class with the AmeriQuest Common Stock, such that Computer
2000 presently holds approximately 52.7% of the outstanding voting power
attributable to all classes voting as a single class of Common Stock
(which includes 532,000 of AmeriQuest Common Stock also held by Computer
2000). Additionally, as outlined under "Item 1. Business--Recent
Developments," Computer 2000 has options and warrants to acquire
additional shares which could ultimately increase its voting power to
approximately 62% of all classes voting as a single class of Common
Stock. Messrs. Harry Krischik and Klaus J.M. Laufen each have shared
voting power over the shares held by Computer 2000 as each is also a
Director of Computer 2000, and collectively could control any vote where
there is only a total of three directors for Computer 2000. In this
regard, it should also be noted that the parent companies of Computer
2000, Klockner & Co. AG and VIAG Aktiengesellschaft, have been asserting
a significant degree of

26
<PAGE>

control over the affairs of Computer 2000. Additionally, it should be
noted that Messrs. Steve DeWindt, Mark Mulford and Holger Heims are
nominees of Computer 2000.
(2) The Board of Directors of Manufacturing Indemnity and Insurance Company
of America is vested with the voting and investment powers relating to
the shares of AmeriQuest's Common Stock held by Manufacturers Indemnity
and Insurance Company of America. Mr. Marc L. Werner, as a Director of
Manufacturers Indemnity and Insurance Company of America, may be deemed
to have shared voting and investment powers over the 1,683,473 shares of
AmeriQuest Common Stock held by Manufacturers Indemnity and Insurance
Company of America. In addition, Manufacturers Indemnity and Insurance
Company of America holds a four-year warrant to purchase 190,000 shares
of Common Stock at $3.50 per share from May 14, 1995 to November 14,
1998. The exercise price of the warrant was adjusted downward to $2.22
per share because of the right of such purchasers to adjust the warrant
exercise price to the same price as other investors acquire shares
between November 14, 1994 and May 14, 1995. The conversion price to
Computer 2000 of its $18 million loan is deemed by AmeriQuest to
constitute such a "sale." In addition, Manufacturers Indemnity and
Insurance Company of America holds a three-year warrant to purchase
1,360,000 shares of Common Stock at $1.05 per share thru June 30, 1998.
(3) Includes 150,000 shares subject to stock options currently exercisable at
$1.50 per share.
(4) Includes 200,000 shares issued to Mr. Clark on October 14, 1994 for which
Mr. Clark paid $2,000 in cash and tendered to AmeriQuest a one-year
Promissory Note in the amount of $498,000. The balance of the shares are
subject to currently exercisable stock options, exercisable at $1.00 per
share.
(5) Includes 50,000 shares issued to Mr. Holmes on October 14, 1994 for which
Mr. Holmes paid $500 in cash and tendered to AmeriQuest a one-year
Promissory Note in the amount of $124,500. The balance of the shares are
subject to currently exercisable stock options, exercisable at $1.00 per
share.
(6) The number of shares listed for Mr. Grubstein includes 107,000 shares of
AmeriQuest Common Stock issuable in consequence of the assumption by
AmeriQuest of Kenfil's obligation under a Warrant issued to Corporate
Efficiency Consulting, L.P., a New Jersey limited partnership ("CEC") for
315,000 shares of Kenfil Common Stock. Mr. Grubstein now holds his option
directly and not derivatively through CEC.
(7) Includes 100,000 shares subject to stock options currently exercisable at
$3.15 per share.
(8) Includes 40,000 shares subject to stock options currently exercisable at
$2.00 per share.
(9) Includes 100,000 shares subject to stock options currently exercisable at
$2.00 per share.
(10) Includes 2,407,000 shares subject to stock options and warrants currently
vested and issuable upon exercise of such options and warrants.
(11) The address for the executive officers and directors and proposed
directors is: 3 Imperial Promenade, Ste. 300, Santa Ana, California
92707.
(12) Each executive officer and director has sole voting and investment power
with respect to the shares listed, unless otherwise indicated.
(13) For purposes of determining the percentage of outstanding Common Stock
held by each person or group set forth in the table, the number of shares
held by a person or group is divided by the sum of the number of shares
of AmeriQuest's Common Stock outstanding on September 15, 1995 (810,811
shares of Series A Preferred Stock; 1,785,714 shares of Series B
Preferred Stock; and 24,303,572 shares of Common Stock) plus the number
of shares of Common Stock subject to outstanding stock options and
warrants exercisable currently or within 60 days of September 15, 1995 by
such person or group, in accordance with Rule 13d-3(d)(1) under the
Securities Exchange Act of 1934, as amended. Percentages of less than 1%
are represented by an asterisk.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

27
<PAGE>

and the grant of new options was proposed by new directors without regard to
any compensation that might be paid to others pursuant to recommendation of
the Compensation Committee. Additionally, on July 28, 1995, the Board resolved
to cancel the options outstanding in favor of Messrs. Walker and Silvis in the
respective amounts of 35,000 and 15,000 shares, respectively, and granted to
such individuals fully-paid shares in such amounts in recognition of their
long-standing service to AmeriQuest.

On October 14, 1994, Manufacturers Indemnity and Insurance Company of
America paid $456,000 for (i) 190,000 shares of AmeriQuest Common Stock and
(ii) a warrant to acquire an additional 190,000 shares of AmeriQuest Common
Stock, initially exercisable at $3.50 per share and subsequently adjusted to
$2.22 per share. Manufacturers Indemnity and Insurance Company of America's
purchase was part of a private placement in October, 1994 to a larger group of
investors that provided funds necessary for AmeriQuest to acquire NCD. Also,
on October 14, 1994, Manufacturers Indemnity and Insurance Company of America
acquired 200,000 shares of AmeriQuest Common Stock in consideration of a
promise to pay $2.50 per share.

SEVERANCE ARRANGEMENTS WITH PRECEDING MANAGEMENT

On July 28, 1995, the Board of Directors resolved to accede to the demands
of Mr. Gregory A. White in connection with his severance of service from
AmeriQuest. The Separation Agreement between AmeriQuest and Mr. White provides
for (i) a lump-sum payment of $500,000 within three (3) business days
following the closing of the Purchase Agreement (together with normal salary
until so paid), (ii) to continue health insurance coverage for Mr. White and
his dependents for a period of two years through July 11, 1997, (iii) all
options are deemed vested and exercisable for a period of twenty-four months
from the effective date of the Separation Agreement, and (iv) AmeriQuest will
allow Mr. White to retain $155,000 he took as an interest-free loan, which
shall be due and payable as soon as the market price for AmeriQuest's Common
Stock reaches $3.50 for a 20-day (consecutive) period, provided there is then
an effective registration statement available which would allow Mr. White to
sell the shares underlying his options upon exercise thereof. AmeriQuest also
forgave the outstanding loan it made to Mr. White to assist him in relocating
his family from Florida to California, in the amount of $75,000.

----------------

28
<PAGE>

On July 28, 1995, the Board of Directors, in recognition of indications that
Computer 2000 intended to replace Messrs. Clark and Holmes, resolved that
AmeriQuest should honor the terms of their severance pay concurrent with the
closing of the Purchase Agreement, without compromise. However, those
provisions were mutually agreed to be compromised, based upon certain oral
understandings, and are protested. The final terms were more favorable to
AmeriQuest than those strictly provided for in the agreements, in that a
substantial portion of the cash obligation was handled by repricing
outstanding options, and certain other concessions.

The severance arrangement with Mr. Clark provided for the payment of
$290,000 cash, comprised of a $170,000 severance payment, $20,000 for accrued
vacation and $100,000 as a consulting retainer. Additionally, the exercise
price of Mr. Clark's 250,000 stock options was repriced from $2.00 per share
to $1.00 per share.

The severance arrangement with Mr. Holmes provided for cash payments
totaling $171,539, comprised of $160,000 severance (of which $60,000 remains
to be paid on January 1, 1996) and $11,539 for accrued vacation. Additionally,
the exercise price of Mr. Holmes' 100,000 stock options was repriced from
$2.00 per share to $1.00 per share.

29
<PAGE>

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a) Financial Statements and Schedules

(1) Financial Statements included in Part II of this Report:
<TABLE>
<CAPTION>
PAGE
REFERENCE
---------
<S> <C>
Report of Independent Public Accountants........................ F-1
Statements of Operations for each of the three years ended June
30, 1995....................................................... F-2
Balance Sheets at June 30, 1995 and 1994........................ F-3
Statements of Stockholders' Equity (Deficit) for each of the
three years ended June 30, 1995................................ F-4
Statements of Cash Flows for each of the three years ended June
30, 1995....................................................... F-5
Notes to Financial Statements................................... F-7
(2) Financial Statement Schedule
Schedule II--Valuation and Qualifying Accounts and Reserves..... F-17
</TABLE>

(b) Reports on Form 8-K

Current Report on Form 8-K (Amendment No. 3) dated June 14, 1994, filed May
26, 1995, amending certain pro forma disclosures relating to the acquisition
of Kenfil Inc.

Current Report on Form 8-K (Amendment No. 1) dated July 18, 1994, filed
April 6, 1995, reporting that AmeriQuest had resolved to abort its sale of CMS
Enhancements (S) PTE Ltd., a Singapore subsidiary of AmeriQuest, for failure
of the purchaser to remit the entirety of the agreed consideration.

Current Report on Form 8-K (Amendment No. 4) dated September 12, 1994, filed
May 9, 1995, amending certain pro forma disclosures relating to the
acquisition of Kenfil Inc.

Current Report on Form 8-K (Amendment No. 6) dated November 14, 1994, filed
May 26, 1995, amending certain pro forma disclosures relating to the
acquisition of Ross White Enterprises, Inc. d/b/a "National Computer
Distributors."

Current Report on Form 8-K dated June 26, 1995, filed July 3, 1995,
reporting the resignation of Robert H. Beckett from the Board of Directors and
the assertion of Robec, Inc. regarding possibly renegotiating the exchange
ratio for that transaction.

Current Report on Form 8-K dated August 7, 1995, filed August 16, 1995,
reporting a change in control of AmeriQuest upon the closing of the Purchase
Agreement by and between AmeriQuest and Computer 2000 AG, the resignation of
Mr. Gregory A. White from the Board of Directors and a proposed change of
fiscal year to September 30 of each year to conform to the fiscal year end of
Computer 2000 AG.

Current Report on Form 8-K dated August 9, 1995, filed August 16, 1995,
reporting the disposition of CMS Enhancements (S) PTE Ltd., a Singapore
subsidiary of AmeriQuest.

30
<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF DOCUMENT PAGE NO. LOCATION OF FILING
- ----------- ----------------- -------- ------------------
<S> <C> <C> <C>
2.01* Amended and Restated Agreement and SEC File No. 33-57611
Plan of Reorganization dated as of Exhibit 2.01
August 11, 1994 by, between and among
AmeriQuest, Robec and certain
principal shareholders of Robec.
2.02* Agreement and Plan of Reorganization 50 SEC File No. 1-10397
dated September 26, 1994 by, between 10-K for June 30, 1994
and among AmeriQuest, Ross White
Enterprises, Inc. d/b/a "National
Computer Distributors ("NCD") and the
shareholders of NCD.
3.01(a)* Certificate of Incorporation of SEC File 1-10397
AmeriQuest as amended through 10-K for June 30, 1994
September 22, 1994.
3.01(b) Certificate of Designations for SEC File 1-10397
Preferred Stock issued and issuable to 10-K for June 30, 1995
Computer 2000.
3.02* By-laws of AmeriQuest. 189 SEC File 33-81726
4.01* Reference is made to Exhibits 3.01 and
3.02, the Certificate of Incorporation
and Bylaws, which define the rights of
security holders.
4.02* Specimen Stock Certificate. 274 SEC File 33-81726
10.01 Inventory and Working Capital SEC File No. 1-10397
Financing Agreement dated May 5, 1995 10-K for June 30, 1995
by and between CDS Distribution, Inc.
and IBM Credit Corporation, as
amended.
10.02 Inventory and Working Capital SEC File No. 1-10397
Financing Agreement dated May 5, 1995 10-K for June 30, 1995
by and between CMS Enhancements, Inc.
and IBM Credit Corporation, as
amended.
10.03 Working Capital Financing Agreement SEC File No. 1-10397
dated May 5, 1995 by and between 10-K for June 30, 1995
AmeriQuest/Kenfil Inc. and IBM Credit
Corporation, as amended.
10.04 Revolving Credit Agreement dated April SEC File No. 1-10397
27, 1992 by and between Ross White 10-K for June 30, 1995
Enterprise, Inc. d/b/a "National
Computer Distributors," as amended.
10.05* Inventory and Working Capital SEC File No. 0-18115
Financing Agreement dated September 8-K dated
21, 1994 by and between Robec, Inc. September 22, 1994
and IBM Credit Corporation, as
amended.
10.06* Incentive Stock Option Plan. SEC File 2-96539
10.07* Employee Stock Bonus Plan. SEC File 33-23809
10.08 Employment Agreement for Steve SEC File No. 1-10397
DeWindt. 10-K for June 30, 1995
</TABLE>

31
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE OF DOCUMENT PAGE NO. LOCATION OF FILING
- ----------- ----------------- -------- ------------------
<S> <C> <C> <C>
10.09 Employment Agreement for Mark Mulford. SEC File No. 1-10397
10-K for June 30, 1995
10.10 Employment Agreement for Holger Heims. SEC File No. 1-10397
10-K for June 30, 1995
10.11* Exchange Agreement between AmeriQuest 62 SEC File No. 1-10397
and Mr. James D'Jen for the 10-K/A-4 for
disposition of CMS Enhancements. June 30, 1994
10.12* Purchase Agreement dated August 7, SEC File No. 1-10397
1995 by and between AmeriQuest and 8-K dated August 7, 1995
Computer 2000 AG.
10.13* Agreement of Sublease dated December SEC File No. 33-81726
5, 1994 by and between AmeriQuest and
The Austin Company.
21.01* Subsidiaries of AmeriQuest. 351 SEC File No. 1-10397
10-K for June 30, 1994
23.01 Consent of Arthur Andersen LLP to the SEC File No. 1-10397
incorporation of their report included 10-K for June 30, 1995
in the Annual Report on Form 10-K of
AmeriQuest for the fiscal year ended
June 30, 1995 into AmeriQuest's
previously filed Registration
Statements.
24.01 Powers of Attorney for Messrs. Steve 50 SEC File No. 1-10397
DeWindt, Mark Mulford, Marc L. Werner, 10-K for June 30, 1995
Dr. Harry Krischik, Klaus J.M Laufen,
Holger Heims, Harold L. Clark and
Stephen G. Holmes.
27.01 Financial Data Schedule. 66 SEC File No. 1-10397
10-K for June 30, 1995
</TABLE>

- --------
* Incorporated herein by reference to the indicated filing pursuant to Rule
12b-32 under the Securities Exchange Act of 1934, as amended, and Rule 24
of the Commission's Rules of Practice.

32
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1933, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF
SANTA ANA, STATE OF CALIFORNIA, ON THE 13TH DAY OF OCTOBER, 1995.

AmeriQuest Technologies, Inc.

/s/ Steve DeWindt
By: _________________________________
STEVE DEWINDT
CHIEF EXECUTIVE OFFICER

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON
THE DATES INDICATED.

SIGNATURE TITLE DATE

/s/ Steve DeWindt Chairman of the October 13,
- ------------------------------------- Board, Chief 1995
STEVE DEWINDT Executive Officer
and Director
(Principal
Executive Officer)

/s/ Mark Mulford President, Chief October 13,
- ------------------------------------- Operating Officer 1995
MARK MULFORD** and Director

/s/ Donald W. Resnick Secretary, October 13,
- ------------------------------------- Treasurer, Chief 1995
DONALD W. RESNICK Financial Officer
(Principal
Financial and
Accounting Officer)

/s/ Dr. Harry Krischik Co-Chairman of the October 13,
- ------------------------------------- Board 1995
DR. HARRY KRISCHIK**

/s/ Marc L. Werner Vice Chairman of the October 13,
- ------------------------------------- Board 1995
MARC L. WERNER**

/s/ Klaus J. M. Laufen Director October 13,
- ------------------------------------- 1995
KLAUS J. M. LAUFEN**

33
<PAGE>

SIGNATURE TITLE DATE

/s/ Holger Heims Director October 13,
- ------------------------------------- 1995
HOLGER HEIMS**

/s/ Harold L. Clark Director October 13,
- ------------------------------------- 1995
HAROLD L. CLARK**

/s/ Stephen G. Holmes Director October 13,
- ------------------------------------- 1995
STEPHEN G. HOLMES**

/s/ Steve DeWindt /s/ Donald W. Resnick
- ------------------------------------- -------------------------------------
STEVE DEWINDT*, DONALD W. RESNICK**,
ATTORNEY-IN-FACT ATTORNEY-IN-FACT

34
<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To AmeriQuest Technologies, Inc.:

We have audited the accompanying consolidated balance sheets of AmeriQuest
Technologies, Inc. (a Delaware corporation) and subsidiaries (AmeriQuest) as
of June 30, 1995 and 1994, and the related consolidated statements of
operations, stockholders' equity (deficit) and cash flows for each of the
three years in the period ended June 30, 1995. These financial statements and
the schedule referred to below are the responsibility of AmeriQuest's
management. Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of AmeriQuest as of June 30,
1995 and 1994 and the results of their operations and their cash flows for
each of the three years in the period ended June 30, 1995 in conformity with
generally accepted accounting principles.

Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The schedule listed in the index on
page 30 is presented for purposes of complying with the Securities and
Exchange Commissions rules and is not a required part of the basic financial
statements. This schedule has been subjected to the auditing procedures
applied in our audits of the basic financial statements and, in our opinion,
is fairly stated in all material respects in relation to the basic financial
statements taken as a whole.

Arthur Andersen LLP

Los Angeles, California
October 13, 1995

F-1
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
------------------------------------------------
1995 1994 1993
--------------- --------------- ---------------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
NET SALES..................... $416,571 $87,593 $73,082
COST OF SALES................. 400,820 75,023 61,539
--------------- -------------- --------------
Gross profit................ 15,751 12,570 11,543
--------------- -------------- --------------
OPERATING EXPENSES
Selling, general and
administrative................ 53,432 14,119 10,274
Intangibles write off....... 23,777 -- --
Restructuring............... -- 5,700 --
Research and development.... 39 25 782
--------------- -------------- --------------
77,248 19,844 11,056
--------------- -------------- --------------
Income (loss) from
operations.................... (61,497) (7,274) 487
OTHER (INCOME) EXPENSE
Other income................ (13) (31) (26)
Interest expense............ 6,082 728 277
--------------- -------------- --------------
6,069 697 251
--------------- -------------- --------------
Net income (loss)........... $(67,566) $(7,971) $ 236
=============== ============== ==============
Net income (loss) per common
share and
common share equivalent.. $ (3.76) $ (1.33) $ 0.08
=============== ============== ==============
Weighted average shares
outstanding................... 17,993,440 5,973,511 3,060,908
=============== ============== ==============
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-2
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
JUNE 30, JUNE 30,
1995 1994
----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash............................................... $ 970 $ 3,200
Accounts receivable, less allowances for doubtful
accounts
of $9,572 and $477 as of June 30, 1995 and
1994, respectively............................ 56,342 24,708
Inventories........................................ 49,101 24,165
Other current assets............................... 1,362 1,627
----------- -----------
Total current assets............................. 107,775 53,700
----------- -----------
PROPERTY AND EQUIPMENT, NET.......................... 6,649 4,078
INTANGIBLE ASSETS, NET............................... 10,411 6,490
OTHER ASSETS......................................... 3,173 877
----------- -----------
$ 128,008 $ 65,145
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable................................... $ 42,023 $ 23,408
Notes payable...................................... 72,945 23,059
Other current liabilities.......................... 14,234 2,361
----------- -----------
Total current liabilities........................ 129,202 48,828
----------- -----------
SUBORDINATED NOTES PAYABLE TO SHAREHOLDERS........... -- 3,175
LONG TERM OBLIGATIONS................................ 6,515 267
SUBORDINATED NOTES PAYABLE........................... 18,000 --
COMMITMENTS AND CONTINGENCIES........................
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; authorized
10,000,000 shares;
no shares issued and outstanding.............. -- --
Common stock, $.01 par value; authorized 30,000,000
shares;
issued and outstanding, 22,966,711 and
9,857,779 shares,
as of June 30, 1995 and 1994, respectively.... 230 99
Additional paid-in capital......................... 56,196 27,345
Accumulated deficit................................ (82,135) (14,569)
----------- -----------
Total stockholders' equity (deficit)............. (25,709) 12,875
----------- -----------
$ 128,008 $ 65,145
=========== ===========
</TABLE>

The accompanying notes are an integral part of these consolidated balance
sheets.

F-3
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL
----------------- PAID-IN ACCUMULATED
SHARES AMOUNT CAPITAL DEFICIT
---------- ------ ---------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
BALANCES AT JUNE 30, 1992............. 2,925,523 $ 29 $14,757 $ (6,834)
Common stock issued by private
placement............................ 143,000 2 286 --
Common stock issued for assets........ 100,000 1 149 --
Exercise of employee stock options.... 12,187 -- 18 --
Net income for the year ended June 30,
1993.................................. -- -- -- 236
---------- ---- ------- --------
BALANCES AT JUNE 30, 1993............. 3,180,710 $ 32 $15,210 $ (6,598)
---------- ---- ------- --------
Common stock issued by private
placement............................ 4,905,072 49 9,054 --
Common stock issued for businesses
acquired.............................. 1,730,330 17 3,011 --
Exercise of employee stock options.... 41,667 1 70 --
Net loss for the year ended June 30,
1994.................................. -- -- -- (7,971)
---------- ---- ------- --------
BALANCE AT JUNE 30, 1994.............. 9,857,779 $ 99 $27,345 $(14,569)
---------- ---- ------- --------
Common stock issued by private
placement and other.................. 4,266,258 43 8,646 --
Common stock issued for businesses
acquired.............................. 8,352,148 84 19,019 --
Exercise of employee stock options.... 32,834 -- 51 --
Shares issued to employees............ 457,692 4 1,135 --
Net loss for the year ended June 30,
1995.................................. -- -- -- (67,566)
---------- ---- ------- --------
BALANCES AT JUNE 30, 1995............. 22,966,711 $230 $56,196 $(82,135)
========== ==== ======= ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-4
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
----------------------------------------
1995 1994 1993
-------- ---------------------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Cash Flows from Operating Activities
Net income (loss).................... $(67,566) $(7,971) $ 236
Adjustments to reconcile net income
(loss) to net cash
provided by (used in) operating
activities:
Depreciation and amortization...... 4,723 1,107 1,013
Intangibles write-off.............. 23,777 -- --
Provision for losses on accounts
receivable......................... 5,787 577 328
Provision for losses on
inventories........................ 17,039 1,714 633
Loss on sale of equipment.......... 1,540 -- 33
Changes in operating assets and
liabilities:
(Increase) decrease in accounts
receivable....................... (3,016) (1,698) 3,302
(Increase) decrease in
inventories and other............ (390) (1,447) 953
(Increase) decrease in other
assets........................... (189) 1,500 (1,449)
(Decrease) in accounts payable
and other........................ (25,312) (2,190) (3,776)
-------- ------- -------
Net cash provided by (used in)
operating activities................. (43,607) (8,408) 1,273
-------- ------- -------
Cash Flows from Investing Activities
Purchase of property and equipment... (4,316) (1,546) (1,260)
Net cash (paid) received from
acquisition of businesses, net of
acquired cash of $1,656 in 1995...... (1,973) 769 --
Proceeds from sale of equipment...... -- -- 17
-------- ------- -------
Net cash used in investing
activities........................... (6,289) (777) (1,243)
-------- ------- -------
Cash Flows from Financing Activities
Proceeds from subordinated debt...... 18,000 -- 1,505
Proceeds from notes payable
borrowings, net...................... 20,926 3,741 (1,669)
Proceeds from sale of common stock... 8,740 7,624 456
-------- ------- -------
Net cash provided by (used in)
financing activities................. 47,666 11,365 292
-------- ------- -------
Increase (decrease) in cash.......... (2,230) 2,180 322
Cash--beginning of the year.......... 3,200 1,020 698
-------- ------- -------
Cash--end of the year................ $ 970 $ 3,200 $ 1,020
======== ======= =======
</TABLE>

The accompany notes are an integral part of these consolidated financial
statements.

F-5
<PAGE>

Supplemental Disclosures of Cash Flow Information:

<TABLE>
<S> <C>
Interest on lines of During Fiscal 1995, 1994 and 1993 the Company paid interest costs
credit: of approximately $5,917, $728 and $277, respectively.
Income taxes: During Fiscal 1995, 1994 and 1993 the Company made no tax payments.
Noncash investing and financing activities:
Capital leases: During Fiscal 1995 and 1994, the Company entered into capital leases for
equipment totaling approximately $270 and $180, respectively.
Subordinated note During Fiscal 1994, the Company issued approximately 522,000
payable conversion: shares of common stock upon the conversion of a $1,550
subordinated note payable.
Intangible write off: During Fiscal 1995, the Company wrote off $23,777 of intangibles related
to the termination of its entertainment software business and impairment
of intangible assets at certain acquired regional distributors.
</TABLE>

The accompany notes are an integral part of these consolidated financial
statements.

F-6
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business. AmeriQuest Technologies, Inc. and subsidiaries
("Company" or "AmeriQuest") is a national value-added wholesale distributor of
computer hardware and related products to value-added resellers, system
integrators and computer retailers through its wholly-owned subsidiaries, CDS
Distribution, Inc., AmeriQuest/NCD, Inc. and its 50.1 percent owned
subsidiary, Robec, Inc. AmeriQuest is also a supplier of hard disk drive
subsystems compatible with leading business computers, through its wholly-
owned subsidiary, CMS Enhancements, Inc. ("CMS"). CMS also offers disk array,
magneto optical, CD-ROM, floppy disk drives and magnetic tape back-up
subsystems. Through its wholly-owned subsidiary, Kenfil, Inc., AmeriQuest
distributes business applications, utilities, graphics and communication
software to the Asian market.

The Company operates in the personal computer industry, which is affected by
significant technological change and short product life cycles. Competitors
have financial, marketing, or management resources substantially greater than
those of AmeriQuest. Product lines sold by AmeriQuest are also offered by many
other distributors, which in combination with short product life cycles, can
result in rapid declines in product gross margins. In addition, inventory is
subject to loss due to short-term technological obsolescence. No one customer
represents more than 10 percent of consolidated revenues. The Company's
largest vendor accounted for approximately 11% and 20% of the Company's
purchases during fiscal years 1995 and 1994, respectively. No other vendor
represented 10% or more of the Company's purchases in either fiscal year 1995
and 1994.

Basis of consolidation. The consolidated financial statements include the
accounts of AmeriQuest and its majority and wholly-owned subsidiaries. All
significant intercompany accounts and transactions have been eliminated.

Accounting period. The Company's fiscal year ends on the Saturday closest to
June 30, however, in 1994, Friday was used as the last day of the fiscal
period. The year ending dates for the past three fiscal years were July 1,
1995 and June 30, 1994 and 1993. For presentation purposes, all of the
aforementioned fiscal year ends are referred to as June 30.

Inventories. Inventories consist principally of computer hardware and
software held for resale and are stated at the lower of first-in, first-out
cost or market. Reserves for inventory obsolescence and slow moving product
are provided based upon specified criteria, such as recent sales activity and
date of purchase.

Property and equipment. Property and equipment are stated at cost.
Depreciation and amortization are computed using the straight line method over
estimated useful lives as follows:

<TABLE>
<S> <C>
Equipment.................................................... 5 years
Furniture and fixtures....................................... 5 years
Leasehold improvements....................................... Lease term
Vehicles..................................................... 3 to 5 years
</TABLE>

Maintenance, repairs and minor renewals are charged directly to expense as
incurred. Additions and betterments to property and equipment are capitalized.
When assets are disposed of, the related cost and accumulated depreciation
thereon are removed from the accounts and any resulting gain or loss is
included in operations.

Intangible assets. Intangible assets relate primarily to acquired
distribution channels and related vendor relationships and market positions.
Intangibles are amortized using the straight-line method from the date of

F-7
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
acquisition over the expected period to be benefitted, currently estimated at
10 years. In determining the appropriate amortization period the Company
considered the historical length of the acquiree's vendor relationships and
the overall size and quality of the vendors and their product offerings. On a
quarterly basis, the Company assesses the recoverability of intangible assets
based upon consideration of past performance and future expectations of
undiscounted cash flow on an acquisition by acquisition basis to the extent
separately identifiable, in accordance with Statement of Financial Accounting
Standards No. 121, "Accounting for the Impairment of Long Lived Assets and For
Long Lives Assets to be Disposed of". To the extent separate assessment of
such acquired intangibles is no longer feasible (i.e. as a result of
integrating multiple acquisitions into a single business unit) such assessment
is performed on a combined basis as appropriate.

During the fourth quarter of fiscal 1995 in anticipation of the completion
of Computer 2000 A.G.'s (Computer 2000) equity investment, the Company, with
input from Computer 2000 management, made the decision to terminate its
entertainment software business and to focus its management efforts and
capital in the higher margin, value-added products, application software and
computer hardware distribution businesses. Management determined that future
operating cash flow from certain regional acquisitions will not be sufficient
to recover the related intangible assets. As a result of these assessments,
the Company wrote-off approximately $23.8 million of intangibles related to
the termination of its entertainment software business and the impairment of
intangibles related to acquired regional distributors.

Market development funds. In general, vendors provide various incentive
programs to the Company. The funds received under these programs are
determined based on purchases and/or sales of the vendors' product and the
performance of certain training, advertising and other market development
activities. Revenue associated with these funds is recorded when earned either
as a reduction of selling, general and administrative expenses or product
cost, according to the specific nature of the program.

Sales recognition. Sales are recorded as of the date shipments are made to
customers. Sales returns and allowances are reflected as a reduction in sales
and recorded in inventory at expected net realizable value. The Company
permits the return of products within certain time limits and will exchange
returned products. Products that are defective upon arrival are handled on a
warranty return basis with the Company's vendors. The Company provides for
product warranty and return obligations at the point of sale based on
estimates of expected future costs.

Income taxes. The Company accounts for income taxes utilizing taxes from the
liability method required by Statement of Financial Accounting Standards No.
109 "Accounting for Income Taxes."

Net income (loss) per common share and common share equivalent. Net income
(loss) per common share and common share equivalent is computed by dividing
net income (loss) by the weighted average number of shares of common stock and
common stock equivalents outstanding. Common stock equivalents that increase
earnings per share or decrease loss per share are excluded from the
computation.

Reclassifications. Certain amounts in the prior periods have been
reclassified to conform to the current year's presentation.

F-8
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
2. ACQUISITIONS

The Company has pursued a strategy of growth through acquisition by
acquiring regional distributors with the goal of creating a national
distributor of value-added computers, subsystems and peripherals. The success
of this strategy is dependent upon the ability of the Company to effectively
consolidate and integrate the operations of the acquired businesses, combine
different cultures and obtain adequate financing to complete acquisitions and
fund working capital requirements. All of the Company's acquisitions completed
during fiscal years 1993 through 1995 have been accounted for in accordance
with the purchase method of accounting. The Company's Consolidated Financial
Statements include acquiree's results of operations from the effective
acquisition dates.

The per share valuation of the Company's common stock issued in connection
with the following acquisitions represents a discount from the quoted market
price, based upon the weighted average discounts received on recently
completed private equity cash transactions. Management believes this method of
valuation is the best indication of fair value due to the Company's thin stock
trading value and small public float.

Regional distributors. During fiscal year 1994 and 1993, CDS Distribution,
Inc., a wholly-owned subsidiary of the Company completed the acquisition of
several smaller regional distributors ("regional distributors"). Total
consideration given to complete these acquisitions was 1,730,330 shares of the
Company's common stock valued at $3 million. In fiscal 1995, as a result of
the acquisitions of Robec and NCD discussed below, these distributors were
considered to be redundant, resulting in their closure and the write off of
their intangibles of approximately $3.4 million.

Kenfil Inc. ("Kenfil"). As of June 1994, the Company acquired 51% of the
outstanding common stock of Kenfil for common stock of the Company. Kenfil
distributed microcomputer software in both the U.S. and Asia. As of September
1994, the Company acquired the remaining outstanding 49% of the common stock
of Kenfil and converted certain trade and subordinated debt of Kenfil for
common and preferred stock, subsequently converted to common stock of the
Company. During fiscal year 1995, the former U.S. operations of Kenfil,
including principally educational and entertainment software distribution,
were terminated by the Company. Total consideration given for the Kenfil
acquisition was 5,846,162 shares of the Company's common stock valued at
approximately $14 million, plus transaction costs of $785,000.

Robec, Inc. ("Robec"). As of September 1994, the Company acquired 50.1% of
the outstanding common stock of Robec for common stock of the Company. Robec
is a distributor of computer products and services, specializing in systems
and UNIX applications, and is based in Horsham, Pennsylvania. The Company
proposes to acquire the remaining 49.9% of outstanding common stock of Robec
during fiscal year 1996. In September 1995, Robec's shareholders approved the
acquisition by AmeriQuest of the remaining 49.9% of Robec common stock not
owned by the Company.

The Robec merger agreement requires the Company to issue additional common
shares to provide former and current Robec shareholders participating in the
merger with a minimum value associated with the Company's common stock issued
or to be issued to complete the merger transaction. Based upon the exchange
ratio included in the Robec merger agreement, 1,402,805 shares of the
Company's common stock valued at $2.7 million was issued in exchange for 50.1
percent of Robec's common stock in September 1994. Due to the minimum value
provisions and adjustments to the exchange ratio included in the amended Robec
merger agreement, an additional 6.8 million shares of the Company's common
stock is expected to be issued to complete the Robec merger. The additional
shares to be issued are valued at $5.8 million and is recorded as a long term
liability in the accompanying consolidated balance sheet. Total consideration
is expected to be 8.2 million shares of the Company's common stock valued at
$8.5 million, plus transaction costs of $265,000. Intangible assets recorded
at June 30, 1995 related to Robec are approximately $164,000.

F-9
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
The completion of the Robec merger is pending AmeriQuest shareholder
approval and an increase in the authorized number of AmeriQuest common stock
shares.

National Computer Distributors ("NCD"). In November 1994, the Company
acquired all of the outstanding common stock of NCD for cash and common stock
of the Company. NCD is a distributor of computer products and services,
specializing in systems and connectivity applications. Total consideration
given in the NCD acquisition was 1,864,767 shares of the Company's common
stock valued at $4.1 million and cash of $3.4 million. Intangible assets
recorded at June 30, 1995 related to NCD are approximately $9.7 million.

In connection with the issuance of the Company's common stock associated
with the NCD acquisition, the Company entered into a stock repurchase
agreement with holders of 661,586 shares of the Company's common stock. The
holders of the Company's common stock covered by this agreement have required
the Company to repurchase the stock at $3.50 per share which is recorded as a
current liability in the accompanying balance sheet.

Management believes that distribution channel access represents the most
significant intangible acquired in connection with the acquisitions discussed
above. Management initially assigned a 10 year economic life to this
intangible asset as that is the period of time that management expects to
derive benefit from the existing vendor relationships and market position.
Management determined that 10 years is an appropriate economic life based upon
the historical length of the acquiree's vendor relationships and the overall
size and quality of the acquiree's vendors and their product offerings. See
Note 1 for a discussion of the Company's policy for evaluating the realization
of intangible assets, the termination of the entertainment software business
and the related fiscal 1995 write-off of intangibles.

The following unaudited pro forma combined information shows the results of
the Company's operations for the fiscal years ended June 30, 1995 and 1994 as
though the acquisitions and the Computer 2000 equity investment (see Note 8)
all had occurred as of the beginning of each respective fiscal year (in
thousands except per share data):

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
-----------------------
1995 1994
----------- -----------
<S> <C> <C>
Revenues......................................... $ 520,134 $ 613,606
Net loss......................................... 70,020 37,636
Net loss per share............................... 1.33 .75
Weighted average shares.......................... 52,729,000 50,405,380
</TABLE>

The pro forma results have been prepared for comparative purposes only and
are not necessarily indicative of the actual results of operations had the
acquisitions taken place at the beginning of the indicated period or the
results that may occur in the future. Furthermore, the pro forma results do
not give effect to cost savings or incremental costs which may occur as a
result of the integration and consolidation of the acquired companies.

The entertainment software business of Kenfil contributed revenues of $25
million and $139 million and incurred net losses of $25.9 million and $20.8
million on a pro forma basis during fiscal years 1995 and 1994, respectively.

The following unaudited condensed balance sheet information reflects the
financial position of the Company at June 30, 1995 as though the acquisition
of the remaining shares of Robec and the Computer 2000 equity investment had
occurred as of that date. The pro forma amounts do not reflect the results of
actual operations

F-10
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
subsequent to June 30, 1995 (i.e. to the extent losses were incurred
subsequent to June 30, 1995, such losses would result in a corresponding
reduction in shareholders' equity).

<TABLE>
<CAPTION>
JUNE 30, 1995
---------------------
AS REPORTED PRO FORMA
----------- ---------
<S> <C> <C>
Total current assets................................ $107,775 $107,775
======== ========
Total current liabilities........................... $129,202 $ 97,952
======== ========
Total long-term liabilities......................... $ 24,515 $ 667
======== ========
Shareholders' equity (deficit)...................... $(25,709) $ 29,389
======== ========
</TABLE>

The above presentation assumes that the Robec merger is completed in
accordance with the amended Robec merger agreement which results in the
issuance of approximately 6.8 million shares of the Company's common stock.
The issuance of the remaining shares is currently pending AmeriQuest
shareholder approval. If the final consummation of the merger were to include
consideration other than stock (i.e. cash or notes) the amount of pro forma
equity would be reduced by a corresponding amount.

3. INVENTORIES

Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>
JUNE 30,
---------------
1995 1994
------- -------
<S> <C> <C>
Finished goods............................................ $46,628 $19,977
Raw materials and subassemblies........................... 2,473 4,188
------- -------
$49,101 $24,165
======= =======
</TABLE>

Inventories are reflected net of reserves of approximately $13.8 million and
$2.6 million at June 30, 1995 and 1994, respectively. Inventories do not
contain any labor or overhead.

The Company manages its inventories by maintaining sufficient quantities to
achieve high order fill rates while at the same time attempting to stock only
those products in high demand with a rapid turnover rate. Inventory balances
will fluctuate as the Company adds new product lines and when appropriate,
makes large purchases from manufacturers when the terms of such purchases are
considered advantageous. Short product life years and rapid technological
obsolescence significantly increases the risk of declines in inventory value
and the lack of recovery of inventory balances at recorded values. The
Company's contracts with most of its vendors provide price protection and
stock return privileges to reduce to some degree the risk of loss to the
Company due to manufacturer price reductions and slow moving or obsolete
inventory.

4. PROPERTY AND EQUIPMENT

Property and equipment consist of the following (in thousands):

<TABLE>
<CAPTION>
JUNE 30,
---------------
1995 1994
------- -------
<S> <C> <C>
Equipment................................................ $10,753 $ 5,106
Furniture and fixtures................................... 4,156 5,563
Leasehold improvements................................... 2,358 433
------- -------
17,267 11,102
Less accumulated depreciation and amortization........... 10,618 7,024
------- -------
$ 6,649 $ 4,078
======= =======
</TABLE>

F-11
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

5. NOTES PAYABLE

At various dates during fiscal year 1995 and continuing at September 1995,
the Company was in default to its primary lender due to noncompliance with
certain financial ratio and covenant compliance. In October 1995, the Company
received a waiver from its primary lenders for non-compliance with the
financial covenants of NCD's credit agreement. The Company has also amended
its credit agreements covering its remaining borrowings to remove the
financial covenants which the Company was not in compliance with at June 30,
1995, pending renegotiation of those covenants. The amendment also allows the
lender to cancel the credit agreements with 60 days notice. At September 30,
1995, AmeriQuest, through NCD, had approximately $8 million available under
its existing credit facilities based upon available collateral.

The Company is in the process of negotiating the refinancing of its credit
agreements. Management expects that the Company will complete this refinancing
by December 31, 1995. Management believes that improvements in operating cash
flows resulting from the cost containment activities discussed above, together
with available borrowings on current credit agreements and the expected
refinancing will allow the Company to meet its obligations and capital needs
as they are required, through June 30, 1996.

6. INCOME TAXES

The deferred tax asset (liability) of the Company consists of the following
(in thousands):

<TABLE>
<CAPTION>
JUNE 30,
-----------------
1995 1994
-------- -------
<S> <C> <C>
Inventory reserves.......................................... $ 17,405 $ 481
Depreciation................................................ 268 331
Allowance for doubtful accounts............................. 12,488 153
Other....................................................... 10,962 (487)
Net operating loss carryforwards............................ 51,949 4,800
Valuation allowance......................................... (93,072) (5,545)
-------- -------
$ -- $ (267)
======== =======
</TABLE>

F-12
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

The principal elements accounting for the difference between income taxes
computed at the statutory rate and the effective rate are as follows (in
thousands):

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
-----------------------
1995 1994 1993
-------- ------- ----
<S> <C> <C> <C>
Federal tax expense (credit) computed at statutory
rate.................................................. $(23,648) $(3,200) $ 80
State taxes, net of federal benefit................... -- -- 15
Tax (benefit from) earnings of foreign operations..... -- -- (24)
Intangible write off.................................. 8,322 -- --
Effect of U.S. and foreign net operating losses....... 15,326 3,200 (71)
-------- ------- ----
$ -- $ -- $--
======== ======= ====
</TABLE>

At June 30, 1995, the Company had an income tax operating loss carryforward
of approximately $52 million, which is available to offset earnings in future
periods through 2010, subject to limitations discussed below. Of the Company's
consolidated net operating loss, $5 million relates to the Company's Robec
subsidiary which is not included in the Company's consolidated federal income
tax return. The Company experienced "ownership changes" in 1994 and 1995 for
income tax purposes, which will result in future annual limitations on the
utilization of net operating loss carryforwards to approximately $4 million per
year.

7. COMMITMENTS AND CONTINGENCIES

The Company leases its corporate office, warehouse space and certain
equipment under operating leases. Future minimum rental commitments for all
non-cancellable operating leases at June 30, 1995 are as follows (in
thousands):

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
- -------------------
<S> <C>
1996................................................................. $ 4,274
1997................................................................. 4,226
1998................................................................. 2,487
1999................................................................. 2,153
2000................................................................. 1,854
Thereafter............................................................ 6,841
-------
$21,835
=======
</TABLE>

Total rental expense under non-cancellable agreements for the years ended
June 30, 1995, 1994 and 1993 was approximately $4,291,000, $1,083,000 and
$694,000, respectively.

In June 1995, the Company entered into a settlement agreement with Microware
Corporation ("Microware") regarding a default judgment in the amount of $15.9
million which had been entered against the Company in favor of certain
shareholders of the defunct Microware. The underlying lawsuit relates to the
Company's decision not to proceed with the acquisition of Microware in early
1993. Under the terms of the settlement the Company issued 125,000 shares of
its common stock to the plaintiffs and paid $50,000 in cash in exchange for
vacation of the default judgement, without prejudice. The plaintiffs refiled
their claim in July 1995 seeking $8 million of compensatory damages and $50
million of punitive damages. Management, after discussion with counsel,
believes that the plaintiff's claim is without merit. The Company is also a
party to various other legal matters. Based upon discussions with counsel,
management believes that the ultimate outcome of these matters will not have a
material adverse effect on the Company's future financial position or its
results of operations.

The Company is contingently liable at June 30, 1995 under the terms of
repurchase agreements with financial institutions providing inventory financing
for dealers of the Company's products. The contingent liability under those
agreements approximates the amount financed, reduced by the resale value of any
products

F-13
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
which may be repurchased, and the risk of loss is spread over numerous dealers
and financial institutions. Losses under these agreements have been immaterial
in the past. Sales under these agreements during the years ended June 30,
1995, 1994 and 1993 were approximately $17 million, $7 million, and $6
million, respectively.

8. COMMON STOCK

In August 1995 Computer 2000 exchanged these notes for 810,811 shares of
AmeriQuest's Series A preferred stock (convertible into 8,108,110 shares of
common stock, subject to adjustment) and warrants to purchase 657,289 shares
of Series D preferred stock (convertible up to 6,572,890 shares of common
stock, subject to adjustment) exercisable at $0.53 per share of Series D
preferred stock ($0.05 per share of common stock on an as-if-converted to
common stock basis). The $18 million loan is reflected as a non-current
liability at June 30, 1995 in the accompanying consolidated balance sheet. In
addition, Computer 2000 purchased from AmeriQuest, for $31.2 million,
1,785,714 shares of Series B preferred stock (convertible into 17,857,140
shares of common stock) and warrants to purchase 746,186 shares of Series D
preferred stock (convertible up to 7,461,860 shares of common stock, subject
to adjustment) exercisable at $.53 per share of Series D preferred stock
($0.05 per share of common stock on an as-if-converted to common stock basis).
Assuming the exercise of warrants referred to above the conversion of the
preferred stock issuable upon such exercise and the conversion of the
preferred stock AmeriQuest will have issued 40 million shares of common stock
at an average purchase price of $1.25 per share and Computer 2000 will hold
approximately 62% of AmeriQuest's outstanding voting stock.

Further, in consideration for Computer 2000's exchange of the notes of $18
million and Computer 2000's additional investment of $31.2 million, AmeriQuest
also granted to Computer 2000 pari passu rights with respect to other
outstanding warrants, options and other rights to acquire shares of
AmeriQuest's Common Stock that AmeriQuest has previously granted, or is
obligated to grant in the future, to others:

(i) If AmeriQuest issues in connection with its acquisition of Robec any
shares in excess of 2,800,000 shares of common stock, including all shares
already issued and all shares issued in the future, including shares issued
upon the exercise of options or warrants granted, assumed or exchanged in
connection with the Robec acquisition, then Computer 2000 will have the
right, pursuant to certain warrants to be granted by AmeriQuest to purchase
a number of shares of Series E preferred stock as will be convertible into
a number of shares of common stock that will be equal to the number of
incremental shares that are issued in connection with the Robec
acquisition. The exercise price of the acquisition maintenance warrants
will be $1.25 per share of Series E preferred stock ($0.05 per share of
common stock on an as-if-converted to common stock basis).

(ii) In connection with a private placement in June 1995 AmeriQuest
issued common stock and warrants to investors, which included warrants to
purchase up to 5,148,574 shares of common stock at an exercise price of
$1.05 per share. If and to the extent that any of the unit warrants are
exercised, then Computer 2000 will have the right, pursuant to certain
warrants to be issued by AmeriQuest, to purchase a number of Series F
preferred stock that will be convertible into a number of shares of common
stock equal to the shares issued upon the exercise of the unit warrants.
The exercise price of these warrants will be $5.25 per share of Series F
preferred stock ($.525 per share of common stock on an as-if-converted to
common stock).

(iii) AmeriQuest granted to Computer 2000 an option to purchase a number
of shares of common stock that will be equal to the number of shares of
common stock that AmeriQuest issues upon exercise or conversion of all
currently outstanding options, warrants or other rights (other than shares
subject to the unit maintenance warrants and acquisitions maintenance) to
acquire (upon conversion or otherwise) any

F-14
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
shares of common stock or other equity securities of AmeriQuest. This
option will be exercisable for the same consideration and on the same terms
as the consideration for which and terms under which such additional shares
are issued.

On August 31, 1995, after completion of the Computer 2000 equity investment
and assuming conversion of all the preferred stock to common stock, the Company
would have 48,931,961 shares of common stock outstanding. Assuming the
completion of the Robec merger and exercise of outstanding warrants and
Computer 2000's maintenance warrant arrangements, the Company would have
approximately 96 million shares of common stock outstanding.

In August 1994, the shareholders approved an increase in the authorized
common stock of the Company from 10 to 30 million shares, the effect of which
is reflected herein, however, in order to complete the Robec transaction (see
Note 2) and allow for the conversion of preferred stock held by Computer 2000,
additional common stock will be required to be authorized.

The Company has instituted various stock option plans which authorize the
granting of options to key employees, directors, officers, vendors and
customers to purchase shares of the Company's common stock. All grants of
options during the years presented have been to employees or directors and were
granted at the then quoted market price. A summary of shares available for
grant and the options outstanding under the plans are as follows:

<TABLE>
<CAPTION>
SHARES
AVAILABLE OPTIONS PRICE
FOR GRANT OUTSTANDING RANGE
--------- ----------- ----------
<S> <C> <C> <C>
BALANCES, JUNE 30, 1992........................ 134,500 138,782 $1.50-3.00
Increase in shares available for grant....... 140,000 -- --
Options granted.............................. (73,000) 73,000 2.00-2.50
Options exercised............................ -- (12,187) 1.50
Cancelled.................................... 6,750 (6,750) 2.50
------- ------- ----------
BALANCES, JUNE 30, 1993........................ 208,250 192,845 $1.50-3.00
Increase in shares available for grant....... 250,000 -- --
Options granted.............................. (20,000) 20,000 2.38-4.50
Options exercised............................ -- (41,667) 1.50-2.00
Cancelled.................................... 78,818 (78,818) --
------- ------- ----------
BALANCES, JUNE 30, 1994........................ 517,068 92,360 $1.50-4.50
Options exercised............................ -- (32,834) 1.50
Cancelled.................................... 2,625 (2,625) 1.50-2.38
------- ------- ----------
BALANCES, JUNE 30, 1995........................ 519,693 56,901 $1.50-4.50
======= ======= ==========
</TABLE>

The 56,901 options outstanding are currently exercisable.

In fiscal 1995 and 1994, warrants to acquire common stock of the Company were
issued to unrelated parties aggregating in connection with private equity and
other transactions, 7,490,574 shares, are exercisable at prices ranging from
$1.05 to $5 per share (the then quoted market price) and expire through 1999.
In addition,non-qualified options to acquire an additional 1,422,291 shares of
common stock are outstanding at exercise prices ranging from $1 to $4.50 per
share. Of this amount, options to acquire 782,291 shares have been issued
subject to the Company obtaining appropriate shareholder approval.

During 1995, the Company issued 457,692 shares of stock to various employees,
including 450,000 shares which were sold to members of management at $2.50 per
share in exchange for one-year promissory notes totaling $1,125,000. As a
result of Computer 2000's equity investment and the related changes in
management, the ultimate realizability of these notes is uncertain,
consequentially they have been reserved for in the accompanying financial
statements.

F-15
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

9. RESTRUCTURING

During fiscal year 1994, the Company restructured certain of its activities
in order to emphasize and streamline its operations, consistent with its core
capabilities in value-added distribution. The components of the restructuring
charges are as follows (dollars in thousands):

<TABLE>
<S> <C>
Employee terminations................................................... $ 500
Facilities abandonment.................................................. 300
Discontinued product lines.............................................. 4,900
------
$5,700
======
</TABLE>

10. FOREIGN SALES INFORMATION

A summary of the Company's operations by geographic area for the last three
years is as follows (in thousands):

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1995 U.S. FAR EAST ELIMINATION CONSOLIDATED
- ------------------------ -------- -------- ----------- ------------
<S> <C> <C> <C> <C>
Sales to unaffiliated customers...... $374,552 $42,019 $ -- $416,571
Transfers between geographic areas... $ -- $ -- $ -- $ --
Net sales............................ $374,552 $42,019 $ -- $416,571
Loss from operations................. $ 60,746 $ 751 $ -- $ 61,497
Identifiable assets.................. $122,548 $ 5,460 $ -- $128,008
<CAPTION>
YEAR ENDED JUNE 30, 1994 U.S. FAR EAST ELIMINATION CONSOLIDATED
- ------------------------ -------- -------- ----------- ------------
<S> <C> <C> <C> <C>
Sales to unaffiliated customers...... $ 62,089 $25,504 $ -- $ 87,593
Transfers between geographic areas... $ 4,107 $ 298 $(4,405) $ --
Net sales............................ $ 66,196 $25,802 $(4,405) $ 87,593
Loss from operations................. $ 7,182 $ 92 $ -- $ 7,274
Identifiable assets.................. $ 62,584 $ 2,561 $ -- $ 65,145
<CAPTION>
YEAR ENDED JUNE 30, 1993 U.S. FAR EAST ELIMINATION CONSOLIDATED
- ------------------------ -------- -------- ----------- ------------
<S> <C> <C> <C> <C>
Sales to unaffiliated customers...... $ 50,342 $22,740 $ -- $ 73,082
Transfers between geographic areas... $ -- $ 3,086 $(3,086) $ --
Net sales............................ $ 50,342 $25,826 $(3,086) $ 73,082
Income from operations............... $ 647 $ (160) $ -- $ 487
Identifiable assets.................. $ 17,170 $ 3,104 $ -- $ 20,274
</TABLE>

United States sales include export sales of approximately $6.4 million, $2.3
million and $2 million made principally to Europe, Latin America, the Far East
and Canada in fiscal years 1995, 1994 and 1993, respectively.

11. DISPOSITION

In August 1995, the Company completed the sale of its Singapore subsidiary,
("CMS Singapore") to a former officer and director of the Company. The Company
exchanged all of the stock of CMS Singapore for 350,000 shares of the
Company's previously issued common stock. Consideration received for the
divestiture of CMS Singapore is approximately equal to its net book value.
Sales of CMS Singapore approximated $20 million during fiscal 1995.

F-16
<PAGE>

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES

SCHEDULE II

AMERIQUEST TECHNOLOGIES, INC. AND SUBSIDIARIES VALUATION AND QUALIFYING
ACCOUNTS AND RESERVES (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
BALANCE ADDITIONS
AT CHARGED TO DEDUCTIONS-- BALANCE
BEGINNING COST AND ACCOUNTS AT END
DESCRIPTIONS OF PERIOD EXPENSES WRITTEN OFF OTHER OF PERIOD
------------ --------- ---------- ------------ ------ ---------
<S> <C> <C> <C> <C> <C>
Allowance for Doubtful
Accounts:
July 1, 1992 to June
30, 1993................. $ 403 $ 328 $ 478 -- $ 253
July 1, 1993 to June
30, 1994................. $ 253 $ 577 $ 353 -- $ 477
July 1, 1994 to June
30, 1995................. $ 477 $ 5,787 $ 622 3,930(1) $ 9,572
Inventory Reserve:
July 1, 1992 to June
30, 1993................. $7,425 $ 633 $ 4,962 -- $ 3,096
July 1, 1993 to June
30, 1994................. $3,096 $ 1,714 $ 2,177 -- $ 2,633
July 1, 1994 to June
30, 1995................. $2,633 $17,039 $13,354 $7,461(1) $13,779
</TABLE>
- --------
(1) Additions to reserves related to acquisitions and accounted for as part of
their purchase price allocation.

F-17

<PAGE>
EXHIBIT 3.01(b)
EXHIBIT A
---------

CERTIFICATE OF DESIGNATIONS

AMERIQUEST TECHNOLOGIES, INC.

AmeriQuest Technologies, Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), in
-----------
accordance with the provisions of Section 151(g) thereof, hereby certifies as
follows:

Pursuant to the authority conferred upon the Board of Directors by the
Certificate of Amendment of the Certificate of Incorporation of the Corporation
filed with the Office of the Secretary of State of the State of Delaware on
September 14, 1994, the Board of Directors on August 3, 1995 adopted the
following resolutions decreasing to zero the number of authorized shares of this
Corporation's Series C Preferred Stock and creating five new series of Preferred
Stock:

RESOLVED, that because no shares of the Corporation's Series C Preferred
Stock are currently outstanding and pursuant to the authority granted to the
Board of Directors by the Fourth Article of the Certificate of Amendment of the
Certificate of Incorporation of the Corporation filed with the Office of the
Secretary of State of the State of Delaware on September 14, 1994 (the
"Certificate"), the number of authorized shares of the Corporation's Series C
-----------
Preferred Stock shall be reduced to zero and no shares of the Corporation's
Series C Preferred Stock shall be issued subject to the Certificate of
Designations previously filed with the Office of the Secretary of State of the
State of Delaware on July 18, 1994 with respect to the Series C Preferred Stock;

RESOLVED, that pursuant to the authority granted to the Board of Directors
by the Fourth Article of the Certificate, five new series of the class of
Preferred Stock of the Corporation are hereby created, and the designation and
amounts thereof and the powers, preferences, privileges, restrictions,
limitations, qualifications and rights of the shares of each such series are as
follows:

SECTION 1: SERIES A, SERIES B, SERIES D, SERIES E AND
------------------------------------------
SERIES F PREFERRED STOCK.
------------------------

The following number of shares of authorized and unissued Preferred Stock,
par value $0.01 per share, of the Corporation are hereby designated as follows,
with the respective powers, preferences, rights, limitations and restrictions
specified herein:

(i) Eight Hundred Ten Thousand, Eight Hundred and Eleven (810,811)
shares are designated as Series A Preferred Stock (hereinafter referred to as
the "Series A Preferred Stock");
------------------------

(ii) One Million, Seven Hundred Eighty Five Thousand, Seven Hundred
and Fourteen (1,785,714) shares are designated as Series B Preferred Stock
(hereinafter referred to as the "Series B Preferred Stock");
------------------------

<PAGE>

(iii) One Million, Four Hundred Three Thousand, Four Hundred and
Seventy Five (1,403,475) shares as designated as Series D Preferred Stock
(hereinafter referred to as the "Series D Preferred Stock");
------------------------

(iv) Four Hundred Thousand (400,000) shares as designated as Series E
Preferred Stock (hereinafter referred to as the "Series E Preferred Stock");
------------------------

(v) Five Hundred Fourteen Thousand, Eight Hundred and Fifty Seven
(514, 857) shares as designated as Series F Preferred Stock (hereinafter
referred to as the "Series F Preferred Stock").
------------------------

1.1 Definitions. For purposes of Sections 1 and 2 hereof, the following
-----------
definitions shall apply:

(a) "Board" shall mean the Board of Directors of the Corporation.
-----

(b) "Corporation" shall mean this corporation.
-----------

(d) "Original Issue Date" shall mean (i) with respect to the Series A
-------------------
Preferred Stock, Series B Preferred Stock, Series D Preferred Stock, Series E
Preferred Stock and Series F Preferred Stock, the date on which this Certificate
of Designations is filed with the Delaware Secretary of State, and (ii) with
respect to any other series of Preferred Stock which may be issued in the future
the date on which the first share of such Series of Preferred Stock is issued.

(e) "Original Issue Price" shall mean $22.20 per share for the Series
--------------------
A Preferred Stock, $17.50 per share for the Series B Preferred Stock, $0.53 per
share for the Series D Preferred Stock, $1.25 per share for the Series E
Preferred Stock and $5.25 per share for the Series F Preferred Stock.

(f) "Issued Preferred Stock" shall mean the Series A Preferred Stock,
----------------------
Series B Preferred Stock, Series D Preferred Stock, Series E Preferred Stock and
Series F Preferred Stock of the Corporation.

(g) Subsidiary" shall mean any corporation of which at least fifty
----------
percent (50%) of the outstanding voting stock is at the time owned directly or
indirectly by the Corporation or by one or more of such subsidiary corporations.

1.2 Dividends.
---------

(a) Issued Preferred Stock Dividends. The holders of the then
--------------------------------
outstanding Issued Preferred Stock shall be entitled to receive, if, as and when
declared by the Board, out of any assets or funds legally available therefor,
dividends concurrently with any dividends paid on the outstanding shares of
Common Stock, in any given fiscal year of the Corporation, in an amount at least
equal to the dividend that would be payable upon and with respect to the number

2
<PAGE>

of shares of Common Stock into which the shares of Issued Preferred Stock are
convertible on the date of such payment.

(b) Dividends Noncumulative. Subject to the provisions of Section
-----------------------
1.2(a), dividends on the Issued Preferred Stock shall not be mandatory or
cumulative, and no rights shall accrue to the holders of the Issued Preferred
Stock in the event that the Corporation shall fail to declare or pay dividends
on the Issued Preferred Stock in a specified amount in any previous fiscal year
of the Corporation, whether or not the earnings of the Corporation in the
previous fiscal year were sufficient to pay such dividends in whole or in part;
provided, however, nothing in this Section 1.2(b) shall be read to allow the
- -------- -------
Corporation to pay or declare dividends on the outstanding shares of Common
Stock without complying with the provisions of Section 1.2(a).

1.3 Liquidation Preferences.
-----------------------

(a) Preference for Issued Preferred Stock. In the event of any
-------------------------------------
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary, the holders of each share of Issued Preferred Stock then
outstanding shall be entitled to be paid out of the assets and funds of the
Corporation available for distribution to its stockholders, before any payment
or declaration and setting apart for payment of any amount shall be made in
respect of the Common Stock or any other stock of the Corporation ranking on
liquidation junior to the Issued Preferred Stock, an amount per share equal to
the Original Issue Price of the applicable series of Issued Preferred Stock plus
all declared but unpaid dividends on the Issued Preferred Stock (the "Issued
------
Preferred Preference"). All payments of the Issued Preferred Preference shall
- --------------------
be made pro rata to all holders of Issued Preferred Stock based on the
applicable Original Issue Price. If upon any liquidation, dissolution or
winding up of the Corporation, the assets and funds to be distributed to the
holders of the Issued Preferred Stock shall be insufficient to permit the
payment to such stockholders of the full Issued Preferred Preference, then all
of the remaining assets of the Corporation shall be distributed ratably to the
holders of the Issued Preferred Stock based on the aggregate Issued Preferred
Preference for the shares of Issued Preferred Stock held by each holder.

(b) No Participating Preference. If, after the payment in full of
---------------------------
the Issued Preferred Preference, the Corporation has assets or funds remaining
available for distribution to stockholders, then the remaining assets and funds
of the Corporation available for distribution to stockholders shall be
distributed to the holders of outstanding Common Stock without participation by
the holders of the Issued Preferred Stock.

(c) Merger or Sale of Assets. A consolidation or merger of the
------------------------
Corporation with or into any other corporation or corporations in which the
holders of the Corporation's outstanding shares before the consolidation or
merger do not retain a majority of the voting power of the surviving corporation
(or its parent), or a sale of all or substantially all of the assets of the
Corporation, shall be deemed to be a liquidation, dissolution or winding up of
the Corporation as those terms are used in this Section.

(d) Non-Cash Consideration. In the case of any event described in
----------------------
paragraph (c) above, if the consideration received by the Corporation is other
than cash, indebtedness or securities, the value of such consideration shall be
its fair market value as determined in good faith by the Board. Any securities
to be delivered pursuant to paragraphs (a) or (b) above, shall be valued as
follows:

3
<PAGE>

(1) Securities not subject to investment letter or other similar
restrictions on free marketability:

(A) If traded on a national securities exchange or the
NASDAQ National Market System, the value shall be deemed to be the average of
the closing prices of the securities on such exchange or system over the 30-day
period ending three (3) days prior to the closing; and

(B) If actively traded over-the-counter, the value shall be
deemed to be the average of the closing bid prices over the 30-day period ending
three (3) days prior to the closing; and

(C) If there is no active public market, the value shall be
the fair market value thereof, as determined in good faith by the Board.

(2) The method of valuation of securities subject to investment
letter or other restrictions on free marketability shall be to make an
appropriate discount from the market value determined as above in clause (1)(A),
(B) or (C) to reflect the approximate fair market value thereof, as determined
in good faith by the Board.

1.4 Voting Rights. Except as otherwise expressly provided herein, or as
-------------
required by law, the holders of Issued Preferred Stock and the holders of Common
Stock shall vote together and not as separate classes. Each holder of shares of
Issued Preferred Stock shall be entitled to the number of votes equal to the
number of whole shares of Common Stock into which such shares of Issued
Preferred Stock could be converted pursuant to the provisions of Section 1.5
below at the record date for the determination of the stockholders entitled to
vote on such matters or, if no such record date is established, the date such
vote is taken or any written consent of stockholders is solicited.

1.5 Conversion Rights. The outstanding shares of Issued Preferred Stock
-----------------
shall be convertible to Common Stock as follows:

(a) Optional Conversion. Subject to Section 1.5(b), each share of
-------------------
Issued Preferred Stock shall be convertible at any time or from time to time at
the option of the holder thereof into fully paid and nonassessable shares of
Common Stock as provided herein.

(b) Automatic Conversion. Each share of Issued Preferred Stock will
--------------------
be converted into fully paid and nonassessable shares of Common Stock as
provided herein at such time as there are a sufficient number of authorized
shares of Common Stock legally and validly reserved to effect the conversion or
exercise of all outstanding shares of Issued Preferred Stock and all outstanding
rights, options, warrants or other securities convertible, exchangeable or
exercisable for Issued Preferred Stock.

(c) Conversion Price. Each share of Issued Preferred Stock shall be
----------------
convertible into the number of shares of Common Stock which results from (a)
dividing the Original Issue Price for the applicable series of Issued Preferred
Stock by the conversion price of that series of Issued Preferred Stock that is
in effect at the time of conversion (the "Conversion Price") and (b) multiplying
----------------
such quotient by (i) ten (10) with respect to Series A Preferred Stock, Series B

4
<PAGE>

Preferred Stock, Series D Preferred Stock and Series F Preferred Stock and (ii)
twenty-five (25) with respect to Series E Preferred Stock. The initial
Conversion Price for each series of Issued Preferred Stock shall be its Original
Issue Price. The Conversion Price shall be subject to adjustment from time to
time as provided below.

(d) Adjustment for Stock Splits and Combinations. If the Corporation
--------------------------------------------
shall at any time or from time to time after the Original Issue Date of a series
of Issued Preferred Stock effect a stock split or subdivision of the outstanding
Common Stock, the Conversion Price for such series of Issued Preferred Stock in
effect immediately before that subdivision shall be proportionately decreased,
and, conversely, if the Corporation shall at any time or from time to time after
the Original Issue Date of a series of Issued Preferred Stock combine the
outstanding shares of Common Stock into a smaller number of shares, the
Conversion Price for such series of Issued Preferred Stock in effect immediately
before the combination shall be proportionately increased. Any adjustment under
this subsection (b) shall become effective at the close of business on the date
the stock split, subdivision or combination becomes effective.

(e) Adjustment for Common Stock Dividends and Distributions. If the
-------------------------------------------------------
Corporation at any time or from time to time after the Original Issue Date of a
series of Issued Preferred Stock makes, or fixes, a record date for the
determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable solely in additional shares of Common Stock, in each
such event the Conversion Price for such series of Issued Preferred Stock that
is then in effect shall be decreased as of the time of such issuance or, in the
event such record date is fixed, as of the close of business on such record
date, by multiplying the Conversion Price then in effect by a fraction (1) the
numerator of which is the total number of shares of Common Stock issued and
outstanding immediately prior to the time of such issuance or the close of
business on such record date, and (2) the denominator of which is the total
number of shares of Common Stock issued and outstanding immediately prior to the
time of such issuance or the close of business on such record date plus the
number of shares of Common Stock issuable in payment of such dividend or
distribution; provided, however, that if such record date is fixed and such
dividend is not fully paid or if such distribution is not fully made on the date
fixed therefor, the Conversion Price shall be recomputed accordingly as of the
close of business on such record date and thereafter the Conversion Price shall
be adjusted pursuant to this subsection (c) to reflect the actual payment of
such dividend or distribution.

(f) Adjustments for Other Dividends and Distributions. If the
-------------------------------------------------
Corporation at any time or from time to time after the Original Issue Date of a
series of Issued Preferred Stock makes, or fixes a record date for the
determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Corporation other than shares of
Common Stock, in each such event appropriate provision shall be made so that the
holders of such series of Issued Preferred Stock shall receive on the date of
such dividend or distribution the amount of securities of the Corporation which
they would have received had their Issued Preferred Stock been converted into
Common Stock on the date of such event.

(g) Adjustment for Reclassification, Exchange and Substitution. If
-----------------------------------------------------------
at any time or from time to time after the Original Issue Date of a series of
Issued Preferred Stock, the Common Stock issuable upon the conversion of such
series of Issued Preferred Stock is changed into the same or a different number
of shares of any class or classes of stock, whether by recapitalization,
reclassification or otherwise (other than a subdivision or combination of
shares, stock dividend, other dividend or distribution, or a reorganization,
merger, consolidation or sale

5
<PAGE>

of assets provided for elsewhere in this Section 1.5 or in Section 1.3(c)), then
in any such event each holder of such series of Issued Preferred Stock shall
have the right thereafter to convert such stock into the kind and amount of
stock and other securities and property receivable upon such recapitalization,
reclassification or other change by holders of the number of shares of Common
Stock into which such shares of Issued Preferred Stock could have been converted
immediately prior to such recapitalization, reclassification or change, all
subject to further adjustment as provided herein or with respect to such other
securities or property by the terms thereof.

(h) Reorganizations. If at any time or from time to time after the
---------------
Original Issue Date of a series of Issued Preferred Stock there is a capital
reorganization of the Common Stock (other than a recapitalization, subdivision,
combination, reclassification, exchange or substitution of shares provided for
elsewhere in this Section 1.5 or in Section 1.3(c)), as a part of such capital
reorganization provision shall be made so that the holders of such series of
Issued Preferred Stock shall thereafter be entitled to receive upon conversion
of the Issued Preferred Stock the number of shares of stock or other securities
or property of the Corporation to which a holder of the number of shares of
Common Stock deliverable upon conversion would have been entitled on such
capital reorganization, subject to adjustment in respect of such stock or
securities by the terms thereof. In any such case, appropriate adjustment shall
be made in the application of the provisions of this Section 1.5 with respect to
the rights of the holders of Issued Preferred Stock after such capital
reorganization to the end that the provisions of this Section 1.5 (including
adjustment of the Conversion Price then in effect and the number of shares
issuable upon conversion of the Issued Preferred Stock) shall be applicable
after that event and be as nearly equivalent as practicable.

(i) Certificate of Adjustment. In each case of an adjustment or
-------------------------
readjustment of any Conversion Price for the number of shares of Common Stock or
other securities issuable upon conversion of the Issued Preferred Stock, the
Corporation, at its expense, shall cause its Chief Financial Officer to compute
such adjustment or readjustment in accordance with the provisions hereof and
prepare a certificate showing such adjustment or readjustment, and shall mail
such certificate, by first class mail, postage prepaid, to each registered
holder of the Issued Preferred Stock at the holder's address as shown in the
Corporation's books. The certificate shall set forth such adjustment or
readjustment, showing in detail the facts upon which such adjustment or
readjustment is based, including a statement of (1) the applicable Conversion
Price at the time in effect and (2) the type and amount, if any, of other
property which at the time would be received upon conversion of the applicable
series of Issued Preferred Stock.

(j) Notices of Record Date. Upon (1) any taking by the Corporation
----------------------
of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend or
other distribution, or (2) any capital reorganization of the Corporation, any
reclassification or recapitalization of the capital stock of the Corporation,
any merger or consolidation of the Corporation with or into any other
corporation, or any transfer of all or substantially all the assets of the
Corporation to any other person or any voluntary or involuntary dissolution,
liquidation or winding up of the Corporation, the Corporation shall mail to each
holder of Issued Preferred Stock at least ten (10) days prior to the record date
specified therein a notice specifying (1) the date on which any such record is
to be taken for the purpose of such dividend or distribution and a description
of such dividend or distribution, (2) the date on which any such reorganization,
reclassification, transfer, consolidation, merger, dissolution, liquidation or
winding up is expected to become effective, and (3) the date, if any, that is to
be fixed as to when the holders of record of Common Stock (or other securities)
shall be entitled to

6
<PAGE>

exchange their shares of Common Stock (or other securities) for securities or
other property deliverable upon such reorganization, reclassification, transfer,
consolidation, merger, dissolution, liquidation or winding up.

(k) Mechanics of Optional Conversion. Each holder of Issued
--------------------------------
Preferred Stock who desires to convert the same into share of Common Stock shall
surrender the certificate or certificates therefor, duly endorsed, at the office
of the Corporation or any transfer agent for the Issued Preferred Stock or
Common Stock, and shall give written notice to the Corporation at such office
that such holder elects to convert the same and shall state therein the number
of shares of Issued Preferred Stock being converted. Thereupon the Corporation
shall promptly issue and deliver at such office to such holder a certificate or
certificates for the number of shares of Common Stock to which such holder is
entitled. Such conversion shall be deemed to have been made immediately prior to
the close of business on the date of such surrender of the certificate
representing the shares of Issued Preferred Stock to be converted, and the
person entitled to receive the shares of Common Stock issuable upon such
conversion shall be treated for all purposes as the record holder of such shares
of Common Stock on such date.

(l) Mechanics of Automatic Conversion. Upon the filing with the
---------------------------------
Secretary of State of the State of Delaware of an amendment to the Corporation's
Certificate of Incorporation increasing the authorized number of shares of
Common Stock to an amount sufficient to provide for the conversion of all
authorized shares of Issued Preferred Stock for which a Certificate of
Designations has been filed (whether or not such shares are outstanding), the
outstanding shares of Issued Preferred Stock shall be converted into Common
Stock automatically without the need for any further action by the holders of
such shares and whether or not the certificates representing such shares are
surrendered to the Corporation or its transfer agent; provided, however, that
-------- -------
the Corporation shall not be obligated to issue certificates evidencing the
shares of Common Stock issuable upon such conversion unless the certificates
evidencing such shares of Issued Preferred Stock are delivered to the
Corporation or its transfer agent as provided below, or the holder notifies the
Corporation or its transfer agent that such certificates have been lost, stolen
or destroyed and executes an agreement satisfactory to the Corporation to
indemnify the Corporation from any loss incurred by it in connection with such
certificates. Upon the occurrence of such automatic conversion of the Issued
Preferred Stock, the holders of Issued Preferred Stock shall surrender the
certificates representing such shares at the office of the Corporation or any
transfer agent for the Issued Preferred Stock or Common Stock. Thereupon, there
shall be issued and delivered to such holder promptly at such office and in its
name as shown on such surrendered certificate or certificates, a certificate or
certificates for the number of shares of Common Stock into which the shares of
Preferred Stock surrendered were convertible on the date on which such automatic
conversion occurred.

(m) Fractional Shares. No fractional shares of Common Stock shall be
-----------------
issued upon conversion of Issued Preferred Stock. In lieu of any fractional
share to which the holder would otherwise be entitled, the Corporation shall pay
cash equal to the product of such fraction multiplied by the Common Stock's per
share fair market value as determined in good faith by the Board as of the date
of conversion.

(n) Reservation of Stock Issuable Upon Conversion. The Corporation
---------------------------------------------
shall at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Issued Preferred Stock, such number of its shares of Common
Stock as shall from time to time be sufficient to effect the conversion of all
outstanding shares of the Issued Preferred Stock; and if at any time (including
without limitation the Original Issue Date) the number of authorized but
unissued shares of Common Stock shall not be sufficient to effect the

7
<PAGE>

conversion of all then outstanding shares of the Issued Preferred Stock, the
Corporation will take such corporate action as may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of Common
Stock to such number of shares as shall be sufficient for such purpose.

(o) Notices. Any notice required by the provisions of this Section
-------
1.5 to be given to the holders of shares of the Issued Preferred Stock shall be
deemed given upon the earlier of actual receipt or deposit in the United States
mail, by certified or registered mail, return receipt requested, postage
prepaid, addressed to each holder of record at the address of such holder
appearing on the books of the Corporation.

(p) Payment of Taxes. The Corporation will pay all transfer taxes or
----------------
charges that may be imposed with respect to the issue or delivery of shares of
Common Stock upon conversion of shares of Issued Preferred Stock, except for any
tax or other charge imposed in connection with any transfer involved in the
issue and delivery of shares of Common Stock in a name other than that in which
the shares of Issued Preferred Stock so converted were registered.

(q) No Impairment. The Corporation shall not amend its Certificate
-------------
of Incorporation or participate in any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, for the purpose of avoiding or seeking to avoid the observance
or performance of any of the terms to be observed or performed hereunder by the
Corporation, but shall at all times in good faith assist in carrying out all
such action as may be reasonably necessary or appropriate in order to protect
the conversion rights of the holders of the Issued Preferred Stock against
dilution or other impairment.

(r) No Reissuance of Issued Preferred Stock. No share or shares of
---------------------------------------
Issued Preferred Stock acquired by the Corporation by reason of redemption,
purchase, conversion or otherwise shall be reissued, and all such shares shall
be canceled, retired and eliminated from the shares which the Corporation shall
be authorized to issue.

SECTION 2: RESTRICTIONS AND LIMITATIONS.
----------------------------

2.1 So long as any shares of any series of Issued Preferred Stock remain
outstanding, the Corporation shall not, without the approval by vote or written
consent of the holders of eighty-five percent (85%) of the outstanding shares of
such series of Issued Preferred Stock (i) increase the authorized shares of such
series of Issued Preferred Stock or (ii) amend or repeal any provision of or add
any provision to the Corporation's Certificate of Incorporation or Bylaws if
such amendment or repeal would alter or change any of the rights, preferences,
privileges of or limitations provided herein for the benefit of such series of
Issued Preferred Stock.

2.2 So long as any shares of any series of Issued Preferred Stock remain
outstanding, the Corporation shall not, without the approval, by vote or written
consent, of the holders of a majority of the outstanding Issued Preferred Stock,
voting as a single class:

(a) Increase the total number of authorized shares of Preferred
Stock;

8
<PAGE>

(b) Authorize or issue any equity security (other than Common Stock)
senior to or on a parity with any series of Preferred Stock as to dividend
rights, redemption rights, liquidation preferences or voting rights;

(c) Merge with or into or sell all or substantially all of its assets
to any person or entity or effect any other form of corporate recapitalization
or reorganization, if after such merger, sale, recapitalization or
reorganization the then-current stockholders of the Corporation hold less than
50% of the combined voting power of the surviving entity;

(d) Enter into any transaction that would result in a deemed dividend
under Section 305 of the Internal Revenue Code 1986, as amended; or

(e) Increase the size of the Board of Directors above nine (9)
members.

IN WITNESS WHEREOF, AmeriQuest Technologies, Inc., has caused this
Certificate of Designations to be duly executed and attested this ____ day of
August 1995.

AMERIQUEST TECHNOLOGIES, INC.

By:______________________________________
Harold Clark
Chief Executive Officer
Attest:

____________________________________
Stephen Holmes
Secretary

<PAGE>

EXHIBIT 10.01

Inventory and Working Capital Financing Agreement

by and between

CDS Distribution, Inc.

and

IBM Credit Corporation
<PAGE>

Table of Contents

INVENTORY AND WORKING CAPITAL
FINANCING AGREEMENT........................................................ 1
RECITALS ............................................................. 1
Section 1. DEFINITIONS.............................................. 1
1.1. Special Definitions...................................... 1
1.2. Other Defined Terms...................................... 9
Section 2. LINE OF CREDIT/FINANCE CHARGES/OTHER CHARGES............. 9
2.1. Line of Credit........................................... 9
2.2. Product Advances......................................... 10
2.3. A/R Advances............................................. 11
2.4. Finance and Other Charges................................ 13
2.5. Statements Regarding Customer's Account.................. 13
2.6. Shortfall................................................ 14
2.7. Application of Payments.................................. 14
2.8. Prepayment and Reborrowing By Customer................... 14
Section 3. LINE OF CREDIT ADDITIONAL PROVISIONS..................... 14
3.1. Ineligible Accounts...................................... 14
3.2. Reimbursement for Charges................................ 16
3.3. Lockbox and Special Account.............................. 17
3.4. Collections.............................................. 17
3.5. Application of Remittances and Credits................... 17
3.6. Power of Attorney........................................ 17
Section 4. SECURITY--COLLATERAL..................................... 19
4.1. Grant.................................................... 19
4.2. Further Assurances....................................... 20
Section 5. CONDITIONS PRECEDENT..................................... 20
5.1. Conditions Precedent to the Effectiveness of
This Agreement......................................... 20
5.2. Conditions to Each Advance............................... 21
Section 6. REPRESENTATIONS AND WARRANTIES........................... 22
6.1. Organization and Qualifications.......................... 22
6.2. Rights in Collateral; Priority of Liens.................. 22
6.3. No Conflicts............................................. 22
6.4. Enforceability........................................... 23
6.5. Locations of Offices, Records and Inventory.............. 23
6.6. Fictitious Business Names................................ 23
6.7. Organization............................................. 23
6.8. No Judgments or Litigation............................... 23
6.9. No Defaults.............................................. 24
6.10. Labor Matters............................................ 24
6.11. Compliance with Law...................................... 24
6.12. ERISA.................................................... 24
6.13. Compliance with Environmental Laws....................... 24
6.14. Intellectual Property.................................... 25
6.15. Licenses and Permits..................................... 25
6.16. Investment Company....................................... 25
6.17. Taxes and Tax Returns.................................... 26
6.18. Status of Accounts....................................... 26
6.19. Affiliate/Subsidiary Transactions........................ 26

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<PAGE>

6.20. Accuracy and Completeness of Information................. 26
6.21. Recording Taxes.......................................... 26
6.22. Indebtedness............................................. 27
Section 7. AFFFIRMATIVE CONVENANTS.................................. 27
7.1. Financial and Other Information.......................... 27
7.2. Location of Collateral................................... 29
7.3. Changes in Customer...................................... 30
7.4. Corporate Existence...................................... 30
7.5. ERISA.................................................... 30
7.6. Environmental Matters.................................... 30
7.7. Collateral Books and Records/Collateral Audit............ 31
7.8. Insurance; Casualty Loss................................. 32
7.9. Taxes.................................................... 32
7.10. Compliance With Laws..................................... 33
7.11. Fiscal Year.............................................. 33
7.12. Intellectual Property.................................... 33
7.13. Maintenance of Property.................................. 33
7.14. Collateral............................................... 33
7.15. Subsidiaries............................................. 34
Section 8. NEGATIVE COVENANTS....................................... 35
8.1. Liens.................................................... 35
8.2. Disposition of Assets.................................... 35
8.3. Corporate Changes........................................ 35
8.4. Guaranties............................................... 35
8.5. Restricted Payments...................................... 35
8.6. Investments.............................................. 36
8.7. Affiliate/Subsidiary Transactions........................ 36
8.8. ERISA.................................................... 36
8.9. Additional Negative Pledges.............................. 37
8.10. Storage of Collateral with Bailees and Warehousemen...... 37
8.11. Use of Proceeds.......................................... 37
8.12. Accounts................................................. 37
8.13. Indebtedness............................................. 37
8.14. Loans.................................................... 37
Section 9. DEFAULT.................................................. 38
9.1. Event of Default......................................... 38
9.2. Acceleration............................................. 40
9.3. Remedies................................................. 40
Section 10. MISCELLANEOUS............................................ 42
10.1. Term; Termination........................................ 42
10.2. Indemnification.......................................... 42
10.3. Additional Obligations................................... 43
10.4. LIMITATION OF LIABILITY.................................. 43
10.5. Alteration/Waiver........................................ 43
10.6. Severability............................................. 44
10.7. One Loan................................................. 44
10.8. Additional Collateral.................................... 44
10.9. No Merger or Novations................................... 44
10.10. Paragraph Titles......................................... 45
10.11. Binding Effect; Assignment............................... 45

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<PAGE>

10.12. Notices.................................................. 45
10.13. Counterparts............................................. 46
10.14. ATTACHMENT A MODIFICATIONS............................... 46
10.15. SUBMISSION AND CONSENT TO JURISDICTION AND
CHOICE OF LAW.......................................... 46
10.16. JURY TRIAL WAIVER........................................ 47

3
<PAGE>

INVENTORY AND WORKING CAPITAL
FINANCING AGREEMENT

This INVENTORY AND WORKING CAPITAL FINANCING AGREEMENT (as amended,
supplemented or otherwise modified from time to time, this "Agreement") is
hereby made this 5 day of May, 1995, by and between IBM CREDIT CORPORATION with
a place of business at 1500 Riveredge Parkway, Atlanta, GA 30328 ("IBM Credit"),
and CDS DISTRIBUTION, INC. with a place of business at 2722 Michelson Drive,
Irvine, CA 92713 ("Customer").

RECITALS

WHEREAS, in the course of Customer's operations, Customer intends to
purchase from Persons approved in writing by IBM Credit for the purposes of this
Agreement (the "Authorized Suppliers") computer hardware and software products
manufactured or distributed by or bearing any trademark or trade name of such
Authorized Suppliers for distribution throughout the United States (the
"Products") (as of the date hereof the Authorized Suppliers are as set forth on
Attachment E hereto);

WHEREAS, Customer has requested that IBM Credit finance its purchase of
Products from such Authorized Suppliers and its working capital requirements,
and IBM Credit is willing to provide such financing to Customer subject to the
terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

Section 1. DEFINITIONS

1.1 Special Definitions. The following terms shall have the following respective
meaning in this Agreement:

"A/R Advance": any loan or advance of funds made by IBM Credit to Customer
pursuant to Section 2.3 of this Agreement, including, as the context may
require, a WCO Advance, a PRO Advance and a Takeout Advance.

"A/R Advance Date": the Business Day on which IBM Credit makes an A/R Advance
under this Agreement.

"A/R Advance Term": shall be the collective or individual reference, as the
context may require, to a PRO Advance Term and

1
<PAGE>

a WCO Advance Term.

"A/R Finance Charges": as defined on Attachment A.

"Accounts": as defined in the U.C.C.

"Advance": any loan or other extension of credit by IBM Credit to Customer
pursuant to this Agreement including, without limitation, (i) Product Advances
and (ii) A/R Advances.

"Affiliate": with respect to the Customer, any Person meeting one of the
following: (i) at least 10% of such Person's equity is owned, directly or
indirectly, by Customer; (ii) at least 10% of Customer's equity is owned,
directly or indirectly, by such Person; or (iii) at least 10% of Customer's
equity and at least 10% of such Person's equity is owned, directly or
indirectly, by the same Person or Persons. All of Customer's officers,
directors, joint venturers, and partners shall also be deemed to be Affiliates
of Customer for purposes of this Agreement.

"AmeriQuest": AmeriQuest Technologies, Inc., the direct owner of one hundred
percent (100%) of the outstanding capital stock of Customer.

"Auditors": a nationally recognized firm of independent certified public
accountants selected by Customer and satisfactory to IBM Credit.

"Available Credit": at any time, (1) the Maximum Advance Amount less (2) the
Outstanding Advances at such time.

"Average Daily Balance": the sum of the Outstanding Product Advances or
Outstanding A/R Advances, as the case may be, as of the end of each day during a
calendar month, divided by the number of days in the calendar month.

"Borrowing Base": as defined in Attachment A.

"Business Day": any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are generally closed or on which IBM
Credit is closed.

"Closing Date": the date on which the conditions precedent to the effectiveness
of this Agreement set forth in Section 5.1 hereof are satisfied or waived in
writing by IBM Credit.

"Code": the Internal Revenue Code of 1986, as amended or any successor statute.

"Collateral": as defined in Section 4.1.

"Collateral Management Report": a report to be delivered by

2
<PAGE>

Customer to IBM Credit from time to time, as provided herein, signed by the
chief executive officer or chief financial officer, in the form of Attachment F
hereto, detailing and certifying, among other items: a summary of Customer's
inventory on hand financed by IBM Credit and Customer's Eligible Accounts, the
amounts and aging of all of Customer's Accounts, Customer's inventory on hand
financed by IBM Credit by quantity, type, model, Authorized Supplier's invoice
price to Customer and the total of the line item values for all inventory listed
on the report, the amounts and aging of Customer's accounts payable as of a
specified date, all of Customer's IBM Credit borrowing activity during a
specified period and the total amount of Customer's Borrowing Base as well as
Customer's Outstanding A/R Advances, Outstanding Product Advances, Available
Credit and any Shortfall Amount as of a specified date.

"Common Due Date": (1) the fifth day of a calendar month if the Product Advance
Term or A/R Advance Term, whichever is applicable, expires on the first through
tenth of such calendar month; (2) the fifteenth day of a calendar month if the
Product Advance Term or A/R Advance Term, whichever is applicable, expires on
the eleventh through twentieth of such calendar month; and (3) the twenty-fifth
day of a calendar month if the Product Advance Term or A/R Advance Term,
whichever is applicable, expires on the twenty-first through the last day of
such calendar month.

"Compliance Certificate": a certificate substantially in the form of Attachment
C.

"Default": either (1) an Event of Default or (2) any event or condition which,
but for the requirement that notice be given or time lapse or both, would be an
Event of Default.

"Delinquency Fee Rate": as defined on Attachment A. "Eligible Account": as
defined in Section 3.1.

"Environmental Laws": all statutes, laws, judicial decisions, regulations,
ordinances, and other governmental restrictions relating to pollution, the
protection of the environment, occupational health and safety, or to emissions,
discharges or release of pollutants, contaminants, hazardous substances or
wastes into the environment.

"Environmental Liability": any claim, demand, obligation, cause of action,
allegation, order, violation, injury, judgment, penalty or fine, cost or
expense, resulting from the violation or alleged violation of any Environmental
Laws or the imposition of any Lien pursuant to any Environmental Laws.

"ERISA": the Employee Retirement Income Security Act of 1974, as

3
<PAGE>

amended, or any successor statutes.

"Event of Default": as defined in Section 9.1.

"Financial Statements": the consolidated and consolidating balance sheets,
statements of operations, statements of cash flows and statements of changes in
shareholder's equity of AmeriQuest and its Subsidiaries for the period
specified, prepared in accordance with GAAP and consistent with prior practices.

"Floor Plan Lender": any Person who now or hereinafter provides inventory
financing to Customer, provided that such Person executes an Intercreditor
Agreement (as defined in Section 5.1 of this Agreement) or a subordination
agreement with IBM Credit in form and substance satisfactory to IBM Credit.

"Free Financing Period": for each Product Advance, the period, if any, in which
IBM Credit does not charge Customer a financing charge. IBM Credit shall
calculate the Customer's Free Financing Period utilizing a methodology that is
consistent with the methodologies used for similarly situated customers of IBM
Credit. The Customer understands that IBM Credit may not offer or may cease to
offer a Free Financing Period for the Customer's purchases of Products.

"GAAP": generally accepted accounting principles in the United States as in
effect from time to time.

"Governmental Authority": any nation or government, any state or other political
subdivision thereof, and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled (through stock or capital
ownership or otherwise) by any of the foregoing.

"Guaranties": guaranties in favor of IBM Credit guarantying the Obligations of
Customer.

"Guarantor": any guarantor pursuant to any of the Guaranties.

"Hazardous Substances": all substances, wastes or materials, to the extent
subject to regulation as "hazardous substances" or "hazardous waste" under any
Environmental-LawS.

4
<PAGE>

Person in respect of letters of credit, banker's acceptances or similar
obligations issued or created for the account of such Person, (4) liabilities
arising under any interest rate protection, future, option swap, cap or hedge
agreement or arrangement under which such Person is a party or beneficiary, (5)
all obligations under guaranties of such Person and (6) all liabilities secured
by any Lien on any property owned by such Person even though such Person has
not assumed or otherwise become liable for the payment thereof.

"Investment": with respect to any Person (the "Investor"), (1) any investment
by the Investor in any other Person, whether by means of share purchase,
capital contribution, purchase or other acquisition of a partnership or joint
venture interest, loan, time deposit, demand deposit or otherwise, and (2) any
guaranty by the Investor of any Indebtedness or other obligation of any other
Person.

"Lien(s)": any lien, claim, charge, pledge, security interest, deed of trust,
mortgage, other encumbrance or other arrangement having the practical effect of
the foregoing, including the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement.

"Line of Credit": as defined in Section 2.1.

"Material Adverse Effect": a material adverse effect (1) on the business,
operations, results of operations, assets, or financial condition of the
Customer, (2) on the aggregate value of the Collateral or the aggregate amount
which IBM Credit would be likely to receive (after giving consideration to
reasonably likely delays in payment and reasonable costs of enforcement) in the
liquidation of such Collateral to recover the Obligations in full, or (3) on
the rights and remedies of IBM Credit under this Agreement.

"Maximum Advance Amount": at any time, the lesser of (1) the Line of Credit and
(2) the Borrowing Base at such time.

"Obligations": all covenants, agreements, warranties, duties, representations,
loans, advances, interest (including interest accruing on or after the filing
of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to Customer, whether or not a claim
for post-filing or post-petition interest is allowed in such proceeding), fees,
reasonable expenses, indemnities, liabilities and Indebtedness of any kind and
nature whatsoever now or hereafter arising, owing, due or payable from Customer
to IBM Credit, whether primary or secondary, joint or several, direct,
contingent, fixed or otherwise, secured or unsecured arising under this
Agreement and the Other Agreements.
<PAGE>

"Other Agreements": all security agreements, mortgages, leases, instruments,
documents, guarantees, schedules of assignment, contracts and similar agreements
executed by Customer and delivered to IBM Credit, pursuant to this Agreement or
otherwise, and all amendments, supplements and other modifications to the
foregoing from time to time.

"Other Charges": as set forth in Attachment A.

"Outstanding Advances": at any time of determination, the sum of (1) the
Outstanding Product Advances and (2) the Outstanding A/R Advances.

"Outstanding A/R Advances": at any time of determination, the sum of (1) the
unpaid principal amount of all A/R Advances made by IBM Credit under this
Agreement; and (2) any finance charge, fee, expense or other amount related to
A/R Advances charged to Customer's account with IBM Credit.

"Outstanding Product Advances": at any time of determination, the sum of (1) the
unpaid principal amount of all Product Advances made by IBM Credit under this
Agreement; and (2) any finance charge, fee, expense or other amount related to
Product Advances charged to Customer's account with IBM Credit.

"Payment Dates": the fifth, fifteenth and twenty-fifth day of each calendar
month.

"Permitted Indebtedness": any of the following:

(1) Indebtedness to IBM Credit;

(2) Indebtedness described in Section VII of Attachment B;

(3) Indebtedness to any Floor Plan Lender;

(4) Purchase Money Indebtedness;

(5) guaranties in favor of IBM Credit; and

(6) Other Indebtedness consented to by IBM Credit in writing prior to the
incurrence thereof.

"Permitted Liens": any of the following:

(1) Liens which are the subject of an Intercreditor Agreement, in effect from
time to time between IBM Credit and any other secured creditor;

(2) Purchase Money Security Interests;

(3) Liens described in Section I of Attachment B;

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<PAGE>

(4) Liens of warehousemen, mechanics, materialmen, workers, repairmen, common
carriers, landlords and other similar Liens arising by operation of law or
otherwise, not waived in connection herewith, for amounts that are not yet due
and payable or being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted if an adequate reserve or other appropriate
provisions shall have been made therefor as required to be in conformity with
GAAP and an adverse determination in such proceedings could not reasonably be
expected to have a Material Adverse Effect;

(5) attachment or judgment Liens individually or in the aggregate not in excess
of $300,000 (exclusive of (A) any amounts that are duly bonded to the
satisfaction of IBM Credit or (B) any amount fully covered by insurance as to
which the insurance company has acknowledged its obligation to pay such judgment
in full);

(6) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate, are not
substantial in amount and which do not materially detract from the value of the
property subject thereto or materially interfere with the ordinary conduct of
the business of Customer;

(7) extensions and renewals of the foregoing permitted Liens; provided that (A)
the aggregate amount of such extended or renewed Liens do not exceed the
original principal amount of the Indebtedness for which it secures, (B) such
Liens do not extend to any property other than property already previously
subject to the Lien and (C) such extended or renewed Liens are on terms and
conditions no more restrictive than the terms and conditions of the Liens being
extended or renewed;

(8) Liens arising from deposits or pledges to secure bids, tenders, contracts,
leases, surety and appeal bonds and other obligations of like nature arising in
the ordinary course of the Customer's business;

(9) Liens for taxes, assessments or governmental charges not delinquent or being
contested, in good faith, by appropriate proceedings promptly instituted and
diligently conducted if an adequate reserve or other appropriate provisions
shall have been made therefor as required in order to be in conformity with GAAP
and an adverse determination in such proceedings could not reasonably be
expected to have a Material Adverse Effect;

(10) Liens arising out of deposits in connection with workers' compensation,
unemployment insurance or other social security or similar legislation;

(11) Liens arising pursuant to this Agreement; and

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<PAGE>

(12) other Liens consented to by IBM Credit in writing prior to the incurrence
thereof.

"Person": any individual, association, firm, corporation, partnership, trust,
unincorporated organization or other entity whatsoever.

"Policies": all policies of insurance required to be maintained by Customer
under this Agreement or any of the Other Agreements.

"Prime Rate": as of the date of determination, the average of the rates of
interest announced by Citibank, N.A., The Chase Manhattan Bank, N.A. and Bank of
America National Trust & Savings Association as their prime or base rate, as of
the last Business Day of the calendar month immediately preceding the date of
determination, whether or not such announced rates are the actual rates charged
by such banking institutions to their most creditworthy borrowers.

"PRO Advance": an A/R Advance, with a PRO Advance Term, made by IBM Credit to
itself on behalf of Customer to repay all or a portion of a Product Advance that
is due and payable.

"PRO Advance Term": for each PRO Advance, a period, in increments of ten days as
specified by Customer in the Request for A/R Advance with respect to such PRO
Advance, but in no event in excess of thirty days, commencing on the A/R Advance
Date for such PRO Advance.

"Product Advance": any advance of funds made or committed to be made by IBM
Credit for the account of Customer to an Authorized Supplier in respect of an
invoice delivered by such Authorized Supplier to IBM Credit describing Products
purchased by Customer, including any such advance made or committed to be made
as of the date hereof pursuant to the Financing Agreement.

"Product Advance Charge": as defined on Attachment A.

"Product Advance Term": for each Product Advance, a period of days equal to that
set forth in Attachment A from time to time, commencing on the invoice date of
such Product Advance.

"Purchase Money Indebtedness": any Indebtedness (including capital leases)
incurred to finance the acquisition of assets (other than assets manufactured or
distributed by or bearing any trademark or trade name of any Authorized
Supplier) to be used in the Customer's business not to exceed the lesser of (1)
the purchase price or acquisition cost of such asset and (2) the fair market
value of such asset.

"Purchase Money Security Interest": any security interest securing Purchase
Money Indebtedness, which security interest

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<PAGE>

applies solely to the particular asset acquired with the Purchase Money
Indebtedness.

"Request for A/R Advance": as defined in Section 2.3.

"Requirement of Law": as to any Person, the articles of incorporation and by-
laws of such Person, and any law, treaty, rule or regulation or determination of
an arbitrator or a court or other governmental authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.

"Shortfall Amount": as defined in Section 2.6.

"Subsidiary": with respect to any Person, any corporation or other entity of
which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other Persons performing similar
functions are at the time directly or indirectly owned by such Person.

"Takeout Advance": an A/R Advance made to existing creditors of Customer on
behalf of Customer, in an amount sufficient to discharge Customer's indebtedness
to such creditor.

"Termination Date": shall mean (i) the first anniversary of the date of this
Agreement or such other date as IBM Credit and Customer may agree to in writing
from time to time.

"Voting Stock": securities, the holders of which are ordinarily, in the absence
of contingencies, entitled to elect the corporate directors (or persons
performing similar functions).

"WCO Advance": an A/R Advance, with a WCO Advance Term.

"WCO Advance Term": for each WCO Advance, a period of one hundred eighty (180)
days commencing on the A/R Advance Date for such WCO Advance.

1.2. Other Defined Terms. Terms not otherwise defined in this Agreement which
are defined in the Uniform Commercial Code as in effect in the State of New York
(the "U.C.C.") shall have the meanings assigned to them therein.

Section 2. LINE OF CREDIT/FINANCE CHARGES/OTHER CHARGES

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<PAGE>

to Section 9.2, IBM Credit agrees to extend to the Customer a line of credit
("Line of Credit") in the amount set forth in Attachment A pursuant to which
IBM Credit will make to the Customer, from time to time, Advances in an
aggregate amount at any one time outstanding not to exceed the Maximum Advance
Amount.

2.2 Product Advances. (A) Subject to the terms and conditions of this
Agreement, IBM Credit shall make Product Advances in connection with Customer's
purchase of Products from Authorized Suppliers. Customer hereby authorizes and
directs IBM Credit to pay the proceeds of Product Advances directly to the
applicable Authorized Supplier in respect of invoices delivered to IBM Credit
for such Products by such Authorized Supplier and acknowledges that each such
Product Advance constitutes a loan by IBM Credit to Customer pursuant to this
Agreement as if the Customer received the proceeds of the Product Advance
directly from IBM Credit.

(B) No finance charge shall accrue on any Product Advance during the Free
Financing Period, if any, applicable to such Product Advance. Customer shall
repay each Product Advance no later than the Common Due Date for such Product
Advance. Customer may, at its option, repay each Product Advance by requesting
IBM Credit to apply all or any part of the principal amount of an A/R Advance
to the Outstanding Product Advances. Customer's request for such application
shall be made in accordance with Section 2.3. When so requested and subject to
the terms and conditions of this Agreement, IBM Credit shall apply the amount
so requested to the amounts due in respect of the Outstanding Product Advances.
Nothing contained herein shall relieve Customer of its obligation to repay
Product Advances when due. Each Product Advance shall accrue a finance charge
on the Average Daily Balance thereof from the end of the Free Financing Period,
if any, for such Product Advance, or if no such Free Financing Period shall be
in effect, from the date of invoice for such Product Advance, in each case,
until such Product Advance shall become due and payable in accordance with the
terms of this Agreement, at a per annum rate equal to the lesser of (a) the
finance charge set forth in Attachment A to this Agreement as the "Product
Advance Charge" and (b) the highest rate from time to time permitted by
applicable law. In addition, for any Product Advance with respect to which a
Free Financing Period shall not be in effect, Customer shall pay a fee equal to
50 basis points of such Product Advance. Such fee shall be due and payable on
the Common Due Date for such Product Advance. If it is determined that amounts
received from Customer were in excess of the highest rate permitted by law,
then the amount representing such excess shall be considered reductions to
principal of Advances.

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<PAGE>

the Collateral. Customer shall be obligated to pay IBM Credit in full even if
the Collateral is defective or fails to conform to the warranties extended by
the Authorized Supplier. The Obligations of Customer shall not be affected by
any dispute Customer may have with any manufacturer, distributor or Authorized
Supplier. Customer will not assert any claim or defense which it may have
against any manufacturer, distributor or Authorized Supplier against IBM Credit.

(D) Customer hereby authorizes IBM Credit to collect directly from any
Authorized Supplier any credits, rebates, bonuses or discounts owed by such
Authorized Supplier to Customer ("Supplier Credits"). Any Supplier Credits
received by IBM Credit may be applied by IBM Credit to the Outstanding
Advances. Any Supplier Credits collected by IBM Credit shall in no way reduce
Customer's debt to IBM Credit in respect of the Outstanding Advances until such
Supplier Credits are applied by IBM Credit.

(E) IBM Credit may apply any payments and Supplier Credits received by IBM
Credit to reduce finance charges first and then to principal amounts of
Advances owed by Customer. IBM Credit may apply principal payments to the
oldest (earliest) invoices (and related Product Advances) first, but, in any
case, all principal payments will be applied in respect of the Outstanding
Product Advances made for Products which have been sold, lost, stolen,
destroyed, damaged or otherwise disposed of prior to any other application
thereof.

(F) Customer will indemnify and hold IBM Credit harmless from and against
any claims or demands asserted by any Person relating to or arising from the
Collateral for any reason whatsoever, including, without limitation, the
condition of the Collateral, any misrepresentation made about the Collateral by
any representative of Customer, or any act or failure to act by Customer except
to the extent such claims or demands are directly attributable to IBM Credit's
gross negligence or willful misconduct. Nothing contained in the foregoing shall
impair any rights or claims which the Customer may have against any
manufacturer, distributor or Authorized Supplier.

2.3. A/R Advances. (A) Whenever Customer shall desire IBM Credit to provide an
A/R Advance, Customer shall deliver to IBM Credit written notice of Customer's
request for such an Advance ("Request for A/R Advance"). For any requested A/R
Advance pursuant to which monies will be disbursed to Customer or any Person
other than IBM Credit, a Request for A/R Advance shall be delivered to IBM
Credit on or prior to 1:00 p.m. (Stamford, CT time) one Business Day prior to
the requested A/R Advance Date. The Request for A/R Advance shall specify (i)
the requested A/R Advance Date; (ii) the amount of the requested A/R Advance;
(iii) whether such A/R Advance is a WCO Advance or a PRO Advance; (iv)

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<PAGE>

if applicable, the PRO Advance Term for such A/R Advance; (v) for each PRO
Advance, the month, day and year of the Common Due Date, as set forth in
Customer's applicable billing statement from IBM Credit, for the Product Advance
to which the PRO Advance is to be applied; and (vi) if applicable, the amount of
the requested A/R Advance that should be applied to the Outstanding Product
Advances (provided that all PRO Advances shall be applied to Outstanding Product
Advances). Customer may deliver a Request for A/R Advance via facsimile. Any
Request for A/R Advance delivered to IBM Credit shall be irrevocable.
Notwithstanding any other provision of this Agreement, Customer shall not (i)
request more than one PRO Advance in respect of any Product Advance; and (ii)
request a PRO Advance for any Common Due Date on which Customer will take a
discount offered by IBM Credit for invoice amounts paid in full within fifteen
days of the invoice date under IBM Credit's High Turnover Option ("HTO")
Program.

(B) Subject to the terms and conditions of this Agreement, on the A/R
Advance Date specified in a Request for A/R Advance, IBM Credit shall make the
principal amount of each A/R Advance available to the Customer in immediately
available funds to an account maintained by Customer (or in the case of a
Takeout Advance, as directed by Customer). If IBM Credit is making an A/R
Advance hereunder on a day on which Customer is to repay all or any part of an
Outstanding Advance (or any other amount owing hereunder), IBM Credit shall
apply the proceeds of the A/R Advance to such repayment and only an amount equal
to the difference, if any, between the amount of the A/R Advance and the amount
being repaid shall be made available to Customer as provided in the immediately
preceding sentence.

(C) Each A/R Advance shall accrue a finance charge on the unpaid principal
amount thereof, at a per annum rate equal to the lesser of (a) the finance
charge set forth in Attachment A to this Agreement under the caption "A/R
Finance Charge" for such type of A/R Advance, and (b) the highest rate from time
to time permitted by applicable law. If it is determined that amounts received
from the Customer were in excess of such highest rate, then the amount
representing such excess shall be considered reductions to principal of
Advances.

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<PAGE>

automatically renew for an additional WCO Advance Term. Notwithstanding any
other provision of this Agreement, a Takeout Advance may only be requested on
the Closing Date and such Takeout Advance shall be limited to an amount
sufficient to discharge the indebtedness that is the subject of a Takeout
Advance. Unless otherwise agreed in writing, a Takeout Advance shall be due as
defined on Attachment D.

2.4. Finance and Other Charges. (A) Finance charges shall be calculated by
multiplying the applicable Delinquency Fee Rate, Product Advance Charge or A/R
Finance Charge provided for in this Agreement by Customer's applicable Average
Daily Balance. The Delinquency Fee Rate, the Product Advance Charge and the
various A/R Finance Charges provided for in this Agreement are each computed on
the basis of an actual day, 360 day year.

(B) The Customer hereby agrees to pay to IBM Credit the charges set forth
as "Other Charges" in Attachment A. The Customer also agrees to pay IBM Credit
additional charges for any returned items of payment received by Customer. The
Customer hereby acknowledges that any such charges are not interest but that
such charges, if unpaid, will constitute part of the Outstanding Advances.

(C) The finance charges and Other Charges owed under this Agreement, and
any charges hereafter agreed to in writing by the parties, are payable monthly
on receipt of IBM Credit's bill or statement therefor or IBM Credit may, in its
sole discretion, add unpaid finance charges and Other Charges to the Customer's
outstanding Advances.

(D) If any amount owed under this Agreement, including, without limitation,
any Advance, is not paid when due (whether at maturity, by acceleration or
otherwise), the unpaid amount thereof will bear a late charge from and including
its due date to but not including the date IBM Credit receives payment thereof,
at a per annum rate equal to the lesser of (a) the amount set forth in
Attachment A to this Agreement as the "Delinquency Fee Rate" and (b) the highest
rate from time to time permitted by applicable law. In addition, if any
Shortfall Amount shall not be paid when due pursuant to Section 2.6 hereof,
Customer shall pay IBM Credit an additional late charge equal to the product of
the Shortfall Amount multiplied by thirty (30) basis points. If it is determined
that amounts received from Customer were in excess of such highest rate, then
the amount representing such excess shall be considered reductions to principal
of Advances.

2.5. Statements Regarding Customer's ACcount. IBM Credit will send statements of
each transaction hereunder as well as monthly billing statements to Customer
with respect to Advances and other charges due on Customer's account with IBM
Credit. Each

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<PAGE>

statement of transaction and monthly billing statement shall be deemed, absent
manifest error, to be correct and shall constitute an account stated with
respect to each transaction or amount described therein unless within seven (7)
calendar days after such statement of transaction or billing statement is
received by Customer, Customer provides IBM Credit written notice objecting that
such amount or transaction is incorrectly described therein and specifying the
error(s), if any, contained therein. IBM Credit may at any time adjust such
statements of transaction or billing statements to comply with applicable law
and this Agreement.

2.6. Shortfall. If, on any date, the Outstanding Advances shall exceed the
Maximum Advance Amount (such excess, the "Shortfall Amount"), then the Customer
shall on such date prepay the Outstanding Advances in an amount equal to such
Shortfall Amount.

2.7. Application of Payments. The Customer hereby agrees that all checks and
other instruments delivered to IBM Credit on account of Customer's Obligations
shall constitute conditional payment until such items are actually collected by
IBM Credit. The Customer waives the right to direct the application of any and
all payments at any time or times hereafter received by IBM Credit on account of
the Customer's Obligations. Customer agrees that IBM Credit shall have the
continuing exclusive right to apply and reapply any and all such payments to
Customer's Obligations in such manner as IBM Credit may deem advisable
notwithstanding any entry by IBM Credit upon any of its books and records.

2.8. Prepayment and Reborrowing By Customer. (A) Customer may at any time
prepay, without notice or penalty, in whole or in part amounts owed under this
Agreement. IBM Credit may apply payments made to it (whether by the Customer or
otherwise) to pay finance charges and other amounts owing under this Agreement
first and then to the principal amount owed by the Customer.

(B) Subject to the terms and conditions of this Agreement, any amount
prepaid or repaid to IBM Credit in respect to the Outstanding Advances may be
reborrowed by Customer in accordance with the provisions of this Agreement.

Section 3. LINE OF CREDIT ADDITIONAL PROVISIONS

3.1. Ineligible Accounts. IBM Credit and Customer agree that IBM Credit shall
have the sole right to determine eligibility of Accounts from an Account obligor
for purposes of determining the Borrowing Base; however, without limiting such
right, the following AccOunts will be deemed to be ineligible for purposes of
determining the Borrowing Base:

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<PAGE>

(A) Accounts created from the sale of goods and/or performance of services
on non-standard terms or that allow for payment to be made more than forty-five
(45) days from the date of such sale or performance of services;

(B) Accounts unpaid more than ninety (90) days from date of invoice;

(C) Accounts payable by an account debtor if fifty percent (50%) or more of
the aggregate outstanding balance of all such Accounts remain unpaid for more
than ninety (90) days from the date of invoice;

(D) Accounts payable by an account debtor that is an Affiliate of Customer
or an officer, employee, agent, guarantor, stockholder or Affiliate of Customer
or is related to or has common shareholders, officers or directors with
Customer;

(E) Accounts arising from consignment sales;

(F) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which the payment by
the account debtor is or may be conditional;

(G) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which:

(i) the account debtor is not a commercial entity, or

(ii) the account debtor is not a resident of the United States;

(H) Accounts payable by any account debtor to which Customer is or may
become liable for goods sold or services rendered by such account debtor to
Customer;

(I) Accounts arising from the sale or lease of goods purchased for a
personal, family or household purpose;

(J) Accounts arising from the sale or other disposition of goods that has
been used for demonstration purposes or loaned or leased by the Customer to
another party;

(K) Accounts which are progress payment accounts or contra accounts;

(L) Accounts upon which IBM Credit does not have a valid, perfected, first
priority security interest;

(M) Accounts payable by an account debtor that is or

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<PAGE>

Customer knows will become, subject to proceedings under United States
Bankruptcy Law or other law for the relief of debtors;

(N) Accounts that are not payable in US dollars;

(O) Accounts payable by any account debtor that is a remarketer of computer
hardware and software products and whose purchases of such products from
Customer have been financed by another person who pays the proceeds of such
financing directly to Customer on behalf of such obligor;

(P) Accounts arising from the sale or lease of goods which are billed to
any account debtor but have not yet been shipped by Customer;

(Q) Accounts with respect to which Customer has permitted or agreed to any
extension, compromise or settlement, or made any change or modification of any
kind or nature, including, but not limited to, any change or modification to the
terms relating thereto;

(R) Accounts that do not arise from undisputed bona fide transactions
completed in accordance with the terms and conditions contained in the invoices,
purchase orders and contracts relating thereto;

(S) Accounts that are discounted for the full payment term specified in
Customer's terms and conditions with its account debtors, or for any longer
period of time;

(T) Accounts on cash on delivery (C.O.D.) terms;

(U) Accounts arising from maintenance or service contracts that are billed
in advance of full performance of service;

(V) Accounts arising from bartered transactions;

(W) Accounts arising from incentive payments, rebates, discounts, credits,
and refunds from a supplier; and

(X) Any and all other Accounts that IBM Credit deems, in its sole and
absolute discretion, to be ineligible.

The aggregate of all Accounts that are not ineligible Accounts shall hereinafter
be referred to as "Eligible Accounts".

3.2. Reimbursement for Charges. Customer agrees to pay for all costs and
expenses of Customer's bank in respect to collection of checks and other items
of payment, all fees relating to the use and maintenance of the Lockbox and the
Special Account (each as defined in Section 3.3) and with respect to remittances
of proceeds of the Advances hereunder.

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<PAGE>

3.3. Lockbox and Special Account. Customer shall establish and maintain
lockbox(es) (each, a "Lockbox") at the address(es) set forth in Attachment A
with the financial institution(s) listed in Attachment A (each, a "Bank")
pursuant to an agreement between the Customer and each Bank in form and
substance satisfactory to IBM Credit. Customer shall also establish and maintain
a deposit account which shall contain only proceeds of Customer's Accounts
("Special Account") with each Bank. Customer shall enter into and maintain a
contingent blocked account agreement with each Bank for the benefit of IBM
Credit in form and substance satisfactory to IBM Credit pursuant to which, among
other things, such Bank shall agree that, upon notice from IBM Credit,
disbursements from the Special Account shall be made only as IBM Credit shall
direct.

3.4. Collections. Customer shall instruct all Account obligors to remit payments
directly to a Lockbox. In addition, Customer shall have such instruction printed
in conspicuous type on all invoices. Customer shall instruct such Bank to
deposit all remittances to such Bank's Lockbox into its Special Account.
Customer further agrees that it shall not deposit or permit any deposits of
funds other than remittances paid in respect of the Accounts into the Special
Account(s) or permit any commingling of funds with such remittances in any
Lockbox or Special Account. Without limiting the Customer's foregoing
obligations, if, at any time, Customer receives a remittance directly from an
account obligor, then Customer shall make entries on its books and records in a
manner that shall reasonably identify such remittances and shall keep a separate
account on its record books of all remittances so received and deposit the same
into a Special Account. Until so deposited into the Special Account, Customer
shall keep all remittances received in respect of Accounts separate and apart
from Customer's other property so that they are capable of identification as the
proceeds of Accounts in which IBM Credit has a security interest.

3.5. Application of Remittances and Credits. Customer shall apply all
remittances against the aggregate of Customer's outstanding Accounts no later
than the end of the Business Day on which such remittances are deposited into
the Special Account. Customer also agrees to apply each remittance against its
respective Account no later than three (3) Business Days from the date such
remittance is deposited into the Special Account. In addition, Customer shall
promptly apply any credits owing in respect to any Account when due.

3.6. Power of Attorney. Customer hereby irrevocably appoints IBM Credit, with
full power of substitution, as its true and lawful attorney-in-fact with full
power, in good faith and in compliance with commercially reasonable standards,
in the discretion of IBM Credit, to:

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<PAGE>

(A) sign the name of Customer on any document or instrument that IBM Credit
shall deem necessary or appropriate to perfect and maintain perfected the
security interest in the Collateral contemplated under this Agreement and the
Other Agreements;

(B) endorse the name of Customer upon any of the items of payment of
proceeds and deposit the same in the account of IBM Credit for application to
the Obligation; and

upon the occurrence and during the continuance of an Event of Default as defined
in Section 9.1 hereof:

(C) demand payment, enforce payment and otherwise exercise all Customer's
rights and remedies with respect to the collection of any Accounts;

(D) settle, adjust, compromise, extend or renew any Accounts;

(E) settle, adjust or compromise any legal proceedings brought to collect
any Accounts;

(F) sell or assign any Accounts upon such terms, for such amounts and at
such time or times as IBM Credit may deem advisable;

(G) discharge and release any Accounts;

(H) prepare, file and sign Customer's name on any Proof of Claim in
Bankruptcy or similar document against any Account obligor;

(I) prepare, file and sign Customer's name on any notice of lien, claim of
mechanic's lien, assignment or satisfaction of lien or mechanic's lien, or
similar document in connection with any Accounts;

(J) endorse the name of Customer upon any chattel paper, document,
instrument, invoice, freight bill, bill of lading or similar document or
agreement relating to any Account or goods pertaining thereto;

(K) endorse the name of Customer upon any of the items of payment of
proceeds and deposit the same in the account of IBM Credit for application to
the Obligation;

(L) sign the name of Customer to requests for verification of Accounts and
notices thereof to Account obligors;

(M) sign the name of Customer on any document or instrument that IBM Credit
shall deem necessary or appropriate to enforce any and all remedies it may have
under this Agreement, at law or

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<PAGE>

otherwise; and

(N) make, settle and adjust claims under the Policies with respect to the
Collateral and endorse Customer's name on any check, draft, instrument or other
item of payment of the proceeds of the Policies with respect to the Collateral;
and

(O) take control in any manner of any term of payment or proceeds and for
such purpose to notify the postal authorities to change the address for delivery
of mail addressed to Customer to such address as IBM Credit may designate.

The power of attorney granted by this Section is for value and coupled with an
interest and is irrevocable so long as this Agreement is in effect or any
Obligations remain outstanding. Nothing done by IBM Credit pursuant to such
power of attorney will reduce any of Customer's Obligations other than
Customer's payment Obligations to the extent IBM Credit has received monies.

Section 4. SECURITY -- COLLATERAL

4.1 Grant. To secure Customer's full and punctual payment and performance of the
Obligations when due (whether at the stated maturity, by acceleration or
otherwise), Customer hereby grants IBM Credit a security interest in all of
Customer's right, title and interest in and to the following property, whether
now owned or hereafter acquired or existing and wherever located:

(A) all inventory and equipment, and all parts thereof, attachments,
accessories and accessions thereto, products thereof and documents therefor;

(B) all accounts, contract rights, chattel paper, instruments, deposit
accounts, obligations of any kind owing to Customer, whether or not arising out
of or in connection with the sale or lease of goods or the rendering of services
and all books, invoices, documents and other records in any form evidencing or
relating to any of the foregoing;

(D) all rights now or hereafter existing in and to all mortgages, security
agreements, leases or other contracts securing or otherwise relating to any of
the foregoing; and

(E) all substitutions and replacements for all of the foregoing, all
proceeds of all of the foregoing and, to the extent not otherwise included, all
payments under insurance or any indemnity, warranty or guaranty, payable by
reason of loss or damage to or otherwise with respect to any of the foregoing.

All of the above assets shall be collectively defined herein as

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the "Collateral".

Customer covenants and agrees with IBM Credit that: (a) the security constituted
to by this Agreement is in addition to any other security from time to time held
by IBM Credit and (b) the security hereby created is a continuing security
interest and will cover and secure the payment of all Obligations both present
and future of Customer to IBM Credit pursuant to this Agreement and the Other
Agreements.

4.2. Further Assurances. Customer shall, from time to time upon the request of
IBM Credit, execute and deliver to IBM Credit, or cause to be executed and
delivered, at such time or times as IBM Credit may request such other and
further documents, certificates and instruments that IBM Credit may deem
necessary to perfect and maintain perfected IBM Credit's security interests in
the Collateral and in order to fully consummate all of the transactions
contemplated under this Agreement and the Other Agreements. Customer shall make
appropriate entries on its books and records disclosing IBM Credit's security
interests in the Collateral.

Section 5. CONDITIONS PRECEDENT

5.1. Conditions Precedent to the Effectiveness of This Agreement. The
effectiveness of this Agreement is subject to the receipt by IBM Credit of, or
waiver in writing by IBM Credit of compliance with, the following conditions
precedent:

(A) this Agreement executed and delivered by Customer and IBM Credit;

(B) (i) copies of the resolutions of the Board of Directors of Customer
certified by the secretary or assistant secretary of Customer authorizing the
execution, delivery and performance of this Agreement and each Other Agreement
executed and delivered in connection herewith, (ii) a certificate of the
secretary or an assistant secretary of Customer, in form and substance
satisfactory to IBM Credit, certifying the names and true signatures of the
officers of Customer authorized to sign this Agreement and the Other Agreements
and (iii) copies of the articles of incorporation and by-laws of Customer
certified by the secretary or assistant secretary of Customer;

(C) certificates dated as of a recent date from the Secretary of State or
other appropriate authority evidencing the good standing of Customer in the
jurisdiction of its organization and in each other jurisdiction where the
ownership or lease of its property or the conduct of its business requires it to
qualify to do business;

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(D) copies of all approvals and consents from any Person, in each case in
form and substance satisfactory to IBM Credit, which are required to enable
Customer to authorize, or required in connection with, (a) the execution,
delivery or performance of this Agreement and each of the Other Agreements, and
(b) the legality, validity, binding effect or enforceability of this Agreement
and each of the Other Agreements;

(E) a lockbox agreement executed by Customer and each Bank, in form and
substance satisfactory to IBM Credit;

(F) a contingent blocked account agreement executed by Customer and each
Bank in form and substance satisfactory to IBM Credit;

(G) intercreditor agreements ("Intercreditor Agreement"), in form and
substance satisfactory to IBM Credit, executed by each other secured creditor of
Customer as set forth in Attachment A;

(H) a favorable opinion of counsel for Customer in substantially the form
of Attachment I;

(I) UCC-1 financing statements for each jurisdiction reasonably requested
by IBM Credit executed by Customer and each guarantor whose guaranty to IBM
Credit is intended to be secured by a pledge of its assets;

(J) the statements, certificates, documents, instruments, financing
statements, agreements and information set forth in Attachment A and Attachment
B; and

(K) all such other statements, certificates, documents, instruments,
financing statements, agreements and other information with respect to the
matters contemplated by this Agreement as IBM Credit shall have reasonably
requested.

5.2. Conditions to Each Advance. No Advance will be required to be made or
renewed by IBM Credit under this Agreement unless, on and as of the date of such
Advance, the following statements shall be true to the satisfaction of IBM
Credit:

(A) The representations and warranties contained in this Agreement or in
any document, instrument or agreement executed in connection herewith, are true
and correct in all material respects on and as of the date of such Advance as
though made on and as of such date;

(B) No event has occurred and is continuing or after giving effect to such
Advance or the application of the proceeds thereof would result which would
constitute a Default;

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(D) Both before and after giving effect to the making of such Advance, no
Shortfall Amount exists.

Except as Customer has otherwise disclosed to IBM Credit in writing prior to
each request, each request (or deemed request pursuant to Section 2.3 (D)) for
an Advance hereunder and the receipt (or deemed receipt) by the Customer of the
proceeds of any Advance hereunder shall be deemed to be a representation and
warranty by Customer that, as of and on the date of such Advance, the statements
set forth in (A) through (D) above are true statements. No such disclosures by
Customer to IBM Credit shall in any manner be deemed to satisfy the conditions
precedent to each Advance that are set forth in this Section 5.2.

Section 6. REPRESENTATIONS AND WARRANTIES

To induce IBM Credit to enter into this Agreement, Customer represents and
warrants to IBM Credit as follows:

6.1. Organization and Qualifications. Customer and each of its Subsidiaries (i)
is a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, (ii) has the power and authority
to own its properties and assets and to transact the businesses in which it
presently is engaged and (iii) is duly qualified and is authorized to do
business and is in good standing in each jurisdiction where it presently is
engaged in business and is required to be so qualified.

6.2. Rights in Collateral; Priority of Liens. Customer and each of its
Subsidiaries owns the property granted by it respectively as Collateral to IBM
Credit, free and clear of any and all Liens in favor of third parties except for
the Liens otherwise permitted pursuant to Section 8.1. The Liens granted by the
Customer and each of its Subsidiaries pursuant to this Agreement, the Guaranties
and the Other Agreements in the Collateral constitute the valid and enforceable
first, prior and perfected Liens on the Collateral, except to the extent any
Liens that are prior to IBM Credit's Liens are (i) the subject of an
Intercreditor Agreement or (ii) Purchase Money Security Interests in product of
a brand that is not financed by IBM Credit.

6.3. No Conflicts. The execution, delivery and performance by Customer of this
Agreement and each of the Other Agreements (i) are within its corporate power;
(ii) are duly authorized by all necessary corporate action; (iii) are not in
contravention in any respect of any Requirement of Law or any indenture,
contract,

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lease, agreement, instrument or other commitment to which it is a party or by
which it or any of its properties are bound; (iv) do not require the consent,
registration or approval of any Governmental Authority or any other Person
(except such as have been duly obtained, made or given, and are in full force
and effect); and (v) will not, except as contemplated herein, result in the
imposition of any Liens upon any of its properties.

6.4. Enforceability. This Agreement and all of the other documents executed and
delivered by the Customer in connection herewith are the legal, valid and
binding obligations of Customer, and are enforceable in accordance with their
terms, except as such enforceability may be limited by the effect of any
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or similar laws affecting creditors' rights generally or the general
equitable principles relating thereto.

6.5. Locations of Offices, Records and Inventory. The address of the principal
place of business and chief executive office of Customer is as set forth on
Attachment B or on any notice provided by Customer to IBM Credit pursuant to
Section 7.7(C) of this Agreement. The books and records of Customer, and all of
its chattel paper (other than the chattel paper delivered to IBM Credit pursuant
to Section 7.14(E)) and records of Accounts, are maintained exclusively at such
location. There is no jurisdiction in which Customer has any assets, equipment
or inventory (except for vehicles and inventory in transit for processing) other
than those jurisdictions identified on Attachment B or on any notice provided by
Customer to IBM Credit pursuant to Section 7.7(C) of this Agreement. Attachment
B, as amended from time to time by any notice provided by Customer to IBM Credit
in accordance with Section 7.7(C) of this Agreement, also contains a complete
list of the legal names and addresses of each warehouse at which the Customer's
inventory is stored. None of the receipts received by Customer from any
warehouseman states that the goods covered thereby are to be delivered to bearer
or to the order of a named person or to a named person and such named person's
assigns.

6.6. Fictitious Business Names. Customer has not used any corporate or
fictitious name during the five (5) years preceding the date of this Agreement,
other than those listed on Attachment B.

6.7. Organization. All of the outstanding capital stock of Customer has been
validly issued, is fully paid and nonassessable.

6.8. No Judgments or Litigation. Except as set forth on Attachment B, no
judgments, orders, writs or decrees are outstanding against Customer nor is
there now pending or, to the

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best of Customer's knowledge after due inquiry, threatened, any litigation,
contested claim, investigation, arbitration, or governmental proceeding by or
against Customer.

6.9. No Defaults. The Customer is not in default under any term of any
indenture, contract, lease, agreement, instrument or other commitment to which
it is a party or by which it, or any of its properties are bound. Customer has
no knowledge of any dispute regarding any such indenture, contract, lease,
agreement, instrument or other commitment. No Default or Event of Default has
occurred and is continuing.

6.10. Labor Matters. Except as set forth on any notice provided by Customer to
IBM Credit pursuant to Section 7.1(F) of this Agreement, the Customer is not a
party to any labor dispute. There are no strikes or walkouts or labor
controversies pending or threatened against the Customer which could reasonably
be expected to have a Material Adverse Effect.

6.11. Compliance with Law. Customer has not violated or failed to comply with
any Requirement of Law or any requirement of any self regulatory organization.

6.12. ERISA. Each "employee benefit plan", "employee pension benefit plan",
"defined benefit plan", or "multi-employer benefit plan", which Customer has
established, maintained, or to which it is required to contribute (collectively,
the "Plans") is in compliance with all applicable provisions of ERISA and the
Code and the rules and regulations thereunder as well as the Plan's terms and
conditions. There have been no "prohibited transactions" and no "reportable
event" has occurred within the last 60 months with respect to any Plan. Customer
has no "multi-employer benefit plan". As used in this Agreement the terms
"employee benefit plan", "employee pension benefit plan", "defined benefit
plan", and "multi-employer benefit plan" have the respective meanings assigned
to them in Section 3 of ERISA and any applicable rules and regulations
thereunder. The Customer has not incurred any "accumulated funding deficiency"
within the meaning of ERISA or incurred any liability to the Pension Benefit
Guaranty Corporation (the "PBGC") in connection with a Plan (other than for
premiums due in the ordinary course).

6.13. Compliance with Environmental Laws. Except as otherwise disclosed in
Attachment B:

(A) The Customer has obtained all government approvals required with
respect to the operation of their businesses under any Environmental Law.

(B) (i) the Customer has not generated, transported or disposed of any
Hazardous Substance; (ii) the Customer is not currently generating, transporting
or disposing of any Hazardous

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Substance; (iii) the Customer has no knowledge that (a) any of its real property
(whether owned, leased, or otherwise directly or indirectly controlled) has been
used for the disposal of or has been contaminated by any Hazardous Substance, or
(b) any of its business operations have contaminated lands or waters of others
with any Hazardous Substance; (iv) the Customer and its respective assets are
not subject to any Environmental Liability and, to the best of the Customer's
knowledge, any threatened Environmental Liability; (v) the Customer has not
received any notice of or otherwise learned of any governmental investigation
evaluating whether any remedial action is necessary to respond to a release or
threatened release of any Hazardous Substance for which the Customer may be
liable; (vi) the Customer is not in violation of any Environmental Law; (vii)
there are no proceedings or investigations pending against Customer with respect
to any violation or alleged violation of any Environmental Law; provided
however, that the parties acknowledge that any generation, transportation, use,
storage and disposal of certain such Hazardous Substances in Customer's or its
Subsidiaries' business shall be excluded from representations (i) and (ii)
above, provided, further, that Customer is at all times generating,
transporting, utilizing, storing and disposing such Hazardous Substances in
accordance with all applicable Environmental Laws and in a manner designed to
minimize the risk of any spill, contamination, release or discharge of Hazardous
Substances other than as authorized by Environmental Laws.

6.14. Intellectual Property. Customer possesses such assets, licenses, patents,
patent applications, copyrights, service marks, trademarks, trade names and
trade secrets and all rights and other property relating thereto or arising
therefrom ("Intellectual Property") as are necessary or advisable to continue to
conduct its present and proposed business activities.

6.15. Licenses and Permits. Customer has obtained and holds in full force and
effect all franchises, licenses, leases, permits, certificates, authorizations,
qualifications, easements, rights of way and other rights and approvals which
are necessary for the operation of its businesses as presently conducted.
Customer is not in violation of the terms of any such franchise, license, lease,
permit, certificate, authorization, qualification, easement, right of way, right
or approval.

6.16. Investment Company. The Customer is not (i) an investment company or a
company controlled by an investment company within the meaning of the Investment
Company Act of 1940, as amended, (ii) a holding company or a subsidiary of a
holding company, or an Affiliate of a holding company or of a subsidiary of a
holding company, within the meaning of the Public Utility Holding Company Act of
1935, as amended, or (iii) subject to any other law which purports to regulate
or restrict its ability to borrow money or to consummate the transactions
contemplated by this Agreement or

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<PAGE>

the Other Agreements or to perform its obligations hereunder or thereunder.

6.17. Taxes and Tax Returns. Customer has timely filed all federal, state, and
local tax returns and other reports which it is required by law to file, and has
either duly paid all taxes, fees and other governmental charges indicated to be
due on the basis of such reports and returns or pursuant to any assessment
received by the Customer, or made provision for the payment thereof in
accordance with GAAP. The charges and reserves on the books of the Customer in
respect of taxes or other governmental charges are in accordance with GAAP. No
tax liens have been filed against Customer or any of its property.

6.18. Status of Accounts. Each Account is based on an actual and bona fide sale
and delivery of goods or rendition of services to customers, made by Customer,
in the ordinary course of its business; the goods and inventory being sold and
the Accounts created are its exclusive property and are not and shall not be
subject to any Lien, consignment arrangement, encumbrance, security interest or
financing statement whatsoever (other than Permitted Liens). The Customer's
customers have accepted goods or services and owe and are obligated to pay the
full amounts stated in the invoices according to their terms. There are no
proceedings or actions known to Customer which are pending or threatened against
any Material Account Obligor (as defined in Section 7.14(B) of this Agreement)
of any of the Accounts which could reasonably be expected to result in a
material adverse effect on the obligor's ability to pay the full amounts due to
Customer.

6.19. Affiliate/Subsidiary Transactions. Customer is not a party to or bound by
any agreement or arrangement (whether oral or written) to which any Affiliate or
Subsidiary of the Customer is a party except (i) in the ordinary course of and
pursuant to the reasonable requirements of Customer's business and (ii) upon
fair and reasonable terms no less favorable to Customer than it could obtain in
a comparable arm's-length transaction with an unaffiliated Person.

6.20. Accuracy and Completeness of Information. All factual information
furnished by or on behalf of the Customer to IBM Credit or the Auditors for
purposes of or in connection with this Agreement or any Other Agreement, or any
transaction contemplated hereby or thereby is or will be true and accurate in
all material respects on the date as of which such information is dated or
certified and not incomplete by omitting to state any material fact necessary to
make such information not misleading at such time.

6.21. Recording Taxes. All recording taxes, recording fees, filing fees and
other charges payable in connection with the

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<PAGE>

filing and recording of this Agreement have either been paid in full by Customer
or arrangements for the payment of such amounts by Customer have been made to
the satisfaction of IBM Credit.

6.22. Indebtedness. Customer (i) has no Indebtedness, other than Permitted
Indebtedness; and (ii) has not guaranteed the obligations of any other Person
(except as permitted by Section 8.4),

Section 7. AFFIRMATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations:

7.1. Financial and Other Information. Customer shall cause to be furnished to
IBM Credit the following information within the following time periods:

(A) as soon as available and in any event within ninety (90) days after the
end of each fiscal year of AmeriQuest (i) audited Financial Statements (provided
that, to the extent not otherwise audited by the Auditors, the consolidating
Financial Statements may be unaudited) as of the close of the fiscal year and
for the fiscal year, together with a comparison to the Financial Statements for
the prior year, in each case accompanied by (a) either an opinion of the
Auditors without a "going concern" or like qualification or exception, or
qualification arising out of the scope of the audit or, if so qualified, an
opinion which shall be in scope and substance reasonably satisfactory to IBM
Credit, (b) such Auditors' "Management Letter" to AmeriQuest, if any, (c) a
written statement signed by the Auditors stating that in the course of the
regular audit of the business of AmeriQuest and its consolidated Subsidiaries,
which audit was conducted by the Auditors in accordance with generally accepted
auditing standards, the Auditors have not obtained any knowledge of the
existence of any Default under any provision of this Agreement, or, if such
Auditors shall have obtained from such examination any such knowledge, they
shall disclose in such written statement the existence of the Default and the
nature thereof, it being understood that such Auditors shall have no liability,
directly or indirectly, to anyone for failure to obtain knowledge of any such
Default; (ii) if composed, a narrative discussion of the consolidated financial
condition and results of operations and the consolidated liquidity and capital
resources of AmeriQuest and its Subsidiaries for such fiscal year prepared by
the chief executive officer or chief financial officer of AmeriQuest; and (iii)
a Compliance Certificate along with a schedule, in substantially the form of
Attachment C hereto, of the calculations used in determining, as of the end of
such fiscal year, whether

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AmeriQuest is in compliance with the financial covenants set forth in Exhibit A
to the guaranty executed by AmeriQuest;

(B) as soon as available and in any event within forty-five (45) days after
the end of each fiscal quarter of AmeriQuest (i) Financial Statements as of the
end of such period and for the fiscal year to date, together with a comparison
to the Financial Statements for the same periods in the prior year, all in
reasonable detail and duly certified (subject to normal year-end audit
adjustments and except for the absence of footnotes) by the chief executive
officer or chief financial officer of AmeriQuest as having been prepared in
accordance with GAAP; (ii) if composed, a narrative discussion of the
consolidated financial condition and results of operations and the consolidated
liquidity and capital resources of AmeriQuest and its Subsidiaries for such
period and for the fiscal year to date prepared by the chief executive officer
or chief financial officer of AmeriQuest; and (iii) a Compliance Certificate
along with a schedule, in substantially the form of Attachment C hereto, of the
calculations used in determining, as of the end of such fiscal quarter, whether
AmeriQuest is in compliance with the financial covenants set forth in Exhibit A
to the guaranty executed by AmeriQuest;

(C) promptly after Customer obtains knowledge of (i) the occurrence of a
Default or Event of Default, or (ii) the existence of any condition or event
which would result in the Customer's failure to satisfy the conditions precedent
to Advances set forth in Section 5, a certificate of the chief executive officer
or chief financial officer of Customer specifying the nature thereof and the
Customer's proposed response thereto, each in reasonable detail;

(D) promptly after Customer obtains knowledge of (i) any proceeding(s)
being instituted or threatened to be instituted by or against Customer in any
federal, state, local or foreign court or before any commission or other
regulatory body (federal, state, local or foreign), or (ii) any actual or
prospective change, development or event which, in any such case, has had or
could reasonably be expected to have a Material Adverse Effect, a certificate of
the chief executive officer or chief financial officer of Customer specifying
the nature thereof and the Customer's proposed response thereto, each in
reasonable detail;

(E) promptly after Customer obtains knowledge that (i) any order, judgment
or decree in excess of $300,000 shall have been entered against Customer or any
of its properties or assets, or (ii) it has received any notification of a
material violation of any Requirement of Law from any Governmental Authority, a
certificate of the chief executive officer or chief financial officer of
Customer specifying the nature thereof and the Customer's proposed response
thereto, each in reasonable detail;

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<PAGE>

(F) promptly after Customer learns of any material labor dispute to which
Customer may become a party, any strikes or walkouts relating to any of its
plants or other facilities, and the expiration of any labor contract to which
Customer is a party or by which it is bound, a certificate of the chief
executive officer or chief financial officer of Customer specifying the nature
thereof and the Customer's proposed response thereto, each in reasonable detail;

(G) within five (5) Business Days after request by IBM Credit, any written
certificates, schedules and reports together with all supporting documents as
IBM Credit may reasonably request relating to the Collateral or the Customer's
or any guarantor's business affairs and financial condition;

(H) by the fifth (5th) day of each month, or as otherwise agreed in
writing, a Collateral Management Report as of a date no earlier than the last
day of the immediately preceding month;

(I) along with the Financial Statements set forth in Section 7.1(A) and
(B), the name, address and phone number of each of its account debtors' primary
contacts for each Account on the Accounts aging report contained in its most
recent Collateral Management Report; and

(J) within five (5) days after the same are sent, copies of all financial
statements and reports which AmeriQuest or Customer sends to its stockholders,
and within five (5) days after the same are filed, copies of all financial
statements and reports which AmeriQuest or Customer may make to, or file with,
the Securities and Exchange Commission or any successor or analogous
governmental authority.

Each certificate, schedule and report provided by Customer to IBM Credit shall
be signed by an authorized officer of Customer, and which signature shall be
deemed a representation and warranty that the information contained in such
certificate, schedule or report is true and accurate in all material respects on
the date as of which such certificate, schedule or report is made and does not
omit to state a material fact necessary in order to make the statements
contained therein not misleading at such time. Each financial statement
delivered pursuant to this Section 7.1 shall be prepared in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods.

7.2. Location of Collateral. The inventory, equipment and other tangible
Collateral shall be kept or sold at the addresses as set forth on Attachment B
or on any notice provided by Customer to IBM Credit in accordance with Section
7.7(C). Such locations shall be certified quarterly to IBM Credit substantially
in the form of Attachment G.

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<PAGE>

7.3. Changes in Customer. Customer shall provide 30 days prior written notice to
IBM Credit of any change in Customer's name, chief executive office and
principal place of business, organization, form of ownership or corporate
structure; provided, however, that Customer's compliance with this covenant
shall not relieve it of any of its other obligations or any other provisions
under this Agreement or any Other Agreement limiting actions of the type
described in this Section.

7.4. Corporate Existence. Customer shall (A) maintain its corporate existence,
maintain in full force and effect all licenses, bonds, franchises, leases and
qualifications to do business, and all contracts and other rights necessary to
the profitable conduct of its business, (B) continue in, and limit its
operations to, the same general lines of business as presently conducted by it
unless otherwise permitted in writing by IBM Credit and (C) comply with all
Requirements of Law.

7.5. ERISA. Customer shall promptly notify IBM Credit in writing after it learns
of the occurrence of any event which would constitute a "reportable event" under
ERISA or any regulations thereunder with respect to any Plan, or that the PBGC
has instituted or will institute proceedings to terminate any Plan.
Notwithstanding the foregoing, the Customer shall have no obligation to notify
IBM Credit as to any "reportable event" as to which the 30-day notice
requirement of Section 4043(b) has been waived by the PBGC, until such time as
such Customer is required to notify the PBGC of such reportable event. Such
notification shall include a certificate of the chief financial officer of
Customer setting forth details as to such "reportable event" and the action
which Customer proposes to take with respect thereto, together with a copy of
any notice of such "reportable event" which may be required to be filed with the
PBGC, or any notice delivered by the PBGC evidencing its intent to institute
such proceedings. Upon request of IBM Credit, Customer shall furnish, or cause
the plan administrator to furnish, to IBM Credit the most recently filed annual
report for each Plan.

7.6. Environmental Matters. (A) Customer and any other Person under Customer's
control (including, without limitation, agents and Affiliates under such
control) shall (i) comply with all Environmental Laws in all material respects,
and (ii) undertake to use commercially reasonable efforts to prevent any
unlawful release of any Hazardous Substance by Customer or such Person into,
upon, over or under any property now or hereinafter owned, leased or otherwise
controlled (directly or indirectly) by Customer.

(B) Customer shall notify IBM Credit, promptly upon its obtaining knowledge
of (i) any non-routine proceeding or investigation by any Governmental Authority
with respect to the

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<PAGE>

presence of any Hazardous Substances on or in any property now or hereinafter
owned, leased or otherwise controlled (directly or indirectly) by Customer, (ii)
all claims made or threatened by any Person or Governmental Authority against
Customer or any of Customer's assets relating to any loss or injury resulting
from any Hazardous Substance, (iii) Customer's discovery of evidence of unlawful
disposal of or environmental contamination by any Hazardous Substance on any
property now or hereinafter owned, leased or otherwise controlled (directly or
indirectly) by Customer, and (iv) any occurrence or condition which could
constitute a violation of any Environmental Law.

7.7. Collateral Books and Records/Collateral Audit. (A) Customer agrees to
maintain books and records pertaining to the Collateral in such detail, form and
scope as is consistent with good business practice, and agrees that such books
and records will reflect IBM Credit's interest in the Accounts.

(B) Customer agrees that IBM Credit or its agents may enter upon the
premises of Customer at any time and from time to time, during normal business
hours and upon reasonable notice under the circumstances, and at any time at all
on and after the occurrence and during the continuance of an Event of Default
for the purposes of (i) inspecting the Collateral, (ii) inspecting and/or
copying (at Customer's expense) any and all records pertaining thereto, (iii)
discussing the affairs, finances and business of Customer with any officers,
employees and directors of Customer or with the Auditors and (iv) verifying
Eligible Accounts and other Collateral. Customer also agrees to provide IBM
Credit with such reasonable information and documentation that IBM Credit deems
necessary to conduct the foregoing activities, including, without limitation,
reasonably requested samplings of purchase orders, invoices and evidences of
delivery or other performance. Upon the occurrence and during the continuance of
an Event of Default which has not been waived by IBM Credit in writing, IBM
Credit may conduct any of the foregoing activities in any manner that IBM Credit
deems reasonably necessary.

(C) Customer shall give IBM Credit thirty (30) days prior written notice of
any change in the location of any Collateral, the location of its books and
records or in the location of its chief executive office or place of business
from the locations specified in Attachment B, and will execute in advance of
such change and cause to be filed and/or delivered to IBM Credit any financing
statements, landlord or other lien waivers, or other documents reasonably
required by IBM Credit, all in form and substance reasonably satisfactory to IBM
Credit.

(D) Customer agrees to advise IBM Credit promptly, in reasonably sufficient
detail, of any substantial change relating to the type, quantity or quality of
the Collateral, or any event which could reasonably be expected to have a
Material Adverse

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<PAGE>

Effect on the value of the Collateral or on the security interests granted to
IBM Credit therein.

7.8. Insurance; Casualty Loss. (A) Customer will maintain with financially sound
and reputable insurance companies: (i) insurance on its properties, (ii) public
liability insurance against claims for personal injury or death as a result of
the use of any products sold by it and (iii) insurance coverage against other
business risks, in each case, in at least such amounts and against at least such
risks as are usually and prudently insured against in the same general
geographical area by companies of established repute engaged in the same or a
similar business. Customer will furnish to IBM Credit, upon its written request,
the insurance certificates with respect to such insurance. In addition, all
Policies so maintained are to name IBM Credit as an additional insured as its
interest may appear.

(B) Without limiting the generality of the foregoing, Customer shall keep
and maintain, at its sole expense, the Collateral insured for an amount not less
than the amount set forth on Attachment A from time to time opposite the caption
"Collateral Insurance Amount" against all loss or damage under an "all risk"
Policy in companies mutually acceptable to IBM Credit and Customer, with a
lender's loss payable endorsement or mortgagee clause in form and substance
reasonably satisfactory to IBM Credit designating that any loss payable
thereunder with respect to such Collateral shall be payable to IBM Credit. Upon
receipt of proceeds by IBM Credit the same shall be applied on account of the
Customer's Outstanding Product Advances first, then to the Outstanding A/R
Advances. Customer agrees to instruct each insurer to give IBM Credit, by
endorsement upon the Policy issued by it or by independent instruments furnished
to IBM Credit, at least ten (10) days written notice before any Policy shall be
altered or cancelled and that no act or default of Customer or any other person
shall affect the right of IBM Credit to recover under the Policies. Customer
hereby agrees to direct all insurers under the Policies to pay all proceeds with
respect to the Collateral directly to IBM Credit. If Customer fails to pay any
cost, charges or premiums, or if Customer fails to insure the Collateral, IBM
Credit may pay such costs, charges or premiums. Any amounts paid by IBM Credit
hereunder shall be considered an additional debt owed by Customer to IBM Credit
and are due and payable immediately upon receipt of an invoice by IBM Credit.

7.9. Taxes. Customer agrees to pay, when due, all taxes lawfully levied or
assessed against Customer or any of the Collateral before any penalty or
interest accrues thereon unless such taxes are being contested, in good faith,
by appropriate proceedings promptly instituted and diligently conducted and an
adequate reserve or other appropriate provisions have been made therefor as
required in order to be in conformity with GAAP and

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an adverse determination in such proceedings could not reasonably be expected to
have a Material Adverse Effect.

7.10. Compliance With Laws. Customer agrees to comply with all Requirements of
Law applicable to the Collateral or any part thereof, or to the operation of its
business.

7.11. Fiscal Year. Customer agrees to maintain its fiscal year as a year ending
June 30 unless Customer provides IBM Credit at least thirty (30) days prior
written notice of any change thereof.

7.12. Intellectual Property. Customer shall do and cause to be done all things
necessary to preserve and keep in full force and effect all registrations of
Intellectual Property which the failure to do or cause to be done could
reasonably be expected to have a Material Adverse Effect.

7.13. Maintenance of Property. Customer shall maintain all of its material
properties (business and otherwise) in good condition and repair (ordinary wear
and tear excepted) and pay and discharge all costs of repair and maintenance
thereof and all rental and mortgage payments and related charges pertaining
thereto and not commit or permit any waste with respect to any of its material
properties.

7.14. Collateral. Customer shall:

(A) if from time to time reasonably required by IBM Credit, provide IBM
Credit with access to copies of all invoices, delivery evidences and other such
documents relating to each Account;

(B) promptly upon Customer's obtaining knowledge thereof, furnish to and
inform IBM Credit of all material adverse information relating to the financial
condition of any Account obligor whose outstanding obligations to Customer
constitute two percent (2%) or more of the Accounts at such time (a "Material
Account Obligor");

(C) promptly upon Customer's learning thereof, notify IBM Credit in writing
of any event which would cause any obligation of a Material Account Obligor to
become an Ineligible Account;

(D) keep all goods rejected or returned by any account debtor and all goods
repossessed or stopped in transit by Customer from any account debtor segregated
from other property of Customer, holding the same in trust for IBM Credit until
Customer applies a credit against such account debtor's outstanding obligations
to Customer or sells such goods in the ordinary course of business, whichever
occurs earlier;

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(E) stamp or otherwise mark chattel paper and instruments now owned or
hereafter acquired by it in conspicuous type to show that the same are subject
to IBM Credit's security interest and immediately thereafter deliver or cause
such chattel paper and instruments to be delivered to IBM Credit or any agent
designated by IBM Credit with appropriate endorsements and assignments to vest
title and possession in IBM Credit;

(F) use commercially reasonable efforts to collect all
Accounts owed;

(G) promptly notify IBM Credit of any loss, theft or destruction of or
damage to any of the Collateral. Customer shall diligently file and prosecute
its claim for any award or payment in connection with any such loss, theft,
destruction of or damage to Collateral. Customer shall, upon demand of IBM
Credit, make, execute and deliver any assignments and other instruments
sufficient for the purpose of assigning any such award or payment to IBM Credit,
free of any encumbrances of any kind whatsoever;

(H) consistent with reasonable commercial practice, observe and perform all
matters and things necessary or expedient to be observed or performed under or
by virtue of any lease, license, concession or franchise forming part of the
Collateral in order to preserve, protect and maintain all the rights of IBM
Credit thereunder;

(I) consistent with reasonable commercial practice, maintain, use and
operate the Collateral and carry on and conduct its business in a proper and
efficient manner so as to preserve and protect the Collateral and the earnings,
incomes, rents, issues and profits thereof; and

(J) at any time and from time to time, upon the request of IBM Credit, and
at the sole expense of Customer, Customer will promptly and duly execute and
deliver such further instruments and documents and take such further action as
IBM Credit may reasonably request for the purpose of obtaining or preserving the
full benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, the filing of any financing or continuation
statements under the Uniform Commercial Code in effect in any jurisdiction with
respect to the security interests granted herein and the payment of any and all
recording taxes and filing fees in connection therewith.

7.15. Subsidiaries. IBM Credit may require that any Subsidiaries of Customer
become parties to this Agreement or any other agreement executed in connection
with this Agreement as guarantors or sureties. Customer will comply, and cause
all Subsidiaries of Customer to comply with Sections 7 and 8 of this Agreement,
as if such sections applied directly to such

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Subsidiaries.

Section 8. NEGATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations due hereunder:

8.1. Liens. The Customer will not, directly or indirectly mortgage, assign,
pledge, transfer, create, incur, assume, permit to exist or otherwise permit any
Lien or judgment to exist on any of its property, assets, revenues or goods,
whether real, personal or mixed, whether now owned or hereafter acquired, except
for Permitted Liens.

8.2. Disposition of Assets. The Customer will not, directly or indirectly, sell,
lease, assign, transfer or otherwise dispose of any assets other than (i) sales
of inventory in the ordinary course of business and short term rental of
inventory as demonstrations in amounts not material to Customer, and (ii)
voluntary dispositions of individual assets and obsolete or worn out property in
the ordinary course of business, provided, that the aggregate book value of all
such assets and property so sold or disposed of under this section 8.2 (ii) in
any fiscal year shall not exceed 5% of the consolidated assets of the Customer
as of the beginning of such fiscal year.

8.3. Corporate Changes. The Customer will not, without the prior written consent
of IBM Credit, directly or indirectly, merge, consolidate, liquidate, dissolve
or enter into or engage in any operation or activity materially different from
that presently being conducted by Customer.

8.4. Guaranties. The Customer will not, directly or indirectly, assume,
guaranty, endorse, or otherwise become liable upon the obligations of any other
Person, except (i) by the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business, (ii) by
the giving of indemnities in connection with the sale of inventory or other
asset dispositions permitted hereunder, and (iii) for guaranties in favor of IBM
Credit.

8.5. Restricted Payments. The Customer will not, directly or indirectly: (i)
declare or pay any dividend (other than dividends payable solely in common stock
of Customer) on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any shares of any class of capital stock of
Customer or any warrants, options or rights to purchase any such capital stock,
whether now or hereafter outstanding, or make any other distribution in respect
thereof,

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either directly or indirectly, whether in cash or property or in obligations of
Customer; or (ii) make any optional payment or prepayment on or redemption
(including, without limitation, by making payments to a sinking or analogous
fund) or repurchase of any Indebtedness (other than the Obligations).

8.6. Investments. The Customer will not, directly or indirectly, make, maintain
or acquire any Investment in any Person other than:

(A) interest bearing deposit accounts (including certificates of deposit)
which are insured by the Federal Deposit Insurance Corporation ("FDIC") or a
similar federal insurance program;

(B) direct obligations of the government of the United States of America or
any agency or instrumentality thereof or obligations guaranteed as to principal
and interest by the United States of America or any agency thereof;

(C) stock or obligations issued to Customer in settlement of claims against
others by reason of an event of bankruptcy or a composition or the readjustment
of debt or a reorganization of any debtor of Customer; and

(D) commercial paper of any corporation organized under the laws of any
State of the United States or any bank organized or licensed to conduct a
banking business under the laws of the United States or any State thereof having
the short-term highest rating then given by Moody's Investor's Services, Inc.
or Standard & Poor's Corporation.

8.7. Affiliate/Subsidiary Transactions. The Customer will not, directly or
indirectly, enter into any transaction with any Affiliate or Subsidiary,
including, without limitation, the purchase, sale or exchange of property or the
rendering of any service to any Affiliate or Subsidiary of Customer except in
the ordinary course of business and pursuant to the reasonable requirements of
Customer's business upon fair and reasonable terms no less favorable to Customer
than could be obtained in a comparable arm's-length transaction with an
unaffiliated Person.

8.8. ERISA. The Customer will not (A) terminate any Plan so as to incur a
material liability to the PBGC, (B) permit any "prohibited transaction"
involving any Plan (other than a "multi-employer benefit plan") which would
subject the Customer to a material tax or penalty on "prohibited transactions"
under the Code or ERISA, (C) fail to pay to any Plan any contribution which they
are obligated to pay under the terms of such Plan, if such failure would result
in a material "accumulated funding deficiency", whether or not waived, (D) allow
or suffer to exist any occurrence and during the continuance of a "reportable
event"

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or any other event or condition, which presents a material risk of termination
by the PBGC of any Plan (other than a "multi-employer benefit plan"), or (E)
fail to notify IBM Credit as required in Section 7.5. As used in this Agreement,
the terms "accumulated funding deficiency" and "reportable event" shall have the
respective meanings assigned to them in ERISA, and the term "prohibited
transaction" shall have the meaning assigned to it in the Code and ERISA. For
purposes of this Section 8.8, the terms material liability, tax, penalty,
accumulated funding deficiency and risk of termination shall mean a liability,
tax, penalty, accumulated funding deficiency or risk of termination which could
reasonably be expected to have a Material Adverse Effect.

8.9. Additional Negative Pledges. Customer will not, directly or indirectly,
create or otherwise cause or permit to exist or become effective any contractual
obligation which may restrict or inhibit IBM Credit's rights or ability to sell
or otherwise dispose of the Collateral or any part thereof after the occurrence
and during the continuance of an Event of Default.

8.10. Storage of Collateral with Bailees and Warehousemen. Collateral shall not
be stored with a bailee, warehouseman or similar party without the prior written
consent of IBM Credit unless Customer will, concurrently with the delivery of
such Collateral to such party, cause such party to issue and deliver to IBM
Credit, warehouse receipts in the name of IBM Credit evidencing the storage of
such Collateral.

8.11. Use of Proceeds. The Customer shall not use any portion of the proceeds of
any Advances other than to acquire Products from Authorized Suppliers and for
its general working capital requirements.

8.12. Accounts. The Customer shall not permit or agree to any extension,
compromise or settlement or make any change or modification of any kind or
nature with respect to any Account, including any of the terms relating thereto,
which would affect IBM Credit's ability to collect payment on any Account in
whole or in part, except for such extensions, compromises or settlements made by
Customer in the ordinary course of its business, provided, however, that the
aggregate amount of such extensions, compromises or settlements does not exceed
five percent (5%) of the Customer's Accounts at any time.

8.13. Indebtedness. The Customer will not create, incur, assume or permit to
exist any Indebtedness, except for Permitted Indebtedness.

8.14. Loans. The Customer will not make any loans, advances, contributions or
payments of money or goods to any Subsidiary, Affiliate or parent corporation or
to any officer, director or

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stockholder of Customer or of any such corporation (except for compensation for
personal services actually rendered), except for transactions expressly
authorized in this Agreement.

Section 9. DEFAULT

9.1. Event of Default. Any one or more of the following events shall constitute
an Event of Default by the Customer under this Agreement and the Other
Agreements:

(A) The failure to make timely payment of the Obligations or any part
thereof when due and payable;

(B) Customer fails to comply with or observe any term, covenant or
agreement contained in this Agreement;

(C) Any representation, warranty, statement, report or certificate made or
delivered by or on behalf of Customer or any of its officers, employees or
agents or by or on behalf of any Guarantor to IBM Credit was false in any
material respect at the time when made or deemed made;

(D) The occurrence of any event or circumstance which could reasonably be
expected to have a Material Adverse Effect;

(E) Customer, any Subsidiary or any Guarantor shall generally not pay its
debts as such debts become due, become or otherwise declare itself insolvent,
file a voluntary petition for bankruptcy protection, have filed against it any
involuntary bankruptcy petition, cease to do business as a going concern, make
any assignment for the benefit of creditors, or a custodian, receiver, trustee,
liquidator, administrator or person with similar powers shall be appointed for
Customer, any Subsidiary or any Guarantor or any of its respective properties or
have any of its respective properties seized or attached, or take any action to
authorize, or for the purpose of effectuating, the foregoing, provided, however,
that Customer, any Subsidiary or any Guarantor shall have a period of forty-five
(45) days within which to discharge any involuntary petition for bankruptcy or
similar proceeding;

(F) The use of any funds borrowed from IBM Credit under this Agreement for
any purpose other than as provided in this Agreement;

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within thirty (30) days after termination of any such stay or bond) or such
judgment is not fully covered by insurance as to which the insurance company has
acknowledged its obligation to pay such judgment in full;

(H) The dissolution or liquidation of Customer or any Guarantor, or
Customer or any Guarantor or its directors or stockholders shall take any action
to dissolve or liquidate Customer or any Guarantor;

(I) Any "going concern" or like qualification or exception, or
qualification arising out of the scope of an audit by an Auditor of his opinion
relative to any Financial Statement delivered to IBM Credit under this
Agreement;

(J) There issues a warrant of distress for any rent or taxes with respect
to any premises occupied by Customer in or upon which the Collateral, or any
part thereof, may at any time be situated and such warrant shall continue for a
period of ten (10) Business Days from the date such warrant is issued;

(K) Customer suspends business;

(L) The occurrence of any event or condition which enables the holder of
any Indebtedness arising in one or more related or unrelated transactions, in
aggregate principal amount exceeding $300,000 to accelerate the maturity thereof
or the failure of Customer to pay when due any such Indebtedness;

(M) Any guaranty of any or all of the Customer's Obligations executed by
any guarantor in favor of IBM Credit, shall at any time for any reason cease to
be in full force and effect or shall be declared to be null and void by a court
of competent jurisdiction or the validity or enforceability thereof shall be
contested or denied by any such guarantor, or any such guarantor shall deny that
it has any further liability or obligation thereunder or any such guarantor
shall fail to comply with or observe any of the terms, provisions or conditions
contained in any such guaranty;

(N) Customer is in default under the material terms of any of the Other
Agreements after the expiration of any applicable cure periods;

(O) There shall occur a "reportable event" with respect to any Plan, or any
Plan shall be subject to termination proceedings (whether voluntary or
involuntary) and there shall result from such "reportable event" or termination
proceedings a liability of Customer to the PBGC which in the reasonable opinion
of IBM Credit will have a Material Adverse Effect;

(P) Any "person" (as defined in Section 13(d)(3) of the

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Securities Exchange Act of 1934, as amended) acquires a beneficial interest in
50% or more of the Voting Stock of Customer.

(Q) Robec, Inc. fails to execute and deliver to IBM Credit in form and
substance satisfactory to IBM Credit, a collateralized guaranty guarantying the
obligations of Customer to IBM Credit and execute any document or instrument
that IBM Credit shall deem necessary or appropriate to perfect and maintain
perfected IBM Credit's security interest in the assets of Robec, Inc.
contemplated by the collateralized guaranty upon the earlier of (i) the
acquisition of all of the outstanding shares of Robec, Inc. by an Affiliate, and
(ii) June 30, 1995.

9.2. Acceleration. Upon the occurrence and during the continuance of an Event of
Default which has not been waived in writing by IBM Credit, IBM Credit may, in
its sole discretion, take any or all of the following actions, without prejudice
to any other rights it may have at law or under this Agreement to enforce its
claims against the Customer: (a) declare all Obligations to be immediately due
and payable (except with respect to any Event of Default set forth in Section
9.1(E) hereof, in which case all Obligations shall automatically become
immediately due and payable without the necessity of any notice or other demand)
without presentment, demand, protest or any other action or obligation of IBM
Credit; and

(b) immediately terminate the Line of Credit hereunder.

9.3. Remedies. (A) Upon the occurrence and during the continuance of any Event
of Default which has not been waived in writing by IBM Credit, IBM Credit may
exercise all rights and remedies of a secured party under the U.C.C. Without
limiting the generality of the foregoing, IBM Credit may: (i) remove from any
premises where same may be located any and all documents, instruments, files and
records (including the copying of any computer records), and any receptacles or
cabinets containing same, relating to the Accounts, or IBM Credit may use (at
the expense of the Customer) such of the supplies or space of the Customer at
Customer's place of business or otherwise, as may be necessary to properly
administer and control the Accounts or the handling of collections and
realizations thereon; (ii) bring suit, in the name of the Customer or IBM Credit
and generally shall have all other rights respecting said Accounts, including
without limitation the right to accelerate or extend the time of payment,
settle, compromise, release in whole or in part any amounts owing on any
Accounts and issue credits in the name of the Customer or IBM Credit; (iii)
sell, assign and deliver the Accounts and any returned, reclaimed or repossessed
merchandise, with or without advertisement, at public or private sale, for cash,
on credit or otherwise, at IBM Credit's sole option and discretion, and IBM
Credit may bid or become a purchaser at any

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such sale; and (iv) foreclose the security interests created pursuant to this
Agreement by any available judicial procedure, or to take possession of any or
all of the Collateral without judicial process and to enter any premises where
any Collateral may be located for the purpose of taking possession of or
removing the same.

(B) Upon the occurrence and during the continuance of any Event of Default
which has not been waived in writing by IBM Credit, IBM Credit shall have the
right to sell, lease, or otherwise dispose of all or any part of the Collateral,
whether in its then condition or after further preparation or processing, in the
name of Customer or IBM Credit, or in the name of such other party as IBM Credit
may designate, either at public or private sale or at any broker's board, in
lots or in bulk, for cash or for credit, with or without warranties or
representations, and upon such other terms and conditions as IBM Credit in its
sole discretion may deem advisable, and IBM Credit shall have the right to
purchase at any such sale. If IBM Credit, in its sole discretion determines that
any of the Collateral requires rebuilding, repairing, maintenance or
preparation, IBM Credit shall have the right, at its option, to do such of the
aforesaid as it deems necessary for the purpose of putting such Collateral in
such saleable form as IBM Credit shall deem appropriate. The Customer hereby
agrees that any disposition by IBM Credit of any Collateral pursuant to and in
accordance with the terms of a repurchase agreement between IBM Credit and the
manufacturer or any supplier (including any Authorized Supplier) of such
Collateral constitutes a commercially reasonable sale. The Customer agrees, at
the request of IBM Credit, to assemble the Collateral and to make it available
to IBM Credit at places which IBM Credit shall select, whether at the premises
of the Customer or elsewhere, and to make available to IBM Credit the premises
and facilities of the Customer for the purpose of IBM Credit's taking possession
of, removing or putting such Collateral in saleable form. If notice of intended
disposition of any Collateral is required by law, it is agreed that ten (10)
Business Days notice shall constitute reasonable notification.

(C) Unless expressly prohibited by the licensor thereof, if any, IBM Credit
is hereby granted, upon the occurrence and during the continuance of any Event
of Default which has not been waived in writing by IBM Credit, an irrevocable,
non-exclusive license to use, assign, license or sublicense all computer
software programs, data bases, processes and materials used by the Customer in
its businesses or in connection with any of the Collateral.

(D) The net cash proceeds resulting from IBM Credit's exercise of any of
the foregoing rights (after deducting all charges, costs and expenses, including
reasonable attorneys'

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fees) shall be applied by IBM Credit to the payment of Customer's Obligations,
whether due or to become due, in such order as IBM Credit may in it sole
discretion elect. Customer shall remain liable to IBM Credit for any
deficiencies, and IBM Credit in turn agrees to remit to Customer or its
successors or assigns, any surplus resulting therefrom.

(E) The enumeration of the foregoing rights is not intended to be
exhaustive and the exercise of any right shall not preclude the exercise of any
other rights, all of which shall be cumulative.

9.4. Waiver. If IBM Credit seeks to take possession of any of the Collateral by
any court process Customer hereby irrevocably waives to the extent permitted by
applicable law any bonds, surety and security relating thereto required by any
statute, court rule or otherwise as an incident to such possession and any
demand for possession of the Collateral prior to the commencement of any suit or
action to recover possession thereof. In addition, Customer waives to the extent
permitted by applicable law all rights of set-off it may have against IBM
Credit. Customer further waives to the extent permitted by applicable law
presentment, demand and protest, and notices of non-payment, non-performance,
any right of contribution, dishonor, and any other demands, and notices required
by law.

Section 10. MISCELLANEOUS

10.1. Term; Termination. (A) This Agreement shall remain in force until the
earlier of (i) the Termination Date, (ii) the date specified in a written notice
by the Customer that they intend to terminate this Agreement which date shall be
no less than 90 days following the receipt by IBM Credit of such written notice,
and (iii) termination by IBM Credit after the occurrence and during the
continuance of an Event of Default. Upon the date that this Agreement is
terminated, all of Customer's Obligations shall be immediately due and payable
in their entirety, even if they are not yet due under their terms.

(B) Until the indefeasible payment in full of all of Customer's
Obligations, no termination of this Agreement or any of the Other Agreements
shall in any way affect or impair the Customer's Obligations to IBM Credit
including, without limitation, any transaction or event occurring prior to such
termination, and IBM Credit's security interest in the Collateral.

10.2. Indemnification. The Customer hereby agrees to indemnify and hold harmless
IBM Credit and each of its officers, directors, agents and assigns
(collectively, the "Indemnified Persons")

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against all losses, claims, damages, liabilities or other expenses (including
reasonable attorneys' fees and court costs now or hereinafter arising from the
enforcement of this Agreement, the "Losses") to which any of them may become
subject insofar as such Losses arise out of or are based upon any event,
circumstance or condition (a) occurring or existing on or before the date of
this Agreement relating to any financing arrangements IBM Credit may from time
to time have with (i) Customer, (ii) any Person that shall be acquired by
Customer or (iii) any Person that Customer may acquire all or substantially all
of the assets of, or (b) directly or indirectly, relating to the execution,
delivery or performance of this Agreement or the consummation of the
transactions contemplated hereby or thereby or to any of the Collateral or to
any act or omission of the Customer in connection therewith. Notwithstanding the
foregoing, the Customer shall not be obligated to indemnify IBM Credit for any
Losses incurred by IBM Credit which are a result of IBM Credit's gross
negligence or willful misconduct. The indemnity provided herein shall survive
the termination of this Agreement.

10.3. Additional Obligations. IBM Credit, without waiving or releasing any
Obligation or Default of the Customer, may perform any Obligations of the
Customer that the Customer shall fail or refuse to perform and IBM Credit may,
at any time or times hereafter, but shall be under no obligation so to do, pay,
acquire or accept any assignment of any security interest, lien, encumbrance or
claim against the Collateral asserted by any person. All sums paid by IBM Credit
in performing in satisfaction or on account of the foregoing and any expenses,
including reasonable attorney's fees, court costs, and other charges relating
thereto, shall be a part of the Obligations, payable on demand and secured by
the Collateral.

10.4. LIMITATION OF LIABILITY. NEITHER IBM CREDIT NOR ANY OTHER INDEMNIFIED
PERSON SHALL HAVE ANY LIABILITY WITH RESPECT TO ANY SPECIAL, INDIRECT OR
CONSEQUENTIAL DAMAGES SUFFERED BY CUSTOMER IN CONNECTION WITH THIS AGREEMENT,
ANY OTHER AGREEMENT OR ANY CLAIMS IN ANY MANNER RELATED THERETO. NOR SHALL IBM
CREDIT OR ANY OTHER INDEMNIFIED PERSON HAVE ANY LIABILITY TO CUSTOMER OR ANY
OTHER PERSON FOR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY IT OR THEM
HEREUNDER, EXCEPT FOR ITS OR THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

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this Agreement or any of the Other Agreements, such dispensation may be revoked
by IBM Credit at any time and shall not be deemed to constitute a waiver of any
such requirement subsequent thereto. IBM Credit's failure at any time or times
to require strict compliance and performance by the Customer of any
undertakings, agreements, covenants, warranties and representations of this
Agreement or any Other Agreement shall not waive, affect or diminish any right
of IBM Credit thereafter to demand strict compliance and performance thereof.
Any waiver by IBM Credit of any Default by the Customer under this Agreement or
any of the Other Agreements shall not waive or affect any other Default by the
Customer under this Agreement or any of the Other Agreements, whether such
Default is prior or subsequent to such other Default and whether of the same or
a different type. None of the undertakings, agreements, warranties, covenants,
and representations of the Customer contained in this Agreement or the Other
Agreements and no Default by the Customer shall be deemed waived by IBM Credit
unless such waiver is in writing signed by an authorized representative of IBM
Credit.

10.6. Severability. If any provision of this Agreement or the Other Agreements
or the application thereof to any Person or circumstance is held invalid or
unenforceable, the remainder of this Agreement and the Other Agreements and the
application of such provision to other Persons or circumstances will not be
affected thereby, the provisions of this Agreement and the Other Agreements
being severable in any such instance.

10.7. One Loan. All Advances heretofore, now or at any time or times hereafter
made by IBM Credit to the Customer under this Agreement or the Other Agreements
shall constitute one loan secured by IBM Credit's security interests in the
Collateral and by all other security interests, liens and encumbrances
heretofore, now or from time to time hereafter granted by the Customer to IBM
Credit or any assignor of IBM Credit.

10.8. Additional Collateral. All monies, reserves and proceeds received or
collected by IBM Credit with respect to Accounts and other property of the
Customer in possession of IBM Credit at any time or times hereafter are hereby
pledged by Customer to IBM Credit as security for the payment of Customer's
Obligations and shall be applied promptly by IBM Credit on account of the
Customer's Obligations; provided, however, IBM Credit may release to the
Customer such portions of such monies, reserves and proceeds as IBM Credit may
from time to time determine, in its sole discretion.

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Customer under the Financing Agreement and any Other Agreement. Customer
acknowledges and agrees that such Obligations outstanding as of the date hereof
have not been satisfied or discharged and that this Agreement is not intended to
effect a novation of the Customer's Obligations under the Financing Agreement or
any Other Agreement.

(B) Neither the obtaining of any judgment nor the exercise of any power of
seizure or sale shall operate to extinguish the Obligations of the Customer to
IBM Credit secured by this Agreement and shall not operate as a merger of any
covenant in this Agreement, and the acceptance of any payment or alternate
security shall not constitute or create a novation and the obtaining of a
judgment or judgments under a covenant herein contained shall not operate as a
merger of that covenant or affect IBM Credit's rights under this Agreement.

10.10. Paragraph Titles. The Section titles used in this Agreement and the Other
Agreements are for convenience only and do not define or limit the contents of
any Section.

10.11. Binding Effect; Assignment. This Agreement and the Other Agreements shall
be binding upon and inure to the benefit of IBM Credit and the Customer and
their respective successors and assigns; provided, that the Customer shall have
no right to assign this Agreement or any of the Other Agreements without the
prior written consent of IBM Credit.

10.12. Notices. Except as otherwise expressly provided in this Agreement, any
notice required or desired to be served, given or delivered hereunder shall be
in writing, and shall be deemed to have been validly served, given or delivered
(A) upon receipt if deposited in the United States mails, first class mail, with
proper postage prepaid, (B) upon receipt of confirmation or answer back if sent
by telecopy, or other similar facsimile transmission, (C) one Business Day after
deposit with a reputable overnight courier with all charges prepaid, or (D) when
delivered, if hand-delivered by messenger, all of which shall be properly
addressed to the party to be notified and sent to the address or number
indicated as follows:

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(i) If to IBM Credit at:
IBM Credit Corporation
1500 Riveredge Parkway
Atlanta, GA 30328
Attention: Remarketer Finance Center Manager
Telecopy: (404) 644-4825

(ii) If to Customer at:
CDS Distribution, Inc.
MacArthur Place, 3 Imperial Promenade
Santa Ana, CA 92707
Attention: Stephen G. Holmes
Telecopy: (704) 513-2450

or to such other address or number as each party designates to the other in the
manner prescribed herein.

10.13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto were upon the same instrument.

10.14. ATTACHMENT A MODIFICATIONS. IBM Credit may modify the Product Advance
Term set forth in Attachment A from time to time if on at least two occasions
during any three-month period a Shortfall Amount has become due and payable and
may modify the Collateral Insurance Amount set forth in Attachment A from time
to time, in each case, by providing Customer with a new Attachment A. Any such
new Attachment A shall be effective as of the date specified in the new
Attachment A.

10.15. SUBMISSION AND CONSENT TO JURISDICTION AND CHOICE OF LAW. TO INDUCE IBM
CREDIT TO ACCEPT THIS AGREEMENT AND THE OTHER AGREEMENTS, THE CUSTOMER HEREBY
IRREVOCABLY AND UNCONDITIONALLY:

(A) SUBMITS ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT AND ANY OTHER AGREEMENT, OR FOR THE RECOGNITION AND
ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND ANY FEDERAL DISTRICT
COURT IN NEW YORK.

(B) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH
COURTS AND WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREINAFTER HAVE TO THE VENUE
OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM
THE SAME.

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REGISTERED OR CERTIFIED MAlL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO CUSTOMER AT ITS ADDRESS SET FORTH IN SECTION 10.12 OR AT
SUCH OTHER ADDRESS OF WHICH IBM CREDIT SHALL HAVE BEEN NOTIFIED PURSUANT
THERETO;

(D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN
ANY OTHER JURISDICTION.

(E) AGREES THAT THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS (WITHOUT GIVING EFFECT TO CONFLICT OF
LAW PROVISIONS) OF THE STATE OF NEW YORK.

10.16. JURY TRIAL WAIVER. EACH OF IBM CREDIT AND THE CUSTOMER HEREBY IRREVOCABLY
WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING (INCLUDING ANY
COUNTERCLAIM) OF ANY TYPE IN WHICH IBM CREDIT AND THE CUSTOMER ARE PARTIES AS TO
ALL MATTERS ARISING DIRECTLY OR INDIRECTLY OUT OF THIS AGREEMENT OR ANY
DOCUMENT, INSTRUMENT OR AGREEMENT EXECUTED IN CONNECTION HEREWITH.

IN WITNESS WHEREOF, the Customer has read this entire Agreement, and has caused
its authorized representatives to execute this Agreement and has caused its
corporate seal to be affixed hereto as of the date first written above.

CDS DISTRIBUTION, INC.

By: /s/ Stephen G. Holmes
-------------------------------
Print Name: Stephen G. Holmes
-----------------------
Title: CFO
----------------------------

ACCEPTED this day of , 1995
------- ------------------
IBM CREDIT CORPORATION

By:
-----------------------------
Print Name:
---------------------
Title:
--------------------------

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<PAGE>

ATTACHMENT A, EFFECTIVE DATE MAY 5, 1995 ("IWCF ATTACHMENT A")
TO INVENTORY AND WORKING CAPITAL FINANCING AGREEMENT ("IWCF AGREEMENT")
DATED MAY 5, 1995

Customer: CDS Distribution, Inc.

I. Fees, Rates and Repayment Terms:

(A) Line of Credit: Thirty-Five Million Dollars ($35,000,000.00);

(B) Borrowing Base:

(i) 85% of the amount of the Customer's Eligible Accounts as of the
date of determination as reflected in the Customer's most recent
Collateral Management Report;

(ii) 100% of the Customer's inventory in the Customer's possession as
of the date of determination as reflected in the Customer's most
recent Collateral Management Report constituting Products (other than
service parts) financed through a Product Advance by IBM Credit. The
value to be assigned to such inventory shall be based upon the
Authorized Supplier's invoice price to Customer for Financed Products
net of all applicable price reduction credits.

(D) Product Advance Term: 100 days

(E) Collateral Insurance Amount: Thirty Million Dollars
($30,000,000.00)

(F) A/R Finance Charge:

(i) PRO Advance Charge: Prime Rate plus 2.000%

(ii) WCO Advance Charge: Prime Rate plus 2.000%

(iii) Takeout Advance Charge: Prime Rate plus 1.750%

(G) Delinquency Fee Rate: Prime Rate plus 6.500%

(H) Shortfall Transaction Fee: Shortfall Amount multiplied by 0.30%

(I) Other Charges:

(i) Application Processing Fee: $ 0.00
(ii) Monthly Service Fee: $1,500.00
(iii) Closing Fee: $ 0.00
(iv) Commitment Fee: $ 0.00

Page 1 of 19

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FIRST AMENDMENT TO INVENTORY AND WORKING CAPITAL
FINANCING AGREEMENT

This First Amendment, dated May 18, 1995 is hereby made to that certain
Inventory and Working Capital Financing Agreement (as amended, supplemented or
otherwise modified from time to time, the "Agreement") to be entered into by and
between CDS Distribution, Inc. ("Customer") and IBM Credit Corporation ("IBM
Credit").

RECITALS

WHEREAS, Customer executed that certain Agreement on May 5, 1995.

WHEREAS, Customer has requested that it be permitted to deliver certain
security pledges and related documents, as required by IBM Credit, after the
execution of the Agreement.

WHEREAS, IBM Credit has agreed to permit the delivery of such documents
after the execution of the Agreement subject to the terms and conditions set
forth in this First Amendment;

NOW THEREFORE, in consideration of the premises set forth herein, and for
other good and valuable consideration, the value and sufficiency of which is
hereby acknowledged, the Customer and IBM Credit agree as follows:

AGREEMENT

SECTION 1. Definitions. All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Agreement.

a) The following definition is added to Section 1.1 of the Agreement:

"`Foreign Subsidiaries': Kenfil Distribution (Far East) Limited,
Kenfil Distribution (M) SDN. BHD., and CMS Enhancements
(Australia) Pty Limited; for each the outstanding capital stock of which is
one hundred percent (100%) owned by Customer or its Affiliates."

SECTION 2. Amendment to Event of Default.

a) The following paragraph (R) is inserted immediately following Section
9.1, paragraph (Q):

"(R) Customer fails to grant, by June 30, 1995, IBM Credit a first
priority security interest in and assign, pledge, hypothecate and deliver
to IBM Credit 100% of the stock of each of the Foreign Subsidiaries and
all substitutions, dividends, interest, and redemption prices and other
rights with respect to such securities and all other property received in
respect of or in exchange for such securities, opinions of local counsel

Page 1 of 3

49
<PAGE>

satisfactory to IBM Credit concerning IBM Credit's first priority
security interest in the stock of the Foreign Subsidiaries and additional
related documents, both satisfactory in form and substance to IBM Credit,
with respect to the securities pledged of the Foreign Subsidiaries, as
IBM Credit may reasonably request."

SECTION 3. Representations and Warranties. Customer makes to IBM Credit the
following representations and warranties, all of which are material and are made
to induce IBM Credit to enter into this Amendment.

3.1 Accuracy and Completeness of Warranties and Representations. All
representations made by Customer in the Agreement were true, accurate and
complete in every respect as of the date made, and, after giving effect to
this Amendment, all representations made by Customer in the Agreement are
true, accurate and complete in every material respect as of the date hereof,
and do not fail to disclose any material fact necessary to make the
representations not misleading.

3.2 Violation of Other Agreements. The execution and delivery of this
Amendment do not violate or cause Customer not to be in compliance with the
terms of any agreement to which Customer is a party.

3.3. Litigation. Except as has been disclosed by Customer to IBM Credit in
writing, there is no litigation, proceeding, investigation or labor dispute
pending or threatened against Customer, which if adversely determined, would
materially adversely affect the ability of Customer to perform its obligations
under the Financing Agreement, and the other documents, instruments and
agreements executed in connection therewith or pursuant hereto.

SECTION 4. Ratification of Agreement. Except as specifically waived hereby, all
the provisions of the Agreement shall remain in full force and effect. Customer
hereby ratifies, confirms and agrees that the Agreement represents a valid and
enforceable obligation of Customer, and is not subject to any claims, offsets or
defenses.

SECTION 5. Governing Law. This Amendment shall be governed by and interpreted in
accordance with the laws of the State of New York.

SECTION 6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement.

Page 2 of 3

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<PAGE>

IN WITNESS WHEREOF, this Amendment has been executed by the duly authorized
officers of the undersigned as of the day and year first above written.

CDS DISTRIBUTION, INC. IBM CREDIT CORPORATION

BY: /s/ Stephen G. Holmes BY:
--------------------------- -----------------------------
NAME: Stephen G. Holmes NAME:
------------------------- ---------------------------
TITLE: CFO TITLE:
------------------------ --------------------------

ATTEST: ATTEST:
/s/ Peter ???????????
- ------------------------------ --------------------------------

PRINT NAME: Peter ????????? PRINT NAME:
------------------- ---------------------

Page 3 of 3

<PAGE>

EXHIBIT 10.02

Inventory and Working Capital Financing Agreement

by and between

CMS Enhancements, Inc.

and

IBM Credit Corporation
<PAGE>

Table of Contents

1
<PAGE>

2
<PAGE>

3
<PAGE>

INVENTORY AND WORKING CAPITAL
FINANCING AGREEMENT

This INVENTORY AND WORKING CAPITAL FINANCING AGREEMENT (as amended,
supplemented or otherwise modified from time to time, this "Agreement") is
hereby made this 5 day of May, 1995, by and between IBM CREDIT CORPORATION with
a place of business at 1500 Riveredge Parkway, Atlanta, GA 30328 ("IBM Credit"),
and CMS ENHANCEMENTS, INC. with a place of business at 2722 Michelson Drive,
Irvine, CA 92713 ("Customer").

RECITALS

NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

Section 1. DEFINITIONS

1.1 Special Definitions. The following terms shall have the following respective
meaning in this Agreement:

"A/R Advance Date": the Business Day on which IBM Credit makes an A/R Advance
under this Agreement.

"A/R Advance Term": shall be the collective or individual reference, as the
context may require, to a PRO Advance Term and

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<PAGE>

a WCO Advance Term.

"A/R Finance Charges": as defined on Attachment A.

"Accounts": as defined in the U.C.C.

"Advance": any loan or other extension of credit by IBM Credit to Customer
pursuant to this Agreement including, without limitation, (i) Product Advances
and (ii) A/R Advances.

"AmeriQuest": AmeriQuest Technologies, Inc., the direct owner of one hundred
percent (100%) of the outstanding capital stock of Customer.

"Auditors": a nationally recognized firm of independent certified public
accountants selected by Customer and satisfactory to IBM Credit.

"Available Credit": at any time, (1) the Maximum Advance Amount less (2) the
Outstanding Advances at such time.

"Borrowing Base": as defined in Attachment A.

"Business Day": any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are generally closed or on which IBM
Credit is closed.

"Closing Date": the date on which the conditions precedent to the effectiveness
of this Agreement set forth in Section 5.1 hereof are satisfied or waived in
writing by IBM Credit.

"Code": the Internal Revenue Code of 1986, as amended or any successor statute.

"Collateral": as defined in Section 4.1.

"Collateral Management Report": a report to be delivered by

2
<PAGE>

"Compliance Certificate": a certificate substantially in the form of Attachment
C.

"Default": either (1) an Event of Default or (2) any event or condition which,
but for the requirement that notice be given or time lapse or both, would be an
Event of Default.

"Delinquency Fee Rate": as defined on Attachment A. "Eligible Account": as
defined in Section 3.1.

"ERISA": the Employee Retirement Income Security Act of 1974, as

3
<PAGE>

amended, or any successor statutes.

"Event of Default": as defined in Section 9.1.

"GAAP": generally accepted accounting principles in the United States as in
effect from time to time.

"Guaranties": guaranties in favor of IBM Credit guarantying the Obligations of
Customer.

"Guarantor": any guarantor pursuant to any of the Guaranties.

"Hazardous Substances": all substances, wastes or materials, to the extent
subject to regulation as "hazardous substances" or "hazardous waste" under any
Environmental-LawS.

4
<PAGE>

"Line of Credit": as defined in Section 2.1.

"Maximum Advance Amount": at any time, the lesser of (1) the Line of Credit and
(2) the Borrowing Base at such time.

"Other Charges": as set forth in Attachment A.

"Outstanding Advances": at any time of determination, the sum of (1) the
Outstanding Product Advances and (2) the Outstanding A/R Advances.

"Payment Dates": the fifth, fifteenth and twenty-fifth day of each calendar
month.

"Permitted Indebtedness": any of the following:

(1) Indebtedness to IBM Credit;

(2) Indebtedness described in Section VII of Attachment B;

(3) Indebtedness to any Floor Plan Lender;

(4) Purchase Money Indebtedness;

(5) guaranties in favor of IBM Credit; and

(6) Other Indebtedness consented to by IBM Credit in writing prior to the
incurrence thereof.

"Permitted Liens": any of the following:

(1) Liens which are the subject of an Intercreditor Agreement, in effect from
time to time between IBM Credit and any other secured creditor;

(2) Purchase Money Security Interests;

(3) Liens described in Section I of Attachment B;

6
<PAGE>

(10) Liens arising out of deposits in connection with workers' compensation,
unemployment insurance or other social security or similar legislation;

(11) Liens arising pursuant to this Agreement; and

7
<PAGE>

(12) other Liens consented to by IBM Credit in writing prior to the incurrence
thereof.

"Person": any individual, association, firm, corporation, partnership, trust,
unincorporated organization or other entity whatsoever.

"Policies": all policies of insurance required to be maintained by Customer
under this Agreement or any of the Other Agreements.

"PRO Advance": an A/R Advance, with a PRO Advance Term, made by IBM Credit to
itself on behalf of Customer to repay all or a portion of a Product Advance that
is due and payable.

"Product Advance Charge": as defined on Attachment A.

"Product Advance Term": for each Product Advance, a period of days equal to that
set forth in Attachment A from time to time, commencing on the invoice date of
such Product Advance.

"Purchase Money Security Interest": any security interest securing Purchase
Money Indebtedness, which security interest

8
<PAGE>

applies solely to the particular asset acquired with the Purchase Money
Indebtedness.

"Request for A/R Advance": as defined in Section 2.3.

"Shortfall Amount": as defined in Section 2.6.

"Takeout Advance": an A/R Advance made to existing creditors of Customer on
behalf of Customer, in an amount sufficient to discharge Customer's indebtedness
to such creditor.

"Termination Date": shall mean (i) the first anniversary of the date of this
Agreement or such other date as IBM Credit and Customer may agree to in writing
from time to time.

"Voting Stock": securities, the holders of which are ordinarily, in the absence
of contingencies, entitled to elect the corporate directors (or persons
performing similar functions).

"WCO Advance": an A/R Advance, with a WCO Advance Term.

"WCO Advance Term": for each WCO Advance, a period of one hundred eighty (180)
days commencing on the A/R Advance Date for such WCO Advance.

Section 2. LINE OF CREDIT/FINANCE CHARGES/OTHER CHARGES

9
<PAGE>

10
<PAGE>

11
<PAGE>

12
<PAGE>

13
<PAGE>

Section 3. LINE OF CREDIT ADDITIONAL PROVISIONS

14
<PAGE>

(B) Accounts unpaid more than ninety (90) days from date of invoice;

(E) Accounts arising from consignment sales;

(F) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which the payment by
the account debtor is or may be conditional;

(G) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which:

(i) the account debtor is not a commercial entity, or

(ii) the account debtor is not a resident of the United States;

(H) Accounts payable by any account debtor to which Customer is or may
become liable for goods sold or services rendered by such account debtor to
Customer;

(I) Accounts arising from the sale or lease of goods purchased for a
personal, family or household purpose;

(J) Accounts arising from the sale or other disposition of goods that has
been used for demonstration purposes or loaned or leased by the Customer to
another party;

(K) Accounts which are progress payment accounts or contra accounts;

(L) Accounts upon which IBM Credit does not have a valid, perfected, first
priority security interest;

(M) Accounts payable by an account debtor that is or

15
<PAGE>

Customer knows will become, subject to proceedings under United States
Bankruptcy Law or other law for the relief of debtors;

(N) Accounts that are not payable in US dollars;

(P) Accounts arising from the sale or lease of goods which are billed to
any account debtor but have not yet been shipped by Customer;

(R) Accounts that do not arise from undisputed bona fide transactions
completed in accordance with the terms and conditions contained in the invoices,
purchase orders and contracts relating thereto;

(S) Accounts that are discounted for the full payment term specified in
Customer's terms and conditions with its account debtors, or for any longer
period of time;

(T) Accounts on cash on delivery (C.O.D.) terms;

(U) Accounts arising from maintenance or service contracts that are billed
in advance of full performance of service;

(V) Accounts arising from bartered transactions;

(W) Accounts arising from incentive payments, rebates, discounts, credits,
and refunds from a supplier; and

(X) Any and all other Accounts that IBM Credit deems, in its sole and
absolute discretion, to be ineligible.

The aggregate of all Accounts that are not ineligible Accounts shall hereinafter
be referred to as "Eligible Accounts".

16
<PAGE>

17
<PAGE>

(B) endorse the name of Customer upon any of the items of payment of
proceeds and deposit the same in the account of IBM Credit for application to
the Obligation; and

upon the occurrence and during the continuance of an Event of Default as defined
in Section 9.1 hereof:

(C) demand payment, enforce payment and otherwise exercise all Customer's
rights and remedies with respect to the collection of any Accounts;

(D) settle, adjust, compromise, extend or renew any Accounts;

(E) settle, adjust or compromise any legal proceedings brought to collect
any Accounts;

(F) sell or assign any Accounts upon such terms, for such amounts and at
such time or times as IBM Credit may deem advisable;

(G) discharge and release any Accounts;

(H) prepare, file and sign Customer's name on any Proof of Claim in
Bankruptcy or similar document against any Account obligor;

(I) prepare, file and sign Customer's name on any notice of lien, claim of
mechanic's lien, assignment or satisfaction of lien or mechanic's lien, or
similar document in connection with any Accounts;

(K) endorse the name of Customer upon any of the items of payment of
proceeds and deposit the same in the account of IBM Credit for application to
the Obligation;

(L) sign the name of Customer to requests for verification of Accounts and
notices thereof to Account obligors;

(M) sign the name of Customer on any document or instrument that IBM Credit
shall deem necessary or appropriate to enforce any and all remedies it may have
under this Agreement, at law or

18
<PAGE>

otherwise; and

Section 4. SECURITY -- COLLATERAL

(A) all inventory and equipment, and all parts thereof, attachments,
accessories and accessions thereto, products thereof and documents therefor;

(D) all rights now or hereafter existing in and to all mortgages, security
agreements, leases or other contracts securing or otherwise relating to any of
the foregoing; and

All of the above assets shall be collectively defined herein as

19
<PAGE>

the "Collateral".

Section 5. CONDITIONS PRECEDENT

(A) this Agreement executed and delivered by Customer and IBM Credit;

20
<PAGE>

(E) a lockbox agreement executed by Customer and each Bank, in form and
substance satisfactory to IBM Credit;

(F) a contingent blocked account agreement executed by Customer and each
Bank in form and substance satisfactory to IBM Credit;

(G) intercreditor agreements ("Intercreditor Agreement"), in form and
substance satisfactory to IBM Credit, executed by each other secured creditor of
Customer as set forth in Attachment A;

(H) a favorable opinion of counsel for Customer in substantially the form
of Attachment I;

(J) the statements, certificates, documents, instruments, financing
statements, agreements and information set forth in Attachment A and Attachment
B; and

(B) No event has occurred and is continuing or after giving effect to such
Advance or the application of the proceeds thereof would result which would
constitute a Default;

21
<PAGE>

(D) Both before and after giving effect to the making of such Advance, no
Shortfall Amount exists.

Section 6. REPRESENTATIONS AND WARRANTIES

To induce IBM Credit to enter into this Agreement, Customer represents and
warrants to IBM Credit as follows:

22
<PAGE>

6.6. Fictitious Business Names. Customer has not used any corporate or
fictitious name during the five (5) years preceding the date of this Agreement,
other than those listed on Attachment B.

6.7. Organization. All of the outstanding capital stock of Customer has been
validly issued, is fully paid and nonassessable.

6.8. No Judgments or Litigation. Except as set forth on Attachment B, no
judgments, orders, writs or decrees are outstanding against Customer nor is
there now pending or, to the

23
<PAGE>

best of Customer's knowledge after due inquiry, threatened, any litigation,
contested claim, investigation, arbitration, or governmental proceeding by or
against Customer.

6.11. Compliance with Law. Customer has not violated or failed to comply with
any Requirement of Law or any requirement of any self regulatory organization.

6.13. Compliance with Environmental Laws. Except as otherwise disclosed in
Attachment B:

(A) The Customer has obtained all government approvals required with
respect to the operation of their businesses under any Environmental Law.

(B) (i) the Customer has not generated, transported or disposed of any
Hazardous Substance; (ii) the Customer is not currently generating, transporting
or disposing of any Hazardous

24
<PAGE>

25
<PAGE>

the Other Agreements or to perform its obligations hereunder or thereunder.

6.21. Recording Taxes. All recording taxes, recording fees, filing fees and
other charges payable in connection with the

26
<PAGE>

filing and recording of this Agreement have either been paid in full by Customer
or arrangements for the payment of such amounts by Customer have been made to
the satisfaction of IBM Credit.

6.22. Indebtedness. Customer (i) has no Indebtedness, other than Permitted
Indebtedness; and (ii) has not guaranteed the obligations of any other Person
(except as permitted by Section 8.4),

Section 7. AFFIRMATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations:

7.1. Financial and Other Information. Customer shall cause to be furnished to
IBM Credit the following information within the following time periods:

27
<PAGE>

AmeriQuest is in compliance with the financial covenants set forth in Exhibit A
to the guaranty executed by AmeriQuest;

28
<PAGE>

(H) by the fifth (5th) day of each month, or as otherwise agreed in
writing, a Collateral Management Report as of a date no earlier than the last
day of the immediately preceding month;

29
<PAGE>

(B) Customer shall notify IBM Credit, promptly upon its obtaining knowledge
of (i) any non-routine proceeding or investigation by any Governmental Authority
with respect to the

30
<PAGE>

31
<PAGE>

Effect on the value of the Collateral or on the security interests granted to
IBM Credit therein.

32
<PAGE>

an adverse determination in such proceedings could not reasonably be expected to
have a Material Adverse Effect.

7.10. Compliance With Laws. Customer agrees to comply with all Requirements of
Law applicable to the Collateral or any part thereof, or to the operation of its
business.

7.11. Fiscal Year. Customer agrees to maintain its fiscal year as a year ending
June 30 unless Customer provides IBM Credit at least thirty (30) days prior
written notice of any change thereof.

7.14. Collateral. Customer shall:

(A) if from time to time reasonably required by IBM Credit, provide IBM
Credit with access to copies of all invoices, delivery evidences and other such
documents relating to each Account;

(C) promptly upon Customer's learning thereof, notify IBM Credit in writing
of any event which would cause any obligation of a Material Account Obligor to
become an Ineligible Account;

33
<PAGE>

(F) use commercially reasonable efforts to collect all
Accounts owed;

34
<PAGE>

Subsidiaries.

Section 8. NEGATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations due hereunder:

35
<PAGE>

8.6. Investments. The Customer will not, directly or indirectly, make, maintain
or acquire any Investment in any Person other than:

(A) interest bearing deposit accounts (including certificates of deposit)
which are insured by the Federal Deposit Insurance Corporation ("FDIC") or a
similar federal insurance program;

36
<PAGE>

8.13. Indebtedness. The Customer will not create, incur, assume or permit to
exist any Indebtedness, except for Permitted Indebtedness.

8.14. Loans. The Customer will not make any loans, advances, contributions or
payments of money or goods to any Subsidiary, Affiliate or parent corporation or
to any officer, director or

37
<PAGE>

stockholder of Customer or of any such corporation (except for compensation for
personal services actually rendered), except for transactions expressly
authorized in this Agreement.

Section 9. DEFAULT

9.1. Event of Default. Any one or more of the following events shall constitute
an Event of Default by the Customer under this Agreement and the Other
Agreements:

(A) The failure to make timely payment of the Obligations or any part
thereof when due and payable;

(B) Customer fails to comply with or observe any term, covenant or
agreement contained in this Agreement;

(D) The occurrence of any event or circumstance which could reasonably be
expected to have a Material Adverse Effect;

(F) The use of any funds borrowed from IBM Credit under this Agreement for
any purpose other than as provided in this Agreement;

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<PAGE>

(K) Customer suspends business;

(N) Customer is in default under the material terms of any of the Other
Agreements after the expiration of any applicable cure periods;

(P) Any "person" (as defined in Section 13(d)(3) of the

39
<PAGE>

Securities Exchange Act of 1934, as amended) acquires a beneficial interest in
50% or more of the Voting Stock of Customer.

(b) immediately terminate the Line of Credit hereunder.

40
<PAGE>

(D) The net cash proceeds resulting from IBM Credit's exercise of any of
the foregoing rights (after deducting all charges, costs and expenses, including
reasonable attorneys'

41
<PAGE>

(E) The enumeration of the foregoing rights is not intended to be
exhaustive and the exercise of any right shall not preclude the exercise of any
other rights, all of which shall be cumulative.

Section 10. MISCELLANEOUS

10.2. Indemnification. The Customer hereby agrees to indemnify and hold harmless
IBM Credit and each of its officers, directors, agents and assigns
(collectively, the "Indemnified Persons")

42
<PAGE>

43
<PAGE>

44
<PAGE>

10.10. Paragraph Titles. The Section titles used in this Agreement and the Other
Agreements are for convenience only and do not define or limit the contents of
any Section.

45
<PAGE>

(i) If to IBM Credit at:
IBM Credit Corporation
1500 Riveredge Parkway
Atlanta, GA 30328
Attention: Remarketer Finance Center Manager
Telecopy: (404) 644-4825

(ii) If to Customer at:
CMS Enhancements, Inc.
MacArthur Place, 3 Imperial Promenade
Santa Ana, CA 92707
Attention: Stephen G. Holmes
Telecopy: (704) 513-2450

or to such other address or number as each party designates to the other in the
manner prescribed herein.

10.13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto were upon the same instrument.

10.15. SUBMISSION AND CONSENT TO JURISDICTION AND CHOICE OF LAW. TO INDUCE IBM
CREDIT TO ACCEPT THIS AGREEMENT AND THE OTHER AGREEMENTS, THE CUSTOMER HEREBY
IRREVOCABLY AND UNCONDITIONALLY:

46
<PAGE>

(D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN
ANY OTHER JURISDICTION.

(E) AGREES THAT THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS (WITHOUT GIVING EFFECT TO CONFLICT OF
LAW PROVISIONS) OF THE STATE OF NEW YORK.

CMS ENHANCEMENTS, INC.

By: /s/ Stephen G. Holmes
-------------------------------
Print Name: Stephen G. Holmes
-----------------------
Title: CFO
----------------------------

ACCEPTED this day of , 1995
------- ------------------
IBM CREDIT CORPORATION

By:
-----------------------------
Print Name:
---------------------
Title:
--------------------------

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<PAGE>

ATTACHMENT A, EFFECTIVE DATE MAY 5, 1995 ("IWCF ATTACHMENT A")
TO INVENTORY AND WORKING CAPITAL FINANCING AGREEMENT ("IWCF AGREEMENT")
DATED MAY 5, 1995

Customer: CMS Enhancements, Inc.

I. Fees, Rates and Repayment Terms:

(A) Line of Credit: Five Million Dollars ($5,000,000.00);

(B) Borrowing Base:

(i) 85% of the amount of the Customer's Eligible Accounts as of the
date of determination as reflected in the Customer's most recent
Collateral Management Report;

(D) Product Advance Term: 100 days

(E) Collateral Insurance Amount: Five Million Dollars
($5,000,000.00)

(F) A/R Finance Charge:

(i) PRO Advance Charge: Prime Rate plus 2.000%

(ii) WCO Advance Charge: Prime Rate plus 2.000%

(iii) Takeout Advance Charge: Prime Rate plus 1.750%

(G) Delinquency Fee Rate: Prime Rate plus 6.500%

(H) Shortfall Transaction Fee: Shortfall Amount multiplied by 0.30%

(I) Other Charges:

(i) Application Processing Fee: $3,000.00
(ii) Monthly Service Fee: $ 500.00
(iii) Closing Fee: $ 0.00
(iv) Commitment Fee: $ 0.00

Page 1 of 19

<PAGE>

FIRST AMENDMENT TO INVENTORY AND WORKING CAPITAL
FINANCING AGREEMENT

RECITALS

WHEREAS, Customer executed that certain Agreement on May 5, 1995.

WHEREAS, Customer has requested that it be permitted to deliver certain
security pledges and related documents, as required by IBM Credit, after the
execution of the Agreement.

WHEREAS, IBM Credit has agreed to permit the delivery of such documents
after the execution of the Agreement subject to the terms and conditions set
forth in this First Amendment;

AGREEMENT

SECTION 1. Definitions. All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Agreement.

a) The following definition is added to Section 1.1 of the Agreement:

SECTION 2. Amendment to Event of Default.

a) The following paragraph (R) is inserted immediately following Section
9.1, paragraph (Q):

Page 1 of 3

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<PAGE>

3.2 Violation of Other Agreements. The execution and delivery of this
Amendment do not violate or cause Customer not to be in compliance with the
terms of any agreement to which Customer is a party.

SECTION 5. Governing Law. This Amendment shall be governed by and interpreted in
accordance with the laws of the State of New York.

SECTION 6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement.

Page 2 of 3

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<PAGE>

IN WITNESS WHEREOF, this Amendment has been executed by the duly authorized
officers of the undersigned as of the day and year first above written.

CDS DISTRIBUTION, INC. IBM CREDIT CORPORATION

ATTEST: ATTEST:
/s/ Peter ???????????
- ------------------------------ --------------------------------

PRINT NAME: Peter ????????? PRINT NAME:
------------------- ---------------------

Page 3 of 3

<PAGE>
EXHIBIT 10.03

WORKING CAPITAL FINANCING AGREEMENT

This WORKING CAPITAL FINANCING AGREEMENT (as amended, supplemented or
otherwise modified from time to time, this "Agreement") and is hereby made this
5 day of May, 1995, by and between IBM CREDIT CORPORATION with a place of
business at 1500 Riveredge Parkway, Atlanta, GA 30328 ("IBM Credit"), and
AmeriQuest/Kenfil Inc. with a place of business at 2722 Michelson Drive, Irvine,
CA 92713 ("Customer").

RECITALS

WHEREAS, in the course of Customer's operations, Customer requires cash for
its working capital requirements;

WHEREAS, Customer has requested that IBM Credit provide it with working
capital loans and IBM Credit is willing to provide such loans to Customer
subject to the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

Section 1. DEFINITIONS

1.1 Special Definitions. The following terms shall have the following respective
meaning in this Agreement:

"A/R Advance": any loan or advance of funds made by IBM Credit to Customer
pursuant to Section 2.2 of this Agreement, including, as the context may
require, a WCO Advance and a Takeout Advance.

"A/R Advance Date": the Business Day on which IBM Credit makes an A/R Advance
under this Agreement.

"A/R Advance Term": shall be a WCO Advance Term.

"A/R Finance Charges": as defined on Attachment A.

"Accounts": as defined in the U.C.C.

"Advance": any loan or other extension of credit by IBM Credit to Customer
pursuant to this Agreement including, without

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<PAGE>

limitation, A/R Advances.

"AmeriQuest": AmeriQuest Technologies, Inc., the direct owner of one hundred
percent (100%) of the outstanding capital stock of Customer.

"Auditors": a nationally recognized firm of independent certified public
accountants selected by Customer and satisfactory to IBM Credit.

"Available Credit": at any time, (1) the Maximum Advance Amount less (2) the
Outstanding Advances at such time.

"Average Daily Balance": the sum of the Outstanding A/R Advances as of the end
of each day during a calendar month, divided by the number of days in the
calendar month.

"Borrowing Base": as defined in Attachment A.

"Business Day": any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are generally closed or on which IBM
Credit is closed.

"Closing Date": the date on which the conditions precedent to the effectiveness
of this Agreement set forth in Section 5.1 hereof are satisfied or waived in
writing by IBM Credit.

"Code": the Internal Revenue Code of 1986, as amended or any successor statute.

"Collateral": as defined in Section 4.1.

"Collateral Management Report": a report to be delivered by Customer to IBM
Credit from time to time, as provided herein, signed by the chief executive
officer or chief financial officer, in the form of Attachment F hereto,
detailing and certifying, among other items: a summary of Customer's Eligible
Accounts, the amounts and aging of all of Customer's AccountS, the amounts and
aging of Customer's accounts payable as of a specified date, all of Customer's
IBM Credit borrowing activity during a specified period and the total amount of
Customer's Borrowing Base as well as Customer's Outstanding A/R Advances,
Available Credit and any

2
<PAGE>

Shortfall Amount as of a specified date.

"Common Due Date": (1) the fifth day of a calendar month if the A/R Advance Term
expires on the first through tenth of such calendar month; (2) the fifteenth day
of a calendar month if the A/R Advance Term expires on the eleventh through
twentieth of such calendar month; and (3) the twenty-fifth day of a calendar
month if the A/R Advance Term expires on the twenty-first through the last day
of such calendar month.

"Compliance Certificate": a certificate substantially in the form of Attachment
C.

"Default": either (1) an Event of Default or (2) any event or condition which,
but for the requirement that notice be given or time lapse or both, would be an
Event of Default.

"Delinquency Fee Rate": as defined on Attachment A.

"Eligible Account": as defined in Section 3.1.

"ERISA": the Employee Retirement Income Security Act of 1974, as amended, or any
successor statutes.

"Event of Default": as defined in Section 9.1.

3
<PAGE>

"GAAP": generally accepted accounting principles in the United States as in
effect from time to time.

"Guaranties": guaranties in favor of IBM Credit guarantying the Obligations of
Customer.

"Guarantor": any guarantor pursuant to any of the Guaranties.

"Hazardous Substances": all substances, wastes or materials, to the extent
subject to regulation as "hazardous substances" or "hazardous waste" under any
Environmental Laws.

"Indebtedness": with respect to any Person, (1) all obligations of such Person
for borrowed money or for the deferred purchase price of property or services
(other than trade liabilities incurred in the ordinary course of business and
payable in accordance with customary practices) or which is evidenced by a
note, bond, debenture or similar instrument, (2) all obligations of such Person
under capital leases, (3) all obligations of such Person in respect of letters
of credit, banker's acceptances or similar obligations issued or created for
the account of such Person, (4) liabilities arising under any interest rate
protection, future, option swap, cap or hedge agreement or arrangement under
which such Person is a party or beneficiary, (5) all obligations under
guaranties of such Person and (6) all liabilities secured by any Lien on any
property owned by such Person even though such Person has not assumed or
otherwise become liable for the payment thereof.

"Investment": with respect to any Person (the "Investor"), (1) any investment by
the Investor in any other Person, whether by means of share purchase, capital
contribution, purchase or other acquisition of a partnership or joint venture
interest, loan, time deposit, demand deposit or otherwise, and (2) any guaranty
by the Investor of any Indebtedness or other obligation of any other Person.

"Line of Credit": as defined in Section 2.1.

4
<PAGE>

"Material Adverse Effect": a material adverse effect (1) on the business,
operations, results of operations, assets, or financial condition of the
Customer, (2) on the aggregate value of the Collateral or the aggregate amount
which IBM Credit would be likely to receive (after giving consideration to
reasonably likely delays in payment and reasonable costs of enforcement) in the
liquidation of such Collateral to recover the Obligations in full, or (3) on the
rights and remedies of IBM Credit under this Agreement.

"Maximum Advance Amount": at any time, the lesser of (1) the Line of Credit and
(2) the Borrowing Base at such time.

"Obligations": all covenants, agreements, warranties, duties, representations,
loans, advances, interest (including interest accruing on or after the filing of
any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to Customer, whether or not a claim
for post-filing or post-petition interest is allowed in such proceeding), fees,
reasonable expenses, indemnities, liabilities and Indebtedness of any kind and
nature whatsoever now or hereafter arising, owing, due or payable from Customer
to IBM Credit, whether primary or secondary, joint or several, direct,
contingent, fixed or otherwise, secured or unsecured arising under this
Agreement and the Other Agreements.

"Other Charges": as set forth in Attachment A.

"Outstanding Advances": at any time of determination, the sum of the Outstanding
A/R Advances.

"Payment Dates": the fifth, fifteenth and twenty-fifth day of each calendar
month.

"Permitted Indebtedness": any of the following:

(1) Indebtedness to IBM Credit;

(2) Indebtedness described in Section VII of Attachment B;

5
<PAGE>

(3) Indebtedness to any Floor Plan Lender;

(4) Purchase Money Indebtedness;

(5) guaranties in favor of IBM Credit; and

(6) Other Indebtedness consented to by IBM Credit in writing prior to the
incurrence thereof.

"Permitted Liens": any of the following:

(1) Liens which are the subject of an Intercreditor Agreement, in effect from
time to time between IBM Credit and any other secured creditor;

(2) Purchase Money Security Interests;

(3) Liens described in Section I of Attachment B;

(5) attachment or judgment Liens individually or in the
aggregate not in excess of $300,000 (exclusive of (A) any amounts
that are duly bonded to the satisfaction of IBM Credit or (B) any
amount fully covered by insurance as to which the insurance
company has acknowledged its obligation to pay such judgment in
full);

6
<PAGE>

(10) Liens arising out of deposits in connection with workers' compensation,
unemployment insurance or other social security or similar legislation;

(11) Liens arising pursuant to this Agreement; and

(12) other Liens consented to by IBM Credit in writing prior to the incurrence
thereof.

"Person": any individual, association, firm, corporation, partnership, trust,
unincorporated organization or other entity whatsoever.

"Policies": all policies of insurance required to be maintained by Customer
under this Agreement or any of the Other Agreements.

"Prime Rate": as of the date of determination, the average of the rates of
interest announced by Citibank, N.A., The Chase Manhattan Bank, N.A. and Bank of
America National Trust & Savings Association as their prime or base rate, as of
the last Business Day Of the calendar month immediately preceding the date of
determination, whether or not such announced rates are the actual rates charged
by such banking institutions to their most creditworthy borrowers.

"Purchase Money Security Interest": any security interest securing Purchase
Money Indebtedness, which security interest applies solely to the particular
asset acquired with the Purchase Money Indebtedness.

"Request for A/R Advance": as defined in Section 2.2.

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<PAGE>

"Shortfall Amount": as defined in Section 2.5

"Takeout Advance": an A/R Advance made to existing creditors of Customer on
behalf of Customer, in an amount sufficient to discharge Customer's indebtedness
to such creditor.

"Termination Date": shall mean (i) the first anniversary of the date of this
Agreement or such other date as IBM Credit and Customer may agree to in writing
from time to time.

"Voting Stock": securities, the holders of which are ordinarily, in the absence
of contingencies, entitled to elect the corporate directors (or persons
performing similar functions).

"WCO Advance": an A/R Advance, with a WCO Advance Term.

"WCO Advance Term": for each WCO Advance, a period of one hundred eighty (180)
days commencing on the A/R Advance Date for such WCO Advance.

8
<PAGE>

Section 2. LINE OF CREDIT/FINANCE CHARGES/OTHER CHARGES

2.1. Line of Credit. Subject to the terms and conditions set forth in this
Agreement, on and after the Closing Date to but not including the date that is
the earlier of (x) the date on which this Agreement is terminated pursuant to
Section 10.1 and (y) the date on which IBM Credit terminates the Line of Credit
pursuant to Section 9.2, IBM Credit agrees to extend to the Customer a line of
credit ("Line of Credit") in the amount set forth in Attachment A pursuant to
which IBM Credit will make to the Customer, from time to time, Advances in an
aggregate amount at any one time outstanding not to exceed the Maximum Advance
Amount.

2.2. A/R Advances. (A) Whenever Customer shall desire IBM Credit to provide an
A/R Advance, Customer shall deliver to IBM Credit written notice of Customer's
request for such an Advance ("Request for A/R Advance"). For any requested A/R
Advance pursuant to which monies will be disbursed to Customer or any Person
other than IBM Credit, a Request for A/R Advance shall be delivered to IBM
Credit on or prior to 1:00 p.m. (Stamford, CT time) one Business Day prior to
the requested A/R Advance Date. The Request for A/R Advance shall specify (i)
the requested A/R Advance Date; and (ii) the amount of the requested A/R
Advance; Customer may deliver a Request for A/R Advance via facsimile. Any
Request for A/R Advance delivered to IBM Credit shall be irrevocable.

9
<PAGE>

(D) Unless otherwise due and payable at an earlier date, the unpaid
principal amount of each A/R Advance, other than a Takeout Advance, shall be due
and payable on the applicable Common Due Date. Unless otherwise notified by
Customer in writing prior to the day the principal amount of any WCO Advance
becomes due and payable, the Customer shall be deemed to have provided IBM
Credit with a Request for A/R Advance requesting a WCO Advance on the day such
principal amount is due and payable in an amount equal to the unpaid principal
amount of the WCO Advance so due. Subject to the terms and conditions of this
Agreement, the principal amount of such WCO Advance shall automatically renew
for an additional WCO Advance Term. Notwithstanding any other provision of this
Agreement, a Takeout Advance may only be requested on the Closing Date and such
Takeout Advance shall be limited to an amount sufficient to discharge the
indebtedness that is the subject of a Takeout Advance. Unless otherwise agreed
in writing, a Takeout Advance shall be due as defined on Attachment D.

2.3. Finance and Other Charges. (A) Finance charges shall be calculated by
multiplying the applicable Delinquency Fee Rate or A/R Finance Charge provided
for in this Agreement by Customer's applicable Average Daily Balance. The
Delinquency Fee Rate and the various A/R Finance Charges provided for in this
Agreement are each computed on the basis of an actual day, 360 day year.

(D) If any amount owed under this Agreement, including, without limitation,
any Advance, is not paid when due (whether at maturity, by acceleration or
otherwise), the unpaid amount thereof will bear a late charge from and including
its due date to but not including the date IBM Credit receives payment thereof,
at a per annum rate equal to the lesser of (a) the amount set forth in
Attachment A to this Agreement as the "Delinquency Fee Rate" and (b) the highest
rate from time to time permitted by applicable law. In addition, if any
Shortfall Amount shall not be paid when due pursuant to Section 2.5 hereof,
Customer shall pay IBM Credit an additional late charge equal to

10
<PAGE>

the product of the Shortfall Amount multiplied by thirty (30) basis points. If
it is determined that amounts received from Customer were in excess of such
highest rate, then the amount representing such excess shall be considered
reductions to principal of Advances.

2.4. Statements Regarding Customer's Account. IBM Credit will send statements of
each transaction hereunder as well as monthly billing statements to Customer
with respect to Advances and other charges due on Customer's account with IBM
Credit. Each statement of transaction and monthly billing statement shall be
deemed, absent manifest error, to be correct and shall constitute an account
stated with respect to each transaction or amount described therein unless
within seven (7) calendar days after such statement of transaction or billing
statement is received by Customer, Customer provides IBM Credit written notice
objecting that such amount or transaction is incorrectly described therein and
specifying the error(s), if any, contained therein. IBM Credit may at any time
adjust such statements of transaction or billing statements to comply with
applicable law and this Agreement.

2.5. Shortfall. If, on any date, the Outstanding Advances shall exceed the
Maximum Advance Amount (such excess, the "Shortfall Amount"), then the Customer
shall on such date prepay the Outstanding Advances in an amount equal to such
Shortfall Amount.

2.6. Application of Payments. The Customer hereby agrees that all checks and
other instruments delivered to IBM Credit on account of Customer's Obligations
shall constitute conditional payment until such items are actually collected by
IBM Credit. The Customer waives the right to direct the application of any and
all payments at any time or times hereafter received by IBM Credit on account of
the Customer's Obligations. Customer agrees that IBM Credit shall have the
continuing exclusive right to apply and reapply any and all such payments to
Customer's Obligations in such manner as IBM Credit may deem advisable
notwithstanding any entry by IBM Credit upon any of its books and records.

2.7. Prepayment and Reborrowing By Customer. (A) Customer my at any time prepay,
without notice or penalty, in whole or in part amounts owed under this
Agreement. IBM Credit may apply payments made to it (whether by the Customer or
otherwise) to pay finance charges and other amounts owing under this Agreement
first and then to the principal amount owed by the Customer.

11
<PAGE>

Section 3. LINE OF CREDIT/ADDITIONAL PROVISIONS

3.1. Ineligible Accounts. IBM Credit and Customer agree that IBM Credit shall
have the sole right to determine eligibility of Accounts from an Account obligor
for purposes of determining the Borrowing Base; however, without limiting such
right, the following Accounts will be deemed to be ineligible for purposes of
determining the Borrowing Base:

(B) ACcounts unpaid more than ninety (90) days from date of invoice;

(E) Accounts arising from consignment sales;

(F) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which the payment by
the account debtor is or may be conditional;

(G) Except for state, local and United States government institutions and
public educational institutions, accounts with respect to which:

(i) the account debtor is not a commercial entity, or

(ii) the account debtor is not a resident of the United States;

(H) Accounts payable by any account debtor to which Customer is or may
become liable for goods sold or services rendered by such account debtor to
Customer;

(I) Accounts arising from the sale or lease of goods purchased for a
personal, family or household purpose;

(J) Accounts arising from the sale or other disposition of goods that has
been used for demonstration purposes or loaned or

12
<PAGE>

leased by the Customer to another party;

(K) Accounts which are progress payment accounts or contra accounts;

(L) Accounts upon which IBM Credit does not have a valid, perfected, first
priority security interest;

(M) Accounts payable by an account debtor that is or Customer knows will
become, subject to proceedings under United States Bankruptcy Law or other law
for the relief of debtors;

(N) Accounts that are not payable in US dollars;

(P) Accounts arising from the sale or lease of goods which are billed to
any account debtor but have not yet been shipped by Customer;

(R) Accounts that do not arise from undisputed bona fide transactions
completed in accordance with the terms and conditions contained in the invoices,
purchase orders and contracts relating thereto;

(S) Accounts that are discounted for the full payment term specified in
Customer's terms and conditions with its account debtors, or for any longer
period of time;

(T) Accounts on cash on delivery (C.O.D.) terms;

(U) Accounts arising from maintenance or service contracts that are billed
in advance of full performance of service;

(V) Accounts arising from bartered transactions;

(W) Accounts arising from incentive payments, rebates, discounts, credits,
and refunds from a supplier; and

(X) Any and all other Accounts that IBM Credit deems, in its sole and
absolute discretion, to be ineligible.

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<PAGE>

The aggregate of all Accounts that are not ineligible Accounts shall hereinafter
be referred to as "Eligible Accounts".

3.5. Application of Remittances and Credits. Customer shall apply all
remittances against the aggregate of Customer's outstanding ACcounts no later
than the end of the Business Day on which such remittances are deposited into
the Special Account. Customer also agrees to apply each remittance against its
respective Account no later than three (3) Business Days from the

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<PAGE>

date such remittance is deposited into the Special Account. In addition,
Customer shall promptly apply any credits owing in respect to any Account when
due.

(B) endorse the name of Customer upon any of the items of payment of
proceeds and deposit the same in the account of IBM Credit for application to
the Obligation; and

upon the occurrence and during the continuance of an Event of Default as defined
in Section 9.1 hereof:

(C) demand payment, enforce payment and otherwise exercise all Customer's
rights and remedies with respect to the collection of any Accounts;

(D) settle, adjust, compromise, extend or renew any Accounts;

(E) settle, adjust or compromise any legal proceedings brought to collect
any Accounts;

(F) sell or assign any Accounts upon such terms, for such amounts and at
such time or times as IBM Credit may deem advisable;

(G) discharge and release any Accounts;

(H) prepare, file and sign Customer's name on any Proof of Claim in
Bankruptcy or similar document against any Account obligor;

(I) prepare, file and sign Customer's name on any notice of lien, claim of
mechanic's lien, assignment or satisfaction of lien or mechanic's lien, or
similar document in connection with any Accounts;

15
<PAGE>

(K) sign the name of Customer to requests for verification
of Accounts and notices thereof to Account obligors;

(L) sign the name of Customer on any document or instrument that IBM Credit
shall deem necessary or appropriate to enforce any and all remedies it may have
under this Agreement, at law or otherwise; and

(M) make, settle and adjust claims under the Policies with respect to the
Collateral and endorse Customer's name on any check, draft, instrument or other
item of payment of the proceeds of the Policies with respect to the Collateral;
and

(N) take control in any manner of any term of payment or proceeds and for
such purpose to notify the postal authorities to change the address for delivery
of mail addressed to Customer to such address as IBM Credit may designate.

Section 4. SECURITY -- COLLATERAL

(A) all inventory and equipment, and all parts thereof, attachments,
accessories and accessions thereto, products thereof and documents therefor;

(D) all rights now or hereafter existing in and to all mortgages, security
agreements, leases or other contracts securing or otherwise relating to any of
the foregoing; and

(E) all substitutions and replacements for all of the

16
<PAGE>

foregoing, all proceeds of all of the foregoing and, to the extent not otherwise
included, all payments under insurance or any indemnity, warranty or guaranty,
payable by reason of loss or damage to or otherwise with respect to any of the
foregoing.

All of the above assets shall be collectively defined herein as the
"Collateral".

Customer covenants and agrees with IBM Credit that: (a) the security constituted
by this Agreement is in addition to any other security from time to time held by
IBM Credit and (b) the security hereby created is a continuing security interest
and will cover and secure the payment of all Obligations both present and future
of Customer to IBM Credit pursuant to this Agreement and the Other Agreements.

Section 5. CONDITIONS PRECEDENT

(A) this Agreement executed and delivered by Customer and IBM Credit;

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<PAGE>

good standing of Customer in the jurisdiction of its organization and in each
other jurisdiction where the ownership or lease of its property or the conduct
of its business requires it to qualify to do business;

(E) a lockbox agreement executed by Customer and each Bank, in form and
substance satisfactory to IBM Credit;

(F) a contingent blocked account agreement executed by Customer and each
Bank in form and substance satisfactory to IBM Credit;

(G) intercreditor agreements ("Intercreditor Agreement"), in form and
substance satisfactory to IBM Credit, executed by each other secured creditor of
Customer as set forth in Attachment A;

(H) a favorable opinion of counsel for Customer in substantially the form
of Attachment I;

(J) the statements, certificates, documents, instruments, financing
statements, agreements and information set forth in Attachment A and Attachment
B; and

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<PAGE>

(B) No event has occurred and is continuing or after giving effect to such
Advance or the application of the proceeds thereof would result which would
constitute a Default;

(D) Both before and after giving effect to the making of such Advance, no
Shortfall Amount exists.

Except as Customer has otherwise disclosed to IBM Credit in writing prior to
each request, each request (or deemed request pursuant to Section 2.2 (D)) for
an Advance hereunder and the receipt (or deemed receipt) by the Customer of the
proceeds of any Advance hereunder shall be deemed to be a representation and
warranty by Customer that, as of and on the date of such Advance, the statements
set forth in (A) through (D) above are true statements. No such disclosures by
Customer to IBM Credit shall in any manner be deemed to satisfy the conditions
precedent to each Advance that are set forth in this Section 5.2.

Section 6. REPRESENTATIONS AND WARRANTIES

To induce IBM Credit to enter into this Agreement, Customer represents and
warrants to IBM Credit as follows:

6.3. No Conflicts. The execution, delivery and performance by Customer of this
Agreement and each of the Other Agreements (i)

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<PAGE>

are within its corporate power; (ii) are duly authorized by all necessary
corporate action; (iii) are not in contravention in any respect of any
Requirement of Law or any indenture, contract, lease, agreement, instrument or
other commitment to which it is a party or by which it or any of its properties
are bound; (iv) do not require the consent, registration or approval of any
Governmental Authority or any other Person (except such as have been duly
obtained, made or given, and are in full force and effect); and (v) will not,
except as contemplated herein, result in the imposition of any Liens upon any of
its properties.

6.6. Fictitious Business Names. Customer has not used any corporate or
fictitious name during the five (5) years preceding the date of this Agreement,
other than those listed on Attachment B.

6.7. Organization. All of the outstanding capital stock of Customer has been
validly issued, is fully paid and nonassessable.

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<PAGE>

6.8. No Judgments or Litigation. Except as set forth on Attachment B, no
judgments, orders, writs or decrees are outstanding against Customer nor is
there now pending or, to the best of Customer's knowledge after due inquiry,
threatened, any litigation, contested claim, investigation, arbitration, or
governmental proceeding by or against Customer.

6.11. Compliance with Law. Customer has not violated or failed to comply with
any Requirement of Law or any requirement of any self regulatory organization.

6.13. Compliance with Environmental Laws. Except as otherwise disclosed in
Attachment B:

(A) The Customer has obtained all government approvals required with
respect to the operation of their businesses under any Environmental Law.

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<PAGE>

(B) (i) the Customer has not generated, transported or disposed of any
Hazardous Substance; (ii) the Customer is not currently generating, transporting
or disposing of any Hazardous Substance; (iii) the Customer has no knowledge
that (a) any of its real property (whether owned, leased, or otherwise directly
or indirectly controlled) has been used for the disposal of or has been
contaminated by any Hazardous Substance, or (b) any of its business operations
have contaminated lands or waters of others with any Hazardous Substance; (iv)
the Customer and its respective assets are not subject to any Environmental
Liability and, to the best of the Customer's knowledge, any threatened
Environmental Liability; (v) the Customer has not received any notice of or
otherwise learned of any governmental investigation evaluating whether any
remedial action is necessary to respond to a release or threatened release of
any Hazardous Substance for which the Customer may be liable; (vi) the Customer
is not in violation of any Environmental Law; (vii) there are no proceedings or
investigations pending against Customer with respect to any violation or alleged
violation of any Environmental Law; provided however, that the parties
acknowledge that any generation, transportation, use, storage and disposal of
certain such Hazardous Substances in Customer's or its Subsidiaries' business
shall be excluded from representations (i) and (ii) above, provided, further,
that Customer is at all times generating, transporting, utilizing, storing and
disposing such Hazardous Substances in accordance with all applicable
Environmental Laws and in a manner designed to minimize the risk of any spill,
contamination, release or discharge of Hazardous Substances other than as
authorized by Environmental Laws.

22
<PAGE>

Act of 1935, as amended, or (iii) subject to any other law which purports to
regulate or restrict its ability to borrow money or to consummate the
transactions contemplated by this Agreement or the Other Agreements or to
perform its obligations hereunder or thereunder.

23
<PAGE>

6.21. Recording Taxes. All recording taxes, recording fees, filing fees and
other charges payable in connection with the filing and recording of this
Agreement have either been paid in full by Customer or arrangements for the
payment of such amounts by Customer have been made to the satisfaction of IBM
Credit.

6.22. Indebtedness. Customer (i) has no Indebtedness, other than Permitted
Indebtedness; and (ii) has not guaranteed the obligations of any other Person
(except as permitted by Section 8.4).

Section 7. AFFIRMATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations:

7.1. Financial and Other Information. Customer shall cause to be furnished to
IBM Credit the following information within the following time periods:

24
<PAGE>

determining, as of the end of such fiscal year, whether AmeriQuest is in
compliance with the financial covenants set forth in Exhibit A to the guaranty
executed by AmeriQuest;

(B) as soon as available and in any event within forty-five (45) days after
the end of each fiscal quarter of AmeriQuest (i) Financial Statements as of the
end of such period and for the fiscal year to date, together with a comparison
to the Financial Statements for the same periods in the prior year, all in
reasonable detail and duly certified (subject to normal year-end audit
adjustments and except for the absence of footnotes) by the chief executive
officer or chief financial officer of AmeriQuest as having been prepared in
accordance dance with GAAP; (ii) if composed, a narrative discussion of the
consolidated financial condition and results of operations and the consolidated
liquidity and capital resources of AmeriQuest and its Subsidiaries for such
period and for the fiscal year to date prepared by the chief executive officer
or chief financial officer of AmeriQuest; and (iii) a Compliance Certificate
along with a schedule, in substantially the form of Attachment C hereto, of the
calculations used in determining, as of the end of such fiscal quarter, whether
AmeriQuest is in compliance with the financial covenants set forth in Exhibit A
to the guaranty executed by AmeriQuest;

25
<PAGE>

Customer's proposed response thereto, each in reasonable detail;

(H) by the fifth (5th) day of each month, or as otherwise agreed in
writing, a Collateral Management Report as of a date no earlier than the last
day of the immediately preceding month;

26
<PAGE>

form of Attachment G.

(B) Customer shall notify IBM Credit, promptly upon its

27
<PAGE>

obtaining knowledge of (i) any non-routine proceeding or investigation by any
Governmental Authority with respect to the presence of any Hazardous Substances
on or in any property now or hereinafter owned, leased or otherwise controlled
(directly or indirectly) by Customer, (ii) all claims made or threatened by any
Person or Governmental Authority against Customer or any of Customer's assets
relating to any loss or injury resulting from any Hazardous Substance, (iii)
Customer's discovery of evidence of unlawful disposal of or environmental
contamination by any Hazardous Substance on any property now or hereinafter
owned, leased or otherwise controlled (directly or indirectly) by Customer, and
(iv) any occurrence or condition which could constitute a violation of any
Environmental Law.

(D) Customer agrees to advise IBM Credit promptly, in reasonably sufficient
detail, of any substantial change relating

28
<PAGE>

to the type, quantity or quality of the Collateral, or any event which could
reasonably be expected to have a Material Adverse Effect on the value of the
Collateral or on the security interests granted to IBM Credit therein.

(B) Without limiting the generality of the foregoing, Customer shall keep
and maintain, at its sole expense, the Collateral insured for an amount not less
than the amount set forth on Attachment A from time to time opposite the
caption "Collateral Insurance Amount" against all loss or damage under an "all
risk" Policy in companies mutually acceptable to IBM Credit and Customer, with a
lender's loss payable endorsement or mortgagee clause in form and substance
reasonably satisfactory to IBM Credit designating that any loss payable
thereunder with respect to such Collateral shall be payable to IBM Credit. Upon
receipt of proceeds by IBM Credit the same shall be applied on account of the
Customer's Outstanding Product Advances first, then to the Outstanding A/R
Advances. Customer agrees to instruct each insurer to give IBM Credit, by
endorsement upon the Policy issued by it or by independent instruments
furnished to IBM Credit, at least ten (10) days written notice before any Policy
shall be altered or cancelled and that no act or default of Customer or any
other person shall affect the right of IBM Credit to recover under the Policies.
Customer hereby agrees to direct all insurers under the Policies to pay all
proceeds with respect to the Collateral directly to IBM Credit. If Customer
fails to pay any cost, charges or premiums, or if Customer fails to insure the
Collateral, IBM Credit may pay such costs, charges or premiums. Any amounts paid
by IBM Credit hereunder shall be considered an additional debt owed by Customer
to IBM Credit and are due and payable immediately upon receipt of an invoice by
IBM Credit.

29
<PAGE>

adequate reserve or other appropriate provisions have been made therefor as
required in order to be in conformity with GAAP and an adverse determination in
such proceedings could not reasonably be expected to have a Material Adverse
Effect.

7.10. Compliance With Laws. Customer agrees to comply with all Requirements of
Law applicable to the Collateral or any part thereof, or to the operation of its
business.

7.11. Fiscal Year. Customer agrees to maintain its fiscal year as a year ending
June 30 unless Customer provides IBM Credit at least thirty (30) days prior
written notice of any change thereof.

7.14. Collateral. Customer shall:

(A) if from time to time reasonably required by IBM Credit, provide IBM
Credit with access to copies of all invoices, delivery evidences and other such
documents relating to each Account;

(C) promptly upon Customer's learning thereof, notify IBM Credit in writing
of any event which would cause any obligation of a Material Account Obligor to
become an Ineligible Account;

30
<PAGE>

ordinary course of business, whichever occurs earlier;

(F) use commercially reasonable efforts to collect all Accounts owed;

31
<PAGE>

Subsidiaries of Customer to comply with Sections 7 and 8 of this Agreement, as
if such sections applied directly to such Subsidiaries.

Section 8. NEGATIVE COVENANTS

Until termination of this Agreement and the indefeasible payment and
satisfaction of all Obligations due hereunder:

32
<PAGE>

8.6. Investments. The Customer will not, directly or indirectly, make, maintain
or acquire any Investment in any Person other than:

(A) interest bearing deposit accounts (including certificates of deposit)
which are insured by the Federal Deposit Insurance Corporation ("FDIC") or a
similar federal insurance program;

33
<PAGE>

8.11. Use of Proceeds. The Customer shall not use any portion of the proceeds of
any Advances other than for its general working capital requirements.

8.13. Indebtedness. The Customer will not create, incur, assume or permit to
exist any Indebtedness, except for Permitted Indebtedness.

8.14. Loans. The Customer will not make any loans, advances, contributions or
payments of money or goods to any Subsidiary, Affiliate or parent corporation
or to any officer, director or stockholder of Customer or of any such
corporation (except for

34
<PAGE>

compensation for personal services actually rendered), except for transactions
expressly authorized in this Agreement.

Section 9. DEFAULT

9.1. Event of Default. Any one or more of the following events shall constitute
an Event of Default by the Customer under this Agreement and the Other
Agreements:

(A) The failure to make timely payment of the Obligations or
any part thereof when due and payable;

(B) Customer fails to comply with or observe any term,
covenant or agreement contained in this Agreement;

(D) The occurrence of any event or circumstance which could reasonably be
expected to have a Material Adverse Effect;

(F) The use of any funds borrowed from IBM Credit under this Agreement for
any purpose other than as provided in this Agreement;

(G) The entry of any judgment against Customer or any Guarantor in an
amount in excess of $300,000 and such judgment is not satisfied, dismissed,
stayed or superseded by bond within thirty (30) days after the day of entry
thereof (and in the event of a stay or supersedeas bond, such judgment is not
discharged within thirty (30) days after termination of any such stay or bond)
or such judgment is not fully covered by insurance as to which the insurance
company has acknowledged its obligation to

35
<PAGE>

pay such judgment in full;

(K) Customer suspends business;

(N) Customer is in default under the material terms of any of the Other
Agreements after the expiration of any applicable cure periods;

(P) Any "person" (as defined in Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended) other than AmeriQuest acquires a beneficial interest in
50% or more of the Voting Stock of Customer.

36
<PAGE>

9.2. Acceleration. Upon the occurrence and during the continuance of an Event
of Default which has not been waived in writing by IBM Credit, IBM Credit may,
in its sole discretion, take any or all of the following actions, without
prejudice to any other rights it may have at law or under this Agreement to
enforce its claims against the Customer: (a) declare all Obligations to be
immediately due and payable (except with respect to any Event of Default set
forth in Section 9.1(E) hereof, in which case all Obligations shall
automatically become immediately due and payable without the necessity of any
notice or other demand) without presentment, demand, protest or any other
action or obligation of IBM Credit; and

(b) immediately terminate the Line of Credit hereunder.

37
<PAGE>

9.3. Remedies. (A) Upon the occurrence and during the continuance of any Event
of Default which has not been waived in writing by IBM Credit, IBM Credit may
exercise all rights and remedies of a secured party under the U.C.C. Without
limiting the generality of the foregoing, IBM Credit may: (i) remove from any
premises where same may be located any and all documents, instruments, files
and records (including the copying of any computer records), and any
receptacles or cabinets containing same, relating to the Accounts, or IBM
Credit may use (at the expense of the Customer) such of the supplies or space
of the Customer at Customer's place of business or otherwise, as may be
necessary to properly administer and control the Accounts or the handling of
collections and realizations thereon; (ii) bring suit, in the name of the
Customer or IBM Credit and generally shall have all other rights respecting
said Accounts, including without limitation the right to accelerate or extend
the time of payment, settle, compromise, release in whole or in part any
amounts owing on any Accounts and issue credits in the name of the Customer or
IBM Credit; (iii) sell, assign and deliver the Accounts and any returned,
reclaimed or repossessed merchandise, with or without advertisement, at public
or private sale, for cash, on credit or otherwise, at IBM Credit's sole option
and discretion, and IBM Credit may bid or become a purchaser at any such sale;
and (iv) foreclose the security interests created pursuant to this Agreement by
any available judicial procedure, or to take possession of any or all of the
Collateral without judicial process and to enter any premises where any
Collateral may be located for the purpose of taking possession of or removing
the same.

38
<PAGE>

commercially reasonable sale. The Customer agrees, at the request of IBM Credit,
to assemble the Collateral and to make it available to IBM Credit at places
which IBM Credit shall select, whether at the premises of the Customer or
elsewhere, and to make available to IBM Credit the premises and facilities of
the Customer for the purpose of IBM Credit's taking possession of, removing or
putting such Collateral in saleable form. If notice of intended disposition of
any Collateral is required by law, it is agreed that ten (10) Business Days
notice shall constitute reasonable notification.

(D) The net cash proceeds resulting from IBM Credit's exercise of any of
the foregoing rights (after deducting all charges, costs and expenses, including
reasonable attorneys' fees) shall be applied by IBM Credit to the payment of
Customer's Obligations, whether due or to become due, in such order as IBM
Credit may in it sole discretion elect. Customer shall remain liable to IBM
Credit for any deficiencies, and IBM Credit in turn agrees to remit to Customer
or its successors or assigns, any surplus resulting therefrom.

(E) The enumeration of the foregoing rights is not intended to be
exhaustive and the exercise of any right shall not preclude the exercise of any
other rights, all of which shall be cumulative.

39
<PAGE>

Section 10. MISCELLANEOUS

10.2. Indemnification. The Customer hereby agrees to indemnify and hold harmless
IBM Credit and each of its officers, directors, agents and assigns
(collectively, the "Indemnified Persons") against all losses, claims, damages,
liabilities or other expenses (including reasonable attorneys' fees and court
costs now or hereinafter arising from the enforcement of this Agreement, the
"Losses") to which any of them may become subject insofar as such Losses arise
out of or are based upon any event, circumstance or condition (a) occurring or
existing on or before the date of this Agreement relating to any financing
arrangements IBM Credit may from time to time have with (i) Customer, (ii) any
Person that shall be acquired by Customer or (iii) any Person that Customer may
acquire all or substantially all of the assets of, or (b) directly or
indirectly, relating to the execution, delivery or performance of this Agreement
or the consummation of the transactions contemplated hereby or thereby or to any
of the Collateral or to any act or omission of the Customer in connection
therewith. Notwithstanding the foregoing, the Customer shall not be obligated to
indemnify IBM Credit for any Losses incurred by IBM Credit which are a result of
IBM Credit's gross negligence or willful misconduct. The indemnity provided
herein shall survive the termination of this Agreement.

40
<PAGE>

satisfaction or on account of the foregoing and any expenses, including
reasonable attorney's fees, court costs, and other charges relating thereto,
shall be a part of the Obligations, payable on demand and secured by the
Collateral.

10.5. Alteration/Waiver. This Agreement and the Other Agreements may not be
altered or amended except by an agreement in writing signed by the Customer and
by IBM Credit. No delay or omission of IBM Credit to exercise any right or
remedy hereunder, whether before or after the occurrence of any Event of
Default, shall impair any such right or remedy or shall operate as a waiver
thereof or as a waiver of any such Event of Default. In the event that IBM
Credit at any time or from time to time dispenses with any one or more of the
requirements specified in this Agreement or any of the Other Agreements, such
dispensation may be revoked by IBM Credit at any time and shall not be deemed to
constitute a waiver of any such requirement subsequent thereto. IBM Credit's
failure at any time or times to require strict compliance and performance by the
Customer of any undertakings, agreements, covenants, warranties and
representations of this Agreement or any Other Agreement shall not waive, affect
or diminish any right of IBM Credit thereafter to demand strict compliance and
performance thereof. Any waiver by IBM Credit of any Default by the Customer
under this Agreement or any of the Other Agreements shall not waive or affect
any other Default by the Customer under this Agreement or any of the Other
Agreements, whether such Default is prior or subsequent to such other Default
and whether of the same or a different type. None of the undertakings,
agreements, warranties, covenants, and representations of the Customer contained
in this Agreement or the Other Agreements and no Default by the Customer shall
be deemed waived by IBM Credit unless such waiver is in writing signed by an
authorized representative of IBM Credit.

41
<PAGE>

10.9. No Merger or Novations. (A) Notwithstanding anything contained in any
document to the contrary, it is understood and agreed by the Customer and IBM
Credit that the claims of IBM Credit arising hereunder and existing as of the
date hereof constitute continuing claims arising out of the Obligations of
Customer under the Financing Agreement and any Other Agreement. Customer
acknowledges and agrees that such Obligations outstanding as of the date hereof
have not been satisfied or discharged and that this Agreement is not intended to
effect a novation of the Customer's Obligations under the Financing Agreement or
any Other Agreement.

10.10. Paragraph Titles. The Section titles used in this Agreement and the Other
Agreements are for convenience only and do not define or limit the contents of
any Section.

42
<PAGE>

(i) If to IBM Credit at:
IBM Credit Corporation
1500 Riveredge Parkway
Atlanta, GA 30328
Attention: Remarketer Finance Center Manager
Telecopy: (404) 644-4825

(ii) If to Customer at:
AmeriQuest/Kenfil, Inc.
MacArthur Place, 3 Imperial Promenade
Santa Ana, CA 92707
Attention: Stephen G. Holmes
Telecopy: (714) 513-2450

or to such other address or number as each party designates to the other in the
manner prescribed herein.

10.13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto were upon the same instrument.

10.14. SUBMISSION AND CONSENT TO JURISDICTION AND CHOICE OF LAW. TO INDUCE IBM
CREDIT TO ACCEPT THIS AGREEMENT AND THE OTHER AGREEMENTS, THE CUSTOMER HEREBY
IRREVOCABLY AND UNCONDITIONALLY:

43
<PAGE>

(C) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE
EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO CUSTOMER AT ITS ADDRESS
SET FORTH IN SECTION 10.12 OR AT SUCH OTHER ADDRESS OF WHICH IBM CREDIT SHALL
HAVE BEEN NOTIFIED PURSUANT THERETO;

(D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN
ANY OTHER JURISDICTION.

(E) AGREES THAT THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS (WITHOUT GIVING EFFECT TO CONFLICT OF
LAW PROVISIONS) OF THE STATE OF NEW YORK.

10.15. JURY TRIAL WAIVER. EACH OF IBM CREDIT AND THE CUSTOMER HEREBY
IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
(INCLUDING ANY COUNTERCLAIM) OF ANY TYPE IN WHICH IBM CREDIT AND THE CUSTOMER
ARE PARTIES AS TO ALL MATTERS ARISING DIRECTLY OR INDIRECTLY OUT OF THIS
AGREEMENT OR ANY DOCUMENT, INSTRUMENT OR AGREEMENT EXECUTED IN CONNECTION
HEREWITH.

AMERIQUEST/KENFIL INC.

By: /s/ Stephen G. Holmes
------------------------------------
Print Name: Stephen G. Holmes
----------------------------
Title: CFO
---------------------------------

ACCEPTED this day of , 1995
--------- ---------------

IBM CREDIT CORPORATION

By:
------------------------------------
Print Name:
----------------------------
Title:
---------------------------------

44
<PAGE>

FIRST AMENDMENT TO WORKING CAPITAL
FINANCING AGREEMENT

This First Amendment, dated May 18, 1995 is hereby made to that certain
------
Working Capital Financing Agreement (as amended, supplemented or otherwise
modified from time to time, the "Agreement") to be entered into by and between
AmeriQuest/Kenfil Inc. ("Customer") and IBM Credit Corporation ("IBM Credit").

RECITALS

WHEREAS, Customer executed that certain Agreement on May 5, 1995.

WHEREAS, Customer has requested that it be permitted to deliver certain
security pledges and related documents, as required by IBM Credit, after the
execution of the Agreement.

WHEREAS, IBM Credit has agreed to permit the delivery of such documents
after the execution of the Agreement subject to the terms and conditions set
forth in this First Amendment;

AGREEMENT

SECTION 1. Definitions. All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Agreement.

a) The following definition is added to Section 1.1 of the Agreement:

"`Foreign Subsidiaries': Kenfil Distribution (Far East) Limited, Kenfil
Distribution (M) SDN. BHD., and CMS Enhancements (Australia) Pty Limited;
for each the outstanding capital stock of which is one hundred percent
(100%) owned by Customer or its Affiliates."

SECTION 2. Amendment to Event of Default.

a) The following paragraph (R) is inserted immediately following Section
9.1, paragraph (Q):

"(R) Customer fails to grant, by June 30, 1995, IBM Credit a first
priority security interest in and assign, pledge, hypothecate and deliver
to IBM Credit 100% of the stock of each of the Foreign Subsidiaries and
all substitutions, dividends, interest, and redemption prices and other
rights with respect to such securities and all other property received
in respect of or in exchange for such securities, opinions of local
counsel

Page 1 of 3
<PAGE>

satisfactory to IBM Credit concerning IBM Credit's first priority
security interest in the stock of the Foreign Subsidiaries
and additional related documents, both satisfactory in form and substance
to IBM Credit, with respect to the securities pledged of the Foreign
Subsidiaries, as IBM Credit may reasonably request."

3.2 Violation of Other Agreements. The execution and delivery of this
Amendment do not violate or cause Customer not to be in compliance with the
terms of any agreement to which Customer is a party.

SECTION 5. Governing Law. This Amendment shall be governed by and interpreted in
accordance with the laws of the State of New York.

SECTION 6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original and all of which shall
constitute one agreement.

Page 2 of 3
<PAGE>

IN WITNESS WHEREOF, this Amendment has been executed by the duly authorized
officers of the undersigned as of the day and year first above written.

AMERIQUEST KENFIL INC. IBM CREDIT CORPORATION

BY: /s/ Stephen G. Homes BY:
------------------------- ---------------------------
NAME: Stephen G. Holmes NAME:
----------------------- -------------------------
TITLE: CFO TITLE:
---------------------- ------------------------

ATTEST: ATTEST:
PJ
- ---------------------------- ------------------------------
PRINT NAME: Peter ??????? PRINT NAME:
----------------- -------------------

Page 3 of 3

<PAGE>
EXHIBIT 10.04

REVOLVING CREDIT AGREEMENT

DATED AS OF APRIL 27, 1992

THE FIRST NATIONAL BANK OF BOSTON

AND

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS
<PAGE>

TABLE OF CONTENTS
<TABLE>
Section Page
- ------- ----
SECTION I - DEFINITIONS
<S> <C> <C>
1.1 General............................................................ 1
1.2 Accounting Terms................................................... 9

SECTION II - DESCRIPTION OF CREDIT

2.1 The Loans.......................................................... 9
2.2 Notice and Manner of Borrowing..................................... 9
2.3 Closing Fee........................................................ 9
2.4 Commitment Fee..................................................... 10
2.5 Commitment Reduction/Early Termination Fee......................... 10
2.6 The Loan Account................................................... 10
2.7 Interest Rates and Payments of Interest............................ 10
2.8 Changed Circumstances.............................................. 11
2.9 Payments and Prepayments of the Loans.............................. 11
2.10 Method of Payment.................................................. 11
2.11 Overdue Payments................................................... 11
2.12 Computation of Interest and Fees................................... 11
2.13 Borrowing Base Availability........................................ 11
2.14 Borrowing Base Excesses............................................ 12
2.15 Promises to Pay.................................................... 12
2.16 Authorization to Debit Loan Account................................ 12
2.17 Capital Adequacy................................................... 12

SECTION III - CONDITIONS OF LOANS

3.1 Conditions Precedent to Initial Loan............................... 13
3.2 Conditions Precedent to All Loans.................................. 15

SECTION IV - REPRESENTATIONS AND WARRANTIES

4.1 Organization and Qualification..................................... 15
4.2 Corporate Authority................................................ 16
4.3 Valid Obligations.................................................. 16
4.4 Consents or Approvals.............................................. 16
4.5 Title to Properties; Absence of Encumbrances....................... 16
4.6 Financial Statements............................................... 17
4.7 Changes............................................................ 17
4.8 Defaults........................................................... 17
4.9 Taxes.............................................................. 17
4.10 Litigation......................................................... 17
4.11 Use of Proceeds.................................................... 17
4.12 Subsidiaries....................................................... 18
4.13 Investment Company Act............................................. 18
4.14 Compliance with ERISA.............................................. 18
4.15 Security Interest.................................................. 18
4.16 Application of Proceeds............................................ 18
4.17 Taxes and Charges Relating to the Agreement........................ 18
</TABLE>
(i)
<PAGE>

<TABLE>
SECTION V - AFFIRMATIVE COVENANTS
Section Page
- ------- ----
<S> <C> <C>
5.1 Financial Statements and other Reporting Requirements.............. 19
5.2 Conduct of Business................................................ 20
5.3 Maintenance and Insurance.......................................... 20
5.4 Taxes.............................................................. 21
5.5 Inspection by the Bank............................................. 21
5.6 Maintenance of Books and Records................................... 21
5.7 Ratio of EBIT to Interest Expense.................................. 21
5.8 Minimum Total Capital Funds........................................ 21
5.9 Leverage Ratio..................................................... 21
5.10 Ratio Senior Bank Indebtedness to Total Capital Funds.............. 22
5.11 Further Assurances................................................. 22

SECTION VI - NEGATIVE COVENANTS

6.1 Indebtedness....................................................... 22
6.2 Contingent Liabilities............................................. 22
6.3 Encumbrances....................................................... 23
6.4 Capital Expenditures............................................... 24
6.5 ERISA.............................................................. 24
6.6 Merger; Consolidation; Sale or Lease of Assets..................... 24
6.7 Leases............................................................. 24
6.8 Sale and Leaseback................................................. 24
6.9 Investments........................................................ 25
6.10 Change in Terms and Prepayment of Subordinated Indebtedness........ 25
6.11 Dividends and Equity Distributions................................. 25

SECTION VII - SECURITY AGREEMENT

7.1 Creation of Security Interest...................................... 25
7.2 Covenants Pertaining to Collateral................................. 26
7.3 Reports, etc. Pertaining to Collateral............................. 27
7.4 Collection of Accounts and Adjustments............................. 29
7.5 Bank's Rights in Collateral........................................ 29
7.6 Remedies........................................................... 30
7.7 Waivers............................................................ 31

SECTION VIII - DEFAULTS

8.1 Events of Default.................................................. 32
8.2 Remedies........................................................... 34
</TABLE>

(ii)

<PAGE>

<TABLE>
SECTION IX - MISCELLANEOUS
Section Page
- ------- ----
<S> <C> <C>
9.1 Notices........................................................... 34
9.2 Expenses.......................................................... 35
9.3 Set-Off........................................................... 36
9.4 Term of Agreement................................................. 36
9.5 No Waivers........................................................ 36
9.6 Governing Law..................................................... 36
9.7 Amendments........................................................ 36
9.8 Binding Effect of Agreement....................................... 36
9.9 Counterparts...................................................... 37
9.10 Severability...................................................... 37
9.11 Captions.......................................................... 37
9.12 Entire Agreement.................................................. 37
9.13 Jury Waiver....................................................... 37
</TABLE>

EXHIBITS

EXHIBIT 3.1(j) FORM OF LEGAL OPINION

EXHIBIT 4.1 LOCATIONS

EXHIBIT 4.5 ENCUMBRANCES

EXHIBIT 4.10 LITIGATION

EXHIBIT 5.1(c) FORM OF CHIEF FINANCIAL OFFICER'S REPORT

EXHIBIT 6.1(b) INDEBTEDNESS

EXHIBIT 6.3(f)(iii) FORM OF VENDOR SUBORDINATION LETTER

EXHIBIT 7.3(c) FORM OF BORROWING BASE CERTIFICATE

EXHIBIT 7.5 FORM OF AGENCY ACCOUNT AGREEMENT

(iii)
<PAGE>

REVOLVING CREDIT AGREEMENT

THIS REVOLVING CREDIT AGREEMENT (the "Agreement") is made as of April 27,
1992 between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS
(the "Borrower"), a Florida corporation with its chief executive office at
3401-C N.W. 72nd Avenue, Miami, Florida 33132 and THE FIRST NATIONAL BANK OF
BOSTON, a national banking association having its head office at 100 Federal
Street, Boston, Massachusetts 02110.

SECTION I

DEFINITIONS
-----------

1.1 General.
-------

All capitalized terms used in this Agreement or in any certificate, report
or other document made or delivered pursuant to this Agreement (unless otherwise
defined therein) shall have the meanings assigned to them below:

Accounts. All of the accounts of the Borrower including, without
--------
limitation, all rights to payment for goods sold or leased or for services
rendered, all sums of money or other proceeds due or becoming due thereon, all
instruments pertaining thereto, all guarantees and security therefor, all goods
giving rise thereto and all rights pertaining to and interest in such goods
including the right of stoppage in transit; all rights under contracts to
receive money; all other rights and claims to the payment of money, including,
without limitation, chattel paper and amounts due from affiliates of the
Borrower; and insurance proceeds with respect to any of the foregoing.

Agency Account Agreement. See Section 7.5.
------------------------

Agreement. This Agreement (including all exhibits, schedules, annexes and
---------
the like referred to herein) as originally executed, or if amended, varied or
supplemented from time to time, as so amended, varied or supplemented.

Base Rate. The rate of interest announced from time to time by the Bank at
---------
its head office at 100 Federal Street, Boston, Massachusetts 02110 as its "Base
Rate".

Borrowing Base. An amount equal to the lesser of (i) $20,000,000; or (ii)
--------------
the sum of (x) 85% of the face value of Eligible Accounts due and owing at such
time; plus (y) 50% of Eligible Inventory, not to exceed $12,000,000.
----
<PAGE>

-2-

Borrowing Base Certificate. See Section 7.3(c).
--------------------------

Business Day. Any day other than a Saturday, Sunday or legal holiday on
------------
which banks in Boston, Massachusetts are open for the conduct of a substantial
part of their commercial lending business.

Chief Financial Officer's Report. See Section 5.1(c).
--------------------------------

Code. The Internal Revenue Code of 1986 and the rules and regulations
----
thereunder, collectively, as the same may from time to time be supplemented or
amended and remain in effect.

Collateral. Any and all property of the Borrower in which the Bank now
----------
has, by this Agreement acquires or hereafter acquires, a security interest, lien
or encumbrance, including without limitation, the security interest granted
pursuant to Section 7.1 of this Agreement.

Controlled Group. All trades or businesses (whether or not incorporated)
----------------
under common control that, together with the Borrower, are treated as a single
employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.

Default. An event or condition that, with the passage of time or the
-------
giving of notice, or both, would constitute an Event of Default.

EBIT. At any time that the amount thereof shall be determined, the
----
Borrower's Net Income before total interest expense, income tax expense,
expenses attributable to stock bonuses paid to Gregory A. White under the
Employment Agreement dated March 31, 1992 between Gregory A. White and the
Borrower, as amended and in effect as of the date of this Agreement, expenses
attributable to capitalized transaction costs associated with the transactions
consummated under and in connection with the Purchase Agreement and the
transactions contemplated by this Agreement, the amortization of good will and
noncompete agreements and other intangibles shown on the Borrower's balance
sheet, but after the depreciation of the Borrower's fixed asset expense.

Eligible Account. An Account which meets all of the following
----------------
requirements:

(a) such Account is owned by the Borrower and represents a complete bona
fide transaction which requires no further act under any circumstances on part
of the Borrower to make such Account payable to the account debtor;

(b) such Account is not past due more than 60 days;

<PAGE>

-3-

(c) the goods the sale of which gave rise to such Account were shipped or
delivered to the account debtor on an absolute sale as is and not on a bill and
hold sale basis, a consignment sale basis, a guaranteed sale basis, a sale or
return basis, or on the basis of any other similar understanding, and no
material part of such goods has been returned or rejected;

(d) such Account is not evidenced by chattel paper or an instrument of any
kind unless such chattel paper or instrument has been delivered to and is in the
possession of the Bank;

(e) the account debtor with respect to such Account is not insolvent or
the subject of any bankruptcy or insolvency proceedings of any kind or of any
other proceeding or action, threatened or pending, which might have a materially
adverse effect on such account debtor and is not, in the reasonable discretion
of the Bank, deemed ineligible for credit or other reasons;

(f) such Account is not owing by an account debtor whose then-existing
accounts owing to the Borrower exceed in face amount 30% of the Borrower's
total Eligible Accounts;

(g) such Account is not owing by an account debtor when 50% of all
then-existing accounts owing to the Borrower by such account debtor are past due
more than 60 days;

(h) if such Account arises from the performance of services, such services
have been fully rendered;

(i) if the account debtor with respect thereto is located outside of the
United States of America (excluding for this purpose the Commonwealth of Puerto
Rico or the United States Virgin Islands), the goods which gave rise to such
Account were shipped after receipt by the Borrower from the account debtor of an
irrevocable letter of credit, which letter of credit has been confirmed by a
financial institution reasonably acceptable to the Bank and is in form and
substance reasonably acceptable to the Bank, payable in the full face amount of
the face value of he Account in Dollars at a place of payment located within the
United States;

(j) the amount owning on the invoice evidencing such Account is a valid,
legally enforceable obligation of the account debtor with respect thereto and is
not subject to any material present, or contingent, and no facts exist which are
the basis for any future, offset, deduction or counterclaim, dispute or other
defense on the part of such account debtor;

(k) such Account is subject to a security interest in favor of the Bank,
which security interest is perfected as to such Account, and is subject to no
other Lien whatsoever other than a Permitted Lien;
<PAGE>

-4-

(l) such Account is evidenced by an invoice or other documentation in form
reasonably acceptable to the Bank;

(m) such Account is not subject to the Assignment of Claims Act of 1940,
as amended from time to time, or any applicable law now or hereafter existing
similar in effect thereto, as determined in the reasonable discretion of the
Bank, or to any provision prohibiting its assignment or requiring notice of or
consent to such assignment;

(n) the goods giving rise to such Account were not, at the time of the
sale thereof, subject to any Lien, except the Permitted Liens; and

(o) such Account is not determined by the Bank to be ineligible for any
other reason based upon such credit and collateral considerations as the Bank
may reasonably deem appropriate.

Eligible Inventory. Inventory which meets all of the following
------------------
requirements:

(a) such Inventory is owned by the Borrower, is subject to a security
interest in favor of the Bank, which security interest is perfected as to such
Inventory, and is subject to no other Lien whatsoever other than a Permitted
Lien;

(b) such Inventory consists of finished goods;

(c) such Inventory is in good condition and meets all standards applicable
to such goods, their use or sale imposed by any governmental agency, or
department or division thereof, having regulatory authority over such matters;

(d) such Inventory is currently either usable or saleable, at prices
approximately at least cost, in the normal course of the Borrower's business;

(e) such Inventory is located within the United States at one of the
locations set forth in the most recent Schedule of Inventory;

(f) such Inventory is in the possession of the Borrower and not any third
part, such as warehousers or contractors (unless the Bank has received a waiver
from the applicable warehousers or contractors in form and substance reasonably
satisfactory to the Bank);

(g) such Inventory is of a quality and from a vendor satisfactory to the
Bank;

(h) such Inventory is obtained from a vendor offering stock rotation or
stock balancing privileges to the Borrower; and
<PAGE>

-5-

(i) such Inventory is not determined by the Bank to be ineligible for any
other reason based upon such reasonable credit and collateral considerations as
the Bank may deem appropriate.

Inventory immediately loses the status of Inventory if and when the
Borrower sells it, otherwise passes title thereto or consumes it or the Bank
releases or transfers its security interest therein. If and when an Eligible
Account exists by virtue of constituting proceeds of Eligible Inventory, the
Inventory giving rise to the Eligible Account automatically loses its status as
Eligible Inventory.

Encumbrances. See Section 6.3.
------------

Equipment. All of the Borrower's machinery, equipment and fixtures,
---------
wherever located, including, without limitation, office furniture, furnishings
and trade fixtures specialty tools and parts, motor vehicles and materials
handling equipment, together with the Borrower's interest in, and right to, any
and all manuals and other materials that contain technical data relating to the
use, operations, or structure of such equipment, and at least one set of copies
of those materials on which then-current information is recorded.

ERISA. The Employee Retirement Income Security Act of 1974 and the rules
-----
and regulations thereunder, collectively, as the same may from time to time be
supplemented or amended and remain in effect.

Event of Default. Any event described in Section 8.1.
----------------

General Intangibles. All of the general intangibles of the Borrower,
-------------------
including, without limitation, tax refunds, rights with respect to trademarks,
service marks, trade names, patens, copyright rights, trade-secrets information,
and rights to prevent others from doing acts that constitute unfair competition
with or misappropriation of the property of the Borrower including, without
limitations, any sums (net of expenses) that the Borrower may receive arising
out of any claim for infringement of its rights in any patent, copyright,
trademark, trade name, trade secret or other proprietary right and all rights of
the Borrower under contracts to enjoy performance by others or to be entitled to
enjoy rights granted by others or to be entitled to enjoy rights granted by
others, including without limitation any licenses.

Guarantees. As applied to the Borrower, all guarantees, endorsements or
----------
other contingent or surety obligations with respect to obligations of others
whether or not reflected on the balance sheet of the borrower, including any
obligation to furnish funds, directly or indirectly (whether by virtue of
partnership arrangements, by agreement to keep-well or otherwise), through the
purchase of goods, supplies or
<PAGE>

-6-

services, or by way of stock purchase, capital contribution, advance or loan, or
to enter into a contract for any of the foregoing, for the purpose of payment of
obligations of any other person or entity.

Indebtedness. As applied to the Borrower, (i) all obligations for borrowed
------------
money or other extensions of credit, including all obligations representing the
deferred purchase price of property, other than accounts payable arising in the
ordinary course of business, (ii) all obligations evidenced by bonds, notes,
debentures or other similar instruments, (iii) all obligations secured by any
mortgage, pledge, security interest or other lien on property owned or acquired
by the Borrower whether or not the obligations secured thereby shall have been
assumed, (iv) that portion of all obligations arising under capital leases that
is required to be capitalized on the consolidated balance sheet of the Borrower,
and (v) all Guarantees.

Inventory. All inventory of the Borrower wherever located, including,
---------
without limitation, all goods, merchandise, and other personal property which
are held for sale, lease or other disposition, or held for display or
demonstration, or leased or cosigned or which are raw materials, work in
process, or materials used or consumed or to be used or consumed in the business
of the Borrower. "Inventory" shall include all proprietary rights, patents,
plans, drawings, diagrams, schematics, assembly and display materials relating
to any of the foregoing.

Investments. The purchase or acquisition of any share of capital stock,
-----------
partnership interest, evidence of indebtedness or other equity security of any
other person or entity, any loan, advance or extension of credit to, or
contribution to the capital of, any other person or entity, any real estate held
for sale or investment, any commodities futures contracts held other than in
connection with bona fide hedging transactions, any other investment in any
other person or entity, and the making of any commitment or acquisition of any
option to make an Investment.

Loan. A Loan made to the Borrower by the Bank pursuant to Section II of
----
this Agreement.

Loan Account. The general ledger account in the name of the Borrower on the
------------
books of the Bank in which will be recorded loans and advances made by the Bank
to the Borrower pursuant to this Agreement, payments made on such loans, and
other appropriate debits and credits as provided by this Agreement.

Maximum Commitment. $20,000,000.
------------------
<PAGE>

-7-

Net Income. At any date as of which the amount thereof shall be determined,
----------
all amounts that should, in accordance with generally accepted accounting
principles, be included as the net income of the Borrower.

Obligations. Any and all obligations of the Borrower to the Bank of every
-----------
kind and description, direct or indirect, absolute or contingent, primary or
secondary, due or to become due, now existing or hereafter arising or acquired,
regardless of how they arise or are acquired or by what agreement or instrument,
if any, and including obligations to perform acts and refrain from taking action
as well as obligations to pay money.

PBGC. The Pension Benefit Guaranty Corporation or any entity succeeding to
----
any or all of its functions under ERISA.

Permitted Encumbrances. See Section 6.3.
----------------------

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

Proceeds. Whatever is received upon the sale, lease, exchange, collection
--------
or other disposition of the Collateral including, but not limited to, all
Accounts, goods, money, checks, deposit accounts, and insurance proceeds.

Purchase Agreement. The Subordinated Note and Warrant Purchase Agreement
------------------
dated as of March 31, 1992 by and among the Borrower, those persons listed on
Schedule A annexed thereto, and C.T. Capital Trust N.V., a Netherlands Antilles
- ----------
corporation, as agent and attorney in fact for such persons.

Qualified Investments. Investments in (i) notes, bonds or other obligations
--------------------
of the United States of America or any agency thereof that as to principal and
interest constitute direct obligations of or are guaranteed by the United States
of America; (ii) certificates of deposit or other deposit instruments or
accounts of banks or trust companies organized under the laws of the United
States or any state thereof that have capital and surplus of at least
$100,000,000, (iii) commercial paper that is rated not less than prime-one or
A-1 or their equivalents by Moody's Investors Service, Inc. or
<PAGE>

-8-

Standard & Poor's Corporation, respectively, or their successors, and (iv) any
repurchase agreement secured by any one or more of the foregoing.

Senior Bank Indebtedness. Any and all Indebtedness of the Borrower to the
------------------------
Bank whether under this Agreement or otherwise.

Service Fee. See Section 2.3.
-----------

Subordinated Indebtedness. Indebtedness of the Borrower evidenced by the
-------------------------
Subordinated Notes, as defined in, and issued pursuant to, the Purchase
Agreement and any other Indebtedness of the borrower the payment of principal of
and interest on which is expressly subordinated in right of payment, to the
prior payment in full of the Obligations, by a subordination agreement in a form
and continuing terms approved by the Bank.

Subsidiary. Any corporation, association, joint stock company, business
----------
trust or other similar organization of which 50% or more of the ordinary voting
power for the election of a majority of the members of the board of directors or
other governing body of such entity is held or controlled by the Borrower; or
any other such organization the management for which is directly or indirectly
controlled by the Borrower through the exercise of voting power or otherwise; or
any joint venture, whether incorporated or note, on which the Borrower has a 50%
ownership interest.

Tangible Net Worth. At any date as of which the amount hereof shall be
------------------
determined, (i) the total assets of the Borrower minus (ii) the sum of any
-----
amounts attributable to (a) goodwill; (b) intangible items such as unamortized
debt discount and expense, patents, trade and service marks and names,
copyrights and research and development expenses except prepaid expenses; (c)
all reserves not already deducted from assets; (d) any write-up in the book
value of assets resulting from any revaluation thereof subsequent to the date of
the financial statements referred to in Section 4.6; (e) noncompete agreements;
and (f) loans to shareholders of the Borrower including without limitation the
"Senior Management Notes," referred to in Section 3.14 of the Purchase
Agreement, minus (iii) Total Liabilities.
-----

Termination Date. April 30, 1994.
----------------

Total Capital Funds. At any date as of which the amount thereof shall be
-------------------
determined, the sum of Tangible Net Worth and Subordinated Indebtedness.

Total Liabilities. At any date as of which the amount thereof shall be
-----------------
determined, all obligations that should, in accordance with generally accepted
accounting principles, be classified as liabilities on the balance sheet of the
Borrower, including in any event all Indebtedness.
<PAGE>

-9-

Vendor Subordination Letter. See Section 6.3(f)(ii).
---------------------------

1.2. Accounting Terms. All terms of an accounting character shall have the
----------------
meanings assigned thereto by generally accepted accounting principles applied on
a basis consistent with the financial statements referred to in Section 4.6 of
this Agreement, modified to the extent, but only to the extent, that such
meanings are specifically modified herein.

SECTION II

DESCRIPTION OF CREDIT
---------------------

2.1. The Loans. Subject to the terms and conditions hereof, the Bank will
---------
make Loans to the Borrower from time to time until the close of business on the
last Business Day preceding the Termination Date, in such amounts as the
Borrower may request, provided that the debit balance of the Loan Account shall
not at any time exceed the amount available under the Borrowing Base. The
Borrower may borrow, repay pursuant to Section 2.8, and reborrow, from the date
of this Agreement until the last Business Day preceding the Termination Date,
any amount available under the borrowing Base as provided in this Agreement. Any
Loan not repaid by the Termination Date shall be due and payable on such date.

2.2 Notice and Manner of Borrowing. (a) Whenever the Borrower desires to
------------------------------
obtain a Loan hereunder, an officer of the Borrower, certified in writing as
authorized to request Loans hereunder, shall notify the Bank (which notice to
the Bank shall be irrevocable) by telex, telegraph, telecopy or telephone
received no later than 12:00 noon boston time on the day on which the requested
Loan is to be made. Such notice shall specify the effective date and amount of
each Loan subject to the limitations set forth in Section 2.1.

(b) Subject to the terms and conditions hereof, the Bank shall make each
Loan on the effective date specified therefor by debiting the amount of such
Loan to the Loan Account and crediting a like amount to the demand deposit
account of the Borrower with the Bank, or, to such other account as the Borrower
may direct.

(c) Subject to the terms and conditions hereof, the Borrower may obtain
Loans hereunder by writing drafts on any checking account which it may maintain
with the Bank or any of its affiliates. The amount of each such Loan shall be
debited to the Loan Account.

2.3. Closing Fee. The Borrower shall pay to the Bank a non-refundable
-----------
closing fee of $150,000 on the date this Agreement is executed.

<PAGE>

-10-

2.4. Commitment Fee. The Borrower shall pay to the Bank, during each month
--------------
or portion thereof, until the Termination Date, a commitment fee computed at the
rate of three-eighths of one percent (3/8%) per annum on the difference between
(a) the Maximum Commitment; and (b) the average daily balance of the Loan
Account during such month.Commitment fees shall be payable monthly in arrears,
and on the Termination Date.

2.5. Commitment Reduction and Early Termination Fee. The Borrower shall
----------------------------------------------
pay to the Bank three percent (3%) of the amount of any reduction in or
termination of the Maximum Commitment by the borrower in the initial 365 day
period following (and including) the date of this agreement, and two percent
(2%) of the amount of any such reduction or termination in the next succeeding
365 day period. All such amounts shall be payable on the date or dates of such
reductions or terminations.

2.6. The Loan Account. The Loans shall be evidenced by debit entries to
----------------
the Loan Account. The Bank shall also record in the Loan Account all payments
made by the borrower on account of indebtedness evidenced by the Loan Account
and all proceeds of Collateral which are finally paid to the Bank at its office
in cash or solvent credits, and may record therein, in accordance with customary
accounting practice, other debits and credits,including all charges and expenses
properly chargeable to the Borrower and any other Obligation. The debit balance
of the Loan Account shall reflect the amount of the borrower's indebtedness to
the Bank from time to time by reason of Loans and other appropriate charges
hereunder. At least once each month the Bank shall render (i) a statement of
account showing as of its date the debit balance of the Loan Account and charges
to the Loan Account for such month; and (ii) a statement of account showing as
of its date the balance of any deposit account maintained with the Borrower with
the Bank and charges to such deposit account for such month. Each such statement
referred to above shall be considered correct and accepted by the Borrower and
conclusively binding upon it absent manifest error unless, within thirty (30)
days after the date of any such statement, notice to the contrary is received by
the Bank from the Borrower.

2.7. Interest Rate and Payments of Interest. (a) Each Loan shall bear
--------------------------------------
interest on the outstanding principal amount thereof at a rate per annum equal
to the Base Rate plus one and one half percent (1 1/2%), which rate shall change
contemporaneously with any change in the Base rate. Such interest shall be
payable on the first day of each month and when such Loan is due (whether at
maturity, by reason of acceleration or otherwise).

<PAGE>

-11-

(b) At the option of the Bank, and no sooner than thirty (30) days after
the occurrence of an Event of Default hereunder, the interest rate applicable to
each Loan shall increase to three percent (3%) above the rate of interest
applicable to the Loans. Such interest rate shall change contemporaneously with
any change in the Base Rate.

2.8. Changed Circumstances. Intentionally Omitted.
---------------------

2.9. Payments and Prepayments of the Loans. In addition to payments
-------------------------------------
required pursuant to Section 7.6 hereof, the Loans may be prepaid at any time,
in whole or in part, without premium or penalty, provided that interest accrued
on the amounts so paid to the date of such payment must be paid at the time of
any such payment. No prepayment of the Loans before the Termination Date shall
impair the right of the Borrower to borrow as set forth in Section 2.1.

2.10. Method of Payment. All payments and prepayments of principal and
----------------
any and all other amounts due hereunder shall be made by the Borrower to the
Bank at 100 Federal Street, Boston, Massachusetts in immediately available funds
and in United States Dollars, on or before 11:00 a.m. (Boston time) on the due
date thereof, free and clear of, and without any deduction or withholding for,
any taxes or other payments.

2.11. Overdue Payments. Until the provisions of Section 2.7(b) shall
----------------
become applicable, overdue principal (whether at maturity, by reason of
acceleration or otherwise) and, to he extent permitted by applicable law,
overdue interest and fees or any other amounts payable hereunder shall bear
interest from and including the due date thereof until paid, compounded daily
and payable on demand, at a rate per annum equal to 2% above the rate of
interest otherwise applicable to the Loans.

2.12. Computation of Interest and Fees. Interest and all fees payable
--------------------------------
hereunder shall be computed daily on the basis of a year of 360 days and paid
for the actual number of days for which due. If the due date for any payment of
principal is extended by operation of law, interest shall be payable for such
extended time. If any payment required by this Agreement becomes due on a day
that is not a Business Day such payment shall be made on the next succeeding
Business Day, and such extension shall be included in computing interest in
connection with such payment.

2.13. Borrowings Base Availability. The Borrower understands that the Bank
----------------------------
will use the Borrowing Base as a maximum ceiling on Loans. Notwithstanding the
other provisions of this Agreement, in computing Loan availability under the
Borrowing Base, the Bank will subtract from the Borrowing Base the debit balance
of the Loan Account.

<PAGE>

-12-

2.14. Borrowing Base Excesses. If at any time or times the debit
-----------------------
balance of the Loan Account exceeds the Borrowing Base, the Borrower shall pay
immediately to the Bank the amount of any such excess to be credited to the Loan
Account.

2.15. Promises to Pay. The Borrower promises to pay to the Bank in
---------------
accordance with the terms of this Agreement and on the dates specified herein,
subject to acceleration under Section VIII, all monetary Obligations hereunder.

2.16. Authorization to Debit Loan Account. The Borrower authorizes the
-----------------------------------
Bank, in the Bank's sole discretion, to charge when due any monetary Obligation,
including, without limitation, all amounts owing for interest, fees, costs and
expenses and other charges provided by this Agreement, including but not limited
to Section 9.2 of this Agreement, to the Loan Account, and such amounts shall be
Loans hereunder and shall be disclosed promptly to the Borrower by way of
written advices of debits to the Loan Account.

2.17. Capital Adequacy. If the Bank shall have determined that the
----------------
adoption of any applicable law, rule, regulation, guideline, directive or
request (whether or not having the force of law) regarding capital requirements
for banks or bank holding companies, or any change therein or in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by the Bank with any of the foregoing imposes or
increases a requirement by the Bank to allocate capital resources to the Bank's
commitment to make Loans hereunder which has or would have the effect of
reducing the return on the Bank's capital to a level below that which the Bank
could have achieved (taking into consideration the Bank's then existing policies
with respect to capital adequacy and assuming full utilization of the Bank's
capital) but for such adoption, change or compliance by any amount reasonably
deemed by the Bank to be material, then the Bank may, at its option and by
notice to the Borrower, adjust the Commitment fee charged to the Borrower
pursuant to Section 2.4, which adjustment shall become effective sixty (60) days
from the date of such notice.

Any notice by the Bank to the Borrower shall be accompanied by a certificate
shall set forth the nature of the occurrence giving rise to such compensation,
the additional amount or amounts to be paid to it hereunder and the method by
which such amounts were determined. In determining such amount, the Bank may use
any reasonable averaging and attribution methods. Such certificate and the
determinations set forth therein shall be conclusive in the absence of manifest
error.

Notwithstanding any other provision hereof, at any time following receipt
of a notice from the Bank pursuant to this

<PAGE>

-13-

Section 2.17, the Borrower may, upon thirty (30) days notice to the Bank,
terminate this Agreement without payment of any penalty or premium including the
early termination fee otherwise payable under Section 2.5 hereof.

SECTION III

CONDITIONS OF LOANS
-------------------

3.1. Conditions Precedent to Initial Loan. The obligation of the Bank to
------------------------------------
make its initial Loan is subject to the condition precedent that the Bank shall
have received, in form and substance reasonably satisfactory to the Bank and its
counsel, the following:

(a) this Agreement duly executed by the Borrower;

(b) a Certificate of Corporate Borrowing Resolutions signed by the
Secretary of the Borrower;

(d) a Certificate of Legal Existence of the Borrower of reasonably recent
date issued by the Secretary of State of Florida;

(e) a Certificate of Good Standing and Authority regarding the Borrower's
qualification to transact business as a foreign corporation in Georgia and
Texas;

(f) a Certificate signed by the Secretary of the Borrower as to the truth,
correctness and completeness of copies of (i) Certificate of Incorporation filed
with the Secretary of State of the Borrower's jurisdiction of incorporation
together with all amendments thereto; and (ii) By-laws of the Borrower.

(g) Receipt of evidence, in form and substance satisfactory to the Bank, of
the filing of UCC-1 financing statements in favor of the Bank, for filing in all
offices necessary to perfect the Bank's security interest in the Collateral.

(h) an agency account agreement, substantially in the form of Exhibit 7.5
-----------
attached hereto duly executed by the Borrower, the Bank and Barnett Bank of
South Florida, N.A.

(i) Landlord Waivers for following premises leased by the Borrower:

3401-C N.W. 72nd Avenue
Miami, Florida 33122-1321
(Dade County)

<PAGE>

-14-

1746 W. Crosby Road
Carrollton, Texas 75006
(Dallas County)

1275 Oakbrook Drive
Suite A
Norcross, Georgia 30039
(Gwinett County)

Computer Image
12537 South Dixie Highway
Miami, Florida 33156

Computer Image
North Miami Beach, Florida 33162

(j) favorable opinions addressed to the Bank from (i) the Borrower's
counsel, Hutchins & Wheeler and J. James Donnellan, III, Esquire, and (ii)
counsel to the institutional holders of the Subordinated Indebtedness issued
under the Purchase Agreement, opining as to the matters covered by the form of
opinion attached hereto as Exhibit 3.1(j);

(k) insurance certificates required by Section 5.3 hereof;

(l) Vendor Subordination Letters, substantially in the form of Exhibit
6.3(f)(ii) hereto, or the "notice" letters referred to in Section 6.3(f)(ii)(B)
as appropriate, executed by all vendors having, as of the date of this
Agreement, a written security interest grant covering any of the Collateral
included in the Borrowing Base Certificate delivered pursuant to Section 7.3(c)
hereof.

(m) Borrowing Base Certificate dated April 24, 1992 as to: (i) Schedule of
Accounts Receivable as of April 23, 1992, and (ii) Schedule of Inventory as of
April 23, 1992.

(n) Chief Financial Officer's Report dated April 24, 1992 covering the
period of the most recent financial statements referenced in Section 4.6 hereof.

(o) a copy of the audited financial statements for the Borrower's fiscal
year ending December 31, 1991 with copies of the report and statement required
by Section 5.1(a) hereof.

(p) a copy of the financial statements of the Borrower reviewed by Coopers
& Lybrand and the "cold comfort" accountants letter delivered by Coopers &
Lybrand to the agent under the Purchase Agreement covering the period January 1,
1992 to the date of such letter.

(q) such other documents, and completion of such other matters, as counsel
for the Bank may reasonably deem necessary or appropriate.
<PAGE>

-15-

3.2. Conditions Precedent to All Loans. The obligation of the Bank to
---------------------------------
make each Loan, including the initial Loan, is further subject to the following
conditions:

(a) the representations and warranties contained in Section IV shall be
true and accurate in all material respects on and as of the effective date of
each Loan as though made at and as of each such date (except to the extent that
such representations and warranties expressly relate to an earlier date), and no
Default shall have occurred and be continuing, or would result from such Loan;

(b) the resolutions referred to in Section 3.1(b) shall remain in full
force and effect; and

(c) no change shall have occurred in any law or regulation or
interpretation thereof that, in the opinion of counsel for the Bank, would make
it illegal or against the policy of any governmental agency or authority for the
Bank to make Loans hereunder.

The making of each Loan shall be deemed to be a representation and warranty
by the Borrower on the date of such Loan as to the accuracy of the facts
referred to in subsection (a) of this Section 3.2.

SECTION IV

REPRESENTATIONS AND WARRANTIES
------------------------------

In order to induce the Bank to enter into this Agreement and to make Loans
hereunder, the Borrower represents and warrants to the Bank that:

4.1. Organization and Qualification. The Borrower (a) is a corporation
-------------------------------
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, (b) has all requisite corporate power to own
its property and conduct its business as now conducted and as presently
contemplated, (c) is duly qualified and in good standing as a foreign
corporation and is duly authorized to do business in each jurisdiction where the
nature of its properties or business requires such qualification, except where
the failure to be so qualified would not have a material adverse effect on the
business, financial condition, assets or properties of the Borrower on a
consolidated basis, (d) has its chief executive office located at the address of
the Borrower shown in the preamble to this Agreement and (e) has an office,
manufacturing facility, warehouse or occupies space in the states and at the
locations specified in Exhibit 4.1 hereto.
-----------
<PAGE>

-16-

4.2. Corporate Authority. The execution, delivery and performance of this
-------------------
Agreement and the transactions contemplated hereby are within the corporate
power and authority of the Borrower and have been authorized by all necessary
corporate proceedings, and do not and will not:

(a) require any consent or approval of the stockholders of the Borrower
other than those consents and approvals, if any, previously obtained;

(b) contravene any provision of the charter documents or by-laws of the
Borrower or any law, rule or regulation applicable to the Borrower;

(c) contravene any provision of, or constitute an event of default or
event that, but for the requirement that time elapse or notice be given, or
both, would constitute an event of default under, any other agreement,
instrument, order or undertaking binding on the Borrower; or

(d) result in or require the imposition of any Encumbrance on any of the
properties, assets or rights of the Borrower, except Encumbrances permitted
hereunder.

4.3. Valid Obligations. This Agreement and all of its terms and
-----------------
provisions are the legal, valid and binding obligations of the Borrower,
enforceable in accordance with its terms except as limited by bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally, and except as the remedy of specific performance
or of injunctive relief is subject to the discretion of the court before which
any proceeding therefor may be brought.

4.4. Consents or Approvals. The execution, delivery and performance of
---------------------
this Agreement and the transactions contemplated herein do not require any
approval or consent of, or filing or registration with, any governmental or
other agency or authority, or any other party.

4.5. Title to Properties; Absence of Encumbrances. The Borrower has good
--------------------------------------------
and marketable title to all of the properties, assets and rights of every name
and nature now purported to be owned by it, including, without limitation, such
properties, assets and rights as are reflected in the financial statements
referred to in Section 4.6 (except such properties, assets or rights as have
been disposed of in the ordinary course of business since the date thereof),
free from all Encumbrances except Permitted Encumbrances or those Encumbrances
disclosed in Exhibit 4.5 thereto, and, except as so disclosed, free from all
-------
defects of title that might materially adversely affect such properties, assets
or rights, taken as a whole.

<PAGE>

-17-

4.6. Financial Statements. The Borrower has furnished the Bank with its
--------------------
balance sheet as of December 31, 1991 and with its statements of income, changes
in stockholders' equity and cash flow as of such date, and related footnotes,
audited and unqualified by Coopers & Lybrand. The Borrower has also furnished
the Bank its balance sheet and its statements of income, as of December 31,
1991. All such financial statements were prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods specified and present fairly the financial position of the Borrower as
of such dates and the results of the operations of the Borrower for such
periods. The Borrower has also furnished the Bank with certain financial
statements covering the period January 1, 1992 to the date of the "cold comfort"
accountants' letter delivered to the agent under the Purchase Agreement. There
are no liabilities, contingent or otherwise, not disclosed in such financial
statements that involve a material amount.

4.7. Changes. Other than as disclosed in Schedules 8.4 and 8.27 of the
-------
Purchase Agreement, since the date of the most recent financial statements
referred to in Section 4.6, there have been no changes in the assets,
liabilities, financial condition, business or prospects of the Borrower other
than changes in the ordinary course of business, the effect of which has not, in
the aggregate, been materially adverse.

4.8. Defaults. As of the date of this Agreement, no Default exists.
--------

4.9. Taxes. The Borrower has filed all federal, state and other tax
-----
returns which were due prior to the date of this Agreement, and all taxes,
assessments and other governmental charges due from the Borrower prior to or as
of the date hereof have been fully paid. The Borrower has established and will
maintain on its books reserves adequate for the payment of all federal, state
and other tax liabilities.

4.10. Litigation. Except as set forth on Exhibit 4.10 hereto, there is no
---------- ------------
litigation, arbitration, proceeding or investigation pending, or, to the
knowledge of the officers of the Borrower threatened, against the Borrower that,
if adversely determined, would result in a material judgment not fully covered
by insurance or would otherwise have a material adverse effect on the assets,
business or prospects of the Borrower.

4.11. Use of Proceeds. No portion of any Loan is to be used for the
---------------
"purpose of purchasing or carrying" any "margin stock" as such terms are used in
Regulations G, U and X of the Board of Governors of the Federal Reserve System,
12 C.F.R. 221 and 224, as amended; and following the application of the proceeds
of each Loan, the value of all "margin stock" of the
<PAGE>

-18-

Borrower will not exceed 25% of the value of the total assets of the Borrower
that are subject to the restrictions set forth in Section 6.3.

4.12. Subsidiaries. As of the date of this Agreement, the Borrower has no
------------
Subsidiaries.

4.13. Investment Company Act. The Borrower is not subject to regulation
----------------------
under the Investment Company Act of 1940, as amended.

4.14. Compliance with ERISA. The Borrower and each member of the
---------------------
Controlled Group have fulfilled their obligations under the minimum funding
standards of ERISA and the Code with respect to each Plan and are in compliance
in all material respects with the applicable provisions of ERISA and the Code,
and have not incurred any liability to the PBGC or a Plan under Title IV of
ERISA; and no "prohibited transaction" or "reportable event" (as such terms are
defined in ERISA) has occurred with respect to any Plan.

4.15. Security Interest. This Agreement creates and continues in favor of
-----------------
the Bank a security interest in the Collateral identified in Section 7.1 hereof.
All financing statements with respect to the Collateral have been executed and
will be filed on or before the date of the initial loan hereunder in all offices
necessary to perfect a security interest in the Collateral, and such security
interest constitutes a first priority perfected security interest in the
Collateral, except in Collateral (if any) in which a security interest cannot be
perfected by filing under the Uniform Commercial Code.

4.16. Application of Proceeds. The proceeds of Loans made hereunder
-----------------------
shall be used for general working capital purposes.

4.17. Taxes and Charges Relating to the Agreement. All state and local
-------------------------------------------
recording, franchise, stamp, documentary and other governmental charges and
assessments required to be paid in connection with the execution, delivery,
filing or recordation of, or as a condition to, the enforcement of this
Agreement, or the Bank's lien on or security interest in the Collateral, have
been duly paid.

SECTION V

AFFIRMATIVE COVENANTS
---------------------

So long as the Bank has any commitment to lend hereunder or any Loan or
other Obligation remains outstanding, the Borrower covenants as follows:

<PAGE>

-19-

5.1 Financial Statements and other Reporting Requirements. The Borrower
------------------------------------------------------
shall furnish to the Bank:

(a) as soon as available to the Borrower, but in any event within 90 days
after the end of each of its fiscal years, a balance sheet as of the end of, and
a related statement of income, changes in stockholders' equity and cash flow
for, such year, audited and unqualified by Coopers & Lybrand (or other
independent certified public accountants acceptable to the Bank); and,
concurrently with such financial statements, a copy of said certified public
accountants' management report and a written statement by such accountants that,
in the making of the audit necessary for their report and opinion upon such
financial statements they have obtained no knowledge of any Default or, if in
the opinion of such accountants any such Default exists, they shall disclose in
such written statement the nature and status thereof;

(b) as soon as available to the Borrower, but in any event within 45 days
after the end of each fiscal quarter, a balance sheet as of the end of, and a
related statement of income for the period then ended;

(c) concurrently with the delivery of each financial statement pursuant to
subsections (a) and (b) of this Section 5.1, a report in substantially the form
of Exhibit 5.1(c) hereto signed on behalf of the Borrower by its chief financial
--------------
officer;

(d) promptly after the receipt thereof by the Borrower copies of any
reports submitted to the Borrower by independent public accountants in
connection with any interim review of the accounts of the Borrower made by such
accountants;

(e) if and when the Borrower gives or is required to give notice to the
PBGC of any "Reportable Event" (as defined in Section 4043 of ERISA) with
respect to any Plan that might constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that any member of the Controlled Group or the
plan administrator of any Plan has given or is required to give notice of any
such Reportable Event, a copy of the notice of such Reportable Event given or
required to be given to the PBGC;

(f) immediately upon becoming aware of the existence of any condition or
event that constitutes a Default, written notice thereof specifying the nature
and duration thereof and the action being or proposed to be taken with respect
thereto;

(g) promptly upon becoming aware of any litigation or of any investigative
proceedings by a governmental agency or authority commenced or threatened
against the Borrower of which it has notice, the outcome of which would or might
have a
<PAGE>

-20-

materially adverse effect on the assets, business, prospects or financial
condition of the Borrower, written notice thereof and the action being or
proposed to be taken with respect thereto; and

(h) from time to time, such other information about the Borrower as the
Bank may reasonably request.

5.2. Conduct of Business. The Borrower shall:
-------------------

(a) duly observe and comply in all material respects with all applicable
laws and valid requirements of any governmental authorities relative to its
corporate existence, rights and franchises, to the conduct of its business and
to its property and assets, and shall maintain and keep in full force and effect
all licenses and permits necessary in any material respect to the proper conduct
of its business;

(b) maintain its corporate existence;

(c) remain engaged substantially in the business of the wholesale
distribution of computer equipment and related software; and

(d) maintain its chief executive office at the address specified in Section
4.1 hereof, unless the Bank shall have first been notified in writing of any
change.

5.3. Maintenance and Insurance. The Borrower shall maintain its
-------------------------
properties in good repair, working order and condition as required for the
normal conduct of its business. The Borrower shall at all times maintain with
financially sound and reputable insurers, liability and casualty insurance
customary for companies engaged in businesses similar to that of the Borrower
including in any event fire and extended coverage and theft, and, with respect
to the Borrower's casualty insurance covering the Collateral, shall, in addition
be in amounts, containing such terms, in such form, and for such periods as may
be reasonably satisfactory to the Bank, such insurance to be payable to the Bank
(as loss payee and additional insured) and the Borrower as their interests may
appear. All such policies of insurance shall provide for no less than thirty
(30) days written minimum cancellation notice to the Bank. In the event the
Borrower fails to provide and maintain insurance as herein required, the Bank
may, at its option, provide such insurance and charge the amount thereof to the
Loan Account which amount shall bear interest at the rate specified in, and in
accordance with, Section 2.11 of this Agreement. The Borrower shall furnish to
the Bank certificates or other evidence reasonably satisfactory to the Bank of
compliance with the foregoing insurance provisions.
<PAGE>

-21-

5.4. Taxes. The Borrower shall pay or cause to be paid all taxes,
-----
assessments or governmental charges on or against it or its properties on or
prior to the time when they become due unless any such tax, assessment or charge
is being contested in good faith by appropriate proceedings and with adequate
reserves established and maintained in accordance with generally accepted
accounting principles provided no lien shall have been filed to secure any such
tax, assessment or charge.

5.5. Inspection and Verification of Accounts. The Borrower shall permit
---------------------------------------
the Bank or its designees, at any reasonable time and upon reasonable notice (or
if a Default shall have occurred and is continuing, at any time and without
prior notice), to (i) visit and inspect the properties of the Borrower, (ii)
examine and make copies of and take abstracts from the books and records of the
Borrower, (iii) discuss the affairs, finances and accounts of the Borrower and
its appropriate officers, employees and accountants and (iv) arrange for
verification of Accounts under reasonable procedures directly with the
Borrower's accountants, the account debtors or by other methods.

5.6. Maintenance of Books and Records. The Borrower shall keep adequate
-------------------------------
books and records of account, in which true and complete entries will be made
reflecting all of its business and financial transactions, and such entries will
be made in accordance with generally accepted accounting principles consistently
applied and applicable law.

5.7. Ratio of EBIT to Interest Expense. As of the last day of each of the
---------------------------------
Borrower's fiscal quarters, the Borrower shall have a ratio of (a) EBIT to (b)
total interest expense but excluding imputed interest arising from accretion of
debt discount on the Subordinated Indebtedness issued under the Purchase
Agreement, of not less than the ratio specified for each of the following
periods:
Period Ratio
------ -----
April 1, 1992 - June 30, 1992 1.5:1
July 1, 1992 - March 31, 1993 2.5:1
April 1, 1993 and thereafter 3.0:1

5.8. Minimum Total Capital Funds. The Borrower shall maintain Total Capital
---------------------------
Funds of not less than $3,500,000 until March 31, 1993, and thereafter
$3,500,000 plus seventy-five percent (75%) of the Borrower's Net Income for the
----
immediately preceding year.

5.9. Leverage Ratio. The Borrower shall maintain a ratio of (i) Total
--------------
Liabilities less Subordinated Indebtedness to (ii) Total Capital Funds of not
more than 5:1 until March 31, 1993 and 3.5:1 thereafter.

<PAGE>

-22-

5.10. Ratio of Senior Bank Indebtedness to Total Capital Funds. The
--------------------------------------------------------
Borrower shall maintain a ratio of Senior Bank Indebtedness to Total Capital
Funds of not more than 3:1.

5.11. Further Assurances. At any time and from time to time the
------------------
Borrower shall, and shall cause each of its Subsidiaries to, execute and
deliver such further instruments and take such further action as may reasonably
be requested by the Bank to effect the purposes of this Agreement.

SECTION VI

NEGATIVE COVENANTS
------------------

So long as the Bank has any commitment to lend hereunder or any Loan or
other Obligation remains outstanding, the Borrower covenants as follows:

6.1. Indebtedness. The Borrower will not create, incur, assume,
------------
guarantee or be or remain liable with respect to any Indebtedness other than
the following:

(a) Indebtedness of the Borrower to the Bank, any direct or indirect
subsidiary of the Bank or any of the Bank's affiliates;

(b) Indebtedness existing as of the date of this Agreement and disclosed
on Exhibit 6.1(b) hereto or in the financial statements referred to in
--------------
Section 4.6;

(d) Normal trade Indebtedness and relating to the acquisition of goods
and supplies other than any such Indebtedness not more than sixty (60) days past
due from the due date or any such Indebtedness being contested in good faith and
for which adequate reserves have been established and which shall not exceed in
the aggregate at any time $250,000;
-------

(e) Indebtedness secured by Permitted Encumbrances; and

(f) Other Indebtedness not to exceed $50,000 in the aggregate at any
time.

6.2. Contingent Liabilities. The Borrower shall not create, incur,
----------------------
assume, guarantee or remain liable with respect to any Guarantees other than the
following:

(a) Guarantees in favor of the Bank, or any of its or their affiliates;

<PAGE>

-23-

(b) Guarantees existing on the date of this Agreement and disclosed on
Exhibit 6.1(b) hereto or in the financial statements referred to in Section 4.6;
- --------------

(c) Guarantees resulting from the endorsement of negotiable instruments for
collection in the ordinary course of business;

(d) Guarantees with respect to surety, appeal performance and
return-of-money and other similar obligations incurred in the ordinary course of
business (exclusive of obligations for the payment of borrowed money); and

(e) Guarantees of normal trade debt relating to the acquisition of goods
and supplies.

6.3. Encumbrances. The Borrower shall not create, incur, assume or suffer
------------
to exist any mortgage, pledge, security interest, lien or other charge or
encumbrance, including the lien or retained security title of a conditional
vendor upon or with respect to any of its property or assets ("Encumbrances"),
------------
or assign or otherwise convey any right to receive income, including the sale or
discount of accounts receivable with or without recourse, except the following
("Permitted Encumbrances"):
----------------------

(a) Encumbrances in favor of the Bank, or any of the Bank's affiliates;

(b) Liens for taxes, fees, assessments and other governmental charges to
the extent that payment of the same may be postponed or is not required in
accordance with the provisions of Section 5.4;

(c) Landlords' and lessors' liens in respect of rent not in default or
liens in respect of pledges or deposits under workmen's compensation,
unemployment insurance, social security laws, or similar legislation (other
than ERISA) or in connection with appeal and similar bonds incidental to
litigation; mechanics', laborers' and materialmen's and similar liens, if the
obligations secured by such liens are not then delinquent; liens securing the
performance of bids, tenders, contracts (other than for the payment of money);
and statutory obligations incidental to the conduct of its business and that do
not in the aggregate materially detract from the value of its property or
materially impair the use thereof in the operation of its business;

(d) Judgment liens that shall not have been in existence for a period
longer than 60 days after the creation thereof or, if a stay of execution shall
have been obtained, for a period longer than 60 days after the expiration of
such stay;
<PAGE>

-24-

(e) Rights of lessors under capital leases; and

(f) Encumbrances in respect of any purchase money obligations for (i) any
equipment used in the business of the Borrower which at any time shall not
exceed $100,000 in the aggregate, and (ii) inventory supplied by a vendor who
has delivered to the Bank either (A) a Vendor Subordination Letter,
substantially in the form of Exhibit 6.3(f)(ii) hereto, or (B) if such vendor's
------------------
security interest in such inventory has not been perfected by the filing of a
Form-1 Uniform Commercial Code Financing Statement, a letter acknowledging that
notices, if any, given by such vendor to the Bank will be delivered to the
address specified in Section 9.1(d) hereof, provided that any such Encumbrance
-------- ----
shall not extend to property and assets not financed by such a purchase money
obligation.

6.4. Capital Expenditures. The Borrower shall not purchase or agree to
--------------------
purchase, or incur any obligations (including that portion of the obligations
arising under any capital lease that is required to be capitalized on the
balance sheet of the Borrower) for, any equipment or other property constituting
fixed assets of greater than $250,000, in the aggregate, during any fiscal year.

6.5. ERISA. Neither the Borrower nor any member of the Controlled Group
-----
shall permit any Plan maintained by it to (i) engage in any "prohibited
transaction" (as defined in Section 4975 of the Code, (ii) incur any
"accumulated funding deficiency" (as defined in Section 302 of ERISA) whether or
not waived, or (iii) terminate any Plan in a manner that could result in the
imposition of a lien or encumbrance on the assets of the Borrower pursuant to
Section 4068 of ERISA.

6.6. Merger; Consolidation; Sale or Lease of Assets. Other than as
----------------------------------------------
permitted by Section 7.2 of this Agreement, the Borrower shall not sell, lease
or otherwise dispose of assets or properties (valued at the lower of cost or
market), or liquidate, merge or consolidate into or with any other person or
entity.

6.7. Leases. The Borrower shall not, during any fiscal year, have aggregate
------
annual lease payments for real or personal property (whether or not such
payments are termed rent) in excess of $1,000,000.

6.8. Sale and Leaseback. Without the prior written consent of the Bank, the
------------------
Borrower shall not enter into any arrangement, directly or indirectly, whereby
it shall sell or transfer any property owned by it in order to lease such
property or lease other property that the Borrower intends to use for
substantially the same purpose as the property being sold or transferred.
<PAGE>

-25-

6.9. Investments. Without the prior written consent of the Bank, the
-----------
Borrower shall not make or maintain any Investments other than (i) Qualified
Investments; or (ii) Investments in any one entity for which the aggregate
purchase price does not exceed $200,000.

6.10. Change in Terms and Prepayment of Subordinated Indebtedness. The
-----------------------------------------------------------
Borrower shall not:

(a) effect or permit any change in or amendment to (i) the terms by which
any Subordinated Indebtedness purports to be subordinated to the payment or
performance of the Obligations, or (ii) the terms relating to the repayment of
any Subordinated Indebtedness; or

(b) directly or indirectly, make any payment of any principal of or in
redemption, retirement or repurchase of Subordinated Indebtedness, except
payments required by the instruments evidencing such Indebtedness.

6.11 Dividends and other Equity Distributions. The Borrower shall not pay
----------------------------------------
any dividends in excess of $150,000 during the calendar year ending December 31,
1992, and zero thereafter, on any class of its capital stock or make any other
distribution or payment on account of or in redemption, retirement or purchase
of such capital stock; provided that this Section shall not apply to (i) the
--------
issuance, delivery or distribution by the Borrower of shares of its common stock
pro rata to its shareholders and (ii) the purchase or redemption by the Borrower
of its capital stock with the proceeds of the issuance of additional shares of
capital stock.

SECTION VII

SECURITY AGREEMENT
------------------

7.1. Creation of Security Interest. As collateral security for the
-----------------------------
payment and performance in full of the Obligations, the Borrower hereby assigns
to the Bank all of its rights, title and interest in, and grants to the Bank a
continuing security interest in, the following personal property: all personal
property of the Borrower including without limitation, Accounts, Inventory,
Equipment and General Intangibles, whether such property is now owned or
existing or is owned, acquired, or arises hereafter, together with all goods,
instruments, documents of title, policies and certificates of insurance,
securities, chattel paper, deposits, cash or other property owned by or in which
it has an interest which are now or may hereafter be in the possession, custody
or control of the Bank or its assigns for any purpose, and any and all
additions, substitutions, replacements, accessions, Proceeds and products
thereof.

<PAGE>

-26-

7.2. Covenants Pertaining to Collateral. The Borrower covenants that:
----------------------------------
(a) Other than sales of Inventory or grants of licenses and other rights in
the ordinary course of the Borrower's business for cash or an open account and
on terms of payment ordinarily extended to its customers, the Borrower will not
grant, assign or transfer any interest in, or otherwise encumber, any of the
Collateral other than in favor of the Bank, or any of its affiliates, except as
otherwise permitted herein. So long as no Default has occurred and is
continuing, the Borrower may dispose of any Equipment which as become worn out,
obsolete, unnecessary or has been replaced by other Equipment or been
Temporarily removed for the purposes of repair. The Borrower shall defend the
Collateral against, and take any action reasonably necessary to remove any liens
or encumbrances other than those permitted hereunder and defend the right, title
and interest of the Bank in and to any of the Borrower's rights in the
Collateral.

(b) At the time any Account becomes subject to a security interest in favor
of the Bank, such Account shall be a valid, legal and binding obligation of the
account debtor named therein for goods sold or services theretofore performed by
the Borrower, enforceable in accordance with its terms (which terms shall be
expressly set forth on the face of the invoice applicable thereto).

(c) The Collateral shall remain personal property of the Borrower and shall
not be deemed to be a fixture irrespective of the manner of its attachment to
any real estate, and upon request by the Bank, the Borrower will deliver to the
Bank such disclaimer, waiver, or other document as the Bank requests, executed
by each person having an interest in such real estate.

(d) It will keep the Collateral in good order and repair, subject to
reasonable wear and tear, and will not use the same in violation of law or any
policy of insurance thereon, and will pay promptly when due all taxes and
assessments upon the Collateral or for its use or operation.

(e) It will apply for, and pursue diligently applications for, registration
of its ownership of the General Intangibles for which registration is
appropriate and will use other appropriate measures to preserve its rights in
other such General Intangibles.

(f) Except as disclosed in Exhibit 4.1 hereto, all tangible Collateral
-----------
shall be located at the chief executive office of the Borrower, and the Borrower
will not remove any part thereof (except in connection with dispositions
permitted under Section 7.2(a)) unless and until such time as written consent to
a change of location is obtained from the Bank. The
<PAGE>

-27-

Borrower's chief executive office and the place where its records concerning the
Collateral are kept is shown on the first page hereof, and the Borrower will not
change such chief executive office or remove such records without the express
prior written consent of the Bank, which consent shall not be unreasonably
withheld.

(g) At any time and from time to time, upon the written request of the
Bank, and at the sole expense of the Borrower, the Borrower will promptly and
duly execute and deliver any and all such further instruments and documents and
take such further actions as the Bank may reasonably deem desirable in obtaining
the full benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, the filing of any financing or continuation
statement under the Uniform Commercial Code in effect in any jurisdiction with
respect to the liens and security interests granted hereby, transferring
Collateral (other than Inventory and Accounts) to the Bank's possession, and
using its reasonable best efforts to obtain waivers from landlord's and
mortgagees, if necessary. The Borrower also hereby authorizes the Bank to file
any such financing or continuation statement without the signature of the Bank
to the extent permitted by applicable law. If any amount payable under or in
connection with any of the Collateral shall be or become evidenced by any
promissory note or other instrument, such note or instrument shall be
immediately pledged and delivered to the Bank, duly endorsed in a manner
satisfactory to it.

(h) The Borrower will not change its name, identity or corporate structure
in any manner which might make any financing or continuation statement filed
hereunder seriously misleading within the meaning of Section 9-402(7) of the
Uniform Commercial Code (or any other then applicable provision of the Code)
unless the Borrower shall have given the Bank at least 30 days prior written
notice thereof or shall have delivered to the Bank acknowledgement copies of
UCC-3 financing statements reflecting such change duly executed and duly filed
in each jurisdiction in which UCC-1 filings were required in order to perfect
the security interest granted by this Agreement in the Collateral and shall have
taken all action (or made arrangements to take such action concurrently with
such change if it is impossible to take such action in advance) necessary or
reasonably requested by the Bank to amend such financial statement or
continuation statement so that it is not seriously misleading.

7.3. Reports, etc. Pertaining to Collateral. The Borrower will:
--------------------------------------

(a) Schedule of Accounts. Deliver to the Bank on or before the date of
--------------------
the initial Loan hereunder and by the first Business Day following the end of
the last Business Day of each

<PAGE>

-28-

week, and at such other intervals and for such periods as the Bank may request,
a schedule of receivables which

(i) shall be reconciled to the Borrowing Base Certificate as of such last
Business Day,

(ii) shall set forth a detailed aged trial balance of all its then
existing Accounts, specifying the names, addresses and balance due for each
account debtor obligated on an Account so listed, and

(iii) shall set forth a detailed report of balances due from and rebates
owing to account debtors, specifying the names and addresses of each
account debtor, the balance due on each account debtor's Account and the
amount of any rebate owned to that account debtor in the ordinary course of
the Borrower's business.

(b) Schedule of Inventory. Deliver to the Bank on or before the date of
---------------------
the initial Loan hereunder and by the 15th day of each month a schedule of
inventory as of the last Business Day of the immediately preceding monthly
account period of the Borrower and at such other intervals and for such periods
as the Bank may request, itemizing and describing the kind, type and quantity of
Inventory and location and the Borrower's cost thereof.

(c) Borrowing Base Certificate. Concurrently with the delivery of the
--------------------------
schedules required by subsections 7.3(a) and (b) deliver to the Bank a Borrowing
Base Certificate, substantially in the form of Exhibit 7.3(c) hereto, prepared
as of the close of business on the last Business Day of the period covered by
such schedules.

(d) Collateral Values. Promptly notify the Bank of any information
-----------------
received by the Borrower relative to any of the Collateral including the
Accounts, the account debtors, or other persons obligated in connection
therewith, which may in any way affect adversely the value of any of its
property or the rights and remedies of the Bank in respect thereto;

(e) Account Debtor Insolvency. Promptly notify the Bank when it obtains
-------------------------
knowledge of actual or imminent bankruptcy or other insolvency proceeding of any
account debtor owing an aggregate of $100,000 or more to the Borrower;

(f) Sales and Shipping Information. Deliver to the Bank, as the Bank may
------------------------------
from time to time require, delivery receipts, customer's purchase orders,
shipping instructions, bills of lading and any other evidence of shipping
arrangements; and

(g) Notice of Diminution in Value. Immediately notify the Bank of any
-----------------------------
return or adjustment in excess of $100,000,
<PAGE>

-29-

rejection, repossession and loss or damage of or to merchandise represented by
the Accounts or constituting Inventory, and of any credit adjustment or dispute
arising in connection with the goods or services represented by the Accounts or
constituting Inventory, and the Borrowing Base shall be adjusted accordingly.

7.4. Collection of Accounts and Adjustments. Until the Bank exercises its
--------------------------------------
rights to collect the Accounts pursuant to Sections 7.6 or 7.7, the Borrower
will collect with diligence all of its Accounts, and may continue its present
policies with respect to adjustments.

7.5. Bank's Rights in Collateral. (a) After the occurrence of an Event
---------------------------
of Default and so long as such an Event of Default is continuing, with respect
to any Accounts, (i) the Borrower shall, at the request of the Bank, notify
account debtors of the security interest of the Bank in any Account and that
payment thereof is to be made directly to the Bank, and (ii) the Bank itself
may, without notice to or demand upon the Borrower, so notify account debtors.
The giving of such notification shall not affect the duties of the Borrower,
described below with respect to proceeds of collections of Accounts received by
the Borrower. Until such notice by the Bank, any such collection of Accounts,
whether in the form of cash, checks, notes, or other instruments for the payment
of money (properly endorsed or assigned where required to enable the Bank to
collect same), shall be in trust for the Bank, and the Borrower shall deliver
said collections daily to the Bank, or to such bank as may be approved by the
Bank for deposit to an agency account governed by the terms of an agency account
agreement with such bank, substantially in the form of Exhibit 7.5 attached
-----------
hereto, in the identical form received. The Bank shall credit the proceeds of
collection of Accounts received by the Bank to the Loan Account, such credits to
be entered as soon as practicable upon receipt and in any event within one
Business Day after receipt thereof by the Bank. Such credits shall be
conditional upon final payment in cash or solvent credits of the items giving
rise to them. If any item is not so paid, the Bank, in its discretion, whether
or not the item is returned, may either reverse any credit given for the item or
debit the amount of the item from the deposits or other sums which may be due to
the Borrower from the Bank. Upon elimination of any debit balance of the Loan
Account, proceeds of collection and other receipts may then be credited to any
deposit account which the Borrower may maintain with the Bank, or, if there is
no such account, held pending instructions from the Borrower. After the
occurrence of an Event of Default and with respect to any Accounts, the Bank
may, at its option and at any time, whether or not the Obligations are due,
without notice or demand on the Borrower (i) demand, collect, receipt for,
settle, compromise, adjust, give discharges and releases, all as the Bank may
reasonably determine; (ii) commence and prosecute any actions in any court for
the purposes of collecting any such Accounts and enforcing any other rights in
<PAGE>

-30-

respect thereof; (iii) defend, settle or compromise any action brought and, in
connection therewith, give such discharge or release as the Bank may deem
appropriate; (iv) receive, open and dispose of mail addressed to the Borrower
and endorse checks, notes, drafts, acceptances, money orders, or other
instruments or documents evidencing payment, on behalf of and in the name of the
Borrower, or securing, or relating to such Accounts; and (v) sell, assign,
transfer, make any agreement in respect of, or otherwise deal with or exercise
rights in respect of, any such Accounts or the services which have given rise
thereto, as fully and completely as though the Bank were the absolute owners
thereof for all purposes. In taking any action hereunder with respect to the
Collateral, the Bank agrees to use its best efforts to act in a commercially
reasonable manner.

(b) After the occurrence of an Event of Default and so long as any such
Event of Default is continuing, with respect to any Inventory and Equipment,
make, adjust and settle claims under any insurance policy related thereto.

(c) In addition to the remedies provided for herein or otherwise available
to the Bank, the Bank is hereby granted a license or other right to use, without
charge, the Borrower's labels, patents, copyrights, rights of use of any name,
trade secrets, trade names, trademarks and advertising matter, or any property
of a similar nature, as it pertains to the Collateral, in completing production
of, advertising for sale and selling any Collateral and the Borrower's rights
under all licenses and all franchise agreements shall inure to the Bank's
benefit. The Bank shall not exercise any rights provided by this Section 7.5(c)
unless an Event of Default has occurred and is continuing.

Except as otherwise provided herein, the Bank shall have no duty as to the
collection or protection of the Collateral nor as to the preservation of any
rights pertaining thereto.

7.6. Remedies. (a) In any jurisdiction where enforcement of rights
--------
hereunder is sought, the Bank shall have, in addition to all other rights and
remedies, the rights and remedies of a secured party under the applicable
Uniform Commercial Code. Upon the occurrence of an Event of Default or at any
time thereafter (such defaults not having been previously cured to the
reasonable satisfaction of the Bank) and so long as any part of the Obligations
remains unpaid or unperformed, the Bank may, at its option, without notice or
demand, declare all of the Obligations to be immediately due and payable and
take immediate possession of the Collateral, and for that purpose enter upon any
premises on which any of the Collateral is situated and remove the same
therefrom or remain on such premises and in possession of such Collateral for
purposes of conducting a sale or enforcing the rights of the Bank under

<PAGE>

this Agreement. The Borrower will, upon demand, make the Collateral available to
the Bank at a place and time designated by the Bank which is reasonably
convenient. After the occurrence of an Event of Default the Bank may collect and
receive all income and proceeds in respect of the Collateral, exercise all
rights of the Borrower with respect thereto, and apply the Collateral and any
and all income and proceeds received by it hereunder to the payment of all
Obligations to the Bank. The Bank may sell, lease or otherwise dispose of the
Collateral at a public or private sale, with or without having the Collateral at
the place of sale, and upon terms and in such manner as the Bank may determine,
and the Bank may purchase any Collateral at any such sale. Unless the Collateral
threatens to decline rapidly in value or is of the type customarily sold on a
recognized market, the Bank shall give to the Borrower at least ten business
days' prior written notice of the time and place of any public sale of the
Collateral or of the time after which any private sales or any other intended
disposition thereof is to be made.

(b) Prior to any disposition of Collateral pursuant to this Agreement, the
Bank may, at its option, cause any of the Collateral to be repaired,
reconditioned, but not upgraded unless mutually agreed, in such manner and to
such extent as to make saleable, and any reasonable sums expended therefor by
the Bank shall be repaid by the Borrower and become part of the Obligations
secured hereby; the Bank shall have the right to enforce one or more remedies
hereunder successively or concurrently, and any such action shall not stop or
prevent the Bank from pursuing any further remedy which it may have hereunder or
by law.

(c) The Bank shall be entitled to retain and to apply the proceeds of such
sale to: (i) all sums secured hereby; and (ii) its reasonable expenses of
retaking, holding, protecting and maintaining, and preparing for sale and
selling the Collateral, together with interest on such expenses at the rate
specified in, and in accordance with, Section 2.11 of this Agreement, including
reasonable attorney's fees and other legal expenses incurred by it in connection
therewith. If a sufficient sum is not realized from any such disposition of
Collateral to pay all Obligations secured by this Agreement, the Borrower hereby
promises and agrees to pay to the Bank any deficiency.

(d) The Bank shall have the right to enforce one or more remedies
hereunder successively or concurrently, and any further remedy which it may have
hereunder or by law.

7.7. Waivers. Except as otherwise provided herein, the Borrower waives
-------
demand, notice, protest, notice of acceptance of this Agreement, notice of loans
made, credit extended, Collateral received or delivered or other action taken in

<PAGE>

-32-

reliance hereon and all other demands and notice of any description. With
respect to both the Obligations and the Collateral, the Borrower assents to any
extension or postponement of the time of payment or any other forgiveness or
indulgence, to any substitution, exchange or release of Collateral, to the
addition or release of any party or person primarily or secondarily liable, to
the acceptance of partial payment thereon and the settlement, compromising or
adjusting of any thereof, all in such manner and at such time or times as the
Bank may deem advisable. The Bank may exercise any rights with respect to the
Collateral without resorting, or regard, to other collateral or sources of
reimbursement for the Obligations.

SECTION VIII

DEFAULTS
--------

8.1. Events of Default. There shall be an Event of Default hereunder if
-----------------
any of the following events occurs:

(a) The Borrower shall fail to pay when due (i) any amount of principal of
or interest on any Loans, or (ii) any fees or expenses payable hereunder within
five Business Days of the due date therefor; or

(b) The Borrower shall fail to perform any term, covenant or agreement
contained in Sections 5.1(f), 5.5, 5.7 through 5.9 or 6.1 through 6.5; or

(c) The Borrower shall fail to perform any covenant contained in Sections
5.1(e), 5.1(g) or 5.2, and such failure shall continue for 30 days; or

(d) The Borrower shall fail to perform any term, covenant or agreement
(other than in respect of subsections 8.1(a) through (c) hereof) contained in
this Agreement and such default shall continue for 30 days after notice thereof
has been received by the Borrower from the Bank; or

(e) Any representation or warranty of the Borrower made in this Agreement
or any other documents or agreements executed in connection with the
transactions contemplated by this Agreement or in any certificate delivered
hereunder shall prove to have been false in any material respect upon the date
when made or deemed to have been made; or

(f) There shall occur any material adverse change in the assets,
liabilities, financial condition, business or prospects of the Borrower, as
determined by the Bank acting in good faith which shall be in existence for
thirty (30) days after

<PAGE>

-33-

notification by the Bank to the Borrower of such material adverse change; or

(g) The Borrower shall fail to pay at maturity, or within any applicable
period of grace, any Indebtedness or fail to observe or perform any term,
covenant or agreement evidencing or securing such Indebtedness, the result of
which failure is to permit the holder or holders of such Indebtedness to cause
such Indebtedness to become due prior to its stated maturity; or

(h) The Borrower shall (i) apply for or consent to the appointment of, or
the taking of possession by, a receiver, custodian, trustee, liquidator or
similar official of itself or of all or a substantial part of its property, (ii)
be generally not paying its debts as such debts become due, (iii) make a general
assignment for the benefit of its creditors, (iv) commence a voluntary case
under the Federal Bankruptcy Code (as now or hereafter in effect), (v) take any
action or commence any case or proceeding under any law relating to bankruptcy,
insolvency, reorganization, winding-up or composition or adjustment of debts, or
any other law providing for the relief of debtors, (vi) fail to contest in a
timely or appropriate manner, or acquiesce in writing to, any petition filed
against it in an involuntary case under such Bankruptcy Code or other law, (vii)
take any action under the laws of its jurisdiction of incorporation or
organization similar to any of the foregoing, or (viii) take any corporate
action for the purpose of effecting any of the foregoing; or

(i) A proceeding or case shall be commenced, without the application or
consent of the Borrower in any court of competent jurisdiction, seeking (i) the
liquidation, reorganization, dissolution, winding up, or composition or
readjustment of its debts, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of it or of all or any substantial part of its
assets, or (iii) similar relief in respect of it, under any law relating to
bankruptcy, insolvency, reorganization, winding-up or composition or adjustment
of debts or any other law providing for the relief of debtors, and such
proceeding or case shall continue undismissed, or unstayed and in effect, for a
period of 30 days; or an order for relief shall be entered in an involuntary
case under such Bankruptcy Code, against the Borrower or action under the laws
of the jurisdiction of incorporation or organization of the Borrower similar to
any of the foregoing shall be taken with respect to the Borrower and shall
continue unstayed and in effect for any period of 60 days; or

(j) A judgment or order for the payment of money not covered by insurance
shall be entered against the Borrower by any court, or a warrant of attachment
or execution or similar process shall be issued or levied against property of
the

<PAGE>

-34-

Borrower, which in the aggregate exceeds $200,000 in value and such judgment,
order, warrant or process shall continue undischarged or unstayed for 60 days;
or

(k) The Borrower or any member of the Controlled Group shall fail to pay
when due any amount which it shall have become liable to pay to the PBGC or to a
Plan under Title IV of ERISA; or notice of intent to terminate a Plan or Plans
shall be filed under Title IV of ERISA by the Borrowers, any member of the
Controlled Group, any plan administrator or any combination of the foregoing; or
the PBGC shall institute proceedings under Title IV of ERISA to terminate or to
cause a trustee to be appointed to administer any such Plan or Plans or a
proceeding shall be instituted by a fiduciary of any such Plan or Plans against
the Borrower and such proceedings shall not have been dismissed within 60 days
thereafter; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any such Plan or Plans must be
terminated.

8.2. Remedies. Upon the occurrence of an Event of Default described in
--------
subsections 8.1(h) and (i), immediately and automatically, and upon the
occurrence of any other Event of Default, at any time thereafter while such
Event of Default is continuing, at the Bank's option and upon the Bank's
declaration:

(a) The Bank's commitment to make any further Loans hereunder shall
terminate;

(b) The unpaid principal amount of the Loans together with accrued
interest and all other Obligations shall become immediately due and payable
without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived; and

(c) The Bank may exercise any and all rights it has under this Agreement
or any other documents or agreements executed in connection herewith, or at law
or in equity, and proceed to protect and enforce the Bank's rights by any action
at law, in equity or other appropriate proceeding.

SECTION IX

MISCELLANEOUS
-------------

9.1. Notices. All notices, requests and demands to or upon the Borrower
-------
or the Bank shall be deemed to have been duly given or made: if by telecopy,
telex, telegram or by hand, immediately upon sending or delivery; if by any
overnight delivery service, one (1) day after dispatch; and if mailed by
certified mail, return receipt requested, five (5) days after
<PAGE>

-35-

mailing. All notices, requests and demands are to be given or made to the
respective parties at the following addresses (or to such other address as any
party may designate by notice in accordance with this Section):

(a) If to the Borrower:

Ross White Enterprises, Inc., d/b/a
National Computer Distributors
3401-C N.W. 72nd Avenue
Miami, Florida 33132
Attention: Gregory A. White
Telephone: (305) 477-9019
Telecopier: (305) 599-1511

(b) with a copy to

Lee Capital Holdings
One International Place, Suite 4301
Boston, MA 02110
Attention: Jonathan O. Lee
Telephone: (617) 345-0477
Telecopier: (617) 345-0478

The First National Bank of Boston
100 Federal Street
Boston, MA 02110
Attention: William C. Purinton
Vice President
Asset Based Lending, 01-22-08
Telephone: (617) 434-8856
Telecopier: (617) 434-1188

(d) With a copy to:

The First National Bank of Boston
400 Perimeter Center Terrace
Suite 745
Atlanta, Georgia 30346
Attention: William D. Kearney
Vice President
Telephone: (404) 393-4676
Telecopier: (404) 393-4166

9.2. Expenses. The Borrower shall, on demand, pay or reimburse the Bank
---------
for all reasonable expenses (including attorneys' fees of outside counsel or
allocation costs of in-house counsel) incurred or paid by the Bank in connection
with the preparation, negotiation and closing of this Agreement (whether or not
the transactions contemplated hereby shall be consummated) and all reasonable
expenses (including attorneys'

<PAGE>

-36-

fees of outside counsel or allocation costs of in-house counsel) incurred or
paid by the Bank in connection with the administration or amendment of this
Agreement (whether or not the transactions contemplated hereby shall be
consummated) and with the enforcement of any Obligation of the Borrower or
exercise of any right of the Bank hereunder. The Borrower shall, on demand, pay
or reimburse the Bank for all expenses (including the allocation costs of the
Bank's employees) incurred in connection with the commercial finance
examinations of the Borrower's operations conducted by the Bank.

9.3. Set-Off. Regardless of the adequacy of the Collateral, any deposits
-------
or other sums, at any time credited by or due from the Bank to the Borrower may
at any time be applied to or set off against Obligations on which the Borrower
is primarily liable and may at or after the maturity thereof be applied to or
set off against Obligations on which the Borrower is secondarily liable.

9.4. Term of Agreement. This Agreement shall continue in force and effect
-----------------
so long as the Bank has any commitment to make Loans hereunder or any Loan or
any Obligation hereunder shall be outstanding.

9.5. No Waivers. No failure or delay by the Bank in exercising any right,
----------
power or privilege hereunder or under any other documents or agreements executed
in connection herewith shall operate as a waiver thereof; nor shall any single
or partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and remedies
herein provided are cumulative and not exclusive of any rights or remedies
otherwise provided by law.

9.6. Governing Law. This Agreement shall be deemed to be a contract made
-------------
under seal and shall be construed in accordance with and governed by the laws of
The Commonwealth of Massachusetts (without giving effect to any conflicts of
laws provisions contained therein).

9.7. Amendments. Neither this Agreement nor any provision hereof or
----------
thereof may be amended, waived, discharged or terminated except by a written
instrument signed by the Bank and, in the case of amendments, by the Borrower.

9.8. Binding Effect of Agreement. This Agreement shall be binding upon
---------------------------
and inure to the benefit of the Borrower and the Bank and their respective
successors and assigns; provided that the Borrower may not assign or transfer
its rights hereunder. The Bank may assign all of its rights and obligations
hereunder without the consent of the Borrower. The Bank may sell, transfer or
grant participations in the Loan without the prior written consent of the
Borrower and the Borrower agrees that
<PAGE>

-37-

any transferee or participant shall be entitled to the benefits of Sections 2.8,
2.11, 5.5, 9.2 and 9.3 to the same extent as if such transferee or participant
were the Bank hereunder; provided that notwithstanding any such transfer or
participation, the Borrower may, for all purposes of this Agreement, treat the
Bank as the person entitled to exercise all rights hereunder and to receive all
payments with respect thereto.

9.9. Counterparts. This Agreement may be signed in any number of
------------
counterparts with the same effect as if the signatures hereto and thereto were
upon the same instrument.

9.10. Severability. The invalidity or unenforceability of any one or more
------------
phrases, clauses or sections of this Agreement shall not affect the validity or
enforceability of the remaining portions of it.

9.11. Captions. The captions and headings of the various sections and
--------
subsections of this Agreement are provided for convenience only and shall not be
construed to modify the meaning of such sections or subsections.

9.12. Entire Agreement. This Agreement and the documents and agreements
----------------
executed in connection herewith constitute the final agreement of the parties
hereto and supersede any prior agreement or understanding, written or oral, with
respect to the matters contained herein and therein.

9.13. JURY WAIVER. EACH OF THE BORROWER AND THE BANK AGREE THAT NEITHER
-----------
OF THEM, NOR ANY ASSIGNEE OR SUCCESSOR SHALL (A) SEEK A JURY TRIAL IN ANY
LAWSUIT, PROCEEDING, COUNTERCLAIM, OR ANY OTHER ACTION BASED UPON, OR ARISING
OUT OF, THIS AGREEMENT, ANY RELATED INSTRUMENTS, ANY COLLATERAL OR THE DEALINGS
OR THE RELATIONSHIP BETWEEN OR AMONG ANY OF THEM, OR (B) SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE
BORROWER AND THE BANK, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS.
NEITHER THE BORROWER NOR THE BANK HAS AGREED WITH OR REPRESENTED TO THE OTHER
THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL
INSTANCES.
<PAGE>

-38-

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

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

[SIGNATURE APPEARS HERE] By: [SIGNATURE APPEARS HERE]
- ------------------------ -------------------------------
Witness Title: President

[Seal]

Executed At: Boston, Mass.
----------------------

THE FIRST NATIONAL BANK OF BOSTON

[SIGNATURE APPEARS HERE] By: [SIGNATURE APPEARS HERE]
- ------------------------ -------------------------------
Witness Its Authorized Officer

[Seal]

Executed At: Boston MA
----------------------

<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 1

DATED AS OF NOVEMBER 2, 1992

THIS AMENDMENT (this "Amendment") is entered into as of November 2, 1992 by
and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS,
a Florida corporation having an address at 6100 Hollywood Boulevard, Hollywood,
Florida 33024 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON, a
national banking association with its head office at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank").

Preliminary Statement. The parties have entered into a Revolving Credit
----------------------
Agreement dated as of April 27, 1992 (the "Agreement") providing for the
maintenance by the Borrower of certain financial operating ratios. The Borrower
has delivered financial statements and other reports to the Bank reflecting
increases in sales beyond that previously projected and has requested that
certain of these ratios be amended to allow the Borrower to borrow against the
additional accounts receivable arising from these sales. In exchange for the
Borrower's agreement to lower the inventory cap under the Agreement, the Bank
has agreed to the Borrower's request subject to the Borrower's execution and
delivery of this amendment.

Upon and after the date of this Amendment all references to the Agreement
in that document, or in any related document, shall mean the Agreement as
amended by this Amendment. Except as expressly provided in this Amendment, the
execution and delivery of this Amendment does not and will not amend, modify or
supplement any provision of, or constitute a consent to or a waiver of any
noncompliance with the provisions of the Agreement, and, except as specifically
provided in this Amendment, the Agreement shall remain in full force and effect.
All capitalized terms not otherwise defined herein shall have the meanings
ascribed to them in the Agreement.
<PAGE>

-2-

In consideration of the foregoing premises and the mutual benefits to be
derived by the Borrower and the Bank from a continuing relationship under the
Agreement and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, each of the Borrower and the Bank
agrees that the Agreement is hereby amended as follows:

1. The defined term "Borrowing Base" appearing in Section I of the
Agreement is hereby amended in its entirety to read as follows:

2. Exhibit 7.3(c) to the Agreement, the form of Borrowing Base Certificate
required to be delivered to the Bank by the Borrower pursuant to Section 7.3(c)
of the Agreement, is hereby deleted from the Agreement and the form attached
hereto as Schedule A to this Amendment is hereby substituted in its stead.
----------

3. Section 5.9 of the Agreement is hereby amended in its entirety to read
as follows:

5.9. Leverage Ratio. The Borrower shall maintain a ratio of (i) Total
--------------
Liabilities less Subordinated Indebtedness to (ii) Total Capital Funds of
not more than 5.75:1 for the period commencing November 1, 1992 and ending
December 31, 1992 and 6:1 thereafter.

4. Section 5.10 of the Agreement is hereby amended in its entirety to read
as follows:

<PAGE>

-3-

All parts of the Agreement not affected by this Amendment are hereby
ratified and affirmed in all respects, provided that if any provision of the
-------- ----
Agreement shall conflict or be inconsistent with this Amendment, the terms of
this Amendment shall supersede and prevail.

IN WITNESS WHEREOF, each of the Borrower and the Bank in accordance with
Section 9.7 of the Agreement, has caused this Amendment to be executed and
delivered by their respective duly authorized officers as of the date set forth
in the preamble on page one of this Amendment.

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

By: (SIGNATURE APPEARS HERE)
--------------------------------
Title: President
-----------------------------
[Seal]

THE FIRST NATIONAL BANK OF BOSTON

By: (SIGNATURE APPEARS HERE)
--------------------------------
Title: Vice President
-----------------------------
Signed at: Boston, MA
-------------------------

[Seal]

<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 2

DATED AS OF APRIL 19, 1993

THIS AMENDMENT (this "Amendment") is entered into as of April 16, 1993 by
and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS,
a Florida corporation having an address at 6100 Hollywood Boulevard, Hollywood,
Florida 33024 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON, a
national banking association with its head office at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank").

Preliminary Statement. The parties have entered into a Revolving Credit
----------------------
Agreement dated as of April 27, 1992, as previously amended by Amendment No. 1
dated November 2, 1992 and by a letter agreement dated March 18, 1993 (the
"Agreement"). Under the terms of the Agreement, as presently in effect, the
Borrower's Maximum Commitment of $13,500,000 will expire on April 30, 1993. The
Borrower has delivered its financial statements for the period ending March 31,
1993 and revised cash flow projections for the twelve month period ending March
31, 1994 and requested that the Bank increase the Maximum Commitment and
reinstate the original Termination Date of April 30, 1994. The Bank has agreed
to the Borrower's requests subject to the Borrower's execution and delivery of
this amendment.

In consideration of the foregoing premises and the mutual benefits to be
derived by the Borrower and the Bank from a continuing relationship under the
Agreement and for other good

-2-

<PAGE>

-2-

and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, each of the Borrower and the Bank agrees that the Agreement is
hereby amended as follows:

1. The following defined terms appearing in Section I of the Agreement are
hereby amended in their entirety to read as follows:

Borrowing Base. An amount equal to the lesser of (x) $15,000,000 or (y)
--------------
the sum of (i) 85% of the face value of Eligible Accounts due and owing at
such time, plus (ii) the least of (A) 50% of Eligible Inventory, (B)
----
$12,000,000 and (C) the amount available under subset (y)(i) of this
definition, minus (from the sum of (i) and (ii)) $500,000.
-----

Maximum Commitment. $15,000,000.
------------------

Termination Date. April 30, 1994.
----------------

3. Section 5.1(b) of the Agreement is hereby amended in its entirety to
read as follows:

(b) as soon as available, but in any event within 15 days after the end of
each month, a balance sheet as of the end of, and a related statement of

income for, the month then ended;

4. Section 5.7 of the Agreement is hereby amended in its entirety to read
as follows:

5.7. Ratio of EBIT to Interest Expense. As of the last day of each month,
---------------------------------
the Borrower shall have a ratio of (a) EBIT to (b) total interest expense
(excluding imputed interest arising from accretion of debt discount on the
Subordinated Indebtedness issued under the Purchase Agreement) of not less
than 2:1.

This Amendment is executed as an instrument under seal and shall be
governed by the construed in accordance with the laws of The Commonwealth of
Massachusetts without regard to its conflicts of law rules.
<PAGE>

-3-

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

By: [SIGNATURE APPEARS HERE]
-----------------------------
Title: President
--------------------------
[Seal]

THE FIRST NATIONAL BANK OF BOSTON

By:
------------------------------
Title:
---------------------------
Signed at:
[Seal] -----------------------

<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 3

THIS AMENDMENT (this "Amendment") is entered into as of May 26, 1993 by and
between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS, a
Florida corporation having an address at 6100 Hollywood Boulevard, Hollywood,
Florida 33024 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON, a
national banking association with its head office at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank").

In consideration of the foregoing premises and the mutual benefits to be
derived by the Borrower and the Bank from a continuing relationship under the
Agreement and for other good and
<PAGE>

valuable consideration, the receipt and adequacy of which are hereby
acknowledged, each of the Borrower and the Bank agrees that the Agreement is
hereby amended as follows:

1. The following defined terms appearing in Section I of the Agreement are
hereby amended in their entirety to read as follows:

Borrowing Base. An amount equal to the lesser of (x) $20,000,000 or (y) the
--------------
sum of (i) 85% of the face value of Eligible Accounts due and owing at such
time, plus (ii) the least of (A) 50% of Eligible Inventory, (B) $12,000,000
----
and (C) the amount available under subset (y)(i) of this definition, minus
-----
(from the sum of (i) and (ii)) $500,000, or if on the date of any
determination, the amount available hereunder shall exceed $17,500,000,
$750,000.

Maximum Commitment. $20,000,000.
------------------

2. Sections 5.7 through 5.10 of the Agreement are hereby amended in their
entirety to read as follows:

5.7. Ratio of EBIT to Interest Expense. As of May 31, 1993 for the two
---------------------------------
month period then ending, and June 30, 1993 for the three month period then
ending, and thereafter as of the last day of each fiscal quarter, the
Borrower shall have a ratio of (a) EBIT to (b) total interest expense
(excluding imputed interest arising from accretion of debt discount on the
Subordinated Indebtedness issued under the Purchase Agreement) of not less
than 1.5:1 with respect to any such period on the last day of which the
balance of the Loan Account is less than $17,500,000, and 1.75:1 for all
other such periods.

5.8. Minimum Total Capital Funds. The Borrower shall maintain Total
---------------------------
Capital Funds of not less than the amounts set forth below for the periods
specified:

<TABLE>
<CAPTION>
Period Amount
------ ------
<S> <C>
May 26, 1993 - June 29, 1993.............................. $3,800,000
June 30, 1993 - September 29, 1993........................ $3,900,000
September 30, 1993 - December 30, 1993.................... $4,050,000
December 31, 1993 - March 30, 1994........................ $4,250,000
March 31, 1994 and thereafter............................. $4,525,000
</TABLE>

5.9. Leverage Ratio. The Borrower shall maintain a ratio of (i) Total
--------------
Liabilities less Subordinated Indebtedness to (ii) Total Capital Funds of
not more than 7:1.

-2-
<PAGE>

3. Section 5.11 of the Agreement is hereby renumbered as Section 5.12 and
the following new Section 5.11 is added to the Agreement:

5.11. Accounts Payable Average Turnover. As at the end of each of the
---------------------------------
Borrower's fiscal months, the quotient of the Borrower's cost of goods sold
divided by the Borrower's accounts payable arising from the sale of finished
goods to the Borrower when divided into the number "31" shall equal "25" or
less.

4. Exhibit 7.3(c) to the Agreement, the form of Borrowing Base Certificate
required to be delivered to the Bank by the Borrower pursuant to Section 7.3(c)
of the Agreement, is hereby deleted from the Agreement and the form attached
hereto as Schedule A to this Amendment is hereby substituted in its stead.
----------

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

By: (SIGNATURE APPEARS HERE)
----------------------------------
Title: President
-------------------------------
[Seal]

THE FIRST NATIONAL BANK OF BOSTON

By: (SIGNATURE APPEARS HERE)
----------------------------------
Title: Vice President
-------------------------------
Signed at: Boston, MA
---------------------------

[Seal]

-3-

<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 4

THIS AMENDMENT (this "Amendment") is entered into as of October 15, 1993
by and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER
DISTRIBUTORS, a Florida corporation having an address at 6100 Hollywood
Boulevard, Hollywood, Florida 33024 (the "Borrower"), and THE FIRST NATIONAL
BANK OF BOSTON, a national banking association with its head office at 100
Federal Street, Boston, Massachusetts 02110 (the "Bank").

Preliminary Statement. The parties have entered into a Revolving Credit
---------------------
Agreement dated as of April 27, 1992, as previously amended by Amendment No. 1
dated november 2, 1992, by a letter agreement dated March 18, 1993, by Amendment
No. 2 dated as of May 26, 1993 and by Amendment No. 3 dated as of May 26, 1993,
(the "Agreement"). Under the terms of the Agreement, the Borrower has a Maximum
Commitment of $20,000,000 which expires on April 30, 1994. The Borrower has
delivered its financial statements for its most recent fiscal period ending
September 30, 1993 and requested that the Bank increase the Maximum Commitment
under the Agreement, extend the expiration date, and make certain other
modifications to the Agreement. The Bank has agreed to the Borrower's requests
subject to the Borrower's execution and delivery of this amendment.

In consideration of the foregoing premises and the mutual benefits to be
derived by the Borrower and the bank from a continuing relationship under the
Agreement and for other good and valuable consideration, the receipt and
adequacy of which are
<PAGE>

hereby acknowledged, each of the Borrower and the Bank agrees that the Agreement
is hereby amended as follows:

1. The following defined terms appearing in Section I of the Agreement are
hereby amended in their entirety to read as follows:

Borrowing Base. An amount equal to the lesser of (x) $25,000,000 or (y)
--------------
the sum of (i) 85% of the face value of Eligible Accounts due and owing at
such time, plus (ii) the least of (A) 50% of Eligible Inventory, (B)
----
$12,000,000 and (C) the amount available under subset (y)(i) of this
definition, minus (from the sum of (i) and (ii)) the amount specified
-----
below for the range of availability hereunder calculated as of the date of
any determination:

Loan Availability Amount
----------------- ------

Under $17,500,000 ........................ $500,000
$17,500,000 - $20,000,000 ................ $750,000
$Over $20,000,000 ........................ $1,000,000

Maximum Commitment. $25,000,000.
------------------

Termination Date. July 31, 1994.
----------------

2. Section 5.8 of the Agreement is hereby amended in its entirety to read
as follows:

5.8. Minimum Total Capital Funds. The Borrower shall maintain Total
---------------------------
Capital Funds of not less than the amounts set forth below for the periods
specified:

Period Amount
------ ------

September 30, 1993 - December 30, 1993 ....... $4,200,000
December 31, 1993 - March 30, 1994 ........... $4,600,000
March 31, 1994 and thereafter ................ $5,000,000

3. Section 9.2 of the Agreement is hereby amended in its entirety to read
as follows:

9.2 Expenses. The Borrower shall, on demand, pay or reimburse the Bank
--------
for all reasonable expenses (including attorneys' fees of outside counsel or
allocation costs of in-house counsel) incurred or paid by the Bank or any
Assignee, as defined in Section 9.14 of this Agreement, in connection with this
Agreement, any amendments thereof (including without limitation the amended and
restated form of this

-2-
<PAGE>

Agreement contemplated by Section 9.14 of this Agreement), the Bank's
administration of this Agreement (including without limitation any waivers,
approvals and consents relating thereto), its enforcement of any
Obligation, and the exercise of any rights of the Bank hereunder. The
Borrower shall, on demand, also pay or reimburse the Bank for all expenses
(including without limitation the allocation costs of the Bank's employees)
incurred in connection with the commercial finance examinations of the
Borrower's operations conducted by the Bank.

4. The Agreement is hereby further amended by the addition of the
following new Section 9.14:

9.14. Assignments and Participations.
------------------------------

(a) Assignments. The Bank may at any time assign all, or a portion,
-----------
of its rights, interests and duties with respect to its commitment to make
Loans hereunder to one or more banks or other financial institutions, or
any affiliate thereof, (each, an "Assignee") on such terms, as between the
Bank and each Assignee, as the Bank may deem appropriate, and such Assignee
shall assume such rights, interests and duties pursuant to an instrument
executed by such Assignee and the Bank, or, in the case of a partial
assignment by the Bank, pursuant to an amended and restated form of this
Agreement, and for this purpose the Bank may make available to each of its
potential Assignees such information relating to the Borrower, this
Agreement and the transactions contemplated hereby as the Bank may deem
necessary or desirable. Upon notice to the Borrower of an assignment in
full of the Bank's rights, interests and duties hereunder to an Assignee,
such Assignee shall have all the rights, interests and duties of the Bank
hereunder with a commitment to make Loans as set forth in herein, and the
Bank shall be released from its obligations hereunder in full without the
requirement of any further consent or action by the Borrower.

(b) Participations. In addition to its rights to assign all or any
--------------
portion of its commitment hereunder pursuant to the foregoing subsection
(a) of this Section 9.14, the Bank may sell participations in the Loans to
one or more banks or other financial institutions, or any affiliate
thereof, on such terms as the Bank may deem appropriate, and for this
purpose the Bank may make available to each potential participant such
information relating to the Borrower, this Agreement and the transactions
contemplated hereby as the Bank may deem necessary or desirable.

-3-

<PAGE>

5. Exhibit 7.3(c) to the Agreement, the form of Borrowing Base Certificate
required to be delivered to the Bank by the Borrower pursuant to Section 7.3(c)
of the Agreement, is hereby deleted from the Agreement and the form attached
hereto as Schedule A to this Amendment is hereby substituted in its stead.
----------

6. Conditions Precedent to Effectiveness of this Amendment. This
-------------------------------------------------------
Amendment shall take effect on the date of receipt by the Bank of the last item
specified below (other than any item the delivery of which is expressly deferred
or waived in writing by the Bank):

(a) This Amendment duly executed by the Borrower;

(b) A certificate of the Secretary or an Assistant Secretary of the
Borrower with respect to resolutions, of its Board of Directors
authorizing the execution and delivery of this Amendment, identifying
the officer(s) authorized to execute, deliver and take all other
actions required under this Amendment, or the Agreement and providing
specimen signatures of such officer(s), and confirming that the
Borrower's Articles of Organization and By-Laws previously delivered
and certified to the Bank have not been amended, substituted,
rescinded or otherwise modified in any way since the date of said
prior certification;

(c) a certificate of the president or chief financial officer of the
Borrower with respect to representations and warranties under the
Agreement, the absence of Defaults, and the locations and value of the
Borrower's inventory together with such additional UCC Financing
Statements, landlord waivers and insurance certificates as the Bank
may deem necessary or desirable, based on the Borrower's locations
shown in the schedule attached thereto;

(d) a copy of a fully executed amendment to the Subordinated Note and
Warrant Purchase Agreement dated as of March 31, 1992 among the
Borrower, the Purchasers named therein and C.T. Capital Trust, N.V.,
as agent for the Purchasers, reflecting modifications to the
Borrower's financial covenants under that agreement in conformity with
the Borrower's financial covenants under the Agreement after giving
effect to this Amendment;

(e) such other documents and evidence of completion of such other matters,
as the Bank reasonably may deem necessary or desirable.

-4-
<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

By: (SIGNATURE APPEARS HERE)
-----------------------------------
Title: Chairman
--------------------------------
[Seal] Signed at: Boston, MA
----------------------------

THE FIRST NATIONAL BANK OF BOSTON

By: (SIGNATURE APPEARS HERE)
-----------------------------------
Title: Vice President
--------------------------------
Signed at: Boston, MA
----------------------------
[Seal]

-5-
<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 5

THIS AMENDMENT (this "Amendment") is entered into as of March 1, 1994 by
and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS,
a Florida corporation having an address at 6100 Hollywood Boulevard, Hollywood,
Florida 33024 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON, a
national banking association with its head office at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank").

Preliminary Statement. The parties have entered into a Revolving Credit
----------------------
Agreement dated as of April 27, 1992, as previously amended by Amendment No. 1
dated November 2, 1992, by a letter agreement dated March 18, 1993, by Amendment
No. 2 dated as of May 26, 1993, by Amendment No. 3 dated as of May 26, 1993, and
by Amendment No. 4 dated as of October 15, 1993 (the "Agreement"). Under the
terms of the Agreement, the Bank has a Maximum Commitment of $25,000,000.
Subsequent to the delivery by the Borrower to the Bank of its preliminary
financial statements for its third fiscal quarter ending December 31, 1993, the
Borrower has advised the Bank that certain adjustments to these statements may
be appropriate. In view of the uncertainty of the resolution of the matters
underlying these adjustments, the Bank has requested and the Borrower has agreed
to amend the Agreement so as to provide for certain reductions in the Bank's
Maximum Commitment under the Agreement.

<PAGE>

-2-

Borrower and the Bank agrees that the Agreement is hereby amended as follows:

The following defined terms appearing in Section I of the Agreement are
hereby amended in their entirety to read as follows:

Borrowing Base. An amount equal to the lesser of (x) $23,500,000 during the
--------------
period March 1, 1994 through and including March 14, 1994, and $22,500,000
thereafter or (y) the sum of (i) 85% of the face value of Eligible Accounts
due and owing at such time, plus (ii) the least of (A) 50% of Eligible
----
Inventory, (B) $12,000,000 and (C) the amount available under subset (y)(i)
of this definition, minus (from the sum of (i) and (ii)) the amount
-----
specified below for the range of availability hereunder calculated as of
the date of any determination:

<TABLE>
<CAPTION>
Loan Availability Amount
----------------- ------
<S> <C>
Under $17,500,000.............................. $500,000
$17,500,000 - $20,000,000...................... $750,000
Over $20,000,000............................... $1,000,000
</TABLE>

Maximum Commitment. $23,500,000 during the period March 1, 1994 through
------------------
and including March 14, 1994, and $22,500,000 thereafter.

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

By: [SIGNATURE APPEARS HERE]
--------------------------------
Title: Chairman, Board of Directors
-----------------------------
[Seal] Signed at: Boston, Massachusetts
-------------------------

THE FIRST NATIONAL BANK OF BOSTON

By: [SIGNATURE APPEARS HERE]
--------------------------------
Title: Vice President
-----------------------------
Signed at: Boston, MA
-------------------------

[Seal]

<PAGE>

FORBEARANCE AGREEMENT

This Forbearance Agreement (this "Agreement") is entered into as of April
25, 1994 by and between Ross White Enterprises, Inc., d/b/a National Computer
Distributors, a Florida corporation with offices at 6100 Hollywood Boulevard,
Hollywood, Florida 33024 (the "Borrower") and The First National Bank of Boston,
a national banking association with offices at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank"). All capitalized terms herein shall have the
meanings ascribed to them in the Bank Credit Agreement, as defined below.

In consideration of the mutual promises and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which the parties hereby acknowledge, the parties hereby agree as follows:

SECTION 1. RECITALS, ACKNOWLEDGMENT, ADMISSION AND STIPULATION OF FACTS.
-------------------------------------------------------------
The parties hereto stipulate, admit, acknowledge and agree that the following
facts are true, correct and accurate:

1.1 The Borrower and the Bank have entered into a Revolving Credit
Agreement dated as of April 27, 1992, as amended by Amendment No. 1 dated
November 2, 1992, by a letter agreement dated March 18, 1993, by Amendment No. 2
dated as of May 26, 1993, by Amendment No. 3 dated as of May 26, 1993, by
Amendment No. 4 dated as of October 15, 1993, and by Amendment No. 5 dated as of
March 1, 1994 (collectively, the "Bank Credit Agreement") providing for a
working capital line of credit secured by all assets of the Borrower with a
Maximum Commitment of $22,500,000.

1.2 The Borrower has also entered into a Subordinated Note and Warrant
Purchase Agreement dated as of March 31, 1992, as amended by Amendment No. 1
dated as of October 27, 1993 (collectively, the "Note Purchase Agreement") among
the Borrower, the persons named therein as "Purchasers" (the "Purchasers") and
C.T. Capital Trust N.V., a Netherlands Antilles corporation, as agent and
attorney-in-fact for the Purchasers ("Capital Trust") pursuant to which the
Borrower issued its 12% Subordinated Notes due March 31, 1997, each dated March
31, 1992 in an amount equal to $3,000,000 in the aggregate (the "Subordinated
Debt").

<PAGE>

-2-

1.3 By letter dated March 28, 1994, the Bank acknowledged the Event of
Default existing under the Bank Credit Agreement as a result of the Borrower's
failure to comply with its leverage covenant under Section 5.9 of the Bank
Credit Agreement and the Borrower's further disclosure of an as then
undetermined amount of a charge to be taken against the Borrower's fiscal year
1993 Tangible Net Worth.

1.4 Subsequently, the Borrower has advised the Bank that it expects the
charge to Tangible Net Worth to approximate $2,300,000 on a pre-tax basis and
$1,200,000 after-tax, with a corresponding negative adjustment to the amount of
the Borrower's Tangible Net Worth shown in the Borrower's financial statements
previously delivered to the Bank for the Borrower's 1993 fiscal year end.

1.5 As reflected in the Borrower's financial statements for the period
ending March 31, 1994, the Borrower continues to be in default of its leverage
covenant under Section 5.9 of the Bank Credit Agreement. Moreover, based on the
Borrower's disclosures to the Bank regarding the charge it expects to take to
Tangible Net Worth, on a pro-forma basis after giving effect to the $1,200,000
after-tax charge, the Borrower is also in default of its Minimum Total Capital
Funds covenant under Section 5.8 of the Bank Credit Agreement and the maximum
Senior Bank Indebtedness to Total Capital Funds ratio permitted under Section
5.10 of the Bank Credit Agreement. The Borrower is also in default of these
covenants under the Note Purchase Agreement. The Borrower does not contest the
nature or existence of said defaults, and failures or breaches incidental
thereto, or the enforceability of the Bank's rights under the Bank Credit
Agreement and related loan documents, including but not limited to the Agency
Account Agreement.

1.6 Pursuant to the terms of the Bank Credit Agreement, the Bank has
specific rights and remedies, including but not limited to the right to
accelerate the Obligations and to sue for the total amount of principal and
accrued interest due thereunder and costs and expenses, including but not
limited to reasonable attorneys fees in accordance with Section 9.2 of the Bank
Credit Agreement.

1.7 (a) The Bank Credit Agreement and the related loan documents set forth
the legal, valid, binding and continuing obligation of the Borrower to the Bank
and are enforceable in accordance with their respective terms and conditions;
(b) all actions taken by the Bank to the date of this Agreement, pursuant to its
rights under the Bank Credit Agreement and the
<PAGE>

-3-

related loan documents have been commercially reasonable; (c) the Borrower has
no cause of action, claim, defense, setoff or reduction against the Bank in any
way regarding or related to the Bank Credit Agreement or any related loan
document and the sums due thereunder; (d) the Bank properly satisfied and
performed in a timely and reasonable manner all obligations to the Borrower
under the Bank Credit Agreement and the related loan documents; and the
Borrower's Obligations are secured by all assets of the Borrower.

1.8 The Borrower has requested that the Bank refrain from exercising its
rights and remedies under the Bank Credit Agreement and the related loan
documents.

1.9 The Borrower acknowledges, agrees and confirms that except for this
Agreement, the Bank is not required, bound, or obligated in any way to refrain
from exercising its rights and remedies, but the Bank has agreed to the
forbearance requested in consideration of the covenants, representations,
warranties and agreements contained in this Agreement.

SECTION 2. BANK'S AGREEMENT TO FORBEAR. Conditional upon the receipt by
----------------------------
the Bank of the document required by Section 3.4 of this Agreement and so long
as no default under Section 14.1 of this Agreement has occurred, the Bank agrees
to forbear from exercising its rights and remedies under the Bank Credit
Agreement (but not its right to make demand prior to, for payment on, the
Termination Date and to refuse to make loans to the Borrower at any time and
from time to time prior to the Termination Date in accordance with Section 3.1
of this Agreement) until July 31, 1994 in accordance with the provisions of this
Agreement.

SECTION 3. BORROWER'S AGREEMENTS. In consideration of the Bank's
----------------------
agreement to forbear its rights and remedies as stated in Section 2 above, the
Borrower agrees that so long as this Agreement is in effect, all provisions of
the Bank Credit Agreement shall remain in full force and effect except as
follows:

3.1 Notwithstanding Section 2 of the Bank Credit Agreement or any other
provision thereof which either expressly or impliedly commits the Bank to lend
to the Borrower until the Termination Date, all advances to the Borrower under
the Bank Credit Agreement shall be in the Bank's sole and absolute discretion up
to a maximum principal amount of $22,500,000 subject to availability under the
Borrowing Base at the percentages and dollar limitations stated therein, or at
such other percentages and dollar limitations (including zero) as
<PAGE>

-4-

the Bank shall in its sole and absolute discretion determine, and the Bank shall
have no commitment whatsoever to make loans or extend credit or other financial
accommodations to the Borrower. All Obligations are demandable by the Bank at
any time prior to the Termination Date and shall be due and payable in full
without demand on the Termination Date, notwithstanding any provision in the
Bank Credit Agreement to the contrary.

3.2 Notwithstanding Section 2.7 of the Bank Credit Agreement, effective as
of April 21, 1994 and retroactive thereto, the Borrower shall pay interest on
the outstanding amount of each Loan at a rate per annum equal to the Base Rate
plus three percent (3%), which rate shall change contemporaneously with any
change in the Base Rate. The Bank's right to change the higher default rate of
interest specified by the second sentence of said Section 2.7 shall continue.

3.3 On or before June 30, 1994 either (a) the Borrower shall deliver to
the Bank a balance sheet of the Borrower certified by the Borrower's chief
financial officer, as evidence of, and reflecting, the infusion of a minimum of
$1,000,000 in additional equity in the form of additional common stock of the
Borrower, which stock shall be validly issued, fully paid and non-assessable, or
(b) if by the close of business on June 30, 1994 the Borrower shall not have
delivered the balance sheet required by the foregoing 3.3(a), the Bank shall
charge the Borrower's Loan Account a non-refundable fee equal to $350,000.

3.4 Simultaneously with the delivery of this Agreement to the Bank by the
Borrower, the Borrower shall cause to be delivered to the Bank a copy of a
letter addressed to the Borrower and signed by Capital Trust, or such other
document as shall be satisfactory in form and substance to the Bank,
acknowledging the agreement of Capital Trust to forbear its exercise of its
rights and remedies under the Note Purchase Agreement so long as this Agreement
is in effect.

SECTION 4. BANK'S AGREEMENTS. In consideration of the Borrower's
-----------------
agreements set forth in Section 3 above, the Bank agrees that so long as this
Agreement is in effect:

4.1 The commitment fees and early termination fees otherwise due the Bank
under Sections 2.4 and 2.5 of the Bank Credit Agreement are hereby waived.

4.2. The financial covenants set forth in sections 5.7, 5.8, 5.9 and 5.10
are hereby waived.
<PAGE>

-5-

SECTION 5. REPRESENTATIONS. The Borrower agrees and acknowledges that its
----------------
obligations to the Bank under the Bank Credit Agreement and the related loan
documents, except as otherwise expressly modified by this Agreement, are, by the
execution of this Agreement, ratified and confirmed in all respects.

SECTION 6. ACKNOWLEDGMENTS. The Borrower acknowledges and agrees that its
----------------
duly authorized officer executing this Agreement has (a) read and understands
the contents of this Agreement, (b) had opportunity to consult with counsel of
choice regarding same, (c) acted voluntarily and without duress in connection
with the execution and delivery of this Agreement.

SECTION 7. RELEASE, INDEMNITY, WAIVER. The Borrower hereby releases,
---------------------------
covenants not to sue, waives and forever discharges and relieves the Bank and
its agents, attorneys and employees (the "Releasees") of, from, regarding,
and/or on account of any and all rights, benefits, interest, liabilities,
claims, demands, actions, causes of action, suits, debts, covenants,
obligations, accounts due, contracts, rights to payment, damages, lost profits,
costs, fees, counterclaims, attorneys' fees, interest penalties, offsets,
setoffs, losses, and claims and defenses of every nature and kind whatsoever,
whether at common law (contract, tort or other theory) or pursuant to federal,
state or local statute, rule, ordinance, or regulation, whether vested or
contingent, whether known or unknown, whether liquidated or unliquidated,
whether matured or unmatured, whether disputed or undisputed, which the Borrower
ever had or may now have against the Releases, upon or by reason of any matter,
cause or thing whatsoever arising from the Bank Credit Agreement or any related
loan document.

SECTION 8. NO MODIFICATION OR WAIVER. None of the terms or provisions of
--------------------------
the Bank Credit Agreement or the other loan documents or this Agreement may be
changed, waiver, modified, discharged, or terminated except by instrument in
writing executed by the parties hereto, or the party against whom or which
enforcement of the change, waiver, modification, discharge or termination is
asserted. None of the terms or provisions of the Bank Credit Agreement or any of
the related loan documents or this Agreement shall be deemed to have been
abrogated or waived by reason of any failure or failures to enforce the same. In
the event of any inconsistency between the Bank Credit Agreement or any related
loan document and this Agreement, the terms of this Agreement shall prevail.

<PAGE>

-6-

SECTION 9. COUNTERPARTS. This Agreement may be executed in any number of
------------
counterparts, each of which shall be considered an original for all purposes,
provided that all such counterparts shall together constitute one and the same
- -------------
instrument.

SECTION 10. APPLICABLE LAW. This Agreement shall be governed by and
--------------
construed, interpreted and enforced, in accordance with and pursuant to the laws
of The Commonwealth of Massachusetts without regard to its conflicts of law
rules.

SECTION 11. SUCCESSORS AND ASSIGNS. The provisions of this Agreement
----------------------
shall be binding upon, and shall inure to the benefit of, the respective
successors, assigns, and participants of the Bank, and the respective heirs,
successors and assigns of the Borrower (but such reference is not intended, nor
shall it be construed as, a consent to an assignment by the Borrower).

SECTION 12. ENTIRE AGREEMENT. The Bank Credit Agreement and the related
----------------
loan documents, as confirmed and affected by this Agreement, constitute the
entire agreement between the parties hereto relating to or connected with the
loan transactions and other matters contemplated thereby. Any other agreements
or understandings related to or connected with such loan transactions or other
matters not expressly set forth in the Bank Credit Agreement and related loan
documents as confirmed or affected hereby, are null and void and superseded in
their entirety.

SECTION 13. INTENTION OF THE PARTIES. It is intended by the parties
------------------------
hereto that this Agreement shall become a part of the loan documentation files
of the Borrower.

SECTION 14. DEFAULTS AND REMEDIES.
---------------------

SECTION 14.1 DEFAULTS: The following shall constitute a default under
--------
this Agreement:

(a) the occurrence of a further material adverse change in the financial
condition or affairs of the Borrower;

(b) the giving of a notice of intent to accelerate the Subordinated Debt
by Capital Trust;

(c) the occurrence of any event described in subsection 8.1(h) or 8.1(i)
of the Bank Credit Agreement or any other Event of Default (other than the
Events of Default identified in Section 1.5 of this Agreement);

<PAGE>

-7-

(d) failure by the Borrower to abide by and/or comply with all terms or
conditions set forth herein or in the Bank Credit Agreement or other loan
documents as confirmed or affected hereby, or the failure by Capital Trust or
any Purchaser to abide by and/or comply with all terms or conditions set forth
in the letter or other document referred to in Section 3.4 of this Agreement or
in Section 6 of the Note Purchase Agreement.

SECTION 14.2 REMEDIES. In the event of any default by the Borrower under
---------
this Agreement as set forth in subsection 12.1 above, this Agreement shall
terminate as to any matter not already consummated and the Bank may exercise any
or all rights and remedies available to it under the Bank Credit Agreement or
any other loan document, or applicable law. The Borrower shall remain
responsible to pay all costs and expenses, including reasonable attorney's fees
associated with the collection of payments due under this Agreement, the Bank
Credit Agreement and/or other loan documents, as provided in section 9.2 of the
Bank Credit Agreement.

IN WITNESS WHEREOF, The parties have executed this Agreement as an
instrument under seal as of the date first written above.

WITNESS: ROSS WHITE ENTERPRISES, INC.

[SIGNATURE APPEARS HERE] 5-4-94 By: /s/ Gregory A. White
- --------------------------------- ---------------------------------

Name: Gregory A. White
-------------------------------

Title: President
------------------------------

THE FIRST NATIONAL BANK OF BOSTON

[SIGNATURE APPEARS HERE] By: [SIGNATURE APPEARS HERE]
- --------------------------------- ---------------------------------

Name: [NAME APPEARS HERE]
-------------------------------

Title: Vice President
------------------------------
<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 6

THIS AMENDMENT (this "Amendment") is entered into as of August 11, 1994 by
and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL COMPUTER DISTRIBUTORS,
a Florida corporation having an address at 6100 Hollywood Boulevard, Hollywood,
Florida 33024 (the "Borrower"), and THE FIRST NATIONAL BANK OF BOSTON, a
national banking association with its head office at 100 Federal Street, Boston,
Massachusetts 02110 (the "Bank"). All capitalized terms not otherwise defined
herein shall have the meanings ascribed to them in the Credit Agreement, as
defined below.

R E C I T A L S
---------------

WHEREAS, The Borrower and the Bank have entered into a Revolving Credit
Agreement dated as of April 27, 1992, as previously amended by the various
documents listed on Schedule A hereto (the "Credit Agreement");
----------

WHEREAS, under the terms of the Credit Agreement, the Bank has agreed to
extend credit to the Borrower until the Termination Date (August 31, 1994) on a
demand discretionary basis up to a maximum principal amount of $22,500,000
subject to availability under the Borrowing Base;

WHEREAS, the Borrower has also entered into a Subordinated Note and Warrant
Purchase Agreement dated as of March 31, 1992, as amended (collectively, the
"Note Purchase Agreement") among the Borrower, the persons named therein as
"Purchasers" (the "Purchasers") and C.T. Capital Trust N.V., a Netherlands
Antilles corporation, as agent and attorney-in-fact for the Purchasers ("Capital
Trust") pursuant to which the Borrower issued its 12% Subordinated Notes due
March 31, 1997 (the "Maturity Date"), each dated March 31, 1992 in an amount
equal to $3,000,000 in the aggregate (the "Capital Trust Subordinated Debt");

WHEREAS, the Capital Trust Subordinated Debt is presently demandable at any
time prior to August 31, 1994 and, absent a reinstatement of the Maturity Date,
may be accelerated and declared due and payable on August 31, 1994 by Capital
Trust;

WHEREAS, the Borrower has advised the Bank that the Purchasers have agreed
to reinstate the Maturity Date and to
<PAGE>

-2-

further amend the Note Purchase Agreement to the extent necessary to conform the
financial ratios under the Note Purchase Agreement to levels equal to or more
lenient than the ratios under the Credit Agreement after giving effect to the
amendments effected hereby;

WHEREAS, the Borrower has requested that the Bank's commitment under the
Credit Agreement be reinstated and the Termination Date be extended, and in
reliance upon the foregoing and the representations, warranties, covenants and
other agreements contained herein and in the Credit Agreement, the Bank has
agreed to the Borrower's request, subject to the terms hereof;

NOW THEREFORE, in consideration of the foregoing premises and the mutual
benefits to be derived by the Borrower and the Bank from a continuing
relationship under the Credit Agreement and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, each
of the Borrower and the Bank agrees that the Credit Agreement is hereby amended
as follows:

1. The following new defined term is hereby added to Section I of the
Credit Agreement:

"Applicable Margin" shall mean the applicable percentage specified below
-----------------
based on the Borrower's ratio of (i) Total Liabilities less Subordinated
Indebtedness to (ii) Total Capital Funds ("Leverage Ratio") as determined
as of the last day of each month commencing with the month ending August
31, 1994, to be effective on a prospective basis as of the first day of the
next succeeding month:

<TABLE>
<CAPTION>
--------------------------------------------
Leverage Ratio Applicable Percentage
--------------------------------------------
<S> <C>
(Greater Than) 7:1 3%
--------------------------------------------
(Less Than) 7:1 1 1/2%
--------------------------------------------
</TABLE>

2. The definition of "Eligible Inventory" appearing in Section I of the
Credit Agreement is hereby amended by deleting the "and" at the end of subclause
(h), relettering subclause (i) to become subclause (j) and by the addition of
the following additional exclusion therefrom to be inserted immediately
following subclause (h) thereof:

(i) such Inventory is not more than 180 days from date of purchase; and
<PAGE>

-3-

3. The following defined term appearing in Section I of the Credit
Agreement is hereby amended in its entirety to read as follows:

Termination Date. December 31, 1995, or such earlier date on which the
----------------
Bank's commitment hereunder is reduced to zero or otherwise terminated in
accordance with the terms of this Agreement.

4. Section 2.5 of the Credit Agreement is hereby amended to read in its
entirety as follows:

2.5. Early Termination Fee. In the event of a termination by the Borrower
---------------------
of the Bank's commitment hereunder prior to the Termination Date, the
Borrower shall pay to the Bank three percent (3%) of the Maximum Commitment
on the effective date of any such termination, which termination may be
effected only upon thirty (30) days prior written notice delivered by the
Borrower to the Bank.

5. Subclause (a) of Section 2.7 of the Credit Agreement is hereby amended
in its entirety to read as follows:

(a) Each Loan shall bear interest on the outstanding principal amount
thereof at a rate per annum equal to the Base Rate plus the Applicable
----
Margin, which rate shall change contemporaneously with any change in the
Base Rate. Such interest shall be payable on the first day of each month
and when such Loan is due (whether at maturity, by reason of acceleration
or otherwise).

6. Exhibit 5.1(c), the form of Chief Financial Officer Report required to
be delivered to the Bank by the Borrower pursuant to Section 5.1(c) of the
Credit Agreement, is hereby deleted from the Credit Agreement and the form
attached hereto as Schedule B to this Amendment is hereby substituted in its
stead. ----------

7. Section 5.7 of the Credit Agreement is hereby amended in its entirety
to read as follows:

5.7. Ratio of EBIT to Interest Expense. As of the last day of each month,
---------------------------------
the Borrower shall have ratio of (a) EBIT to (b) total interest expense of
not less than 1.75:1, excluding from such calculation any inputed interest
arising from accretion of debt discount on the Subordinated Indebtedness
issued under the Purchase Agreement.

<PAGE>

-4-

8. Section 5.8 of the Credit Agreement is hereby amended in its entirety
to read as follows:

5.8. Minimum Total Capital Funds. The Borrower shall maintain Total
---------------------------
Capital Funds of not less than the amounts set forth below for the periods
specified, plus on a cumulative basis, an additional $250,000 for each
----
quarter ending after October 31, 1994:

<TABLE>
<CAPTION>
Period Amount
------ ------
<S> <C>
June 30, 1994 - September 29, 1994............. $2,700,000
September 30, 1994 - October 30, 1994.......... $2,950,000
October 31, 1994 and thereafter................ $5,000,000
</TABLE>

9. Sections 5.9, 5.10 and 5.11 of the Credit Agreement are hereby deleted
and intentionally omitted.

10. The $250,000 dollar limit on capital expenditures appearing in Section
6.4 of the Credit Agreement is hereby amended to "$500,000."

11. Exhibit 7.3(c) to the Credit Agreement, the form of Borrowing Base
Certificate required to be delivered to the Bank by the Borrower pursuant to
Section 7.3(c) of the Credit Agreement, is hereby deleted from the Credit
Agreement and the form attached hereto as Schedule C to this Amendment is hereby
----------
substituted in its stead.

12. The Forbearance Agreement dated as of April 25, 1994, as amended, is
hereby terminated and all modifications to the Credit Agreement effected
thereby, including but not limited to, those set forth in Sections 3 and 4
thereof, shall be of no further force or effect.

13. Conditions Precedent to Effectiveness of this Amendment. This
-------------------------------------------------------
Amendment shall take effect on the date of receipt by the Bank of the last item
specified below (other than any item the delivery of which is expressly deferred
or waived in writing by the Bank):

(a) This Amendment duly executed by the Borrower;

-5-

(c) a certificate of the president or chief financial officer of the
Borrower with respect to representations and warranties under the
Credit Agreement, the absence of Defaults, and the locations and value
of the Borrower's inventory together with such additional UCC
Financing Statements, landlord waivers and insurance certificates as
the Bank may deem necessary or desirable, based on the Borrower's
locations shown in the schedule attached thereto;

(e) such other documents and evidence of completion of such other matters,
as the Bank reasonably may deem necessary or desirable.

Upon and after the date of this Amendment all references to the Credit
Agreement in that document, or in any related document, shall mean the Credit
Agreement as amended by this Amendment. Except as expressly provided in this
Amendment, the execution and delivery of this Amendment does not and will not
amend, modify or supplement any provision of, or constitute a consent to or a
waiver of any noncompliance with the provisions of the Credit Agreement, and,
except as specifically provided in this Amendment, the Credit Agreement shall
remain in full force and effect.

This Amendment is executed as an instrument under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts without regard to its conflicts of law rules. All parts of the
Credit Agreement not affected by this Amendment are hereby ratified and affirmed
in all respects, provided that if any provision of the Credit Agreement shall
-------------
conflict or be inconsistent with this Amendment, the terms of this Amendment
shall supersede and prevail.

<PAGE>

-6-

IN WITNESS WHEREOF, each of the Borrower and the Bank in accordance with
Section 9.7 of the Credit Agreement, has caused this Amendment to be executed
and delivered by their respective duly authorized officers as of the date set
forth in the preamble on page one of this Amendment.

ROSS WHITE ENTERPRISES, INC.,
WITNESSED: d/b/a/ NATIONAL COMPUTER DISTRIBUTORS

/s/ GUY V. SIMMONS By: /s/ JONATHAN P. LEE
- ----------------------------------- -------------------------------------

Guy V. Simmons Jonathan P. LEE
- ----------------------------------- ----------------------------------------
Print Name Print Name

Address: One International Plaza Title: Chairman
-------------------------- ----------------------------------

Boston, MA 01921 Signed at: Boston, MA
- ----------------------------------- ------------------------------

[Seal]

WITNESSED: THE FIRST NATIONAL BANK OF BOSTON

By:
- ----------------------------------- -------------------------------------

- ----------------------------------- ----------------------------------------
Print Name Print Name

Address: Title:
--------------------------- ----------------------------------

Signed at:
- ----------------------------------- ------------------------------

[Seal]

<PAGE>

-72-

ROSS WHITE ENTERPRISES, INC.,
WITNESSED: d/b/a/ NATIONAL COMPUTER DISTRIBUTORS

By:
- ----------------------------------- ------------------------------------

- ----------------------------------- ---------------------------------------
Print Name Print Name

Address: Title:
--------------------------- --------------------------------

Signed at:
- ----------------------------------- ----------------------------

[Seal]

WITNESSED: THE FIRST NATIONAL BANK OF BOSTON

By:
- ----------------------------------- -----------------------------------

- ----------------------------------- --------------------------------------
Print Name Print Name

Address: 100 Title:
--------------------------- --------------------------------

Signed at:
- ----------------------------------- ----------------------------

[Seal]

<PAGE>

ROSS WHITE ENTERPRISES, INC., d/b/a
NATIONAL COMPUTER DISTRIBUTORS

AMENDMENT NO. 7 AND WAIVER

THIS AMENDMENT NO. 7 AND WAIVER (this "Amendment") is entered into as of
September 8, 1994 by and between ROSS WHITE ENTERPRISES, INC., d/b/a NATIONAL
COMPUTER DISTRIBUTORS, a Florida corporation having an address at 6100 Hollywood
Boulevard, Hollywood, Florida 33024 (the "Borrower"), and THE FIRST NATIONAL
BANK OF BOSTON, a national banking association with its head office at 100
Federal Street, Boston, Massachusetts 02110 (the "Bank"). All capitalized terms
not otherwise defined herein shall have the meanings ascribed to them in the
Credit Agreement, as defined below.

R E C I T A L S
---------------
WHEREAS, the Borrower and the Bank have entered into a Revolving Credit
Agreement dated as of April 27, 1992, as previously amended by the various
documents listed on Schedule A hereto (the "Credit Agreement");
----------

WHEREAS, the Borrower has delivered to the Bank a letter requesting
certain waivers from the Bank with respect to the Borrower's failure to comply
with certain covenants and obligations of the Borrower under the Credit
Agreement;

1. Section 5.7 of the Credit Agreement is hereby amended in entirety to
read as follows:

5.7. Ratio of EBIT to Interest Expense. The Borrower shall have a ratio
----------------------------------
of (i) EBIT to (ii) total interest expense, excluding from such
calculation any imputed interest arising from accretion of debt discount
on the Subordinated Indebtedness issued under the Purchase Agreement, of
not less than (a) 1.75:1 as of the last day of each of the Borrower's
fiscal quarters, and (ii) 1:1 as of the last day of each month ending on
any date other than the last day of any fiscal quarter of the Borrower.

<PAGE>

-2-

2. Section 6.7 of the Credit Agreement is hereby amended in its
entirety to read as follows:

6.7. Leases. The Borrower shall not, during any of its fiscal years, have
------
aggregate lease payments for real or personal property (whether or not such
payments are termed rent) in excess of $1,750,000.

In reliance upon the Borrower's representation, which by the Borrower's
signature hereto, the Borrower is hereby deemed to have made, that other than
the Defaults or Events of Defaults identified below, as of the date of this
Amendment, the Borrower is not otherwise in default of any of its obligations
under the Credit Agreement, the Bank hereby waives any Default or Event of
Default existing as a result of the Borrower's failure to comply with the
following covenants and obligations:

A. The Borrower's obligation under Section 5.1(a) of the Credit Agreement
to deliver to the Bank its audited financial statements within ninety days
following its fiscal year ending March 31, 1994, which statements, by its
signature hereto, the Borrower covenants and agrees shall be delivered to
the Bank on or before September 30, 1994 in accordance with the
requirements of Section 5.1(a) (other than the ninety day time period
specified therein), and the failure by the Borrower to so deliver such
statements shall constitute an Event of Default under the Credit Agreement;

B. During any time prior to March 31, 1994, the Borrower's obligation
under:

(i) Section 5.6 of the Credit Agreement to keep adequate books and
records of account in accordance with generally accepted accounting
principles with respect to certain items previously disclosed to the
Bank, which items the Borrower by its acceptance hereof, represents and
warrants to the Bank are now properly reflected in its books and records;
and

(ii) Section 6.4 of the Credit Agreement to maintain capital expenditures
of the type described by said Section 6.4 within the $250,000 maximum
permitted prior to the effective date of Amendment No. 6 dated as of
August 11, 1994 to the Credit Agreement ("Amendment 6").

C. With respect to the months ending March 31, 1994 and July 31, 1994, the
Borrower's obligation under Section 5.7 of the Credit Agreement to maintain
the ratio of EBIT to total interest expense specified by said Section 5.7;

D. During any time prior to June 30, 1994, the Borrower's obligation under
Section 5.8 of the Credit Agreement to maintain Total Capital Funds of not
less than the amount specified by said Section 5.8;

<PAGE>

-3-

E. During any time prior to the effective date of Amendment 6, the Borrower's
obligation under:

(i) Section 5.9 of the Credit Agreement to maintain its ratio of Total
Liabilities (less Subordinated Indebtedness) to Total Capital Funds within the
maximum ratio permitted by said Section 5.9;

(ii) Section 5.10 of the Credit Agreement to maintain its ratio of Senior
Bank Indebtedness to Total Capital Funds within the maximum ratio permitted by
said Section 5.10;

(iii) Section 5.11 of the Credit Agreement to maintain an accounts
payable average turnover as required by said Section 5.11; and

(iv) Section 6.1(d) of the Credit Agreement, with respect to Hyundia
Electronics America, not to remain liable for normal trade Indebtedness for more
than sixty days past the due date thereof;

The foregoing waivers are expressly limited to the specific defaults and
Events of Defaults set forth above and are not, nor shall they be construed as,
waivers of any other default or Event of Default under the Credit Agreement,
whether now existing or hereafter occurring. These waivers notwithstanding, all
rights of the Bank with respect to any claims it may have against the Borrower
or any third party arising out of or in any way related to the matters giving
rise to the defaults and Events of Defaults enumerated above are expressly
reserved.

Upon and after the date of this Amendment all references to the Credit
Agreement in that document, or in any related document, shall mean the Credit
Agreement as amended by this Amendment. Except as expressly provided in this
Amendment, the execution and delivery of this Amendment does not and will not
amend, modify or supplement any provision of, or constitute a consent to or a
waiver of any noncompliance with the provisions of the Credit Agreement, and,
except as specifically provided in this Agreement, the Credit Agreement shall
remain in full force and effect.

This Amendment is executed as an instrument under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts without regard to its conflicts of law rules. All parts of the
Credit Agreement not affected by this Amendment are hereby ratified and affirmed
in all respects, provided that if any provision of the Credit Agreement shall
-------- ----
conflict or be inconsistent with this Amendment, the terms of this Amendment
shall supersede and prevail.
<PAGE>

-4-

ROSS WHITE ENTERPRISES, INC.,
WITNESSED: d/b/a NATIONAL COMPUTER DISTRIBUTORS

/s/ Guy J. Simmons By: /s/ Jonathan O. Lee
- ------------------------------- ----------------------------------

GUY J. SIMMONS JONATHAN O. LEE
- ------------------------------- -------------------------------------
Print Name Print Name

Address: 1 International Place Title: Chairman
----------------------- ------------------------------
Boston, Massachusetts 02110 Signed At Boston, MA
- ------------------------------- ---------------------------

[Seal]

WITNESSED: THE FIRST NATIONAL BANK OF BOSTON

By:
- ------------------------------- -------------------------------------

- ------------------------------- ----------------------------------------
Print Name Print Name

Address: Title:
----------------------- ----------------------------------
Signed At
- ------------------------------- -------------------------------

[Seal]
<PAGE>

-4-

ROSS WHITE ENTERPRISES, INC.
WITNESSED: d/b/a NATIONAL COMPUTER DISTRUBTORS

By:
- -------------------------------------- -------------------------------

- -------------------------------------- -----------------------------------
Print Name Print Name

Address: Title:
----------------------------- ----------------------------

Signed At
- -------------------------------------- -------------------------

[Seal]

WITNESSED: THE FIRST NATIONAL BANK OF BOSTON

/s/ Deborah L. White By: /s/ Janet O. Sanchez
- -------------------------------------- -------------------------------
Deborah L. White Janet O. Sanchez
- -------------------------------------- -----------------------------------
Print Name Print Name

Address: 100 Federal St. Title: Vice President
----------------------------- ----------------------------

Boston, MA 02110 Signed At 100 Federal St. Boston
- -------------------------------------- -------------------------

[Seal]
<PAGE>

AMERIQUEST/NCD, INC.

AMENDMENT NO. 8

THIS AMENDMENT NO. 8 (this "Amendment") is entered into as of March ,
--
1995 by and between AMERIQUEST/NCD, INC., a Florida corporation having an
address at 6100 Hollywood Boulevard, Hollywood, Florida 33024 (the "Borrower"),
and THE FIRST NATIONAL BANK OF BOSTON, a national banking association with its
head office at 100 Federal Street, Boston, Massachusetts 02110 (the "Bank"). All
capitalized terms not otherwise defined herein shall have the meanings ascribed
to them in the Credit Agreement, as defined below.

RECITALS
--------

WHEREAS, the Borrower and the Bank have entered into a Revolving Credit
Agreement dated as of April 27, 1992, as previously amended by the various
documents listed on Schedule A hereto (as amended, the "Credit Agreement");
----------

WHEREAS, the Borrower has requested certain amendments to the Credit
Agreement, including, but not limited to, an increase in the Maximum Commitment
from $22,500,000 to $30,000,000;

WHEREAS, the Bank is, on the terms and conditions stated below, willing to
grant the request of the Borrower;

1. The following definitions appearing in Section 1.1 of the Credit
Agreement are each hereby amended respectively in their entirety to read as
follows:

(a) "Borrowing Base. An amount equal to the lesser of (x) $30,000,000
--------------
and (y) the sum of (i) 85% of the face value of Eligible Accounts due
and owing at such time, plus (ii) the least of (A) 50% of Eligible
----
Inventory, (B) $15,000,000 and (C) the amount available under
subset (y) (i) of this definition, minus (from the sum of (i) and
-----
(ii)) the amount specified below for the range of availability
hereunder calculated as of the date of any determination:
<PAGE>

-2-

<TABLE>
<CAPTION>
Loan Availability Amount Reserve
------------------------ -------
<S> <C>
Less than $17,500,000 $ 500,000
$17,500,000 - $19,999,999 $ 750,000
$20,000,000 - $22,499,999 $1,000,000
$22,500,000 - $24,999,999 $1,250,000
25,000,000 or more $1,500,000"
</TABLE>

(b) "Maximum Commitment. $30,000,000."
------------------

2. Section 5.7 of the Credit Agreement is hereby amended in its entirety
to read as follows:

"5.7. Ratio of EBIT to Interest Expense. As of the last day of each
---------------------------------
fiscal quarter, the Borrower shall have a ratio of (i) EBIT to (ii) total
interest expense, excluding from such calculation any imputed interest
arising from accretion of debt discount on any Subordinated Indebtedness,
of not less than 1.75:1."

3. Section 5.8 of the Credit Agreement is hereby amended in its entirety
to read as follows:

"5.8. Minimum Total Capital Funds. The Borrower shall maintain at all
---------------------------
times Total Capital Funds of not less than $8,500,000 as of December 31,
1994, plus, on a cumulative basis, an additional $250,000 for each quarter
----
ending after December 31, 1994."

4. Section 5.9 of the Credit Agreement, which was previously deleted and
intentionally omitted from the Credit Agreement, is hereby added to read as
follows:

"5.9. Leverage Ratio. The Borrower shall maintain at all times a ratio
--------------
of (i) Total Liabilities less Subordinated Indebtedness to (ii) Total
----
Capital Funds of not more than 7.5:1."

5. Section 5.10 of the Credit Agreement, which was previously deleted and
intentional omitted from the Credit Agreement, is hereby added to read as
follows:

"5.10. Ratio of Senior Bank Indebtedness to Total Capital Funds. The
--------------------------------------------------------
Borrower shall maintain at all times a ratio of Senior Bank Indebtedness
to Total Capital Funds of not more than 5:1."

6. This Amendment shall become effective when, and only when, the Bank
shall have received the following documents:

(a) This Amendment duly executed by the Borrower and the Bank;

<PAGE>

-3-

(b) A certificate of the secretary or assistant secretary of the Borrower
with respect to resolutions of its Board of Directors authorizing the
execution and delivery of this Amendment and the matters contemplated
hereby, identifying the officers authorized to execute, deliver and take
all other actions required under this Amendment or the Credit Agreement,
and confirming that the Borrower's articles of organization and by-laws
previously delivered and certified to the Bank have not been amended,
substituted, rescinded or otherwise modified in any way since the date of
such prior certification;

(c) A certificate of the president or chief financial officer of the
Borrower with respect to representations and warranties under the Credit
Agreement and the absence of any Default or Event of Default under the
Credit Agreement;

(d) Payment by the Borrower of a closing fee in the amount of $37,500; and

(e) Such other documents and evidence of completion of such other matters
as the Bank may reasonable deem necessary or desirable.

7. The Borrower represents and warrants to the Bank as follows:

(a) The Borrower is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, has all
requisite corporate power to own its property and conduct its business as
now conducted and as presently contemplated, is duly qualified and in good
standing as a foreign corporation, and is duly authorized to do business in
each jurisdiction where the nature of its properties or business require
such qualification, except where the failure to be so qualified would not
have a material adverse affect on the business, financial condition, assets
or properties of the Borrower on a consolidated basis.

(b) The execution, delivery and performance of this Amendment and the
Credit Agreement and the transactions contemplated hereby and thereby are
within the corporate power and authority of the Borrower and had been
authorized by all necessary corporate proceedings, and do not and will not:

(i) require any consent or approval of the stockholders of the
Borrower other than those consents and approvals, if any, previously
obtained;

(ii) contravene any provision of the charter documents or by-laws of
the Borrower or any law, rule or regulation applicable to the
Borrower;

<PAGE>

-4-

(iii) contravene any provision of, or constitute an event of default
or event that, but for the requirement that time elapse or notice be
given, or both, would constitute an event of default, under any other
agreement, instrument, order or undertaking binding on the Borrower;

(iv) result in or require the imposition of any Encumbrance on any of
the properties, assets or rights of the Borrower, except Encumbrances
permitted by the Credit Agreement.

(c) This Amendment and the Credit Agreement and all of their terms and
provisions are the legal, valid and binding obligations of the Borrower,
enforceable in accordance with their terms except as limited by bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally, and except as the remedies of
specific performance or of injunctive relief are subject to the discretion
of the court before which any proceeding therefore may be brought.

(d) The execution, delivery and performance of this Amendment and the
Credit Agreement and the transactions contemplated hereby and thereby do
not require any approval or consent of or filing of registration with, any
governmental or other agency or authority, or any other party.

(e) There is no litigation, arbitration, proceeding or investigation
pending, or, to the knowledge of the officers of the Borrower threatened,
against the Borrower that, if adversely determined would result in a
material judgment not fully covered by insurance or would otherwise have a
material adverse affect on the assets, business or prospects of the
Borrower.

8. Upon and after the date of this Amendment all references to the Credit
Agreement in that document, or in any related document, shall mean the Credit
Agreement as amended by this Amendment. Except as expressly provided in this
Amendment, the execution and delivery of this Amendment does not and will not
amend, modify or supplement any provision of, or constitute a consent to or a
waiver of any noncompliance with the provisions of the Credit Agreement, and,
except as specifically provided in this Amendment, the Credit Agreement shall
remain in full force and effect.

9. This Amendment is executed as an instrument under seal and shall be
governed by and construed in accordance with the laws of The Commonwealth of
Massachusetts without regard to its conflicts of law rules. All parts of the
Credit Agreement not

<PAGE>

-5-

affected by this Amendment are hereby ratified and affirmed in all respects,
provided that if any provision of the Credit Agreement shall conflict or be
- -------- ----
inconsistent with this Amendment, the terms of this Amendment shall supersede
and prevail.

WITNESSED: AMERIQUEST/NCD, INC.

/s/ Stephen G. Holmes By: /s/ Gregory A. White
- ---------------------------------- -----------------------------

STEPHEN G. HOLMES GREGORY A. WHITE
- ---------------------------------- ---------------------------------
Print Name Print Name

Address: 2722 Michelson Dr., Title: President
-------------------------- ---------------------------
Irvine, CA 92715 Signed At Irvine, California
- ---------------------------------- -----------------------

[Seal]

WITNESSED: THE FIRST NATIONAL BANK OF BOSTON

By:
- ---------------------------------- -----------------------------

- ---------------------------------- ---------------------------------
Print Name Print Name

Address: Title:
-------------------------- ---------------------------
Signed At
- ---------------------------------- -----------------------

[Seal]

<PAGE>

SCHEDULE A TO AMENDMENT NO. 8
-----------------------------

DOCUMENTS EFFECTING PRIOR AMENDMENTS TO AGREEMENT
-------------------------------------------------

1. Amendment No. 1 Dated November 2, 1992

2. Letter Agreement Dated March 18, 1993

3. Amendment No. 2 Dated April 16, 1993

4. Amendment No. 3 Dated May 26, 1993

5. Amendment No. 4 Dated October 15, 1993

6. Amendment No. 5 Dated March 1, 1994

7. Forbearance Agreement Dated April 25, 1994

8. Amendment No. 1 To Forbearance Agreement
Dated June 30, 1994

9. Amendment No. 2 To Forbearance Agreement
Dated July 28, 1994

10. Amendment No. 6 Dated August 11, 1994

11. Amendment No. 7 Dated September 8, 1994
<PAGE>

AMERIQUEST/NCD, INC.

AMENDMENT NO. 9, EXTENSION, WAIVER AND CONSENT

This Amendment No. 9, Extension, Waiver and Consent (this "Amendment") is
---------
entered into as of July 11, 1995 by and between The First National Bank of
Boston, a national banking association having a principal place of business at
100 Federal Street, Boston, Massachusetts ("Bank"), and AmeriQuest/NCD, Inc., a
----
Florida corporation having its chief executive office and principal place of
business at MacArthur Place, 3 Imperial Promenade, Santa Ana, California 92707
(the "Borrower") and successor by merger to Ross White Enterprises, Inc. ("Ross
-------- ----
White"). All capitalized terms used but not otherwise defined herein shall have
- -----
the meanings assigned to them in the Credit Agreement, as defined below.

R E C I T A L S
- - - - - - - -

WHEREAS, the Bank and the Borrower have entered into a Revolving Credit
Agreement dated as of April 27, 1992, as amended by Amendment No. 1 dated
November 2, 1992, by a letter agreement dated March 18, 1993, by Amendment No.
2 dated as of May 26, 1993, by Amendment No. 3 dated as of May 26, 1993, by
Amendment No. 4 dated as of October 15, 1993, by Amendment No. 5 dated as of
March 1, 1994, by Amendment No. 6 dated as of August 11, 1994, by Amendment No.
7 and Waiver dated as of September 8, 1994, and by Amendment No. 8 dated as of
March 23, 1995, and as modified by an Assignment and Assumption Agreement dated
as of November 14, 1994 (as so amended and modified, the "Credit Agreement")
----------------
pursuant to which, among other things, the Borrower granted to the Bank a
security interest in all of its personal property (the "Collateral"); and
----------

WHEREAS, on the date of the initial Loan to Ross White under the Credit
Agreement, the Bank had established a revolving line of credit for Ross White as
an independent company engaged in the nationwide sale and distribution of
computers and computer peripherals secured by all of Ross White's assets,
including but not limited to all inventory and accounts receivable; and

WHEREAS, as a result of the acquisition and consolidation strategy of its
parent company, AmeriQuest Technologies, Inc., a Delaware Corporation (the
"Parent"), the Borrower is now affiliated with a number of companies engaged in
------
similar businesses (the Parent and all such affiliated companies, collectively,
the "Parent Group"), and the Borrower has informed the Bank that it has, and
------------
from time to time intends to, relocate
<PAGE>

-2-

certain of its inventory Collateral to locations where goods that are owned
by members of the Parent Group are also warehoused, and pursuant to Section 7.2
of the Credit Agreement has requested that the Bank consent to such relocation;
and

WHEREAS, the Borrower has further requested a sixty day extension of the
time for delivery to the Bank under Section 5.1(a) of the Credit Agreement of
the Borrower's audited balance sheet for the Borrower's fiscal year ending March
31, 1995 and related audited statements of income, changes in stockholders'
equity, and cash flow from June 30, 1995 to August 31, 1995; and

WHEREAS, in reliance on the assurances of the Borrower and the Parent that
notwithstanding the interrelated nature of the Borrower and the Parent Group,
and the consolidation and integration strategies of the Parent, the Parent and
the other members of the Parent Group will conduct their respective dealings
with the Borrower on an independent and arm's-length basis and will observe and
maintain the separate identity of the Borrower, the Bank is willing to consent
to the Collateral being moved and maintained at these shared locations provided
that the Borrower at all time shall segregate the Collateral from goods owned by
the other members of the Parent Group and deliver to the Bank certain
intercreditor agreements with secured creditors of such other members;

WHEREAS, the members of the Parent Group are provided working capital
support by lenders other than the Bank without benefit of an intercorporate
guarantee by the Borrower, and the Bank is providing working capital support to
the Borrower without benefit of an intercorporate guarantee by the Parent or
any other member of the Parent Group; and

WHEREAS, in an effort to monitor on a timely basis the financial results
and prospects of the Borrower, the Bank is requiring that the Borrower provide
the Bank from time to time with certain information relative to the Parent
Group;

WHEREAS, the Bank is further requiring that the Borrower, (i) maintain
financial records and audited financial statements separate from the Parent
Group, (ii) have all corporate actions authorized by the Borrower's board of
directors at properly held and recorded meetings, and (iii) observe all other
corporate formalities with respect to its intercompany purchases and sales of
inventory and other assets;

WHEREAS, the parties are willing to so agree subject to the amendments to
the Credit Agreement and other terms and covenants contained herein;
<PAGE>

-3-

NOW THEREFORE, in consideration of the mutual covenants and conditions
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, each of the Bank and the Borrower
hereby agrees as follows:

1. The preamble to the Credit Agreement is hereby amended in its entirety
to read as follows:

"THIS REVOLVING CREDIT AGREEMENT (this "Agreement") is made as of April 27,
1992 between AMERIQUEST/NCD, INC. (the "Borrower"), a Florida corporation
having its chief executive office and principal place of business at
MacArthur Place, 3 Imperial Promenade, Santa Ana, California 92707, and
successor by merger to Ross White Enterprises, Inc., and THE FIRST NATIONAL
SANK OF BOSTON (the "Bank"), a national banking association having its head
office at 100 Federal Street, Boston, Massachusetts 02110."

2. The definition of "Borrowing Base" appearing in Section 1.1 of the
Credit Agreement is hereby amended in its entirety to read as follows:

(a) "Borrowinq Base. An amount equal to the lesser of (x) $27,500,000 until
--------------
the Contingency Date, as defined below, and thereafter, $30,000,000 and (y)
the sum of (i) 85% of the face value of Eligible Accounts due and owing at
such time, plus (ii) the least of (A) 50% of Eligible Inventory, (B)
----
$15,000,000 and (C) the amount available under subset (y)(i) of this
definition, minus (from the sum of (i) and (ii)) the amount specified below
-----
for the range of availability hereunder calculated as of the date of any
determination,

<TABLE>
<CAPTION>
<S> <C>
Loan Availability Amount Reserve
------------------------ -------
Less than $17,500,000 $ 500,000
$17,500,000 - $19,999,999 $ 750,000
$20,000,000 - $22,499,999 $1,000,000
$22,500,000 - $24,999,999 $1,250,000
25,000,000 or more $1,500,000
</TABLE>

minus from the amount calculated in accordance with the foregoing,
-----
commencing on July 17, 1995, $500,000 and increasing to $1,000,000
commencing on July 24, 1995 through and including the second Business Day
(the "Contingency Date") following receipt by the Bank of unqualified
----------------
audited financial statements of the Borrower in accordance with Section
5.1(a) of this Agreement for the fiscal year ending April 1, 1995
reflecting
<PAGE>

-4-

performance by the Borrower under Sections 5.7, 5.8, 5.9 and 5.10 of this
Agreement at a level equal to or better than that shown in the management-
prepared financial statements delivered to the Bank on May 16, 1995 for the
fiscal year ending April 1, 1995."

3. The definition of "Eligible Account" appearing in Section 1.1 of the
Credit Agreement is hereby amended by deleting the "and" at the end of subclause
(n), relettering subclause (o) to become subclause (p), and by adding the
following new subclause (o) to be inserted immediately following subclause (n)
thereof:

"(o) such Account is not owing by an Affiliate of the Borrower; and"

4. The definition of "Eligible Inventory" appearing in Section 1.1 of the
Credit Agreement is hereby amended by deleting the "and" at the end of subclause
(i), relettering subclause (j) to become subclause (k), and by adding the
following new subclause (j) to be inserted immediately following subclause (i)
thereof:

"(j) commencing on August 15, 1995, such Inventory, if located in a
Consolidated Warehouse, (i) has a value not greater than the Consolidated
Warehouse Inventory Cap then in effect for such warehouse, (or, if the
value of such Inventory is in excess of the amount so specified, such
excess is excluded from the calculation of the total value of such
Inventory), (ii) is the subject of an Intercreditor Agreement, in full
force and effect, (iii) is located in a Consolidated Warehouse for which
the Bank has received an executed landlord agreement, substantially in the
form of Exhibit 1.1 (j) (iii) hereto, or Exhibit 1.1 (j) (iv) hereto, as
--------------------- --------------------
appropriate and (iv) if purchased from an Affiliate of the Borrower, such
Affiliate is a party to the Affiliate Subordination Agreement; and"

5. The definition of "Subordinated Indebtedness" appearing in Section I of
the Credit Agreement is hereby amended in its entirety to read as follows:

"Subordinated Indebtedness. Any Indebtedness of the Borrower the payment of
-------------------------
principal of and interest on which is expressly subordinated in right of
payment to the prior payment in full of the Obligations by a subordination
agreement in a form and containing terms approved by the Bank, including
but not limited to Indebtedness subordinated under the Parent Subordination
Agreement and the Affiliate Subordination Agreement."
<PAGE>

-5-

6. The following new defined terms are hereby added to Section 1.1 of the
Credit Agreement in proper alphabetical order:

"Affiliate. Any person that now or hereafter directly, or indirectly
---------
through one or more intermediaries, controls, or is controlled by, or is
under common control with, such person. The terms "control," "controlled
by," and "under common control with" means the possession, direct or
indirect, of the power to direct or cause the direction of the management
and policies of a person, whether through the ownership of voting
securities or interests, by contract or otherwise."

"Affiliate Subordination Agreement. The Subordination Agreement,
---------------------------------
substantially in the form of Exhibit 1.1(j)(v), as may be amended from
-----------------
time to time, executed by the Borrower and the Affiliates named therein
from time to time in favor of the Bank, pursuant to which any and all
amounts from time to time owing by the Borrower to each such Affiliate is
subordinated to the payment in full of all Indebtedness of the Borrower
owing from time to time to the Bank."

"Consolidated Warehouse. A warehouse at which Collateral owned by the
----------------------
Borrower is located together with goods owned by an Affiliate of the
Borrower."

"Consolidated Warehouse Inventory Cap. The amount shown for each
------------------------------------
Consolidated Warehouse set forth on Exhibit 1.1(j)(i) hereto, as such
-----------------
exhibit may be amended and/or updated from time to reflect such changes in
those amounts as the Borrower and the Bank may agree upon (or, after the
occurrence of an Event of Default which is continuing, as the Bank may, in
its sole discretion, specify from time to time by written notice to the
Borrower,) and/or to add additional Consolidated Warehouses or delete
warehouses no longer constituting a Consolidated Warehouse."

"Intercreditor Agreement. An Intercreditor Agreement in form and substance
-----------------------
satisfactory to the Bank substantially in the form of Exhibit 1.1(j)(ii)
------------------
hereto between the Bank and any secured creditor of an Affiliate of the
Borrower with a security interest in goods of such Affiliate located at a
Consolidated Warehouse."

"Parent. AmeriQuest Technologies, Inc., a Delaware corporation, and any
------
subsequent holder of a majority of the issued and outstanding shares of
common stock of the Borrower."
<PAGE>

-6-

"Parent Subordination Agreement. The Subordination Agreement dated as of
------------------------------
November 14, 1994 executed by the Borrower and AmeriQuest Technologies,
Inc. in favor of the Bank, as may be amended from time to time, pursuant to
which any and all Indebtedness of the Borrower from time to time owing to
the Parent is subordinated to the payment in full of all Indebtedness of
the Borrower owing from time to time to the Bank."

7. The following subclauses of Section 5.1 of the Credit Agreement are
hereby amended in their entirety respectively to read as follows:

"(d) promptly after the receipt thereof by the Borrower, any Subsidiary of
the Borrower, the Parent, or any other Affiliate of the Borrower, copies of
any reports submitted to such person by independent public accountants in
connection with any interim review of the accounts of such person made by
such accountants;"

"(f) immediately upon becoming aware of the existence of any condition or
event that constitutes, with respect to the Borrower, a Default hereunder,
or, with respect to any Subsidiary of the Borrower, the Parent or any other
Affiliate of the Borrower, a default under any agreement or instrument
evidencing or securing indebtedness of such person, written notice thereof
specifying the nature and duration thereof and the action being or proposed
to be taken with respect thereto;"

"(g) promptly upon becoming aware of any litigation or of any investigative
proceedings by a governmental agency or authority commenced or threatened
against the Borrower, any Subsidiary of the Borrower, the Parent, or any
other Affiliate of the Borrower of which such person has notice, the
outcome of which would or might have a materially adverse effect on the
assets, business, prospects or financial condition of such person, written
notice thereof and the action being or proposed to be taken with respect
thereto;"

"(h) promptly after the sending or filing thereof, copies of all proxy
statements, financial statements and reports that the Borrower, any
Subsidiary of the Borrower, the Parent, or any other Affiliate of the
Borrower sends to its stockholders, and copies of all regular, periodic and
special reports, and all registration statements, that the Borrower, any
Subsidiary of the Borrower, the Parent, or any other Affiliate of the
Borrower files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or with any
national securities exchange; and
<PAGE>

-7-

(i) from time to time, such other information about the Borrower, any
Subsidiary of the Borrower, the Parent, or any other Affiliate of the
Borrower as the Bank may reasonably request."

8. Section V of the Credit Agreement is further amended by
renumbering Section 5.12 thereof as Section 5.14, and by
inserting new Sections 5.12 and 5.13 immediately following
Section 5.11 thereof as follows:

"5.12. Maintenance of Independent and Separate Identity. The Borrower shall
------------------------------------------------
(i) maintain financial records and audited financial statements separate
from the Parent and the other Affiliates, (ii) have all corporate actions
authorized by the Borrower's board of directors (at least two members of
which will at all time be independent directors who are not officers or
employees of the Borrower, the Parent or any other Affiliate of the
Borrower) at properly held and recorded meetings, and (iii) observe all
other corporate formalities with respect to its intercompany purchases and
sales of inventory and other assets;

"5.13. Collateral Located in Consolidated Warehouses. (a) All Collateral
----------------------------------------------
located in a Consolidated Warehouse will be located in a segregated section
of such Consolidated Warehouse clearly delineated with colored tape and
containing therein only Collateral and no goods owned by any entity other
than the Borrower, and each item of Collateral will be marked with a
colored sticker or tag or shall be otherwise identified as property of the
Borrower so as to identify it as the Bank's Collateral;

(b) At any time that an Intercreditor Agreement is not in full force and
effect, or, in the event of a bankruptcy of an Affiliate of the Borrower
with goods located in a Consolidated Warehouse, or any foreclosure action
taken by a creditor against any such Affiliate's goods, the Borrower will,
promptly upon the Bank's request, move the Collateral located in the
related Consolidated Warehouse to another location satisfactory to the
Bank, or take such other or additional actions with respect thereto as the
Bank may reasonably require;

(c) The Borrower will notify the Bank, at least thirty (30) days prior to
the relocation, with such detail as the Bank may request, of any intended
relocation of Collateral to a Consolidated Warehouse (including any
relocation of Collateral from one Consolidated Warehouse to another
Consolidated Warehouse, and will at the same time provide the Bank with two
duplicate originals of an
<PAGE>

-8-

updated Exhibit 1.1(j)(i), with Consolidated Warehouse Inventory Caps dated
-----------------
and signed by the Borrower for signature by the Bank, which Exhibit
-------
1.1(j)(i) will replace in its entirety the Exhibit 1.1(j)(i) previously
--------- -----------------
made a part of this Agreement and which the Borrower hereby authorizes the
Bank to substitute therefor; and

(d) Upon request by the Bank, the Borrower will provide the Bank with
copies of any documentation with respect to intercompany receivables
arising from transactions between the Borrower and any Affiliate having
goods located at a Consolidated Warehouse."

9. Section VI is hereby amended to add the following new
Section 6.12:

"6.12. Transactions with Affiliates. (a) The Borrower will not enter into
-----------------------------
or be a party to any transaction or arrangement with any Affiliate
(including, without limitation, the purchase from, sale to or exchange of
property with, or the rendering of any service by or for, any Affiliate),
except in the ordinary course of and pursuant to the reasonable
requirements of the Borrower's business, upon fair and reasonable terms no
less favorable to the Borrower than would obtain in a comparable arm's
length transaction with a person other than an Affiliate, and upon
observance of all normal corporate and business formalities with respect to
such transaction; and

(b) The Borrower will not enter into any transaction pursuant to which it
will, or could, owe money to any Affiliate having goods in a Consolidated
Warehouse until such Affiliate has become a party to the Affiliate
Subordination Agreement and delivered to the Bank an original signature
page therefor accompanied by a certificate of the recording officer for
such Affiliate certifying to the authority of the officer executing the
same.

10. Section 7.3(b) of the Credit Agreement is hereby amended in
its entirety to read as follows:

"(b) Schedule of Inventory. Deliver to the Bank weekly a schedule of
---------------------
inventory as of the last Business Day of the immediately preceding weekly
account period of the Borrower and/or at such other intervals and for such
periods as the Bank may request, itemizing and describing for each location
the kind, type and quantity of Inventory by location and the Borrower's
cost thereof."
<PAGE>

-9-

11. Section 9.1 of the Credit Agreement is hereby amended by
deleting clauses (a) through (d) therefrom, and by adding the
following new clauses (a) and (b):

"(a) If to the Borrower:

AmeriQuest/NCD, Inc.
MacArthur Place
3 Imperial Promenade
Santa Ana, California 92707
Attn: Dennis Fairchild, V.P. Finance
Telephone: (714) 437-0099 x5007
Telecopier: (714) 437-9197

(b) If to the Bank:

The First National Bank of Boston
115 Perimeter Center Place, N.E., Suite 500
Atlanta, Georgia 30346
Attn: John K. Hood/James St. Clair
Telephone: (404) 390-6526/6557
Telecopier: (404) 393-4166

12. Each of Exhibits 4.1. 4.5, 4.10, and 7.3(c) is hereby
----------------------- ------
amended in its entirety and replaced with the respective Exhibit
attached hereto.

13. Extension Waiver. In reliance upon the Borrower's
----------------
representation, which by the Borrower's signature hereto the
Borrower is hereby deemed to have made, that as of the date of
this Amendment the Borrower is not in default of any of its
obligations under the Credit Agreement, the Bank hereby extends
the time for delivery of the Borrower's audited financial
statements required by Section 5.1(a) of the Credit Agreement
for the fiscal year ending April 1, 1995 to August 31, 1995 and
waives the Borrower's failure to deliver such financial
statements within ninety (90) days following its fiscal year
ending April 1, 1995. By its signature hereto, the Borrower
covenants and agrees that such statements by August 31, 1995
shall be delivered to the Bank on or before August 31, 1995 in
accordance with the requirements of Section 5.1(a) (other than
the ninety day time period specified therein), and the failure
by the Borrower to deliver such statements by August 31, 1995
shall constitute an Event of Default under the Credit
Agreement. The foregoing waiver is expressly limited to the
non-compliance by the Borrower with Section 5.1(a) of the
Credit Agreement and is not, nor shall it be construed as, a
waiver of any other provision of the Credit Agreement.

14. Consent. Subject to the satisfaction of the conditions
-------
precedent set forth herein, the Bank hereby consents to the
relocation of any Collateral to a Consolidated Warehouse.
<PAGE>

-10-

15. Effectivess of Amendment. This Amendment, and the extension and waiver
------------------------
and consents contained herein, shall become effective, as of the date first
written above, upon the satisfaction of the following conditions precedent:

(a) receipt by the Bank of this Amendment, executed by an
authorized officer of the Borrower;

(b) receipt by the Bank of a true and correct Exhibit 1.1(j)(i)
as to all Collateral located in a Consolidated Warehouse;

(c) a certificate of the secretary or an assistant secretary of the
Borrower with respect to resolutions of its Board of Directors authorizing
the execution and delivery of this Amendment, confirming the resolutions
previously adopted by the Board of Directors of the Borrower authorizing
the borrowings and other transactions contemplated under the Credit
Agreement, identifying the officer(s) authorized to execute, deliver and
take all other actions required under this Amendment, or the Credit
Agreement, and confirming that the Borrower's Articles of Organization and
By-Laws previously delivered and certified to the Bank have not been
amended, substituted, rescinded or otherwise modified in any way since the
date of said prior certification;

(d) a certificate of the president or chief financial officer of the
Borrower with respect to representations and warranties under the
Agreement, and the absence of any Defaults or Events of Default;

(e) such other items or documents as may be requested by the
Bank.

16. Effect Upon Credit Aqreement. Upon and after the date of
-----------------------------
this Amendment all references to the Credit Agreement in that
document or in any related document, shall mean the Credit
Agreement as amended by this Amendment. Except as expressly
provided in this Amendment, the execution and delivery of this
Amendment does not and will not amend, modify or supplement any
provision of, or constitute a consent to or a waiver of any
non-compliance with the provisions of the Credit Agreement,
and, except as specifically provided in this Amendment, the
Credit Agreement shall remain in full force and effect.

17. No Impairment of Lien. Nothing set forth herein shall
----------------------
affect the priority or extent of the lien of the Credit
Agreement, nor, release or change the liability of any party
who may now be or after the date of this, become liable
primarily or secondarily, thereunder.
<PAGE>

-11-

18. Further Assurances. The Borrower hereby agrees to execute
-------------------
and deliver such other instruments, and take such other action,
as the Bank may reasonably request in connection with this
Amendment, including, without limitation, the delivery of all
additional Uniform Commercial Code financing statements which
the Bank may deem appropriate for the perfection, protection
and enforcement of its security interests in the Collateral.

19. Miscellaneous. (a) This Amendment shall be construed
--------------
according to and governed by the laws of The Commonwealth of
Massachusetts without regard to its internal conflicts rules;
(b) if any provision of this Amendment is adjudicated to be
invalid, illegal or unenforceable, in whole or in part, it will
be deemed omitted to that extent and all other provisions of
this Amendment will remain in full force and effect; (c) the
captions contained in this Amendment are for convenience of
reference only and in no event define, describe or limit the
scope of intent or any of the provisions or terms hereof; (d)
this Amendment shall be binding upon and inure to the benefit
of the parties and their respective heirs, legal representatives,
successors and assigns; and (e) this Amendment may be executed in
one or more counterparts.

20. Additional Agreement Regarding Applicable Margin for Period
-----------------------------------------------------------
Commencing January 1. 1995. In light of the Bank's continuing
- --------------------------
concern regarding certain matters relative to the Borrower's
leverage ratio for the month ending December 31, 1994 and
thereafter, which the parties have agreed will be resolved upon
delivery of the Borrower's audited April 1, 1995 year-end
financial statements (the "Audited Statements"), the parties
hereby agree that the Applicable Margin will be deemed to have
been (i) 3% for the period January 1, 1995 through May 31,
1995, and (ii) 1 1/2% for the period June 1, 1995 through the
end of the month in which the Audited Statements are delivered
to the Bank, provided that if the Audited Statements are
-------- ----
unqualified, the interest due for the period February 1, 1995
through May 31, 1995 shall be recalculated using an Applicable
Margin of 1 1/2% with the difference rebated to the Borrower by
the Bank in the form of a credit against unpaid accrued
interest due or becoming due under the Credit Agreement after
the Bank's receipt of the Audited Statements, and provided
--------
further that if the Audited Statements are qualified, the
- ------- ----
interest due for the period June 1, 1995 through the end of the
month in which the Audited Statements are delivered to the
Bank, shall be recalculated using an Applicable Margin of 3%
with the difference to be charged to the Borrower's Loan
Account.
<PAGE>

-12-

IN WITNESS WHEREOF, the parties have executed this Amendment
by their duly authorized officers as of the date first above written.

AMERIQUEST/NCD, INC.

By:
---------------------------------

---------------------------------
Print Name

Title: CEO
------------------------------

Executed At: CA
------------------------

THE FIRST NATIONAL BANK OF BOSTON

By:
---------------------------------

---------------------------------
Print Name

Title:
------------------------------

Executed At:
------------------------

<PAGE>
EXHIBIT 10.08

EMPLOYMENT AGREEMENT
--------------------

This Employment Agreement (the "Agreement") is entered into as of
---------
September ___, 1995 (the "Effective Date") between AmeriQuest Technologies,Inc.,
--------------
a Delaware corporation with its principal offices located at 3 Imperial
Promenade, Suite 300, Santa Ana, California ("Company"), and Steve DeWindt, a
-------
resident of Laguna Niguel, California ("Employee").
--------

In consideration of the promises and the terms and conditions set
forth in this Agreement, the parties agree as follows:

1. POSITION. During the term of this Agreement, Company will employ
--------
Employee, and Employee will serve Company as the Company's Chief Executive
Officer. Employee will report directly to the Board of Directors of Company.

2. DUTIES. Employee will serve Company in such capacities and with
------
such duties and responsibilities as the Board of Directors may from time to time
determine. Employee will comply with and be bound by Company's operating
policies, procedures, and practices from time to time in effect during
Employee's employment. Employee will perform his duties under this Agreement at
the offices of Company, provided, that Employee may be required to do
--------
extensive traveling in connection with the performance of his duties hereunder.
Employee hereby represents and warrants that he is free to enter into and fully
perform this Agreement and the agreements referred to herein without breach of
any agreement or contract to which he is a party or by which he is bound.

3. EXCLUSIVE SERVICE. During his employment with Company, Employee
-----------------
will devote his full time and efforts exclusively to this employment and apply
all his skill and experience to the performance of his duties and advancing
Company's interests in accordance with Employee's experience and skills. In
addition, during his employment with Company, Employee will not engage in any
consulting activity except with the prior written approval of Company, or at the
direction of Company, and Employee will otherwise do nothing inconsistent with
the performance of his duties hereunder.

4. OBLIGATION NOT TO COMPETE. Employee hereby agrees that while he
-------------------------
is employed by Company (the "Restricted Period"), Employee shall not engage in
-----------------
or provide services to any business that is competitive with or detrimental to
any present or contemplated business of Company known to Employee. Employee also
agrees that, during the Restricted Period, he shall not in any manner attempt to
induce or assist others to attempt to induce any customer or client of Company
to terminate his association with Company, nor do anything directly or
indirectly to interfere with the relationship between Company and any such
persons or concerns. Each of the following activities shall, without limitation,
be deemed to constitute engaging in business within the meaning of this Section
3: to engage in, work with, have an interest or concern in, advise, lend money
to, guarantee the debts or obligations of, or permit one's name or any party
thereof to be used in connection with, an enterprise or endeavor, either
individually, in partnership, or in conjunction with any person or persons,
firms, associations, companies, or corporations, whether as a principal, agent,
shareholder,

<PAGE>

employee, officer, director, partner, consultant or in any other manner
whatsoever; provided, however, that Employee shall retain the right to
-------- -------
invest in or have an interest in entities traded on any public market or offered
by any national brokerage house, provided that said interest does not exceed one
percent (1%) of the voting control of said entity. In addition, Employee may
make passive investments in privately held entities that are determined by the
Board of Directors of Company not to be competitors of Company.

5. TERM OF AGREEMENT. This Agreement will commence on the Effective
-----------------
Date, and will continue for a period of twenty-four months and thereafter unless
terminated pursuant to Section 8 hereof.

6. COMPENSATION AND BENEFITS.
-------------------------

6.1 BASE SALARY. Company agrees to pay Employee an initial
-----------
minimum salary of Two Hundred and Ten Thousand Dollars ($210,000.00) per year.
Employee's salary will be payable as earned in accordance with Company's
customary payroll practice.

6.2 ADDITIONAL BENEFITS. Employee will be eligible to
-------------------
participate in Company's employee benefit plans of general application,
including without limitation those plans covering pension and profit sharing,
executive bonuses, stock purchases, stock options, and those plans covering
life, health, and dental insurance in accordance with the rules established for
individual participation in any such plan and applicable law, provided however,
that Company will pay 100% of the premiums for Employee's (and Employee's
family) health and dental insurance. Employee will receive such other benefits,
including vacation, holidays and sick leave, as Company generally provides to
its employees holding similar positions as that of Employee.

6.3 COMPANY CAR. Company will provide to Employee a BMW 700
-----------
Series or equivalent automobile and pay the costs of insurance and maintenance
thereon.

6.4 PLAN BONUS. Employee will be eligible to earn a bonus of up
----------
to Three Hundred and Thirty-Six Thousand Dollars ($336,000.00) (the "Plan
----
Bonus") during his first year of employment with Company. The performance
- -----
criteria relative to the Plan Bonus is as set forth in Exhibit A attached
---------
hereto.

6.5 PERFORMANCE BONUS. Employee will be eligible to earn a
-----------------
bonus payable in Company stock and based upon Company's cumulative profit from
October 1, 1995 until Employee's termination (the "Performance Bonus"). The
-----------------
performance criteria relative to the Performance Bonus is as set forth in
Exhibit B attached hereto.
- ---------

6.6 EXPENSES. Company will reimburse Employee for all
--------
reasonable and necessary expenses incurred by Employee in connection with
Company's business, provided that such expenses are deductible to Company, are
in accordance with

- 2 -
<PAGE>

Company's applicable policy and are properly documented and accounted for in
accordance with the requirements of the Internal Revenue Service.

7. PROPRIETARY RIGHTS. Employee hereby agrees to execute an
------------------
Employee Confidentiality Agreement with Company in substantially the form
attached hereto as Exhibit C.
---------

8. TERMINATION.
-----------

8.1 EVENTS OF TERMINATION. Employee's employment with Company
---------------------
shall terminate upon any one of the following:

(a) the Company's determination made in good faith that it
is terminating Employee for "cause" as defined under Section
8.2 below ("Termination for Cause");
---------------------

(b) three months after the effective date of a written
notice sent to Employee stating that Company is terminating his
employment, without cause, which notice can be given by Company at
any time after the Effective Date at Company's sole discretion,
for any reason or for no reason; or

(c) the effective date of a written notice sent to Company
from Employee stating that Employee is electing to terminate
his employment with Company.

8.2 "CAUSE" DEFINED. For purposes of this Agreement, "cause"
---------------
for Employee's termination will exist at any time after the happening of one or
more of the following events:

(a) a failure or a refusal to comply in any material
respect with the reasonable policies, standards or regulations of
the Company;

(b) a failure or a refusal in any material respect,
faithfully or diligently, to perform his duties determined by the
Company in accordance with this Agreement or the customary duties
of Employee's employment;

(c) unprofessional, unethical or fraudulent conduct or
conduct that materially discredits the Company or is
materially detrimental to the reputation, character or
standing of the Company;

(d) dishonest conduct or a deliberate attempt to do an
injury to the Company;

(e) Employee's material breach of a term of this Agreement;

- 3 -
<PAGE>

(f) an unlawful or criminal act which would reflect badly
on the Company in the Company's reasonable judgment;

(g) Employee's death.

- 4 -
<PAGE>

9. EFFECT OF TERMINATION.
---------------------

9.1 TERMINATION FOR CAUSE OR VOLUNTARY TERMINATION. In the
----------------------------------------------
event of any termination of this Agreement pursuant to Sections 8.1(a) or
8.1(c), the Company shall pay Employee the compensation and benefits otherwise
payable to Employee under Section 6 through the date of termination. Employee's
rights under the Company's benefit plans of general application shall be
determined under the provisions of those plans.

9.2 TERMINATION WITHOUT CAUSE. In the event of any
-------------------------
termination of this Agreement pursuant to Section 8.1(b), the Company shall pay
Employee the compensation and benefits otherwise payable to Employee under
Section 6 through the last day of the six month period following the date that
the notice referred to in Section 8.1(b) is given.

10. MISCELLANEOUS.
-------------

10.1 ARBITRATION. Employee and Company shall submit to mandatory
-----------
binding arbitration in any controversy or claim arising out of, or relating to,
this Agreement or any breach hereof, provided, however, that Company retains
-------- -------
its right to, and shall not be prohibited, limited or in any other way
restricted from, seeking or obtaining equitable relief from a court having
jurisdiction over the parties. Such arbitration shall be conducted in accordance
with the commercial arbitration rules of the American Arbitration Association in
effect at that time, and judgment upon the determination or award rendered by
the arbitrator may be entered in any court having jurisdiction thereof.

10.2 SEVERABILITY. If any provision of this Agreement shall be
------------
found by any arbitrator or court of competent jurisdiction to be invalid or
unenforceable, then the parties hereby waive such provision to the extent that
it is found to be invalid or unenforceable and to the extent that to do so would
not deprive one of the parties of the substantial benefit of its bargain. Such
provision shall, to the extent allowable by law and the preceding sentence, be
modified by such arbitrator or court so that it becomes enforceable and, as
modified, shall be enforced as any other provision hereof, all the other
provisions continuing in full force and effect.

10.3 REMEDIES. Company and Employee acknowledge that the service
--------
to be provided by Employee is of a special, unique, unusual, extraordinary and
intellectual character, which gives it peculiar value the loss of which cannot
be reasonably or adequately compensated in damages in an action at law.
Accordingly, Employee hereby consents and agrees that for any breach or
violation by Employee of any of the provisions of this Agreement including,
without limitation, Section 3), a restraining order and/or injunction may be
issued against Employee, in addition to any other rights and remedies Company
may have, at law or equity, including without limitation the recovery of money
damages.

- 5 -
<PAGE>

10.4 NO WAIVER. The failure by either party at any time to
---------
require performance or compliance by the other of any of its obligations or
agreements shall in no way affect the right to require such performance or
compliance at any time thereafter. The waiver by either party of a breach of any
provision hereof shall not be taken or held to be a waiver of any preceding or
succeeding breach of such provision or as a waiver of the provision itself. No

- 6 -
<PAGE>

waiver of any kind shall be effective or binding, unless it is in writing and is
signed by the party against whom such waiver is sought to be enforced.

10.5 ASSIGNMENT. This Agreement and all rights hereunder are
----------
personal to Employee and may not be transferred or assigned by Employee at any
time. Company may assign its rights, together with its obligations hereunder, to
any parent, subsidiary, affiliate or successor, or in connection with any sale,
transfer or other disposition of all or substantially all of its business and
assets, provided, however, that any such assignee assumes Company's obligations
-------- -------
hereunder.

10.6 WITHHOLDING. All sums payable to Employee hereunder shall
-----------
be reduced by all federal, state, local and other withholding and similar taxes
and payments required by applicable law.

10.7 ENTIRE AGREEMENT. This Agreement and the Employee
----------------
Confidentiality Agreement constitute the entire and only agreements between the
parties relating to employment of Employee with Company, and this Agreement
supersedes and cancels any and all previous contracts, arrangements or
understandings with respect thereto.

10.8 AMENDMENT. This Agreement may be amended, modified,
---------
superseded, cancelled, renewed or extended only by an agreement in writing
executed by both parties hereto.

10.9 NOTICES. All notices and other communications required or
-------
permitted under this Agreement shall be in writing and hand delivered, sent by
telecopier, sent by certified first class mail, postage pre-paid, or sent by
nationally recognized express courier service. Such notices and other
communications shall be effective upon receipt if hand delivered or sent by
telecopier, five (5) days after mailing if sent by mail, and one (l) day after
dispatch if sent by express courier, to the following addresses, or such other
addresses as any party shall notify the other parties:

If to Company: AmeriQuest Technologies, Inc.
-----------------------------
3 Imperial Promenade, Suite 300
-------------------------------
Santa Ana, CA 92707
--------------------
Telecopier: (714) 445-5350
--------------
Attention: Board of Directors
------------------

If to Employee: Steve DeWindt
-------------
2 Shelter Cove
--------------
Laguna Niguel, CA 92677
------------------------
Telecopier:

10.10 BINDING NATURE. This Agreement shall be binding upon, and
--------------

- 7 -
<PAGE>

inure to the benefit of, the successors and personal representatives of the
respective parties hereto.

10.11 HEADINGS. The headings contained in this Agreement are for
--------
reference purposes only and shall in no way affect the meaning or interpretation
of this Agreement. In this Agreement, the singular includes the plural, the
plural included the singular, the masculine gender includes both male and female
referents, and the word "or" is used in the inclusive sense.

10.12 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original but all of which,
taken together, constitute one and the same agreement.

10.13 GOVERNING LAW. This Agreement and the rights and obligations
-------------
of the parties hereto shall be construed in accordance with the laws of the
State of California, without giving effect to the principles of conflict of
laws.

IN WITNESS WHEREOF, Company and Employee have executed this Agreement as
of the date first above written.

"COMPANY" "EMPLOYEE"

AMERIQUEST TECHNOLOGIES, INC.
STEVE DEWINDT

By:

Name:

Title:

353214

- 8 -
<PAGE>

EXHIBIT A

PLAN BONUS CRITERIA

- 9 -
<PAGE>

EXHIBIT B

PERFORMANCE BONUS CRITERIA

- 10 -
<PAGE>

EXHIBIT C

CONFIDENTIALITY AGREEMENT

- 11 -
<PAGE>

EMPLOYEE INVENTION ASSIGNMENT AND CONFIDENTIALITY AGREEMENT
-----------------------------------------------------------

In consideration of, and as a condition of my employment with AmeriQuest
Technologies, Inc., a Delaware corporation (the "COMPANY"), I hereby represent
to the Company and the Company and I agree as follows:

1. PURPOSE OF AGREEMENT. I understand that the Company is engaged in a
--------------------
continuous program of research, development, production, and marketing in
connection with its business and that it is critical for the Company to preserve
and protect its "Proprietary Information" (as defined below), its rights in
"Inventions" (as defined below), and in all related intellectual property
rights. Accordingly, I am entering into this Agreement as a condition of my
employment with the Company, whether or not I am expected to create inventions
of value for the Company.

2. DISCLOSURE OF INVENTIONS. I will promptly disclose in confidence to the
------------------------
Company all inventions, improvements, designs, original works of authorship,
formulas, processes, compositions of matter, computer software programs,
databases, mask works, and trade secrets ("INVENTIONS") that I make or conceive
or first reduce to practice or create, either alone or jointly with others,
during the period of my employment, whether or not in the course of my
employment, and whether or not such Inventions are patentable, copyrightable or
protectible as trade secrets.

3. WORK FOR HIRE; ASSIGNMENT OF INVENTIONS. I acknowledge that any
---------------------------------------
copyrightable works prepared by me within the scope of my employment are "works
for hire" under the Copyright Act and that the Company will be considered the
author and owner of such copyrightable works. I further acknowledge that all
Inventions that (a) are developed using equipment, supplies, facilities or trade
secrets of the Company, (b) result from work performed by me for the Company, or
(c) relate to the Company's business or current or anticipated research and
development, will be the sole and exclusive property of the Company and are
hereby irrevocably assigned by me to the Company.

4. ASSIGNMENT OF OTHER RIGHTS. In addition to the foregoing assignment of
--------------------------
Inventions to the Company, I hereby irrevocably transfer and assign to the
Company: (a) all worldwide patents, patent applications, copyrights, mask
works, trade secrets, and other intellectual property rights in any Invention;
and (b) any and all "Moral Rights" (as defined below) that I may have in or with
respect to any Invention. I also hereby forever waive and agree never to assert
any and all Moral Rights I may have in or with respect to any Invention, even
after termination of my work on behalf of the Company. "MORAL RIGHTS" means any
rights to claim authorship of an Invention, to object to or prevent the
modification of any Invention, or to withdraw from circulation or control the
publication or distribution of any Invention, and any similar right, existing
under judicial or statutory law of any country in the world, or under any
treaty, regardless of whether or not such right is denominated or generally
referred to as a "moral right."

5. ASSISTANCE. I will assist the Company in every proper way to obtain for
----------
the Company and enforce patents, copyrights, mask work rights, trade secret
rights, and other legal protections for the Company's Inventions in any and all
countries. I will execute any documents that the Company may reasonably request
for use in obtaining or enforcing such patents, copyrights, mask work rights,
trade secrets, and other legal protections. My obligations under this paragraph
will continue beyond the termination of my employment with the Company, provided
that the Company will compensate me at a reasonable rate after such termination
for time or expenses actually spent by me at the Company's request on such
assistance. I appoint the Secretary of the Company as my attorney-in-fact to
execute documents on my behalf for this purpose.
<PAGE>

6. PROPRIETARY INFORMATION. I understand that my employment by the Company
-----------------------
creates a relationship of confidence and trust with respect to any information
of a confidential or secret nature that may be disclosed to me by the Company
that relates to the business of the Company or to the business of any parent,
subsidiary, affiliate, customer or supplier of the Company or any other party
with whom the Company agrees to hold information of such party in confidence
("PROPRIETARY INFORMATION"). Such Proprietary Information includes but is not
limited to Inventions, marketing plans, product plans, business strategies,
financial information, forecasts, personnel information, and customer lists.

7. CONFIDENTIALITY. At all times, both during my employment and after its
---------------
termination, I will keep and hold all such Proprietary Information in strict
confidence and trust, and I will not use or disclose any of such Proprietary
Information without the prior written consent of the Company, except as may be
necessary to perform my duties as an employee of the Company for the benefit of
the Company. Upon termination of my employment with the Company, I will
promptly deliver to the Company all documents and materials of any nature
pertaining to my work with the Company, and I will not take with me any
documents or materials or copies thereof containing any Proprietary Information.

8. NO BREACH OF PRIOR AGREEMENT. I represent that my performance of all the
----------------------------
terms of this Agreement and my duties as an employee of the Company will not
breach any invention assignment, proprietary information, or similar agreement
with any former employer or other party. I represent that I will not bring with
me to the Company or use in the performance of my duties for the Company any
documents or materials of a former employer that are not generally available to
the public or have not been legally transferred to the Company.

9. NOTIFICATION. I hereby authorize the Company to notify my actual or future
------------
employers of the terms of this Agreement and my responsibilities hereunder.

10. NAME & LIKENESS RIGHTS, ETC. I hereby authorize the Company to use, reuse,
----------------------------
and to grant others the right to use and reuse, my name, photograph, likeness
(including caricature), voice, and biographical information, and any
reproduction or simulation thereof, in any media now known or hereafter
developed (including but not limited to film, video, and digital or other
electronic media), both during and after my employment, for whatever purposes
the Company deems necessary.

11. INJUNCTIVE RELIEF. I understand that in the event of a breach or
-----------------
threatened breach of this Agreement by me the Company may suffer irreparable
harm and will therefore be entitled to injunctive relief to enforce this
Agreement.

12. GOVERNING LAW; SEVERABILITY. This Agreement will be governed and
---------------------------
interpreted in accordance with the internal laws of the State of Florida,
without regard to or application of choice-of-law rules or principles. In the
event that any provision of this Agreement is found by a court, arbitrator, or
other tribunal to be illegal, invalid or unenforceable, then such provision
shall not be voided, but shall be enforced to the maximum extent permissible
under applicable law, and the remainder of this Agreement shall remain in full
force and effect.

13. NO DUTY TO EMPLOY. I understand that this Agreement does not constitute a
-----------------
contract of employment or obligate the Company to employ me for any stated
period of time. This Agreement shall be effective as of the first day of my
employment by the Company, namely: September ___, 1995.
<PAGE>

AMERIQUEST TECHNOLOGIES, INC.: EMPLOYEE:

By: ______________________________ _______________________________
Signature

Name:_____________________________ Name __________________________

Title:____________________________ Date:__________________________

[SIGNATURE PAGE TO DEWINDT CONFIDENTIALITY AGREEMENT]

<PAGE>
EXHIBIT 10.09

EMPLOYMENT AGREEMENT
--------------------

This Employment Agreement (the "Agreement") is entered into as of
---------
September 1, 1995 (the "Effective Date") between AmeriQuest Technologies,
--------------
Inc., a Delaware corporation with its principal offices located at 3 Imperial
Promenade, Suite 300, Santa Ana, California ("Company"), and Mark Mulford, a
-------
resident of Laguna Niguel, California ("Employee").
--------

In consideration of the promises and the terms and conditions set
forth in this Agreement, the parties agree as follows:

1. POSITION. During the term of this Agreement, Company will employ
--------
Employee, and Employee will serve Company as the Company's President and Chief
Operating Officer. Employee will report directly to Steve DeWindt, Chairman
of the Board of Directors of Company and Chief Executive Officer.

2. DUTIES. Employee will serve Company in such capacities and with
------
such duties and responsibilities as the Board of Directors and Chief Executive
Officer of Company may from time to time determine. Employee will comply with
and be bound by Company's operating policies, procedures, and practices from
time to time in effect during Employee's employment. Employee will perform his
duties under this Agreement at the offices of Company, provided, that
--------
Employee may be required to do extensive traveling in connection with the
performance of his duties hereunder. Employee hereby represents and warrants
that he is free to enter into and fully perform this Agreement and the
agreements referred to herein without breach of any agreement or contract to
which he is a party or by which he is bound.

1
<PAGE>

associations, companies, or corporations, whether as a principal, agent,
shareholder, employee, officer, director, partner, consultant or in any other
manner whatsoever; provided, however, that Employee shall retain the right to
-------- -------
invest in or have an interest in entities traded on any public market or offered
by any national brokerage house, provided that said interest does not exceed one
percent (1%) of the voting control of said entity. In addition, Employee may
make passive investments in privately held entities that are determined by the
Board of Directors of Company not to be competitors of Company.

5. TERM OF AGREEMENT. This Agreement will commence on the Effective
-----------------
Date, and will continue for a period of twelve months and thereafter unless
terminated pursuant to Section 8 hereof.

6. COMPENSATION AND BENEFITS.
-------------------------

6.1 BASE SALARY. Company agrees to pay Employee an initial
-----------
minimum salary of One Hundred and Ninety Thousand Dollars ($190,000.00) per
year. Employee's salary will be payable as earned in accordance with Company's
customary payroll practice.

6.3 RELOCATION BENEFITS. Company will pay all reasonable costs
-------------------
to relocate Employee from Holland to Southern California, subject to approval of
the Chief Executive Officer. Such costs shall include expenses of moving and
storing Employee's personal property and air fare for Employee and his family.

6.4 ALLOWANCES. Company will provide an allowance to Employee
----------
of $800.00 per month to be applied towards lease of an automobile and
insurance thereon. Company will provide an allowance to Employee of $4,000.00
per month to be applied towards the rental or purchase of a personal residence
and associated costs.

6.5 PLAN BONUS. Employee will be eligible to earn a bonus of up
----------
to Three Hundred and Four Thousand Dollars ($304,000.00) bonus (the "Plan
----
Bonus") during his first year of employment with Company. The performance
- -----
criteria relative to the Plan Bonus is as set forth in Exhibit A attached
---------
hereto.

6.6 PERFORMANCE BONUS. Employee will be eligible to earn a One
-----------------

- 2 -
<PAGE>

Hundred Thousand Dollar ($100,000.00) bonus (the "Performance Bonus") upon the
-----------------
achievement of performance criteria to be established by September 30, 1995 by
the Chief Executive Officer and the Compensation Committee of the Board of
Directors and thereafter attached to hereto as Exhibit B.
---------

6.7 EXPENSES. Company will reimburse Employee for all
--------
reasonable and necessary expenses incurred by Employee in connection with
Company's business, provided that such expenses are deductible to Company, are
in accordance with Company's applicable policy and are properly documented and
accounted for in accordance with the requirements of the Internal Revenue
Service.

6.8 PRICE PROTECTION. It is anticipated that Employee will
----------------
purchase a personal residence in Southern California to occupy during the term
of this Agreement and sell such residence upon the termination thereof or
shortly thereafter. For up to three months after termination of this Agreement,
Company will pay to Employee the difference, if any, by which the net proceeds
received by Employee upon sale of the Employee's residence (the "Proceeds") are
--------
less than the price paid by Employee for such residence, including customary
closing costs ("Cost"). Company shall not be liable to Employee for the
----
amount, if any, by which such residence is damaged by earthquake or fire.
Employee agrees to take all reasonable efforts to sell the residence for the
highest possible sales price. Employee agrees that the excess, if any, of
Proceeds over Cost will be paid to Company. Proceeds and Cost will be calculated
without regard to any mortgage amount.

7. PROPRIETARY RIGHTS. Employee hereby agrees to execute an Employee
------------------
Confidentiality Agreement with Company in substantially the form attached
hereto as Exhibit C.
---------

8. TERMINATION.
-----------

8.1 EVENTS OF TERMINATION. Employee's employment with Company
---------------------
shall terminate upon any one of the following:

(a) the Company's determination made in good faith that it
is terminating Employee for "cause" as defined under Section 8.2
below ("Termination for Cause");
---------------------

(c) the effective date of a written notice sent to Company
from Employee stating that Employee is electing to terminate his
employment with Company.

- 3 -
<PAGE>

8.2 "CAUSE" DEFINED. For purposes of this Agreement, "cause"
--------------
for Employee's termination will exist at any time after the happening of one or
more of the following events:

- 4 -
<PAGE>

(a) a failure or a refusal to comply in any material respect
with the reasonable policies, standards or regulations of the
Company;

(c) unprofessional, unethical or fraudulent conduct or
conduct that materially discredits the Company or is materially
detrimental to the reputation, character or standing of the
Company;

(d) dishonest conduct or a deliberate attempt to do an
injury to the Company;

(e) Employee's material breach of a term of this Agreement;

(f) an unlawful or criminal act which would reflect badly on
the Company in the Company's reasonable judgment;

(g) Employee's death.

9. EFFECT OF TERMINATION.
---------------------

9.2 TERMINATION WITHOUT CAUSE. In the event of any termination
-------------------------
of this Agreement pursuant to Section 8.1(b), the Company shall pay Employee the
compensation and benefits otherwise payable to Employee under Section 6 through
the last day of the three month period following the date that the notice
referred to in Section 8.1(b) is given.

9.3 RESIGNATION AS DIRECTOR. In the event of a termination of
-----------------------
this Agreement for any reason, Employee agrees to resign as a director of
Company. To insure compliance with this provision, Employee is delivering to
Company concurrently herewith, a contingent resignation in the form attached
hereto as Exhibit D.
----------

10. MISCELLANEOUS.
-------------

10.1 ARBITRATION. Employee and Company shall submit to
-----------
mandatory binding arbitration in any controversy or claim arising out of, or
relating to, this

- 5 -
<PAGE>

Agreement or any breach hereof, provided, however, that Company retains its
-------- -------
right to, and shall not be prohibited, limited or in any other way restricted
from, seeking or obtaining equitable relief from a court having jurisdiction
over the parties. Such arbitration shall be conducted in accordance with the
commercial arbitration rules of the American Arbitration Association in effect
at that time, and judgment upon the determination or award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.

10.2 SEVERABILITY. If any provision of this Agreement shall be
------------
found by any arbitrator or court of competent jurisdiction to be invalid or
unenforceable, then the parties hereby waive such provision to the extent that
it is found to be invalid or unenforceable and to the extent that to do so
would not deprive one of the parties of the substantial benefit of its
bargain. Such provision shall, to the extent allowable by law and the
preceding sentence, be modified by such arbitrator or court so that it becomes
enforceable and, as modified, shall be enforced as any other provision hereof,
all the other provisions continuing in full force and effect.

10.5 ASSIGNMENT. This Agreement and all rights hereunder are
----------
personal to Employee and may not be transferred or assigned by Employee at any
time. Company may assign its rights, together with its obligations hereunder,
to any parent, subsidiary, affiliate or successor, or in connection with any
sale, transfer or other disposition of all or substantially all of its
business and assets, provided, however, that any such assignee assumes
-------- -------
Company's obligations hereunder.

10.6 WITHHOLDING. All sums payable to Employee hereunder shall
-----------
be reduced by all federal, state, local and other withholding and similar taxes
and payments required by applicable law.

- 6 -
<PAGE>

10.7 ENTIRE AGREEMENT. This Agreement and the Employee
----------------
Confidentiality Agreement constitute the entire and only agreements between
the parties relating to employment of Employee with Company, and this
Agreement supersedes and cancels any and all previous contracts, arrangements
or understandings with respect thereto.

10.8 AMENDMENT. This Agreement may be amended, modified,
---------
superseded, cancelled, renewed or extended only by an agreement in writing
executed by both parties hereto.

If to Employee: Mark Mulford
------------
9 Emerald Glen
--------------
Laguna Niguel, CA 92677
------------------------
Telecopier:

10.10 BINDING NATURE. This Agreement shall be binding upon, and
--------------
inure to the benefit of, the successors and personal representatives of the
respective parties hereto.

10.13 GOVERNING LAW. This Agreement and the rights and
-------------

- 7 -
<PAGE>

obligations of the parties hereto shall be construed in accordance with the laws
of the State of California, without giving effect to the principles of conflict
of laws.

- 8 -
<PAGE>

IN WITNESS WHEREOF, Company and Employee have executed this Agreement
as of the date first above written.

"COMPANY" "EMPLOYEE"

AMERIQUEST TECHNOLOGIES, INC.
MARK MULFORD

By:

Name:

Title:

- 9 -
<PAGE>

EXHIBIT A

PLAN BONUS CRITERIA

- 10 -
<PAGE>

EXHIBIT B

PERFORMANCE BONUS CRITERIA

- 11 -
<PAGE>

EXHIBIT C

CONFIDENTIALITY AGREEMENT

- 12 -
<PAGE>

EXHIBIT D

CONTINGENT RESIGNATION

September 29, 1995

Board of Directors
AmeriQuest Technologies, Inc.
3 Imperial Promenade, Suite 300
Santa Ana, CA 92707

Re: Resignation
-----------

Dear Board of Directors:

I hereby resign as a member of the Board of Directors of AmeriQuest
Technologies, Inc. ("AQS") at such time as that certain Employment Agreement
dated as of September 1, 1995, by and between AQS and me is terminated for any
reason.

Sincerely,

Mark Mulford

- 13 -
<PAGE>

EMPLOYEE INVENTION ASSIGNMENT AND CONFIDENTIALITY AGREEMENT
-----------------------------------------------------------

9. NOTIFICATION. I hereby authorize the Company to notify my actual or future
------------
employers of the terms of this Agreement and my responsibilities hereunder.

AMERIQUEST TECHNOLOGIES, INC.: EMPLOYEE:

By:___________________________________ ___________________________________
Signature

Name: Steve DeWindt ___________________________________
Name (Please print)

Title: Chief Executive Officer Date:______________________________

[SIGNATURE PAGE TO MULFORD CONFIDENTIALITY AGREEMENT]

<PAGE>

EXHIBIT 10.10

EMPLOYMENT AGREEMENT
--------------------

This Employment Agreement (the "Agreement") is entered into as of October 1,
---------
1995 (the "Effective Date") between AmeriQuest Technologies, Inc., a Delaware
--------------
corporation with its principal offices located at 3 Imperial Promenade, Suite
300, Santa Ana, California ("Company"), and Holger Heims, a resident of
-------
Stiftsbogen 144, 81375 Munich, Germany ("Employee").
--------

In consideration of the promises and the terms and conditions set forth in
this Agreement, the parties agree as follows:

1. POSITION. During the term of this Agreement, Company will employ
--------
Employee, and Employee will serve Company as Company's Vice President
(Operational Controlling) and as primary liaison to the Executive Board of
Computer 2000 AG. Employee will report directly to Steve DeWindt, Company's
Chief Executive Officer and Chairman of the Board of Directors, and Mark
Mulford, Company's President and Chief Operating Officer.

2. DUTIES. Employee will serve Company in such capacities and with such
------
duties and responsibilities as the Board of Directors, Chief Executive Officer
and President of Company may from time to time determine. Employee will comply
with and be bound by Company's operating policies, procedures, and practices
from time to time in effect during Employee's employment. Employee will perform
his duties under this Agreement at the offices of Company, provided, that
--------
Employee may be required to do extensive traveling in connection with the
performance of his duties hereunder. Employee hereby represents and warrants
that he is free to enter into and fully perform this Agreement and the
agreements referred to herein without breach of any agreement or contract to
which he is a party or by which he is bound.

3. OBLIGATION NOT TO COMPETE. Employee hereby agrees that while he is
-------------------------
employed by Company (the "Restricted Period"), Employee shall not engage in or
-----------------
provide services to any business outside of the Computer 2000 group of companies
that is competitive with or detrimental to any present or contemplated business
of the Company known to Employee. Employee also agrees that, during the
Restricted Period, he shall not in any manner attempt to induce or assist others
to attempt to induce any customer or client of Company to terminate his
association with Company, nor do anything directly or indirectly to interfere
with the relationship between Company and any such persons or concerns. Each of
the following activities shall, without limitation, be deemed to constitute
engaging in business within the meaning of this Section 3: to engage in, work
with, have an interest or concern in, advise, lend money to, guarantee the debts
or obligations of, or permit one's name or any party thereof to be used in
connection with, an enterprise or endeavor, either individually, in partnership,
or in conjunction with any person or persons, firms, associations, companies, or
corporations, whether as a principal, agent, shareholder, employee, officer,
director, partner, consultant or in any other manner whatsoever; provided,
--------
however, that Employee shall retain the right to invest in or have an interest
- -------
in entities traded on any public market or offered by any national brokerage
house, provided that said interest does not exceed one percent (1%) of the
voting control of said entity. In addition, Employee may make passive
investments in privately held entities that are determined by the Board of
Directors of Company not to be competitors of Company.
<PAGE>

4. TERM OF AGREEMENT. This Agreement will commence on the Effective Date,
-----------------
and continue until August 31, 1996 unless terminated earlier pursuant to Section
7 hereof.

5. COMPENSATION AND BENEFITS.
-------------------------

5.1 BASE SALARY. The Company agrees to pay Employee an initial salary
-----------
of One Hundred Fifty Thousand Dollars ($150,000) per year. Employee's salary
will be payable as earned in accordance with Company's customary payroll
practice.

5.2 ADDITIONAL BENEFITS. Employee will be eligible to participate in
-------------------
Company's employee benefit plans of general application, including without
limitation those plans covering pension and profit sharing, executive bonuses,
stock purchases, stock options, and plans covering life and disability insurance
in accordance with the rules established for individual participation in any
such plan and applicable law. Employee will receive such other benefits,
including vacation, holidays and sick leave, as the Company generally provides
to its employees holding similar positions as that of Employee.

5.3 EXPENSES. The Company will reimburse Employee for all reasonable
--------
and necessary expenses incurred by Employee in connection with the Company's
business, provided that such expenses are deductible to the Company, are in
accordance with the Company's applicable policy and are properly documented and
accounted for in accordance with the requirements of the Internal Revenue
Service.

6. TERMINATION.
-----------

6.1 EVENTS OF TERMINATION. Employee's employment with the Company shall
---------------------
terminate upon any one of the following:

(a) the Company's determination made in good faith that it is
terminating Employee for "cause" as defined under Section 6.2 below
("Termination for Cause") as evidenced by a written notice to such
---------------------
effect sent to Employee; or

(b) three months after the effective date of a written notice sent
to Employee stating that the Company is terminating his employment,
without cause, which notice can be given by the Company at any time
after the Effective Date at the Company's sole discretion, for any
reason or for no reason ("Termination Without Cause"); or
-------------------------

(c) three months after the effective date of a written notice sent
to the Company from Employee stating that Employee is electing to
terminate his employment with the Company ("Voluntary Termination").
---------------------

6.2 "CAUSE" DEFINED. For purposes of this Agreement, "cause" for
---------------

2
<PAGE>

Employee's termination will exist at any time after the happening of one or more
of the following events:

(a) unethical, dishonest, fraudulent or criminal conduct;

(b) a deliberate attempt to injure the Company;

7. EFFECT OF TERMINATION.
---------------------

7.1 TERMINATION FOR CAUSE. In the event of any termination of this
---------------------
Agreement pursuant to Section 6.1(a), Company shall pay Employee the
compensation and benefits otherwise payable to Employee under Section 5 through
the date of termination. Employee's rights under the Company's benefit plans of
general application shall be determined under the provisions of those plans.

7.2 TERMINATION WITHOUT CAUSE OR VOLUNTARY TERMINATION. In the event of
--------------------------------------------------
any termination of this Agreement pursuant to Sections 6.1(b) or 6.1(c), Company
shall pay Employee the compensation and benefits otherwise payable to Employee
under Section 5 through the last day of the three month period following the
date that the notice referred to in Sections 6.1(b) or 6.1(c) is given.

8. MISCELLANEOUS.
-------------

8.1 ARBITRATION. Employee and the Company shall submit to mandatory
-----------
binding arbitration in any controversy or claim arising out of, or relating to,
this Agreement or any breach hereof, provided, however, that the Company retains
-------- -------
its right to, and shall not be prohibited, limited or in any other way
restricted from, seeking or obtaining equitable relief from a court having
jurisdiction over the parties. Such arbitration shall be conducted in
accordance with the commercial arbitration rules of the American Arbitration
Association in effect at that time, and judgment upon the determination or award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.

8.2 SEVERABILITY. If any provision of this Agreement shall be found by
------------
any arbitrator or court of competent jurisdiction to be invalid or
unenforceable, then the parties hereby waive such provision to the extent that
it is found to be invalid or unenforceable and to the extent that to do so would
not deprive one of the parties of the substantial benefit of its bargain. Such
provision shall, to the extent allowable by law and the preceding sentence, be
modified by such arbitrator or court so that it becomes enforceable and, as
modified, shall be enforced as any other provision hereof, all the other
provisions continuing in full force and effect.

8.3 NO WAIVER. The failure by either party at any time to require
---------
performance or compliance by the other of any of its obligations or agreements
shall in no way affect the right to require such performance or compliance at
any time thereafter. The

3
<PAGE>

waiver by either party of a breach of any provision hereof shall not be taken or
held to be a waiver of any preceding or succeeding breach of such provision or
as a waiver of the provision itself. No waiver of any kind shall be effective or
binding, unless it is in writing and is signed by the party against whom such
waiver is sought to be enforced.

8.4 ASSIGNMENT. This Agreement and all rights hereunder are personal to
----------
Employee and may not be transferred or assigned by Employee at any time. The
Company may assign its rights, together with its obligations hereunder, to any
parent, subsidiary, affiliate or successor, or in connection with any sale,
transfer or other disposition of all or substantially all of its business and
assets, provided, however, that any such assignee assumes the Company's
-------- -------
obligations hereunder.

8.5 WITHHOLDING. All sums payable to Employee hereunder shall be reduced
-----------
by all federal, state, local and other withholding and similar taxes and
payments required by applicable law.

8.6 ENTIRE AGREEMENT. This Agreement constitutes the entire and only
----------------
agreement between the parties relating to employment of Employee with the
Company, and this Agreement supersedes and cancels any and all previous
contracts, arrangements or understandings with respect thereto.

8.7 AMENDMENT. This Agreement may be amended, modified, superseded,
---------
cancelled, renewed or extended only by an agreement in writing executed by both
parties hereto.

8.8 NOTICES. All notices and other communications required or permitted
-------
under this Agreement shall be in writing and hand delivered, sent by telecopier
or sent by nationally recognized express courier service. Such notices and
other communications shall be effective upon receipt if hand delivered or sent
by telecopier, three days after dispatch if sent by express courier, to the
following addresses, or such other addresses as any party shall notify the other
parties:

If to Employee: Holger Heims
------------
3 Imperial Promenade, Suite 300
-------------------------------
Santa Ana, CA 92707
--------------------
Telecopier: (714) 445-5350
--------------

8.9 BINDING NATURE. This Agreement shall be
--------------

4
<PAGE>

binding upon, and inure to the benefit of, the successors and personal
representatives of the respective parties hereto.

8.10 HEADINGS. The headings contained in this Agreement are for
--------
reference purposes only and shall in no way affect the meaning or interpretation
of this Agreement. In this Agreement, the singular includes the plural, the
plural included the singular, the masculine gender includes both male and female
referents, and the word "or" is used in the inclusive sense.

8.11 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original but all of which,
taken together, constitute one and the same agreement.

8.12 GOVERNING LAW. This Agreement and the rights and
-------------
obligations of the parties hereto shall be construed in accordance with the laws
of the State of California, without giving effect to the principles of conflict
of laws.

[THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK]

5
<PAGE>

IN WITNESS WHEREOF, the Company and Employee have executed this Agreement as
of the date first above written.

"COMPANY" "EMPLOYEE"

AMERIQUEST TECHNOLOGIES, INC. HOLGER HEIMS

By: By:

Name:

Title:

[SIGNATURE PAGE TO EMPLOYMENT AGREEMENT]

6
<PAGE>

EMPLOYEE INVENTION ASSIGNMENT AND CONFIDENTIALITY AGREEMENT
-----------------------------------------------------------

7
<PAGE>

9. NOTIFICATION. I hereby authorize the Company to notify my actual or future
------------
employers of the terms of this Agreement and my responsibilities hereunder.

13. NO DUTY TO EMPLOY. I understand that this Agreement does not constitute a
-----------------
contract of

8
<PAGE>

employment or obligate the Company to employ me for any stated period of time.
This Agreement shall be effective as of the first day of my employment by the
Company, namely: October 1, 1995.

AMERIQUEST TECHNOLOGIES, INC.: EMPLOYEE:

By:
------------------------------ ----------------------------------------
Signature
Name: Steve DeWindt
---------------------------- ----------------------------------------
Name (Please print)

Title: Chief Executive Officer Date:
--------------------------- -------------------------------

<PAGE>

EXHIBIT 23.01

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation of
our report included in this Form 10-K into the Company's previously filed
Registration Statements, SEC File Nos. 33-57611, 33-85752, 33-76538, and 33-
74034.

ARTHUR ANDERSEN L.L.P.

/s/ Arthur Andersen L.L.P.

Los Angeles, California
October 13, 1995

<PAGE>
EXHIBIT 24.01

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

I hereby authorize, as a director of AmeriQuest Technologies, Inc. (the
"Corporation"), the filing with the Securities and Exchange Commission of the
Corporation's Annual Report on Form 10-K for the fiscal year ended June 30, 1995
(the "Annual Report"), and any and all amendments thereto as management deems
advisable in response to SEC comments or otherwise, inasmuch as the Annual
Report is deemed to be incorporated by reference in the Corporation's
Registration Statements on Forms S-3 and S-4.

I hereby consent to the filing by the Corporation of such Annual Report,
and to reference to my name in the Annual Report as a "Director" of the
Corporation. I hereby appoint Donald W. Resnick as my attorneys-in-fact with
power to either of them to sign any and all amendments or documents required to
complete any amendments to the Annual Report filed on behalf of the Corporation.

DATED the 12th day of October, 1995.
----

/s/ STEVE DeWINDT
_____________________________________
Steve DeWindt

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

I hereby consent to the filing by the Corporation of such Annual Report,
and to reference to my name in the Annual Report as a "Director" of the
Corporation. I hereby appoint Steve DeWindt and Donald W. Resnick as my
attorneys-in-fact with power to either of them to sign any and all amendments or
documents required to complete any amendments to the Annual Report filed on
behalf of the Corporation.

DATED the 13th day of October, 1995.

/s/ Dr. Harry Krischik
---------------------------------
Dr. Harry Krischik

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 12th day of October, 1995.

/s/ Klaus J. M. Laufen
-------------------------------------
Klaus J. M. Laufen

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 12th day of October, 1995.

/s/ Mark Mulford
-------------------------------------
Mark Mulford

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 6th day of October, 1995.

/s/ Holger Heims
-------------------------------------
Holger Heims

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 12th day of October, 1995.

/s/ Marc L. Werner
-------------------------------------
Marc L. Werner

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 10th day of October, 1995.

/s/ Harold L. Clark
-------------------------------------
Harold L. Clark

<PAGE>

APPOINTMENT OF ATTORNEY-IN-FACT
AND
CONSENT OF DIRECTOR

DATED the 6th day of October, 1995.

/s/ Stephen G. Holmes
-------------------------------------
Stephen G. Holmes

<PAGE>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND INCOME STATEMENT AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUL-01-1995
<PERIOD-END> JUL-01-1995
<CASH> 970
<SECURITIES> 0
<RECEIVABLES> 56,342
<ALLOWANCES> 0
<INVENTORY> 49,101
<CURRENT-ASSETS> 107,775
<PP&E> 6,649
<DEPRECIATION> 0
<TOTAL-ASSETS> 128,008
<CURRENT-LIABILITIES> 129,202
<BONDS> 0
<COMMON> 230
0
0
<OTHER-SE> (25,939)
<TOTAL-LIABILITY-AND-EQUITY> 128,008
<SALES> 416,571
<TOTAL-REVENUES> 416,571
<CGS> 400,820
<TOTAL-COSTS> 400,820
<OTHER-EXPENSES> 77,248
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,082
<INCOME-PRETAX> (67,566)
<INCOME-TAX> 0
<INCOME-CONTINUING> (67,566)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (67,566)
<EPS-PRIMARY> (3.76)
<EPS-DILUTED> (3.76)

</TABLE>