8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 4, 2006

CIROND CORPORATION

(Exact name of registrant as specified in its charter)

Nevada (State or other jurisdiction of incorporation) 0-49763 (Commission File Number) 88-0469593 (IRS Employer Identification No.)

4185 Still Creek Drive #B-101, Burnaby, British Columbia, Canada V5C 6G9

(Address of principal executive offices) (Zip Code)

Not Applicable

(Former name or former address, if changed since last report)

Registrant's telephone number, including area code (604) 205-5039

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

Cirond Corporation (the “Company”) entered into a Foreclosure Sale Agreement dated as of April 4, 2006 (the “Agreement”) among Sand Hill Finance, LLC (“Sand Hill”), the Company, ServGate Technologies, Inc. (“ServGate”), and BSGL, LLC (“BSGL”), pursuant to which the Company agreed to acquire all of the personal property assets of ServGate and assume approximately $6,100,000 of ServGate’s liabilities from Sand Hill and BSGL, who were secured senior lenders holding those assets as collateral on existing loans that were in default. The assets acquired consisted of primarily of intellectual property. The Company also issued 9,000,000 shares of the Company’s Common Stock to BSGL in accordance with the terms of the Agreement. The acquisition was made pursuant to a private foreclosure sale under Section 9610 of the California Uniform Commercial Code. A copy of the Agreement is included as Exhibit 2.1 to this filing.

Item 2.01 Completion of Acquisition or Disposition of Assets

On April 10, 2006, the Company completed its acquisition of the assets and the assumption of the specified liabilities of ServGate pursuant to the terms of the Agreement described in Item 1.01 above. ServGate had developed unified threat management software and had more than 100 employees in the United States, Canada, and China.

While the Company purchased the intellectual property rights (patents, domain names, and product trade marks) to the ServGate products, it did not acquire ServGate’s distributor and importer agreements or sales force. Roughly half of ServGate’s employees are likely to continue with the Company.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

In connection with the acquisition of the assets described above, the Company obtained a secured bridge loan for $1,000,000 from Sand Hill and executed promissory notes to Sand Hill and BSGL in the principal amounts of $2,100,000 and $2,500,000, respectively. All of these obligations are secured by a security interest in the purchased assets. The security interest of the bridge lender, up to a principal amount of $1,000,000 (plus interest and costs of enforcement), has first priority, the security interest of Sand Hill up to a principal amount of $2,100,000 (plus interest and costs of enforcement) is second, and the security interest of BSGL up to a principal amount of $2,500,000 (plus interest and costs of enforcement) is third.

The $1,000,000 bridge loan accrues interest at 10% per annum, requires quarterly interest payments beginning July 1, 2006, and is due October 1, 2006. If the Company should receive at least $3,000,000 of proceeds from the sale of its equity securities by July 3, 2006, then the Company shall pay Sand Hill $500,000 and may elect to extend the maturity date of the loan to April 1, 2007. If revenues generated by the Company through June 30, 2006 are less than $1,500,000, then Sand Hill will have the option to require payment of the loan in full on the day that is 90 days after June 30, 2006. Proceeds of the bridge loans were used for payments to Sand

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Hill to reduce the $2,100,000 principal balance of its note and accrued liabilities that the Company had assumed.

The note for $2,100,000 made payable to Sand Hill is due December 31, 2006, accrues interest at 18% per annum, and requires monthly interest payments, as well as mandatory principal payments as follows: $150,000 by April 7, 2006, $150,000 by April 30, 2006, $500,000 by June 30, 2006, $500,000 by September 30, 2006, 25% of the proceeds from an anticipated OEM agreement, and 15% of the proceeds of any sale of equity over $3,000,000.

The note for $2,500,000 made payable to BSGL is due December 31, 2007, accrues interest at the prime rate plus 2% per annum and requires mandatory principal payments as follows: 10% of the net proceeds of the PIPE Transaction, $375,000 on December 31, 2006, $375,000 on March 31, 2007, $375,000 on June 30, 2007, $375,000 on September 30, 2007, and the remaining outstanding principal balance on December 31, 2007. If the operating income generated by the ServGate products equals or exceeds $2,000,000 for the fiscal year ended December 31, 2006, then the note is to be paid by January 31, 2007. Interest is to be paid upon maturity by issuing common stock at a per share price equal to the lesser of (i) the PIPE Transaction Price (described below) and (ii) the current market price on the maturity date. The PIPE Transaction refers to the proposed issuance by the Company of securities or convertible debt for an aggregate issuance price of not less than $5,000,000.

BSGL can convert the principal amount of the note at any time. BSGL must convert the $1,000,000 of the principal amount of the note if the revenue from the ServGate products does not equal or exceed $5,000,000 for the one-year period commencing April 4, 2006. In either case, conversion would be at a per share price equal to the lesser of (i) the PIPE Transaction Price and (ii) the current market price on the conversion date.

Item 3.02 Unregistered Sales of Equity Securities

Pursuant to the terms of the Agreement described in Item 1.01 above, as part of the Closing the Company issued 9,000,000 shares of its Common Stock to BSGL, LLC. The shares were issued in reliance on the exemption from the registration requirements of the Securities Act of 1933 (the “Act”) pursuant to Section 4(2) thereof. The issuance of the shares was pursuant to a negotiated transaction not involving a public offering. The certificates representing the shares bear a restrictive legend prohibiting the sale of the shares in violation of the Act.

The Company also issued a warrant to purchase stock to Sand Hill, which entitles Sand Hill to purchase, until April 3, 2013 at $0.01 per share, a number of shares of common stock equal to 10% of the outstanding capital stock of the Company on a fully diluted basis, assuming exercise of all stock options, warrants and rights to acquire stock; conversion of all debt or other instruments convertible into equity securities; and conversion of all preferred stock of other equity securities into common stock, with the calculation to be made as of April 4, 2006 after giving effect to the asset acquisition transaction.

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Item 9.01 Financial Statements and Exhibits.

Exhibits:

Regulation S-B Number	Document
2.1	Foreclosure Sale Agreement made April 4, 2006 among Sand Hill Finance, LLC, Cirond Corporation, ServGate Technologies, Inc., and BSGL, LLC
10.1	Loan and Security Agreement dated as of April 3, 2006 between Cirond Corporation and Sand Hill Finance, LLC
10.2	Promissory Note from Cirond Corporation to Sand Hill Finance, LLC dated April 3, 2006 in the amount of $1,000,000
10.3	Promissory Note from Cirond Corporation to Sand Hill Finance, LLC dated April 4, 2006 in the amount of $2,100,000
10.4	Promissory Note from Cirond Corporation to BSGL, LLC dated April 4, 2006 in the amount of $2,500,000
10.5	Warrant to Purchase Stock of Cirond Corporation dated April 3, 2006 issued to Sand Hill Finance, LLC

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CIROND CORPORATION
May 2, 2006	By:    /s/ Nicholas Miller                                  Nicholas Miller President and Chief Executive Officer

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EX-2

                                  EXHIBIT 2.1

               FORCLOSURE SALE AGREEMENT MADE APRIL 4, 2006 AMONG
    SAND HILL FINANCE, LLC, CIROND CORPORATION, SERVGATE TECHNOLOGIES, INC.,
                                 AND BSGL, LLC









                           FORECLOSURE SALE AGREEMENT

         This FORECLOSURE  SALE AGREEMENT (the  "AGREEMENT") is made as of April
4, 2006 (the "EFFECTIVE DATE"), among SAND HILL FINANCE, LLC (sometimes referred
to  as  "SHF"  or   "SELLER"),   CIROND   CORPORATION,   a  Nevada   corporation
("PURCHASER"),   SERVGATE  TECHNOLOGIES,   INC.,  a  Delaware  corporation  (the
"COMPANY"), and BSGL, LLC, a Delaware limited liability company ("BSGL").

                                    RECITALS

         A.  BSGL and Company are  parties to an Amended and  Restated  Loan and
Security  Agreement  dated as of October 29,  2004,  pursuant  to which  Company
issued to BSGL an Amended and Restated Secured  Promissory Note in the principal
amount  of  $2,631,636.14.   Such  loan  agreement  and  note  are  referred  to
collectively  as the "BSGL LOAN  DOCUMENTS"  (Schedule  E). SHF and  Company are
parties to a Financing  Agreement dated as of September 9, 2005, as amended by a
First  Amendment  to  Financing  Agreement  dated  September  29, 2005, a Second
Amendment to Financing  Agreement  dated October 27, 2005, a Third  Amendment to
Financing  Agreement dated December 9, 2005 and a Fourth  Amendment to Financing
Agreement dated December 23, 2005 (collectively,  the "SHF FINANCE  DOCUMENTS").
BSGL and SHF are sometimes  referred to  individually  as a "SECURED  PARTY" and
collectively as the "SECURED PARTIES". As of the date of this Agreement, Company
owes SHF $2,100,000.00 and BSGL $3,131,636.14. Company's obligations to BSGL and
SHF,  respectively,  are secured by all of the Company's  personal property (the
"COLLATERAL").

         B.  One  or more Events of Default  have  occurred  under the BSGL Loan
Documents and the SHF Finance  Documents,  as a consequence of which all amounts
owing thereunder are immediately due and payable.

         C.  SHF delivered a Notice of  Disposition  of Collateral to Company on
March 21, 2006.  Company has asked SHF to conduct a private  foreclosure sale of
the Collateral  under  California  Uniform  Commercial  Code Section 9610.  This
Agreement  sets  forth,  among  other  things,  the  terms  of the  sale  of the
Collateral to Purchaser.

         NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

1.       GENERAL AGREEMENT OF PURCHASE AND SALE.

         1.1   PURCHASE AND SALE.  Subject  to the terms and  conditions of this
Agreement,  Seller will sell to Purchaser,  and Purchaser will agree to buy from
Seller,  all of the  personal  property  of the  Company,  including  the assets
described  in SCHEDULE A hereto (the  "TRANSFERRED  ASSETS").  This sale is held
pursuant to Section 9610 of the California  Uniform Commercial Code. The parties
acknowledge that such sale is commercially reasonable in all respects, including
the method,  manner,  time, and place, and waive any right to further notices of
default or other disposition.  Without limiting the generality of the foregoing,
the parties  acknowledge  that (i) Seller notified Company on or about March 21,
2006 that an Event of Default occurred under the SHF Finance Documents, and (ii)
delivered  the Notice of  Disposition  of  Collateral  to Company  and all other
persons  required under  applicable law,  including BSGL, on March 21, 2006. The
parties waive any claim that effecting the sale under this Agreement pursuant to
such notices is


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not commercially reasonable.

         1.2   CONSIDERATION.  As consideration for the sale to Purchaser of the
Transferred  Assets,  Purchaser will (A) pay the amounts described in SCHEDULE B
attached hereto, (B) assume the obligations and liabilities of Company described
on SCHEDULE B attached hereto (the "ASSUMED LIABILITIES"),  as set forth in this
Agreement,  and (C) issue  9,000,00  shares of Common Stock in  accordance  with
SCHEDULE B attached hereto.

         1.3   CLOSING. The closing of the private foreclosure sale conducted by
Seller and the purchase and sale of the Transferred Assets (the "CLOSING") shall
take place at the offices of the Seller's legal counsel  located at 3175 Hanover
Street,  Palo Alto, CA 94304, at 1:00 p.m.  Pacific Time and shall be the latter
of March 24,  2006,  or the date that the parties have  received  the  documents
requested by each as of such date,  all of which shall be in form and  substance
satisfactory to SHF and BSGL, including:

               (A)  an  approval of the Closing by Company's  Board of Directors
and any special committee;

               (B)  Board resolutions of Purchaser, authorizing the transactions
described herein;

               (C)  Loan  documents  for  a  secured  bridge  loan  (the "BRIDGE
LOAN"), by appropriate  accredited investor ("BRIDGE LENDER") to Purchaser,  and
evidence of Purchaser's receipt of the Bridge Loan proceeds;

               (D)  a secured  promissory  note in the original principal amount
of $2,100,000, issued by Purchaser to the order of SHF;

               (E)  a secured promissory  note in the  original principal amount
of $2,500,000, issued by Purchaser to the order of BSGL; and

               (F)  an  intercreditor  agreement  by and  among  Bridge  Lender,
SHF, BSGL and  Purchaser,  which provides for the lien  priorities  described in
Section 4 hereof.

               (G)  This  Agreement may be executed by the different parties and
dated  and  signed  in  separate   counterparts  and  delivered  via  fax,  each
counterpart  when thus  executed  shall be deemed to be an  original  and all of
which when taken together shall constitute the one and same Agreement.

If the Closing does not occur by 1:00 p.m.  Pacific Time on April 7, 2006,  this
Agreement shall thereafter be of no further force or effect.

         1.4   DELIVERY  OF  POSSESSION.  Seller  shall be under  no  obligation
to cause  delivery  of  control  or  possession  of the  Transferred  Assets  to
Purchaser.  Purchaser  understands and  acknowledges  that the Company,  and not
Seller,  is in  possession  and control of the  Transferred  Assets prior to the
Closing.



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2.       ASSUMPTION  OF  OBLIGATIONS  AND  LIABILITIES.  Purchaser  assumes  all
obligations of Company in respect of the Assumed Liabilities as though Purchaser
were the original  obligor  thereunder.  Without  limiting the generality of the
foregoing,  (i) Purchaser has all of the obligations of the "Borrower" under the
BSGL Loan  Documents and all of the  obligations  of the "Client"  under the SHF
Finance Documents, (ii) the representations and warranties set forth in the BSGL
Loan  Documents and the SHF Finance  Documents  are true as to Purchaser,  (iii)
Purchaser  will comply with the covenants  contained in the BSGL Loan  Documents
and the SHF Finance Documents (provided that payments shall be made at the times
and in the amounts set forth in SCHEDULE  B), and (iv) in addition to the Events
of  Default  set  forth in any of the BSGL  Loan  Documents  or the SHF  Finance
Documents,  Purchaser's  failure to perform any obligation  under this Agreement
shall  constitute an Event of Default under the BSGL Loan  Documents and the SHF
Finance Documents.

3.      COMPANY  LIABILITY.  Notwithstanding  the  assumption  by  Purchaser  in
Section 2, Company shall remain liable for all  obligations  under the BSGL Loan
Documents  and SHF Finance  Documents.  Company  affirms  that such  obligations
remain in full  force  and  effect,  and  Company  has no  defense  against  the
satisfaction of all such  obligations.  Such obligations shall be secured by any
property that Company acquires after the Closing Date.

4.       SECURITY AGREEMENT.  To secure all of its obligations  to SHF under the
SHF Finance Documents and this Agreement, Purchaser grants SHF a second security
interest  in all the  property  of  Purchaser  other  than the  assets  owned by
Purchaser  before the date of this Agreement,  and all of the proceeds  thereof,
whether  now owned or  hereafter  acquired,  including  without  limitation  all
accounts,  chattel  paper,  deposit  accounts,  documents,   equipment,  general
intangibles (including intellectual property, patents,  copyrights,  trademarks,
and  goodwill),  goods,  fixtures,  instruments,  inventory,  financial  assets,
investment property,  letter of credit rights,  money, and all of Debtor's books
and  records  with  respect  to any of the  foregoing,  and  the  computers  and
equipment  containing  said books and  records;  and all  products  and proceeds
thereof,   as  defined  in  this  Agreement  and  the  Uniform  Commercial  Code
(collectively,  the "PURCHASER  COLLATERAL").  The Purchaser Collateral does not
include  property that Purchaser owned before  entering into this Agreement.  To
secure all of its  obligations  to BSGL under the BSGL Loan  Documents  and this
Agreement,  Purchaser  grants BSGL a third  security  interest in the  Purchaser
Collateral.  Purchaser  authorizes Secured Parties to file one or more financing
statements to perfect the security interest granted under this Agreement. Except
for the security interest granted to Bridge Lender, SHF and BSGL, Purchaser owns
the  Purchaser  Collateral  free  and  clear  of  any  lien,  adverse  claim  or
restriction. Regardless of the order of attachment or perfection of any of those
security  interests,  the security  interest of Bridge  Lender in the  Purchaser
Collateral shall be first, up to a principal amount of $1,000,000 (plus interest
and costs of enforcement)  of secured  obligations  owing to Bridge Lender,  the
security  interest of SHF in the Purchaser  Collateral shall be second,  up to a
principal  amount of  $2,100,000  (plus  interest and costs of  enforcement)  of
secured  obligations  owing to SHF,  and the  security  interest  of BSGL in the
Purchaser  Collateral  shall be third,  up to a principal  amount of  $2,500,000
(plus interest and costs of enforcement) of secured  obligations  owing to BSGL.
If  any of  Bridge  Lender,  SHF  or  BSGL  is  owed  more  than  such  amounts,
respectively, the security interest securing payment of such surplus amount will
be fourth,  shared pari pasu among each of Bridge Lender,  SHF and BSGL. Without
the prior written consent of both Secured Parties,  Purchaser shall not encumber
or dispose of any interest in the Purchaser Collateral.


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5.       REPRESENTATIONS, WARRANTIES AND OTHER AGREEMENTS.

         5.1   REPRESENTATIONS AND WARRANTIES OF SELLER AND THE SECURED PARTIES.

               (A)   The  Seller  and  each  of  the  Secured  Parties,   acting
severally,  hereby each represents and warrants that the sale of the Transferred
Assets  by  Seller  pursuant  to this  Agreement  will be free and  clear of any
interest in the  Transferred  Assets  claimed by Seller or the Secured  Parties,
other than the liens in favor of the Secured Parties granted in Section 4.

               (B)   The  Seller  and   each  of  the  Secured  Parties,  acting
severally, hereby each represents and warrants that the execution,  delivery and
performance  by Seller of this Agreement and the  consummation  by Seller of the
transaction  contemplated thereby (i) are within the power of Seller and each of
the Secured Parties, and (ii) have been duly authorized by all necessary actions
on the part of Seller and each of the Secured  Parties.  The  execution  of this
Agreement by Seller and the Secured Parties constitutes,  or will constitute,  a
legal,  valid  and  binding  obligation  of  Seller  and  the  Secured  Parties,
enforceable against Seller and the Secured Parties in accordance with its terms.

               (C)   Seller  and each of the Secured  Parties hereby  represents
and  warrants  that  no  consent,   approval,  order  or  authorization  of,  or
registration,  declaration  or filing with any  governmental  authority or other
party  is  required  in  connection  with the  execution  and  delivery  of this
Agreement  by Seller  or any of the  Secured  Parties,  or the  performance  and
consummation of the transactions contemplated hereby.

               (D)  Seller  and each of the  Secured  Parties  hereby  severally
represents  and  warrants  that the  execution  and  delivery  by Seller and the
Secured Parties and of this Agreement and the  performance  and  consummation of
the  transactions  contemplated  thereby  do not and  will not (i)  violate  its
Certificate  of  Incorporation,  Bylaws,  Certificate  of  Formation  or Company
Agreement or other charter  documents,  or any judgment,  order,  writ,  decree,
statute,  rule or regulation applicable to it; or (ii) violate any provision of,
or result in the breach or the  acceleration  of, or entitle any other person to
accelerate  (whether  after the giving of notice or lapse of time or both),  any
mortgage, indenture, agreement, instrument or contract to which it is a party or
by which it is bound.

               (E)   Seller and each of the Secured Parties hereby  acknowledges
and agrees that  Purchaser  has relied  directly upon the  provisions  set forth
above in entering into this Agreement,  that the  representations and warranties
as set forth above are a material condition to the sale contemplated hereby, and
that  Purchaser  would  not  have  entered  into  this  Agreement  without  such
representations and warranties.

The provisions of this Section 5.1 shall survive the Closing.

         5.2   REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser represents
and warrants that:

               (A)   The  Transferred  Assets are  being  sold to  Purchaser  by
means of a private  foreclosure sale pursuant to the Uniform  Commercial Code as
the same  may,  from  time to time,  be  enacted  and in  effect in the State of
California,  and that the Transferred  Assets are being sold


579271 v3/HN                            4



"AS IS," and "WHERE IS",  with no  representations  and  warranties of any kind,
including any warranties as to merchantability, fitness for intended use, title,
possession, quiet enjoyment, or the like.

               (B)   Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of Nevada.

               (C)   The execution,  delivery  and  performance  by Purchaser of
this  Agreement  and  the   consummation   by  Purchaser  of  the   transactions
contemplated  thereby (i) are within the power of Purchaser,  and (ii) have been
duly authorized by all necessary actions on the part of Purchaser. The execution
of this Agreement by Purchaser constitutes,  or will constitute,  a legal, valid
and binding obligation of Purchaser, enforceable against Purchaser in accordance
with its terms,  except as limited by  bankruptcy,  insolvency  or other laws of
general  application  relating to or affecting  the  enforcement  of  creditors'
rights generally and general principles of equity.

               (D)   The execution and delivery by Purchaser of  this  Agreement
and the performance and consummation of the transactions contemplated thereby do
not and  will not (i)  violate  the  Articles  of  Incorporation  or  Bylaws  of
Purchaser or any judgment,  order,  writ,  decree,  statute,  rule or regulation
applicable  to  Purchaser;  or (ii) violate any  provision  of, or result in the
breach  or the  acceleration  of, or  entitle  any  other  person to  accelerate
(whether  after the  giving of notice or lapse of time or both),  any  mortgage,
indenture, agreement, instrument or contract to which Purchaser is a party or by
which it is bound.

               (E)  No  consent,   approval,   order  or  authorization  of,  or
registration,  declaration  or filing with any  governmental  authority or other
party  is  required  in  connection  with the  execution  and  delivery  of this
Agreement by Purchaser,  or the performance and consummation of the transactions
contemplated hereby.

               (F)   Purchaser's  capitalization  table  attached as  SCHEDULE C
hereto is true and complete.  All shares of Purchaser's stock issued pursuant to
this   Agreement  are  duly   authorized,   validly   issued,   fully  paid  and
nonassessable,  free  of any  liens  or  encumbrances,  and not  subject  to any
transfer restrictions, rights of first refusal, shareholder or other agreements.

               (G)   Purchaser's proforma balance sheet as of  closing, attached
as SCHEDULE D.

The provisions of this Section 5.2 shall survive the Closing.

6.   COVENANTS OF PURCHASER. Purchaser will do the following:

     6.1   Purchaser  will make the payments in the amounts and at the times set
forth in Schedule B hereto. To evidence the payment  obligations to SHF and BSGL
respectively,  Purchaser shall deliver to each promissory notes in substantially
the form attached hereto

7.       COMPANY  GENERAL  RELEASE.  ON   BEHALF  OF  ITSELF,  ITS   SUCCESSORS,
STOCKHOLDERS,  DIRECTORS  AND AGENTS,  COMPANY  RELEASES  SHF AND BSGL AND THEIR
RESPECTIVE OFFICERS,  DIRECTORS,  MANAGERS,  MEMBERS AND AGENTS FROM ANY CLAIMS,
DAMAGES AND LIABILITIES THAT NOW EXIST OR MAY HEREAFTER ARISE IN CONNECTION WITH
THIS AGREEMENT,  THE SHF FINANCING DOCUMENTS,  THE BSGL LOAN DOCUMENTS,  AND THE
TRANSACTIONS  CONTEMPLATED



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BY ANY OF THE FOREGOING, KNOWN OR UNKNOWN. COMPANY ACKNOWLEDGES THAT IT IS AWARE
OF,  AND  VOLUNTARILY  WAIVES ANY RIGHT OR BENEFIT  UNDER,  SECTION  1542 OF THE
CALIFORNIA CIVIL CODE, WHICH SAYS:

         "A general release does not extend to claim which the creditor does not
know to exist in his or her favor at the time of executing the release, which if
known by him or her must have materially affected his or her settlement with the
debtor."

8.       MISCELLANEOUS.

         8.1     FURTHER ASSURANCES.  The parties agree to act in good faith  in
the  performance  and  enforcement of this Agreement and to execute such further
documents  and  agreements  as may be  reasonably  necessary  to  implement  the
purposes of this Agreement.

         8.2     EXPENSES.  All  parties  will  be  responsible  for  their  own
transaction  costs,  provided  that upon  receipt  of the  proceeds  of the PIPE
Transaction, as defined in the BSGL Note, Purchaser shall reimburse BSGL $25,000
on account of fees and expenses incurred in connection with this Agreement.  All
costs of documenting the transfer of the  Transferred  Assets in accordance with
this Agreement, including any transfer taxes, will be paid by Purchaser.

         8.3     COMPANY INDEMNITY.  Company acknowledges that Secured Creditors
are entering into this Agreement at Company's  request.  Company shall indemnify
and defend Secured Creditors harmless from any claim, liability or cost incurred
by either in connection  with this Agreement and the  transactions  contemplated
hereby  (including  reasonable  attorneys fees and  expenses),  except for those
caused by the indemnified party's gross negligence or willful misconduct.

         8.4     NOTICES.  Any  notice  or  other  communication  required by or
permitted to be given in  connection  with this  Agreement  shall be in writing,
except as expressly otherwise permitted herein, and shall be delivered in person
(including via overnight courier service) or sent by telecopy, to the respective
parties at the addresses  referenced  below.  Each of the parties may change the
address to which it desires notices to be sent if it notifies the other party of
such change in accordance  with the provisions of this Section.  Any such notice
will be deemed to be given when  received,  if  personally  delivered or sent by
telecopy  and, if mailed,  two business  days after deposit in the United States
mail, properly addressed, with proper postage affixed.

                 SHF:             Sand Hill Finance, LLC
                                  20573 Stevens Creek Blvd.
                                  Cupertino, CA  95014
                                  Attn:  Ron Ernst

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                 BSGL:            BSGL, LLC
                                  c/o Michael Brownrigg
                                  1524 Columbus Ave.
                                  Burlingame, CA  94010

                 With a copy to:  Craig Tighe
                                  DLA Piper
                                  2000 University Avenue
                                  East Palo Alto, CA 94303

                 Purchaser:       Cirond Corporation
                                  4185 Still Creek Drive, Suite B101
                                  Burnaby, BC V5C 6G9 Canada

                 With a copy to:  Dunnington, Bartholomew and Miller, LLP
                                  477 Madison Ave., New York, NY 10022
                                  Phone:  212 682 8811
                                  Fax: 212 661 7769

                 ServGate:        ServGate Technologies, Inc.
                                  1999 South Bascom Avenue, Suite 700
                                  Campbell, CA  95008


         8.5   ASSIGNMENT OF RIGHTS. No party may assign any part of its rights,
privileges or obligations  under this Agreement  without the written  consent of
the other parties.

         8.6   AGREEMENTS.  Neither this  Agreement  nor any term  hereof may be
changed, waived,  discharged or terminated orally, or by any action or inaction,
but only by an instrument in writing signed by the party or parties against whom
enforcement of the change, waiver or discharge is being sought.

         8.7   INVALID PROVISIONS.  If any provision  in this  Agreement  shall,
for any reason, be held to be invalid,  illegal or unenforceable in any respect,
such  invalidity,  illegality  or  unenforceability  shall not  affect any other
provision of this Agreement.

         8.8   ENTIRETY AND AMENDMENTS.  This Agreement and the other  documents
and  instruments  delivered  pursuant to the  transactions  contemplated  herein
embody  the  entire  agreement  between  the  parties  and  supersede  all prior
agreements and understandings, if any, relating to the subject matter hereof and
may be amended only by an instrument in writing executed by the parties.

         8.9   PARTIES BOUND.  This Agreement will be binding  upon and inure to
the benefit of the parties and their successors and permitted assigns.

         8.10  APPLICABLE  LAW;  COUNTERPARTS;  CONSTRUCTION.  The   terms   and
conditions of this Agreement  will be construed in accordance  with the internal
laws of the State of California  (notwithstanding  the laws of conflicts) except
insofar  as it will be  mandatory  by  statute  to  apply


579271 v3/HN                            7



the laws of another jurisdiction.  Jurisdiction shall lie in Santa Clara County,
California.  The terms of this  Agreement  shall not be  construed  against  the
drafter,  as these  drafting  services have been  performed as a courtesy to the
other party to this Agreement.  This Agreement may be executed simultaneously in
two or more  counterparts,  each of which will be deemed an original  but all of
which together will constitute one and the same instrument.

         8.11   ENFORCEMENT COSTS.  If  any legal  action,  arbitration or other
proceeding  is  brought  for the  enforcement  of this  Agreement  or any  other
agreements,  instruments  or  documents  executed  or  delivered  in  connection
herewith, or because of an alleged dispute, breach, default or misrepresentation
in  connection  with  any of the  provisions  of  this  Agreement  or any  other
agreements,  instruments  or  documents  executed  or  delivered  in  connection
herewith,  the  successful  or  prevailing  party  shall be  entitled to recover
reasonable attorney's fees and other costs incurred in that action,  arbitration
or  proceeding,  in  addition  to any  other  relief  to which it or they may be
entitled.

         8.12   WAIVER OF JURY TRIAL.  Because  disputes  arising  in connection
with complex financial  transactions are most quickly and economically  resolved
by an experienced  and expert person and the parties wish  applicable  state and
federal laws to apply (rather than arbitration  rules),  the parties desire that
their  disputes  be  resolved  by a judge  applying  such  applicable  laws by a
reference  proceeding in Santa Clara County,  California in accordance  with the
provisions of Section 638 et seq of the California Code of Civil Procedure. EACH
OF THE PARTIES HERETO SPECIFICALLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY
OF ANY CAUSE OF ACTION, CLAIM, CROSS-CLAIM,  COUNTERCLAIM,  THIRD PARTY CLAIM OR
ANY OTHER CLAIM (COLLECTIVELY,  "CLAIMS") ASSERTED BY ANY OF THE PARTIES AGAINST
ONE OR MORE OF THE OTHERS.  This waiver  extends to all such  Claims,  including
Claims that involve persons other than the parties hereto; Claims that arise out
of or are in any way connected to the  relationship  between the parties hereto;
and any Claims for damages,  breach of contract,  specific  performance,  or any
equitable or legal relief of any kind, arising out of this Agreement.



THE REMAINING PORTION OF THIS PAGE IS INTENTIONALLY LEFT BLANK












579271 v3/HN                            8



IN WITNESS  WHEREOF,  the parties  hereto have executed this Agreement as of the
date first indicated above.


Seller:                             SAND HILL FINANCE, LLC


                                    By: /s/ RON ERNST
                                       -----------------------------------------
                                    Name:  Ron Ernst
                                         ---------------------------------------
                                    Title:   CFO
                                          --------------------------------------


 Purchaser:                         CIROND CORPORATION

                                    By:  /s/ NICHOLAS R. MILLER
                                       -----------------------------------------
                                    Name:   Nicholas R. Miller
                                         ---------------------------------------
                                    Title:  C.E.O.
                                          --------------------------------------


 BSGL:                              BSGL, LLC

                                    By:  /s/ MICHAEL BROLINRIGG
                                       -----------------------------------------
                                    Name:  Michael Brolinrigg
                                         ---------------------------------------
                                    Title:  Managing Partner
                                          --------------------------------------


 ServGate:                          SERVGATE TECHNOLOGIES, INC.

                                    By:  /s/ FRANCES E. WILL
                                       -----------------------------------------
                                    Name:  Frances E. Will
                                         ---------------------------------------
                                    Title:   CEO
                                          --------------------------------------

579271 v3/HN                            9

EX-10

                                  EXHIBIT 10.1

             LOAN AND SECURITY AGREEMENT DATED AS OF APRIL 3, 2006
             BETWEEN CIROND CORPORATION AND SAND HILL FINANCE, LLC







                           LOAN AND SECURITY AGREEMENT

         This Loan and Security Agreement, dated as of April 3, 2006 (this "LOAN
AGREEMENT"),  is entered by and between CIROND CORPORATION, a Nevada corporation
("BORROWER"), and SAND HILL FINANCE, LLC, a California limited liability company
("LENDER").  All capitalized  terms used herein and not otherwise  defined shall
have the meanings provided in SECTION 13 hereof.

         The parties agree as follows:

1.       THE LOAN.

         1.1 ADVANCE.  Subject to the terms and  conditions  of this  Agreement,
Lender agrees to make one Advance to Borrower in an aggregate  principal  amount
of up to  $1,000,000.  Payments  will be made in  accordance  with the Note,  as
defined herein. Lender will disburse the Advance as follows: $500,000 to Account
No. 122 100 024 at Chase Bank on account of payroll obligations set forth in the
letter by Borrower  to Lender of even date,  and the balance to an account to be
opened at Square 1 Bank.  Borrower shall use the proceeds of the money disbursed
to  Chase  Bank  to pay  payroll  obligations  of  Servgate  Technologies,  Inc.
("Servgate")  that Borrower  assumed under a Foreclosure  Sale Agreement of even
date (the "Foreclosure Agreement"),  and the proceeds disbursed to Square 1 Bank
for working capital.

         1.2 LENDER EXPENSES. Borrower will to pay to Lender, (i) on the Closing
Date, all reasonable costs or expenses (including reasonable attorneys' fees and
expenses)  incurred  in  connection  with  the  preparation  of the  Transaction
Documents  through the Closing Date,  and (ii) after the Closing Date, all costs
and expenses  (including  reasonable  attorneys fees and expenses),  as and when
they become due,  incurred in connection with the preparation of the Transaction
Documents;  reasonable Collateral audit fees; and Lender's reasonable attorneys'
fees and expenses  incurred in amending,  enforcing or defending the Transaction
Documents (including fees and expenses of appeal),  incurred before,  during and
after an Insolvency Event, whether or not suit is brought.

2.       CLOSING.

         2.1  CONDITIONS  TO  CLOSING.  Before the funding of the  Advance,  the
following  conditions shall have been satisfied by Borrower or waived in writing
by Lender:

               (a)   Lender  shall  have  received  the  following,  in form and
substance satisfactory to Lender:

                     (i)     This Agreement;

                     (ii)    A  Promissory  Note  ("NOTE") in  the form attached
                             hereto  as  EXHIBIT  A, in the  original  principal
                             amount of One Million Dollars ($1,000,000);

                     (iii)   Copies,  certified  by  the Secretary  of Borrower,
                             of: (A) the Articles of Incorporation and Bylaws of
                             Borrower   (as   amended   to  the   date  of  this
                             Agreement),   (B)  the   resolutions   adopted   by
                             Borrower's  board  of  directors   authorizing  the
                             transactions  contemplated hereby and the documents
                             being executed in connection therewith, and (C) the
                             incumbency of the officers executing this Agreement
                             and the other  Transaction  Documents  on behalf of
                             Borrower;

                     (iv)    A Warrant (the "WARRANT");

                     (v)     Corporate Resolutions to Borrow;

                     (vii)   An Intercreditor Agreement;

                     (ix)    The Foreclosure Sale Agreement; and

                     (x)     One or more account control agreements.




               (b)   No Event of Default has occurred.

               (c)   The  representations  and  warranties  contained  in   this
Agreement  and the other  Transaction  Documents  of Borrower  shall be true and
correct  as if made on the date of funding of the  Advance  and the  Incremental
Advance.

               (d)  Borrower shall have provided to Lender such other documents,
instruments and agreements as Lender shall reasonably request.

               3.    GRANT OF SECURITY INTEREST. As security for all present and
future indebtedness,  guarantees, liabilities, and other obligations of Borrower
to Lender under this Agreement and the other Transaction  Documents or otherwise
(collectively, the "OBLIGATIONS"), Borrower grants Lender a security interest in
all of Borrower's  personal property,  whether now owned or hereafter  acquired,
including  without  limitation all accounts,  chattel paper,  deposit  accounts,
documents,  equipment,  general intangibles  (including  intellectual  property,
patents,  copyrights,  trademarks, and goodwill), goods, fixtures,  instruments,
inventory,  financial  assets,  investment  property,  letter of credit  rights,
money,  and  all of  Debtor's  books  and  records  with  respect  to any of the
foregoing,  and the computers and equipment  containing  said books and records;
and all products  and proceeds  thereof,  as defined in this  Agreement  and the
Uniform Commercial Code (collectively, the "COLLATERAL"). Borrower will execute,
and authorizes Lender to execute on behalf of Borrower,  such documents and take
such  actions  as  Lender  deems  appropriate  from time to time to  perfect  or
continue the security interest granted hereunder.


               4.  REPRESENTATIONS AND WARRANTIES. Borrower represents to Lender
on the date  hereof  and each  date on which  the  Advance  and the  Incremental
Advance is  requested,  as follows:  (a)  Borrower  is not in default  under any
agreement under which Borrower owes any money,  or any agreement,  the violation
or termination of which could have a Material  Adverse Effect;  (b) Borrower has
taken all action and obtained all consents necessary to authorize the execution,
delivery and  performance of the  Transaction  Documents;  (c) Borrower has good
title to the  Collateral  and there are no liens,  security  interests  or other
encumbrances  on the  Collateral  other than the  security  interest  granted to
Lender  hereunder and Permitted  Liens; (d) the execution and performance of the
Transaction  Documents do not conflict with, or constitute a default under,  any
agreement  to which  Borrower is party or by which  Borrower is bound or a Legal
Requirement;  (e) the information  provided to Lender on or prior to the date of
the  Advance  and  Incremental  Advance  is true  and  correct  in all  material
respects;  (f) all financial statements and other information provided to Lender
fairly present Borrower's financial condition, and there has not been a material
adverse change in the financial condition of Borrower since the date of the most
recent of the financial  statements  submitted to Lender;  (g) Borrower owns the
patents,  copyrights or trademarks, or is a licensee thereof,  necessary for the
operation  of  its  business  as  currently  conducted  and  as  proposed  to be
conducted;  (h)  Borrower  is in  compliance  with all Legal  Requirements;  (i)
Borrower is not party to any litigation and is not the subject of any government
investigation,  and  Borrower  has no  knowledge  of any pending  litigation  or
investigation  or the  existence  of  circumstances  that  reasonably  could  be
expected to give rise to such litigation or investigation; (j) Borrower does not
own any  shares  or other  equity  interests  in any  corporation,  partnership,
limited  liability company or other entity;  (k) Borrower's  inventory is in all
material  respects of good and marketable  quality,  free from material defects,
except for  inventory for which  adequate  reserves have been made in accordance
with GAAP, (l) all Collateral is in good operating condition and repair, subject
to ordinary wear and tear, and Borrower has made all economically reasonable and
necessary repairs thereto; (m) each account receivable  represents an undisputed
bona fide existing unconditional obligation of the account debtor created by the
sale,  delivery  and  acceptance  of goods or the  rendition  of services in the
ordinary  course of Borrower's  business;,  and (r) no  representation  or other
statement  made  by  Borrower  to  Lender  in any  Transaction  Document  or any
certificate or instrument delivered by Borrower to Lender in connection herewith
contains any untrue  statement  of a material  fact or omits to state a material
fact necessary to make any statements made to Lender not misleading.

5.       AFFIRMATIVE COVENANTS.

579284 v1/HN



         5.1  FINANCIAL INFORMATION. Borrower will provide Lender (i) as soon as
available,  but in any event  within 30 days  after the last day of each  month,
monthly company-prepared consolidated financial statements in form and substance
satisfactory  to Lender,  prepared  in  accordance  with  GAAP,  (ii) as soon as
available,  but in any  event  within 90 days  after the last day of  Borrower's
fiscal year,  audited  consolidated  financial  statements in form and substance
satisfactory  to Lender,  prepared in  accordance  with GAAP,  together  with an
unqualified opinion on such financial  statements from an independent  certified
public  accounting  firm  acceptable  to Lender,  (iii) copies of all  materials
provided to members of the  Borrower's  Board of  Directors  for meetings of the
Board of  Directors  at the same time that such  materials  are  provided to the
members of the  Borrower's  Board of Directors,  and (iv) promptly upon Lender's
request,  such other information relating to Borrower's operations and condition
as Lender may reasonably request from time to time.


         5.2 GOOD STANDINGS;  EXISTENCE; COMPLIANCE WITH LAWS. Borrower and each
Subsidiary  will  maintain its  corporate  existence  and good standing and will
maintain in force all licenses and  agreements  necessary or  appropriate to the
conduct of its business.  Borrower and each  Subsidiary will pay all taxes on or
before the date such taxes are due, and will comply with all Legal Requirements.

         5.3 BOARD SEATS.  Borrower  will take such actions as are necessary for
Scott  Broomfield and Humphrey  Polanen to become members of Borrower's Board of
Directors within seven days of the Closing Date.

         5.4 INSPECTION AND AUDIT RIGHTS. Lender shall have (i) a right to visit
and inspect any of the properties of Borrower and its Subsidiaries,  including a
right to examine and copy  Borrower's  and its  Subsidiaries'  books and records
from time to time upon  reasonable  notice to  Borrower  and (ii) to discuss its
affairs,  finances and accounts with the Company's  officers and its independent
public  accountants,  at such  reasonable  times  and as  often  as  Lender  may
reasonably  request.  Lender  may  audit  Borrower's  Collateral  at  Borrower's
expense.  Such audits will be  conducted no more often than  annually  unless an
Event of Default has occurred and is  continuing.  Lender will give  Borrower 10
days  advance  notice of such an audit,  unless an Event of Default has occurred
and is continuing.

         5.5 INSURANCE. Borrower will maintain insurance in a form acceptable to
Lender  relating to the Collateral  and Borrower's  business in amounts and of a
type  acceptable  to Lender.  Any  insurance on the  Collateral  shall include a
lender's  loss  payable  endorsement  in favor of Lender as an  additional  loss
payee, and any liability insurance shall show Lender as an additional insured.

6.       NEGATIVE COVENANTS. Borrower will not do any of the following:

         6.1 INVESTMENTS.  Make any investments in, or loans or advances to, any
Person other than in the ordinary course of business as currently conducted.

         6.2 ACQUISITIONS;  MERGERS.  Acquire the stock or other equity interest
in, or any assets of, any Person other than in the  ordinary  course of business
as  currently  conducted,  or enter  into any merger or  consolidation  with any
Person.

         6.3  DISTRIBUTIONS.  Make any distributions or pay any dividends to any
Person  on  account  of  any  equity  ownership  interest  in  Borrower  or  any
Subsidiary,  or make any payment on account of or in  redemption,  retirement or
purchase of any capital stock of Borrower.

         6.4 AFFILIATE TRANSACTIONS. Directly or indirectly enter into or permit
to  exist  any  material  transaction  with any  Affiliate  of  Borrower  or any
Subsidiary,  except for  transactions in the ordinary  course of business,  upon
fair and  reasonable  terms that are no less favorable to Borrower than would be
obtained in an arms-length transaction with a non-affiliated Person,

         6.5    TRANSFERS.   Dispose  of any  interest  in   Borrower's  or  any
Subsidiary's assets, except for dispositions of inventory in the ordinary course
of business as currently conducted,


579284 v1/HN




         6.6    SUBSIDIARIES.  Create  any  direct  or  indirect  subsidiary  of
Borrower,

         6.7    CORPORATE CHANGES.  Except upon prior written notice to  Lender,
change Borrower's or any Subsidiary's state of incorporation or name.

         6.8    INDEBTEDNESS.  Create,  incur,  assume  or  be  liable  for  any
Indebtedness, other than Permitted Indebtedness.

         6.9    LIENS; ENCUMBRANCES.  Create, incur, or allow any Lien on any of
its  property  or assign  or convey  any right to  receive  income,  except  for
Permitted Liens.

         6.10   SUBORDINATED DEBT.  Make any payment on any  Subordinated  Debt,
except under the terms of the  Subordinated  Debt, or amend any provision in any
document relating to the Subordinated Debt.

7.       EVENTS OF DEFAULT; REMEDIES.

         7.1.  EVENTS  OF  DEFAULT.  Any  one or  more  of the  following  shall
constitute an "EVENT OF DEFAULT" under this  Agreement:  (a) Borrower's  failure
(i) to pay all or any part of the  principal  or interest  hereunder on the date
due and payable,  or (ii) to comply with any  agreement or covenant set forth in
this Agreement or any other  Transaction  Document,  or (iii) to comply with the
terms of any material  agreement to which  Borrower is a party or by which it is
bound, or any agreement pursuant to which Borrower has incurred indebtedness (or
the  occurrence  of an Event of Default  under any such  agreement),  or (iv) to
comply  with any Legal  Requirements;  or (b) the  occurrence  of an  Insolvency
Event; or (c) any  representation  made to Lender in this Agreement or any other
Transaction  Document,  or any  information  given to  Lender by or on behalf of
Borrower,  shall be incorrect in any  material  respect;  or (d) any part of the
Collateral becomes subject to an attachment,  lien, security interest or levy in
favor of any Person  other than Lender,  other than  Permitted  Liens;  or (e) a
judgment  or  judgments  for the  payment  of money  shall be  rendered  against
Borrower  and shall  remain  unsatisfied  and  unstayed for a period of ten (10)
days; or (f) the occurrence or existence of any  circumstance  that has or could
reasonably be expected to have a Material Adverse Effect.

         7.2 REMEDIES.  Upon the  occurrence of an Event of Default,  all unpaid
principal,  accrued  interest and other amounts owing  hereunder  shall,  at the
option of Lender, be immediately due and payable and collectible by or on behalf
of Lender,  and Lender may exercise  all of the rights of a secured  party under
the Uniform Commercial Code and any other applicable law. Lender may immediately
set off and apply to any  obligation  outstanding  hereunder and under any other
Transaction Document any balances or deposits held by Lender or any indebtedness
at any time  owing to or for the  credit  or the  account  of  Borrower  held by
Lender.  Borrower  shall  assemble the  Collateral in  accordance  with Lender's
directions,  and Lender shall have a right at Borrower's sole expense to dispose
of all or any  portion of the  Collateral  in the order and manner  that  Lender
elects, in its sole discretion,  in any commercially  reasonable manner.  Lender
shall have a royalty-free license to use any name, trademark, or any property of
Borrower to complete  production of,  advertisement  for, and disposition of any
Collateral  and  Lender  shall  have a license  to enter  into,  occupy  and use
Borrower's  premises  and the  Collateral  without  charge  to  exercise  any of
Lender's rights or remedies under this Agreement or under any other  Transaction
Document.  Borrower  irrevocably appoints Lender (and any of Lender's designated
employees or agents) as Borrower's  true and lawful attorney in fact to: endorse
Borrower's name on any checks or other forms of payment; make, settle and adjust
all claims under and decisions with respect to Borrower's policies of insurance;
settle and  adjust  disputes  and claims  respecting  accounts  receivable  with
account debtors; execute and deliver all notices,  instruments and agreements in
connection  with  the  perfection  of the  security  interest  granted  in  this
Agreement or under any other Transaction Document;  and sell, lease or otherwise
dispose  of all or any part of the  Collateral.  The  appointment  of  Lender as
Borrower's  attorney  in fact,  and each of Lender's  rights and  powers,  being
coupled with an interest,  is irrevocable until all amount owing to Lender under
this Agreement and the other Transaction Documents have been repaid in full.

8.       WAIVERS; INDEMNITY.  Borrower waives notice of default, presentment and
demand for payment, notice of dishonor, protest and notice of protest under this
Agreement and any other  Transaction  Document.  Borrower shall pay all costs of
collection and enforcement of this Agreement when incurred, including reasonable
attorneys' fees, costs and


579284 v1/HN




expenses  incurred before,  after or in connection with of an Insolvency  Event.
Lender  shall not in any case be  liable  for any loss of,  or  damage  to,  the
Collateral,  the risk of which shall be borne by Borrower at all times. Borrower
shall indemnify and hold Lender harmless from any claim, obligation or liability
(including  without limitation  reasonable  attorneys fees and expenses) arising
out of this  Agreement  or any other  Transaction  Document or the  transactions
contemplated  hereby or thereby,  including  any claim,  obligation or liability
arising before,  after or in connection with an Insolvency  Event. The indemnity
obligation  hereunder shall survive repayment of all Obligations and termination
of this  Agreement  until all  applicable  statute of  limitation  periods as to
actions that may be brought against Lender have run.

9.       MAXIMUM LAWFUL RATE. On the Maturity Date or, if earlier, the date that
the  Advance  and all accrued  interest  thereon  are paid in full,  Lender will
compute the total amount of interest that has been  contracted  for,  charged or
received by Lender or payable by Borrower  hereunder  and compare such amount to
the  Maximum  Lawful  Amount  that could have been  contracted  for,  charged or
received  by  Lender.  If such  computation  reflects  that the total  amount of
interest that has been contracted for,  charged or received by Lender or payable
by Borrower  exceeds the Maximum  Lawful  Amount,  then Lender  shall apply such
excess to the reduction of the principal balance, and any remaining excess shall
be refunded to Borrower. This provision concerning the crediting or refunding of
excess  interest  shall control and take  precedence  over all other  agreements
between  Borrower  and  Lender  so that  under no  circumstance  shall the total
interest contracted for, charged or received by Lender exceed the Maximum Lawful
Amount.

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

         If to Borrower:               CIROND CORPORATION
                                       4185 Still Creek Drive, Suite B101
                                       Burnaby, BC  V5C 6G9, Canada.
                                       Attn: __________________
                                       Fax 604-205-3984


         If to Lender:                 SAND HILL FINANCE, LLC
                                       20573 Stevens Creek Blvd., Suite 200
                                       Cupertino, CA  95014
                                       Attention: Ron Ernst
                                       Fax: (408) 447-8535


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

11.      JURY WAIVER;  JUDICIAL  REFERENCE.  LENDER AND BORROWER WAIVE ANY RIGHT
TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION  ARISING OUT OF THIS  AGREEMENT,
THE  TRANSACTION  DOCUMENTS OR ANY OF THE  TRANSACTIONS  CONTEMPLATED  HEREIN OR
THEREIN,  INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS,  TORT CLAIMS,  BREACH OF
DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY RECOGNIZES
AND AGREES THAT THE FOREGOING WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO
ENTER INTO THIS AGREEMENT.  IF THIS JURY WAIVER IS FOR ANY REASON UNENFORCEABLE,
THE PARTIES  AGREE TO RESOLVE ALL CLAIMS,  CAUSES AND DISPUTES BY A JUDGE ACTING
AS REFEREE PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638.


579284 v1/HN




12.      MISCELLANEOUS.  Lender  may assign all or any part of its  interest  in
this  Agreement or the Advance to any Person,  or grant a  participation  of any
interest in this Agreement, without notice to, or the consent of, Borrower. This
Agreement  can be amended only by an  instrument  signed by Lender and Borrower.
All prior  agreements,  understandings  and  negotiations are superseded by this
Agreement.  Borrower may not assign any obligation  hereunder  without  Lender's
consent,  which may be granted or  withheld in Lender's  sole  discretion.  This
Agreement  may be executed in two or more  counterparts,  each of which shall be
deemed an  original,  but all of which shall  constitute  one  instrument.  Each
provision of this  Agreement  shall be severable  from every other  provision of
this Agreement for the purpose of determining  the legal  enforceability  of any
specific  provision.  All covenants,  representations  and warrants made in this
Agreement  shall  continue  in full force and effect so long as any  obligations
hereunder remain  outstanding.  This Agreement shall be governed by the internal
laws of the State of  California,  without  regard to  conflicts  of laws rules.
Borrower and Lender consent to the  jurisdiction  of the United States  District
Court of the  Northern  District of  California  and the state  courts for Santa
Clara, California.

13.      DEFINITIONS.

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

         "CLOSING DATE" means the date of this Agreement.

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

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

         "EVENT OF DEFAULT" shall have the meaning given to such term in Section
7.

         "FORECLOSURE  SALE AGREEMENT"  means the Foreclosure  Sale Agreement of
even date among Borrower, Servgate, Sand Hill Finance, LLC and BSGL, LLC.

         "GAAP" is generally  accepted  accounting  principles  in effect in the
United States.

         "GOVERNMENTAL   AUTHORITY"  means  any  federal,   state,   provincial,
municipal and foreign  governmental  entity,  authority,  or agency or any other
political subdivision, or any entity exercising executive, legislative judicial,
regulatory or administrative functions of government.

         "INDEBTEDNESS"  means (a) all  indebtedness  for borrowed  money or the
deferred purchase price of property or services,  including  without  limitation
reimbursement  and other obligations with respect to surety bonds and letters of


579284 v1/HN



credit,  (b) all obligations  evidenced by notes,  bonds,  debentures or similar
instruments,   (c)  all  capital  lease  obligations,  and  (d)  all  Contingent
Obligations.

         "INSOLVENCY EVENT" means Borrower's becoming insolvent, or becoming the
subject of any case or proceeding under the United States Bankruptcy Code or any
other law relating to the  reorganization or restructuring of debt, or if any of
Borrower's assets is attached or becomes subject to levy or judicial proceeding

         "INTELLECTUAL  PROPERTY  COLLATERAL"  means  all of  Borrower's  right,
title, and interest in and to Copyrights, Trademarks and Patents, trade secrets,
design rights,  claims for damages relating to the foregoing,  licenses or other
rights to use any of the foregoing, and all amendments,  renewals and extensions
of any of the foregoing.

         "LEGAL  REQUIREMENT"  means any statute,  ordinance,  code,  law, rule,
regulation, order or other requirement,  standard, procedure enacted, adopted or
applied by any Governmental  Authority,  including,  decisions,  orders,  writs,
awards,  or  injunctions  of an  arbitrator  or a court  or  other  Governmental
Authority.

         "MATERIAL  ADVERSE  EFFECT" means a material  adverse effect on (i) the
business  operations,   condition  (financial  or  otherwise)  or  prospects  of
Borrower,  (ii) the ability of Borrower to repay the  Obligations  or  otherwise
perform its obligations  under the Transaction  Documents,  or (iii)  Borrower's
interest in, or the value,  perfection or priority of Lender's security interest
in the Collateral.

         "MATURITY DATE" has the meaning assigned in the Note.

         "MAXIMUM  LAWFUL  AMOUNT" means the maximum  amount of interest that is
permissible  under  applicable  state  or  federal  laws  for  the  type of loan
evidenced by the Transaction Documents.

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

         "PERMITTED INDEBTEDNESS" means:

                  (a)  Indebtedness of Borrower in favor of Lender arising under
this Agreement or any other Transaction Document;

                  (b) Indebtedness  owed by Borrower from time to time under the
Foreclosure  Sale  Agreement  and the  SHF  Finance  Documents,  the  BSGL  Loan
Documents,  as defined in the  Foreclosure  Sale  Agreement,  and the promissory
notes issued by Borrower to Sand Hill Finance,  LLC and BSGL,  LLC, as specified
under the Foreclosure Sale Agreement; and

                  (c)  Indebtedness to trade creditors  incurred in the ordinary
course of business.

         "PERMITTED LIENS" means:

                  (a) Any liens (i) existing on the Closing  Date and  disclosed
in  writing  to Lender on or before  the  Closing  Date  (excluding  liens to be
satisfied with the proceeds of the Advance) or (ii) arising under this Agreement
or the other Transaction Documents;

                  (b) Liens for taxes,  fees,  assessments or other governmental
charges or levies,  either not  delinquent  or being  contested in good faith by
appropriate  proceedings  and for which Borrower  maintains  adequate  reserves,
provided the same have no priority over any of Lender's security interests;

                  (c)  Purchase  money  liens  (i)  on  equipment  and  software
acquired or held by Borrower  incurred  for  financing  the  acquisition  of the
equipment and software, or (ii) existing on equipment when acquired, if the lien
is confined to the property and  improvements  and the proceeds of the equipment
and software;


579284 v1/HN


                  (d) Liens securing the Indebtedness  referred to in clause (b)
of "Permitted Indebtedness";

                  (e) Liens arising from  judgments,  decrees or  attachments in
circumstances not constituting an Event of Default under SECTION 7; and

                  (f) Liens in favor of other financial  institutions arising in
connection with Borrower's deposit accounts held at such institutions to secured
standard fees for deposit  services charged by, but not financing made available
by such institutions,  provided that Lender has a perfected security interest in
the amounts held in such deposit accounts.

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

         "SUBORDINATED  DEBT"  means  any  debt  incurred  by  Borrower  that is
subordinated  in  writing  to the debt  owing by  Borrower  to  Lender  on terms
acceptable to Lender.

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

         "UNIFORM  COMMERCIAL  CODE"  means the  Uniform  Commercial  Code as in
effect from time to time in the state of California.


                            [Signature page follows.]











579284 v1/HN




         IN WITNESS WHEREOF,  the undersigned have executed this Agreement as of
the first day above written.

BORROWER:                                 LENDER:

CIROND CORPORATION                        SAND HILL FINANCE, LLC



By:   /s/ NICHOLAS R. MILLER              By:
   -------------------------------           -----------------------------------

Name:  Nicholas R. Miller                 Name:
      ----------------------------             ---------------------------------

Title:   C.E.O.                           Title:
       ---------------------------              --------------------------------






















579284 v1/HN

EX-10

                                  EXHIBIT 10.2

        PROMISSORY NOTE FROM CIROND CORPORATON TO SAND HILL FINANCE, LLC
                DATED APRIL 3, 2006 IN THE AMOUNT OF $1,000,000










                                 PROMISSORY NOTE

$1,000,000.00                                              Dated:  April 3, 2006

         FOR VALUE RECEIVED, the undersigned, CIROND CORPORATION ("BORROWER"), a
Nevada  corporation,  HEREBY  PROMISES TO PAY to the order of SAND HILL FINANCE,
LLC ("LENDER") the principal amount of One Million Dollars  ($1,000,000) or such
lesser amount as shall equal the aggregate  outstanding principal balance of the
Advance made by Lender to Borrower  pursuant to the Loan and Security  Agreement
dated April 3, 2006 by and between  Lender and Borrower (the "LOAN  AGREEMENT"),
together  with  interest  on any  and all  principal  amounts  remaining  unpaid
hereunder from time to time  outstanding.  Interest shall accrue at a rate equal
to 10% per annum, on a 360-day basis.  Interest shall be payable  quarterly,  on
each July 1,  October 1,  January 1 and April 1 that any  amount is  outstanding
hereunder.  All unpaid principal and accrued but unpaid interest shall be due on
October 1, 2006 (the "Maturity Date").

         If Borrower  receives at least  $3,000,000 of proceeds from the sale or
issuance of its equity  securities  by July 3, 2006,  then upon  receipt of such
proceeds,   Borrower  shall  pay  Lender  $500,000  on  account  of  the  amount
outstanding,  and may elect to extend the  Maturity  Date to April 1,  2007.  If
"Billings"  for the period  beginning  the date hereof and ending June 30, 2006,
are less than  $1,500,000,  then  Lender  shall  have the option on such date to
require payment in full of this Note on the day that is 90 days after such date.
"Billings" means contracts signed,  cash received and products  shipped,  or any
OEM Agreement is completely executed where the total consideration to be paid to
Borrower is at least  $1,500,000,  in each case such contract or agreement to be
on terms reasonably acceptable to Lender.

         Borrower may prepay all or any portion of this Note without  penalty or
premium, provided that amounts repaid may not be reborrowed.  All payments shall
be applied first to fees and expenses, then to interest, and then to principal.

         Presentment  for  payment,  demand,  notice  of  protest  and all other
demands  and notices of any kind in  connection  with the  execution,  delivery,
performance and enforcement of this Note are hereby waived.

         Borrower shall pay all reasonable fees and expenses, including, without
limitation,  reasonable  attorneys'  fees and  costs,  incurred  by Agent or any
Lender in the  enforcement  or attempt to enforce any of Borrower's  obligations
hereunder not performed  when due. This Note shall be governed by, and construed
and interpreted in accordance with, the laws of the State of California.

         IN WITNESS  WHEREOF,  Borrower has caused this Note to be duly executed
by one of its officers thereunto duly authorized on the date hereof.

                                      CIROND CORPORATION,
                                      a Delaware corporation


                                      By: /s/ NICHOLAS R. MILLER
                                         ---------------------------------------

                                      Name:  Nicholas R. Miller
                                           -------------------------------------

                                      Title:    C.E.O.
                                            ------------------------------------

EX-10

                                  EXHIBIT 10.3

       PROMISSORY NOTE FROM CIROND CORPORATION TO SAND HILL FINANCE, LLC
                DATED APRIL 4, 2006 IN THE AMOUNT OF $2,100,000





                                 PROMISSORY NOTE

$2,100,000.00                                              Dated:  April 4, 2006

         FOR VALUE RECEIVED, the undersigned,  CIROND CORPORATION ("CIROND"),  a
Nevada  corporation,  HEREBY  PROMISES TO PAY to the order of SAND HILL FINANCE,
LLC ("SHF") the principal  amount of Two Million,  One Hundred  Thousand Dollars
($2,100,000),  together with interest on any and all principal amounts remaining
unpaid hereunder from time to time outstanding.  Interest shall accrue at a rate
equal to 18% per annum, on a 360-day basis.  Interest shall be payable  monthly,
on the  first  day of  each  month,  for so long as any  amount  is  outstanding
hereunder.  Cirond  shall pay  mandatory  payments in  reduction of principal as
follows: $150,000 to SHF by April 7, 2006, $150,000 on or before April 30, 2006,
$500,000 on or before June 30,  2006,  and $500,000 on or before  September  30,
2006. Cirond shall pay 25% of the proceeds from an anticipated OEM agreement and
15% of the  proceeds of any sale or issuance of equity or debt  securities  over
$3,000,000 as mandatory  prepayments of the outstanding  amount  hereunder.  All
unpaid  principal and accrued but unpaid  interest  shall be due on December 31,
2006 (the "Maturity Date").

         Cirond may prepay all or any  portion of this Note  without  penalty or
premium.  All  payments  shall be applied  first to fees and  expenses,  then to
interest, and then to principal.

         Presentment  for  payment,  demand,  notice  of  protest  and all other
demands  and notices of any kind in  connection  with the  execution,  delivery,
performance and enforcement of this Note are hereby waived.

         Cirond shall pay all reasonable fees and expenses,  including,  without
limitation,  reasonable  attorneys' fees and costs, incurred by Agent or any SHF
in the enforcement or attempt to enforce any of Cirond's  obligations  hereunder
not  performed  when due.  This Note shall be  governed  by, and  construed  and
interpreted in accordance with, the laws of the State of California.

         This Note  provides  further  evidence of the  obligations  of Servgate
Technologies,  Inc.  ("Servgate")  that Cirond  assumed  under  Section 2 of the
Foreclosure Sale Agreement (the "Foreclosure Sale Agreement") of even date among
Cirond,  SHF,  Servgate and BSGL, LLC. SHF may enforce such assumed  obligations
without this Note.

         IN WITNESS WHEREOF,  Cirond has caused this Note to be duly executed by
one of its officers thereunto duly authorized on the date hereof.

                                    CIROND CORPORATION,
                                    a Nevada corporation


                                    By:  /s/ NICHOLAS R. MILLER
                                       -----------------------------------------

                                    Name:    Nicholas R. Miller
                                         ---------------------------------------

                                    Title:     C.E.O.
                                          --------------------------------------

EX-10

                                  EXHIBIT 10.4

              PROMISSORY NOTE FROM CIROND CORPORATION TO BSGL, LLC
                DATED APRIL 4, 2006 IN THE AMOUNT OF $2,500,000









THIS  NOTE  AND THE  SECURITIES  ISSUABLE  UPON  ITS  CONVERSION  HAVE  NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED  ("ACT"),  NOR HAVE THEY
BEEN  REGISTERED OR QUALIFIED  UNDER THE SECURITIES  LAWS OF ANY STATE.  NEITHER
THIS  NOTE  NOR  THE  SECURITIES  ISSUABLE  UPON  ITS  CONVERSION  MAY BE  SOLD,
TRANSFERRED,  HYPOTHECATED,  OR  OTHERWISE  DISPOSED  OF  UNLESS A  REGISTRATION
STATEMENT  UNDER THE ACT IS IN EFFECT AS TO SUCH TRANSFER,  THE TRANSFER IS MADE
IN  ACCORDANCE  WITH  RULE 144 UNDER THE ACT OR AS  OTHERWISE  PERMITTED  BY THE
DEBTOR, OR, IN THE OPINION OF COUNSEL  SATISFACTORY TO THE DEBTOR,  REGISTRATION
UNDER THE ACT IS  UNNECESSARY  IN ORDER FOR SUCH TRANSFER TO COMPLY WITH THE ACT
AND WITH APPLICABLE STATE SECURITIES LAWS.


                SECURED SUBORDINATED CONVERTIBLE PROMISSORY NOTE

$2,500,000                                                         April 4, 2006

         FOR  VALUE  RECEIVED,   CIROND   CORPORATION,   a  Nevada   corporation
("DEBTOR"),  hereby promises to pay to BSGL, LLC, a Delaware  limited  liability
company  ("CREDITOR"),  or order,  the principal sum of Two Million Five Hundred
Thousand  Dollars  ($2,500,000),  together  with  accrued  interest  as provided
herein.

     A.  INTEREST; PAYMENTS.

         1.    INTEREST.  Interest  on the unpaid principal balance of this Note
shall  accrue at the per annum  rate of two  percent  (2%) plus the Prime  Rate;
PROVIDED,  HOWEVER, that during the continuance of an Event of Default, interest
shall  accrue at the per annum rate of four  percent  (4%) plus the Prime  Rate.
Interest  payable  hereunder shall be calculated on the basis of a three hundred
sixty (360) day year for actual days  elapsed.  "PRIME RATE" is the "Prime Rate"
as listed in THE WALL STREET JOURNAL Money Rates report from time to time during
the term  hereof.  Each change in the Prime Rate shall result in a change in the
interest  rate  hereunder as of the date of such Prime Rate change,  without any
notice to Debtor.

         2.    PRINCIPAL PAYMENTS. Debtor shall pay the principal outstanding as
follows:

               a.   Upon the closing of the PIPE  Transaction, Debtor  shall pay
the principal  amount equal to ten percent (10%) of the Net Proceeds of the PIPE
Transaction.   "NET  PROCEEDS"  means  the  aggregate  issuance  price  for  the
securities issued in the PIPE Transaction,  less the underwriters'  discount for
issuing such securities;

                                       1

PA\10452360.4
341814-45



               b.   Three  Hundred Seventy-Five  Thousand Dollars  ($375,000) on
December 31, 2006;

               c.   Three  Hundred  Seventy-Five  Thousand Dollars ($375,000) on
March 31, 2007;

               d.   Three  Hundred  Seventy-Five  Thousand Dollars ($375,000) on
June 30, 2007;

               e.   Three  Hundred  Seventy-Five Thousand  Dollars ($375,000) on
September 30, 2007; and

               f.   The  remaining outstanding  principal  on December  31, 2007
(the "MATURITY DATE").

         3.    VOLUNTARY  PREPAYMENT.  Debtor shall have the right to prepay, in
whole or in part,  the principal of this Note,  upon five (5) days' prior notice
to  Creditor.  Partial  prepayments  shall be applied to the  principal  payment
installments in the inverse order of maturity.

         4.    MANDATORY  PREPAYMENT.  If  the  GAAP  operating  income  for the
Acquired  Business,  as defined in Section  B.1,  equals or exceeds  Two Million
Dollars  ($2,000,000)  for the fiscal year ending December 31, 2006, then Debtor
shall prepay all of the remaining principal on or prior to January 31, 2007.

         5.    INTEREST  PAYMENT.  On  the  Maturity  Date, Debtor shall pay the
accrued interest  outstanding by issuing Common Stock at a per share price equal
to the lesser of (i) the PIPE  Transaction  Price,  and (ii) the Current  Market
Price on the Maturity Date.

         6.    FORM OF PAYMENT.  Principal  and all other  amounts due hereunder
(other  than  interest,  to the  extent  it is to be paid in  Common  Stock,  as
provided in Section A.4) are to be paid in lawful money of the United  States of
America in federal or other immediately available funds.

     B.  AUTOMATIC CONVERSION.

         1.    AUTOMATIC  CONVERSION.  If Debtor's GAAP  revenue attributable to
the business  acquired pursuant to the Foreclosure Sale Agreement (the "ACQUIRED
BUSINESS")  for the one  year  period  commencing  as of the  date  hereof  (the
"MEASUREMENT   PERIOD")   does  not  equal  or  exceed  Five   Million   Dollars
($5,000,000),  then,  on the tenth (10th) day after Debtor  delivers to Creditor
the  GAAP  financial  statements  (the  "AUTOMATIC  CONVERSION  DATE")  for  the
Measurement Period (the "MEASUREMENT PERIOD FINANCIAL STATEMENTS"), Debtor shall
convert One Million  Dollars  ($1,000,000)  of the  principal  outstanding  into
Common  Stock  at a per  share  price  equal


                                       2

PA\10452360.4
341814-45


to the lesser of (i) the PIPE  Transaction  Price,  and (ii) the Current  Market
Price on the conversion date; PROVIDED,  HOWEVER,  that the automatic conversion
under this Section B shall not occur if an Insolvency  Proceeding  exists on the
Automatic Conversion Date.

         2.   DISPUTE RESOLUTION. If the Measurement Period Financial Statements
show that the GAAP revenue  attributable  to the Acquired  Business is less than
Five Million Dollars ($5,000,000),  and Creditor disagrees with such Measurement
Period Financial  Statements,  then Creditor shall give written notice to Debtor
of such disagreement  prior to the Automatic  Conversion Date. If such notice is
timely  given,  the  automatic  conversion  shall  not  occur  on the  Automatic
Conversion Date. Instead, Debtor and Creditor shall jointly retain an accounting
firm  satisfactory  to each of them within  five (5) days of such  notice  being
given.  If they are unable to agree on such  selection  within such five (5) day
period,  Debtor and Creditor shall,  within twenty (20) days after expiration of
such five (5) day period,  each  retain a separate  accounting  firm.  If either
party fails to retain  such a firm during such twenty (20) day period,  then the
accounting  firm  retained  by the other  party  shall  alone  take the  actions
described  below.  Such firm or firms shall determine within thirty (30) days of
being  retained the GAAP revenue of the  Acquired  Business for the  Measurement
Period,  and deliver its or their opinion in writing to Debtor and Creditor.  If
two firms are engaged,  and they cannot jointly agree upon such revenue  amount,
then, unless otherwise  directed in writing by Debtor and Creditor,  such firms,
in their sole  discretion,  shall choose another firm  independent of Debtor and
Creditor,  which firm shall make such determination and render it as promptly as
practicable.  In either case, the  determination so made shall be conclusive and
binding on Debtor and  Creditor.  The fees and expenses  for such  determination
made by such firm or firms shall be paid (i) by Debtor,  if the determination is
that the GAAP revenue was Five Million Dollars  ($5,000,000) or greater, or (ii)
by Creditor,  if the  determination  is that the GAAP revenue was less than Five
Million Dollars ($5,000,000).  If the determination is that the GAAP revenue was
less than Five Million Dollars ($5,000,000), then Debtor shall convert principal
as provided in Section B.1,  effective as the date of such  determination,  with
the conversion price equal to the lesser of (i) the PIPE Transaction  Price, and
(ii) the Current Market Price on the date the conversion would have occurred but
for the dispute resolution process in this Section B.2 being employed.

         3.    FRACTIONAL  SHARES.  Debtor  shall not issue fractional shares of
Common Stock or scrip  representing  fractional  shares of Common Stock upon the
automatic  conversion under this Section B. As to any fractional share of Common
Stock which  Creditor  would  otherwise be entitled to purchase from Debtor upon
such exercise,  Debtor shall purchase from Creditor such  fractional  share at a
price  equal to an  amount  calculated  by  multiplying  such  fractional  share
(calculated  to the nearest  1/100th of a share) by the Current  Market Price on
the  conversion  date.  Payment of such amount shall be made in cash or by check
payable to the order of Creditor at the time of delivery of any  certificate  or
certificates arising upon such exercise.

     C.  VOLUNTARY CONVERSION RIGHT.


                                       3

PA\10452360.4
341814-45


         1.    CONVERSION RIGHT.  Creditor shall have the right (the "CONVERSION
RIGHT"),  in its sole  discretion,  at any time and from time to time during the
period commencing on the date hereof and terminating on the Determination  Date,
to elect to convert  all or any part of the  principal  outstanding  into Common
Stock at a per  share  price  equal to the  lesser  of (i) the PIPE  Transaction
Price,  and (ii) the Current Market Price on the Conversion  Date, as defined in
Section C.2.

         2.    EXERCISE  OF  CONVERSION  RIGHT.  To convert any of the principal
outstanding  into shares of Common  Stock,  Creditor  shall  deliver to Debtor a
written  notice of election to exercise the  Conversion  Right (the  "CONVERSION
Notice"). Debtor shall, as soon as practicable thereafter,  issue and deliver to
Creditor a certificate or  certificates,  registered in Creditor's name, for the
number of shares of Common Stock to which  Creditor  shall be entitled by virtue
of such exercise (such shares the  "CONVERSION  SHARES").  The conversion of the
principal  outstanding shall be deemed to have been made on the date that Debtor
receives the  Conversion  Notice (the  "CONVERSION  DATE") and Creditor shall be
treated for all  purposes as the record  holder of the  Conversion  Shares as of
such date.

         3.    FRACTIONAL  SHARES.  Debtor shall  not issue fractional shares of
Common  Stock or scrip  representing  fractional  shares  of Common  Stock  upon
exercise of the Conversion  Right.  As to any  fractional  share of Common Stock
which  Creditor  would  otherwise be entitled to purchase  from Debtor upon such
exercise,  Debtor shall purchase from Creditor such fractional  share at a price
equal to an amount  calculated by multiplying such fractional share  (calculated
to the nearest 1/100th of a share) by the Current Market Price on the Conversion
Date.  Payment of such amount  shall be made in cash or by check  payable to the
order of Creditor at the time of delivery  of any  certificate  or  certificates
arising upon such exercise.

         4.    NOTICE OF CERTAIN  EVENTS.  If Debtor proposes at any time (a) to
declare any dividend or  distribution  upon the Common  Stock,  whether in cash,
property, stock, or other securities and whether or not a regular cash dividend;
(b) to offer  for  subscription  pro rata to the  holders  of  Common  Stock any
additional shares of stock of any class or series or other rights; (c) to effect
any reclassification or recapitalization of the Common Stock; or (d) to merge or
consolidate with or into any other  corporation,  or sell,  lease,  license,  or
convey all or substantially all of its assets, or to liquidate, dissolve or wind
up, then,  in  connection  with each such event,  Debtor shall give Creditor (1)
prompt prior written notice of the date on which a record will be taken for such
dividend, distribution, or subscription rights (and specifying the date on which
the holders of Common Stock will be entitled thereto) or for determining  rights
to vote, if any, in respect of the matters referred to in (c) and (d) above; and
(2) in the case of the matters  referred to in (c) and (d) above,  prompt  prior
written  notice of the date when the same will take  place (and  specifying  the
date on which the holders of Common  Stock will be  entitled  to exchange  their
Common Stock for securities or other property deliverable upon the occurrence of
such event).


                                       4

PA\10452360.4
341814-45


     D.  SECURITY INTEREST.

         1.    GRANT OF SECURITY INTEREST.  Debtor grants to Creditor a security
interest  in the  Collateral,  as  defined  in  EXHIBIT A hereto,  to secure the
payment of all of the indebtedness hereunder (the "SECURED OBLIGATIONS").

         2.    REPRESENTATIONS  AND  WARRANTIES  REGARDING  COLLATERAL.   Debtor
represents  and warrants to Creditor that Debtor is the true and lawful owner of
the Collateral,  having good and marketable title thereto, free and clear of any
and all Liens  other than the Lien and  security  interest  granted to  Creditor
hereunder  and Permitted  Liens.  Debtor shall not create or assume or permit to
exist any such Lien on or  against  any of the  Collateral  except as created or
permitted by this Note and Permitted  Liens,  and Debtor shall  promptly  notify
Creditor of any such other Lien  against  the  Collateral  and shall  defend the
Collateral  against,  and take all such action as may be  necessary to remove or
discharge, any such Lien.

         3.   PERFECTION OF SECURITY INTEREST. Debtor agrees to take all actions
requested  by Creditor  and  reasonably  necessary  to perfect,  to continue the
perfection of, and to otherwise give notice of, the Lien granted hereunder.



     E.  EVENTS OF DEFAULT.

         1.    DEFINITION OF EVENT OF DEFAULT. The occurrence of any one or more
of the following events shall constitute an "EVENT OF DEFAULT" hereunder:

               a.  Debtor's  breach  of the obligation to pay any amount payable
hereunder on the date that it is due and payable;

               b.  Debtor's failure to perform,  keep or observe in any material
respect any of its covenants, hereunder;

               c.  The occurrence of any Senior Default; or

               d.  Debtor  liquidates  or dissolves or  becomes the subject of a
proceeding under the federal Bankruptcy Code, or any other applicable federal or
state law relating to creditor rights and remedies,  or a receiver,  liquidator,
assignee,  trustee or other similar official is appointed with respect to Debtor
or a substantial portion of Debtor's property,  or an assignment for the benefit
of creditors is made by Debtor (collectively an "INSOLVENCY PROCEEDING").

                                       5

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         2.    RIGHTS AND REMEDIES ON EVENT OF DEFAULT.

               a.   During  the continuance of  an Event  of  Default,  Creditor
shall  have the  right,  itself or through  any of its  agents,  with or without
notice to Debtor (as provided below), as to any or all of the Collateral, by any
available judicial  procedure,  or without judicial process (provided,  however,
that it is in compliance  with the UCC), to exercise any and all rights afforded
to a secured party under the UCC or other  applicable law.  Without limiting the
generality of the foregoing,  Creditor shall have the right to sell or otherwise
dispose of all or any part of the Collateral,  either at public or private sale,
in lots or in bulk,  for  cash or for  credit,  with or  without  warranties  or
representations,  and upon such terms and  conditions,  all as Creditor,  in its
sole discretion,  may deem advisable, and it shall have the right to purchase at
any such sale.  Debtor  agrees  that a notice  sent at least  fifteen  (15) days
before  the time of any  intended  public  sale or of the time  after  which any
private  sale or other  disposition  of the  Collateral  is to be made  shall be
reasonable  notice of such sale or other  disposition.  The proceeds of any such
sale, or other Collateral disposition shall be applied, first to the expenses of
retaking,  holding, storing, processing and preparing for sale, selling, and the
like, and to Creditor's reasonable attorneys' fees and legal expenses,  and then
to the Secured  Obligations and to the payment of any other amounts  required by
applicable  law,  after which  Creditor  shall account to Debtor for any surplus
proceeds.  To the extent  permitted by applicable law, Debtor waives all claims,
damages and demands  against  Creditor  arising out of the  retention or sale or
lease of the Collateral or other exercise of Creditor's rights and remedies with
respect thereto.

               b.   To  the extent  permitted  by law,  Debtor covenants that it
will not at any time insist upon or plead,  or in any manner  whatever  claim or
take any benefit or advantage  of, any stay or extension  law now or at any time
hereafter in force,  nor claim,  take or insist upon any benefit or advantage of
or from  any law now or  hereafter  in  force  providing  for the  valuation  or
appraisal  of the  Collateral  or any part  thereof,  prior to any sale or sales
thereof to be made pursuant to any provision  herein  contained,  or the decree,
judgment or order of any court of competent jurisdiction; or, after such sale or
sales,  claim or exercise any right under any statute now or  hereafter  made or
enacted by any state or  otherwise  to redeem the  property  so sold or any part
thereof, and, to the full extent legally permitted,  hereby expressly waives all
benefit and advantage of any such law or laws,  and  covenants  that it will not
invoke or utilize any such law or laws or otherwise hinder,  delay or impede the
execution of any power herein granted and delegated to Creditor, but will suffer
and permit the  execution  of every such power as though no such  power,  law or
laws had been made or enacted.

               c.   Any sale, whether under any power of sale hereby given or by
virtue of judicial  proceedings,  shall  operate to divest all  Debtor's  right,
title, interest, claim and demand whatsoever, either at law or in equity, in and
to the Collateral sold, and shall be a perpetual bar, both at law and in equity,
against Debtor, its successors and assigns, and against all


                                       6

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persons and entities  claiming the Collateral sold or any part thereof under, by
or through Debtor, its successors or assigns.

               d.   Debtor appoints Creditor, and any officer, employee or agent
of  Creditor,  with full  power of  substitution,  as  Debtor's  true and lawful
attorney-in-fact,  effective as of the date hereof,  with power, in its own name
or in the name of Debtor,  during the  continuance  of an Event of  Default,  to
endorse any notes, checks, drafts, money orders, or other instruments of payment
in respect of the Collateral that may come into Creditor's  possession,  to sign
and endorse any drafts against debtors,  assignments,  verifications and notices
in connection with accounts, and other documents relating to Collateral;  to pay
or  discharge  taxes or Liens at any time  levied  or  placed  on or  threatened
against the  Collateral;  to demand,  collect,  issue  receipt for,  compromise,
settle and sue for monies due in respect of the  Collateral;  to notify  persons
and entities  obligated with respect to the Collateral to make payments directly
to  Creditor;  and,  generally,  to do, at  Creditor's  option  and at  Debtor's
expense,  at any time, or from time to time,  all acts and things which Creditor
deems  necessary  to protect,  preserve  and  realize  upon the  Collateral  and
Creditor's  security  interest therein to effect the intent of this Note, all as
fully and  effectually  as Debtor might or could do; and Debtor hereby  ratifies
all that said attorney  shall  lawfully do or cause to be done by virtue hereof.
This  power of  attorney  shall  be  irrevocable  as long as any of the  Secured
Obligations are outstanding.

               e.   All  of  Creditor's rights  and remedies with respect to the
Collateral,  whether established hereby or by any other agreements,  instruments
or  documents  or by law  shall be  cumulative  and may be  exercised  singly or
concurrently.

               f.   If  payment of the Secured  Obligations  is accelerated as a
result of an Event of  Default,  then,  upon  payment  in full of the  principal
outstanding,  the accrued interest shall be converted into Common Stock at a per
share price equal to the lesser of (i) the PIPE Transaction  Price, and (ii) the
Current Market Price on the date the principal is fully paid.

     F.  SUBORDINATION.  Creditor's  payment  and  other  rights  hereunder  are
subordinated to the extent provided in the Intercreditor Agreement.

     G.  OTHER PROVISIONS.

         1.    REGISTRATION  RIGHTS.  If Debtor  grants  registration  rights to
any of its  shareholders  during the term hereof,  or while  Creditor  holds any
Common Stock  acquired  upon  conversion  of principal  outstanding  or interest
accrued hereunder,  then Debtor shall also grant Creditor,  with respect to such
Common Stock,  the same  registration  rights,  by making Debtor a party to such
registration rights agreement.

         2.    DEFINITIONS.  As used herein, the following  terms shall have the
following meanings:


                                       7

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341814-45



         "CLOSING  PRICE":  of the  Common  Stock  on any  date  means  the last
reported sales price or, in case no such reported sale takes place on such date,
the  average of the  reported  closing  bid and ask prices in either case on the
Nasdaq  National  Market or, if the Common  Stock is not listed or  admitted  to
trading or, if not listed or admitted to trading on the Nasdaq  National  Market
or any national securities exchange, the last reported sales price of the Common
Stock as quoted on NASDAQ or, in case no reported sales take place,  the average
of the closing bid and ask prices as quoted on NASDAQ or any comparable  system,
the closing sales price or, in case no reported sale takes place, the average of
the closing bid and ask prices,  as furnished by any two members of the National
Association  of  Securities  Dealers,  Inc.  selected  from  time to time by the
Company for that purpose.  If no such prices are  available,  the current market
price per share shall be the fair value of a share of Common Stock as determined
in good faith by the Board of Directors.

         "COMMON STOCK":  means the Debtor's common stock,  $0.001 par value, as
it exists on the date hereof,  and any shares of any class or classes of capital
stock of the Debtor  resulting from any  reclassification  or  reclassifications
thereof  and which have no  preference  in respect  of  dividends  or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding-up of the Debtor.

         "CURRENT  MARKET  PRICE":  on any date means the average of the Closing
Prices of the Common Stock on each of the five consecutive Trading Days prior to
but not including such date.

         "FORECLOSURE  SALE  AGREEMENT":  means the Foreclosure  Sale Agreement,
dated as of the date hereof, by and among ServGate  Technologies,  Inc., Debtor,
Creditor and Sand Hill Finance, LLC.

         "GAAP": means generally accepted accounting principles set forth in the
opinions and  pronouncements of the Accounting  Principles Board of the American
Institute of Certified Public  Accountants and statements and  pronouncements of
the Financial  Accounting  Standards  Board or in such other  statements by such
other  Person as may be  approved  by a  significant  segment of the  accounting
profession,  which  are  applicable  to  the  circumstances  as of the  date  of
determination.

         "INSOLVENCY PROCEEDING":  has the meaning specified in Section E.1.d.

         "INTERCREDITOR AGREEMENT":  means the Intercreditor Agreement, dated as
of April 3, 2006, by and among Debtor,  Creditor, and Sand Hill Finance, LLC, as
amended and restated from time to time during the term hereof.

         "LIEN": any lien (statutory or other), mortgage, pledge, hypothecation,
assignment,  deposit  arrangement,  security  interest,  charge,  claim or other
encumbrance of any kind (including any conditional sale or other title retention
agreement,  any  lease in the  nature  thereof,  and any  agreement  to give any
security  interest)  and any  agreement  to give or refrain  from giving a lien,


                                       8

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341814-45


mortgage,  pledge,  hypothecation,  assignment,  deposit  arrangement,  security
interest, charge, claim or other encumbrance of any kind.

         "PERMITTED LIENS":  (i) Liens permitted under the documents  evidencing
the Senior Debt, and (iii) Liens securing the Senior Debt.

         "PIPE TRANSACTION": means the first bona fide issuance by Debtor, after
the date hereof,  in one or more related  transactions or closings of securities
or notes convertible into securities of Debtor,  for an aggregate issuance price
of not less than Five Million Dollars  ($5,000,000);  for purposes of this Note,
the  principal  amount of the  Bridge  Loan,  as  defined  in the  Intercreditor
Agreement,  to the  extent  that  it is  converted  into  or  exchanged  for the
securities or notes issued in the PIPE Transaction,  shall be considered part of
the PIPE Transaction.

         "PIPE  TRANSACTION  PRICE":  means the price at which the securities or
notes are issued in the PIPE  Transaction,  on an  as-converted  to Common Stock
basis.

         "SENIOR  DEBT":  means the Agent Obligations  and the SHF  Obligations,
as such terms are defined in the Intercreditor Agreement.

         "SENIOR DEFAULT":  means an event of default with respect to any of the
Senior Debt.

         "TRADING DAY":  means each  Monday, Tuesday,  Wednesday,  Thursday  and
Friday,  other than any day on which  securities are not generally traded on the
principal exchange or market in which the Common Stock is traded.

         "UCC" means the Uniform  Commercial Code in effect from time to time in
the relevant jurisdiction.

               3.   GOVERNING LAW; VENUE.  This  Note  shall  be governed by the
laws of the State of  California,  without  giving  effect to  conflicts  of law
principles. Debtor and Creditor agree that all actions or proceedings arising in
connection  with this Note  shall be tried and  litigated  only in the state and
federal courts located in the County of Santa Clara,  State of California or, at
Creditor's  option,  any court in which  Creditor  determines it is necessary or
appropriate  to initiate  legal or equitable  proceedings  in order to exercise,
preserve,  protect or defend any of its rights and  remedies  under this Note or
otherwise or to exercise, preserve, protect or defend its Lien, and the priority
thereof, against the Collateral,  and which has subject matter jurisdiction over
the  matter in  controversy.  Debtor  waives any right it may have to assert the
doctrine of forum non conveniens or to object to such venue, and consents to any
court ordered relief.  Debtor waives personal service of process and agrees that
a summons and  complaint  commencing  an action or  proceeding in any such court
shall be promptly  served and shall confer  personal  jurisdiction  if served by
registered or certified mail to Debtor.  If Debtor fails to appear or answer any
summons,  complaint,  process or papers so served  within thirty (30)


                                       9

PA\10452360.4
341814-45


days after the mailing or other service  thereof,  it shall be deemed in default
and an order of judgment may be entered  against it as demanded or prayed for in
such summons, complaint, process or papers. The choice of forum set forth herein
shall not be deemed to preclude the enforcement of any judgment obtained in such
forum,  or the taking of any action under this Note to enforce the same,  in any
appropriate jurisdiction.

               4.   NOTICES. Any notice or communication  required or desired to
be  served,  given or  delivered  hereunder  shall  be in the  form  and  manner
specified below, and shall be addressed to the party to be notified as follows:

If to Creditor:                     BSGL, LLC
                                    c/o Michael Brownrigg
                                    1524 Columbus Avenue
                                    Burlingame, California 94010
                                    Telecopier:

With a copy to:                     Craig M. Tighe
                                    DLA Piper Rudnick Gray Cary US LLP
                                    2000 University Avenue
                                    East Palo Alto, California  94303
                                    Telecopier: (650) 833-2001

If to Debtor:                       Cirond Corporation
                                    1999 South Bascom Avenue
                                    Suite 700
                                    Campbell, CA 95008
                                    Attention:
                                    Telecopier:

With a copy to:                     Dunnington, Bartholomew and Miller, LLP
                                    477 Madison Ave.
                                    New York, New York
                                    Attention:
                                    Telecopier:  (212) 661 7769

or to such other address as each party  designates to the other by notice in the
manner  herein  prescribed.  Notice  shall  be  deemed  given  hereunder  if (i)
delivered  personally  or otherwise  actually  received,  (ii) sent by overnight
delivery  service,  (iii) mailed by  first-class  United  States  mail,  postage
prepaid,  registered or certified,  with return receipt requested,  or (iv) sent
via  telecopy  machine  with a  duplicate  signed  copy  sent on the same day as
provided in clause (ii) above.  Notice  mailed as provided in clause (iii) above
shall be effective  upon the  expiration  of three (3)  business  days after its
deposit in the United States mail,  and notice  telecopied as


                                       10

PA\10452360.4
341814-45



provided in clause (iv) above shall be effective  upon receipt of such  telecopy
if the  duplicate  signed copy is sent under clause (iv) above.  Notice given in
any other manner  described in this section  shall be effective  upon receipt by
the addressee thereof;  PROVIDED,  HOWEVER, that if any notice is tendered to an
addressee and delivery  thereof is refused by such addressee,  such notice shall
be effective upon such tender unless expressly set forth in such notice.

               5.   CREDITOR'S RIGHTS; DEBTOR WAIVERS.  Creditor's acceptance of
partial or delinquent  payment from Debtor hereunder,  or Creditor's  failure to
exercise any right hereunder, shall not constitute a waiver of any obligation of
Debtor hereunder,  or any right of Creditor  hereunder,  and shall not affect in
any way the right to require full  performance  at any time  thereafter.  Debtor
waives presentment,  diligence, demand of payment, notice, protest and all other
demands and notices in connection  with the delivery,  acceptance,  performance,
default or enforcement  of this Note. In any action on this Note,  Creditor need
not produce or file the original of this Note, but need only file a photocopy of
this Note  certified  by Creditor be a true and correct copy of this Note in all
material respects.

               6.   ENFORCEMENT COSTS.  Debtor shall pay all costs and expenses,
including reasonable  attorneys' fees and expenses Creditor expends or incurs in
connection  with the  enforcement  of this Note,  the collection of any sums due
hereunder,  any actions for declaratory  relief in any way related to this Note,
or the protection or preservation of any rights of the holder hereunder.

               7.   REMEDIES.  Debtor stipulate that Creditor's  remedies at law
in the event of any default or threatened  default by Debtor, in the performance
of or compliance with any of the conversion terms hereunder are not and will not
be adequate to the fullest  extent  permitted by law, and that such terms may be
specifically  enforced by a decree for the specific performance of any agreement
contained  herein or by an  injunction  against a violation  of any of the terms
hereof or otherwise.

               8.   SEVERABILITY.  Whenever possible each provision of this Note
shall  be  interpreted  in  such  manner  as to be  effective  and  valid  under
applicable  law,  but  if  any  provision  is  prohibited  by or  invalid  under
applicable  law, it shall be  ineffective  to the extent of such  prohibition or
invalidity, without invalidating the remainder of the provision or the remaining
provisions of this Note.

               9.   AMENDMENT  PROVISIONS.  This  Note  may  not  be  amended or
modified,  nor may any of its terms be  waived,  except by  written  instruments
signed by Debtor and Creditor.

               10.  BINDING EFFECT.  This Note shall be binding upon,  and shall
inure to the  benefit  of,  Debtor  and the holder  hereof and their  respective
successors and assigns; PROVIDED,  HOWEVER, that Debtor's rights and obligations
shall not be assigned or delegated  without


                                       11

PA\10452360.4
341814-45


Creditor's  prior  written  consent,  given  in its  sole  discretion,  and  any
purported assignment or delegation without such consent shall be void AB INITIO.

               11.  TIME OF ESSENCE.  Time  is  of the essence of each and every
provision of this Note.

               12.  HEADINGS.  Section headings  used in this Note have been set
forth herein for convenience of reference only. Unless the contrary is compelled
by the context,  everything  contained in each section hereof applies equally to
this entire Note.

                                    CIROND CORPORATION


                                    By
                                       -----------------------------------------

                                    Name
                                        ----------------------------------------

                                    Title
                                         ---------------------------------------




















                                       12


PA\10452360.4
341814-45

EX-10

                                  EXHIBIT 10.5

                WARRANT TO PURCHASE STOCK OF CIROND CORPORATION
              DATED APRIL 3, 2006 ISSUED TO SAND HILL FINANCE, LLC







THIS WARRANT AND THE SHARES ISSUABLE  HEREUNDER HAVE NOT BEEN  REGISTERED  UNDER
THE  SECURITIES  ACT OF  1933,  AS  AMENDED,  AND MAY NOT BE  SOLD,  PLEDGED  OR
OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF OR IN ACCORDANCE
WITH APPLICABLE LAW.

                            WARRANT TO PURCHASE STOCK

Corporation:               CIROND CORPORATION
Number of Shares:          See below
Class of Stock:            Common
Initial Exercise Price:    $0.01
Issue Date:                April 3, 2006
Expiration Date:           April 3, 2013

         THIS WARRANT  CERTIFIES THAT, in  consideration of the payment of $1.00
and for  other  good and  valuable  consideration,  SAND  HILL  FINANCE,  LLC or
registered  assignee ("Holder") is entitled to purchase the number of fully paid
and  nonassessable  shares (the "Shares") of Common Stock of CIROND  CORPORATION
(the "Company"),  in the number, at the price, and for the term specified above.
The number of shares  shall be equally to ten percent  (10%) of the  outstanding
capital stock of the Company on a fully-diluted basis,  assuming exercise of all
stock options  (including rights of employees,  officers and directors under any
stock option  plans),  warrants and rights to acquire  stock,  conversion of all
debt or other instruments convertible into equity securities,  and conversion of
all  preferred  stock  or  other  equity  securities  into  common  stock,  such
calculation  to be made after giving effect to the financing  closed on or about
the Issue Date and any reverse stock split completed prior to the or issuance of
any debt or equity securities by the Company after the Issue Date.

ARTICLE 1.   EXERCISE

     1.1     METHOD OF EXERCISE.  Holder may exercise this Warrant by delivering
this Warrant and a duly executed  Notice of Exercise in  substantially  the form
attached as Appendix 1 to the principal office of the Company.  Unless Holder is
exercising  the  conversion  right set forth in Section  1.2,  Holder shall also
deliver to the Company a check for the  aggregate  Warrant  Price for the Shares
being purchased.

     1.2     CONVERSION RIGHT.  In lieu  of exercising this Warrant as specified
in Section 1.1,  Holder may from time to time convert this Warrant,  in whole or
in part,  into a number of Shares  determined by dividing (a) the aggregate fair
market value of the Shares or other securities  otherwise issuable upon exercise
of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair
market  value  of one  Share.  The fair  market  value  of the  Shares  shall be
determined pursuant to Section 1.3.

     1.3     FAIR MARKET VALUE.  If the Shares are traded  regularly in a public
market,  the fair market value of the Shares  shall be the closing  price of the
Shares (or the closing  price of the  Company's  stock into which the Shares are
convertible)  reported for the business day  immediately  before Holder delivers
its Notice of Exercise to the Company. If the Shares are not regularly traded in
a public  market,  the Board of Directors of the Company  shall  determine  fair
market   value  in  its   reasonable   good  faith   judgment.   The   foregoing
notwithstanding, if Holder advises the Board of Directors in writing that Holder
disagrees  with such  determination,  then the Company and Holder shall promptly
agree upon a reputable  investment banking firm to undertake such valuation.  If
the valuation of such investment banking firm is greater than that determined by
the Board of Directors,  then all fees and expenses of such  investment  banking
firm shall be paid by the  Company.  In all other  circumstances,  such fees and
expenses shall be paid by Holder.

     1.4     DELIVERY  OF  CERTIFICATE  AND  NEW WARRANT.  Promptly after Holder
exercises  or  converts  this  Warrant,  the  Company  shall  deliver  to Holder
certificates  for the Shares  acquired  and, if this  Warrant has not been fully
exercised  or  converted  and has not expired,  a new Warrant  representing  the
Shares not so acquired.

     1.5     REPLACEMENT  OF  WARRANTS.   On  receipt  of  evidence   reasonably
satisfactory  to the Company of the loss,  theft,  destruction  or mutilation of
this Warrant and, in the case of loss,  theft or destruction,  on delivery of an
indemnity  agreement  reasonably  satisfactory in form and amount to the Company
or, in the case of mutilation,  or

                                       1

579288 v1/HN


surrender and  cancellation  of this  Warrant,  the Company at its expense shall
execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

ARTICLE 2.   ADJUSTMENTS TO THE SHARES.

     2.1     STOCK  DIVIDENDS,  SPLITS,  ETC.  If the Company declares or pays a
dividend  on its common  stock  payable in common  stock,  or other  securities,
subdivides the  outstanding  common stock into a greater amount of common stock,
then upon  exercise  of this  Warrant,  for each Share  acquired,  Holder  shall
receive,  without  cost to Holder,  the total number and kind of  securities  to
which Holder  would have been  entitled had Holder owned the Shares of record as
of the date the dividend or subdivision occurred.

     2.2  RECLASSIFICATION, EXCHANGE OR SUBSTITUTION. Upon any reclassification,
exchange,  substitution,  or other event that  results in a change of the number
and/or class of the  securities  issuable  upon  exercise or  conversion of this
Warrant,  Holder shall be entitled to receive,  upon  exercise or  conversion of
this Warrant,  the number and kind of securities  and property that Holder would
have  received  for the Shares if this  Warrant had been  exercised  immediately
before such reclassification,  exchange,  substitution,  or other event. Such an
event shall include any  automatic  conversion  of the  outstanding  or issuable
securities  of the  Company  of the same class or series as the Shares to common
stock pursuant to the terms of the Company's  Certificate of Incorporation  upon
the closing of a registered  public offering of the Company's common stock. Upon
the closing of any sale,  license,  or other disposition of all or substantially
all of the assets  (including  intellectual  property)  of the  Company,  or any
reorganization, consolidation, or merger of the Company where the holders of the
Company's  securities  before the transaction  beneficially own less than 50% of
the outstanding voting securities of the surviving entity after the transaction,
the successor  entity shall assume the  obligations  of this  Warrant,  and this
Warrant  thereafter  shall be  exercisable  for the same  securities,  cash, and
property  as would be  payable  for the Shares  issuable  upon  exercise  of the
unexercised  portion of this Warrant as if such Shares were  outstanding  on the
record date for the Acquisition and subsequent closing.  The Warrant Price shall
be adjusted  accordingly.  The Company or its successor  shall promptly issue to
Holder a new Warrant for such new securities or other property.  The new Warrant
shall  provide for  adjustments  which shall be as nearly  equivalent  as may be
practicable to the adjustments provided for in this Article 2 including, without
limitation,  adjustments to the Warrant Price and to the number of securities or
property  issuable  upon  exercise of the new Warrant.  The  provisions  of this
Section 2.2 shall  similarly apply to successive  reclassifications,  exchanges,
substitutions, or other events.

     2.3     ADJUSTMENTS  FOR COMBINATIONS,  ETC.  If the outstanding Shares are
combined or consolidated, by reclassification or otherwise, into a lesser number
of shares, the Warrant Price shall be proportionately increased.

     2.4     WEIGHTED AVERAGE ADJUSTMENT. At any time that the Shares are Common
Stock,  if the Company  issues  additional  common shares  (including  shares of
common stock ultimately issuable upon conversion of a security  convertible into
common stock) after the date of the Warrant and the consideration per additional
common share is less than the Warrant  Price in effect  immediately  before such
issue shall be reduced,  concurrently  with such Issue, to a price determined by
multiplying the Warrant Price by a fraction:

                 (a)   the  numerator  of  which is  the amount  of common stock
outstanding  immediately  before such Issue plus the amount of common stock that
the aggregate  consideration  received by the Company for the additional  common
shares would  purchase at the Warrant  Price in effect  immediately  before such
Issue, and

                 (b)   the denominator of which is the amount  of  common  stock
outstanding  immediately  before  such issue plus the number of such  additional
common shares.

Upon each  adjustment of the Warrant Price,  the number of Shares  issuable upon
exercise of the Warrant  shall be increased  to equal the  quotient  obtained by
dividing (a) the product  resulting  from  multiplying  (i) the number of Shares
issuable upon exercise of the Warrant and (ii) the Warrant  Price,  in each case
as in effect  immediately  before such  adjustment,  by (b) the adjusted Warrant
Price.

     2.5     NO  IMPAIRMENT.  The  Company  shall  not,  by  amendment  of   its
Certificate of  Incorporation or through a  reorganization,  transfer of assets,
consolidation,  merger,  dissolution,  issue, or sale of securities or any


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other voluntary action,  avoid or seek to avoid the observance or performance of
any of the terms to be observed or performed  under this Warrant by the Company,
but shall at all times in good faith assist in carrying  out all the  provisions
of  this  Article  2 and in  taking  all  such  action  as may be  necessary  or
appropriate to protect Holder's rights under this Article against impairment. If
the Company takes any action affecting the Shares or its common stock other than
as described  above that adversely  affects  Holder's rights under this Warrant,
the Warrant Price shall be adjusted  downward and the number of Shares  issuable
upon exercise of this Warrant shall be adjusted upward in such a manner that the
aggregate Warrant Price of this Warrant is unchanged.

     2.6     CERTIFICATE AS TO ADJUSTMENTS.  Upon each adjustment of the Warrant
Price, the Company at its expense shall promptly  compute such  adjustment,  and
furnish Holder with a certificate of its Chief  Financial  Officer setting forth
such adjustment and the facts upon which such  adjustment is based.  The Company
shall,  upon written  request,  furnish  Holder a certificate  setting forth the
Warrant  Price in effect  upon the date  thereof  and the series of  adjustments
leading to such Warrant Price.

ARTICLE 3.   REPRESENTATIONS AND COVENANTS OF THE COMPANY.

     3.1     REPRESENTATIONS AND  WARRANTIES.  The Company hereby represents and
warrants to the Holder as follows:

                 (a)   The initial  Warrant  Price  referenced on the first page
of this  Warrant is not greater  than the fair market  value of the Shares as of
the date of this Warrant.

                 (b)   All Shares that may be issued  upon the  exercise  of the
purchase  right  represented  by this Warrant,  shall,  upon  issuance,  be duly
authorized, validly issued, fully paid and nonassessable,  and free of any liens
and  encumbrances  except for  restrictions  on transfer  provided for herein or
under applicable federal and state securities laws.

                 (c)   The   capitalization   table  attached  hereto  correctly
sets forth the authorized, issued and outstanding shares of capital stock of the
Company and all options to acquire any such shares.

     3.2     NOTICE  OF CERTAIN EVENTS.  If the Company proposes at any time (a)
to declare any dividend or distribution upon its common stock,  whether in cash,
property, stock, or other securities and whether or not a regular cash dividend;
(b) to offer for  subscription pro rata to the holders of any class or series of
its stock any additional shares of stock of any class or series or other rights;
(c) to effect any  reclassification  or recapitalization of common stock; (d) to
merge  or  consolidate  with or into any  other  corporation,  or  sell,  lease,
license,  or convey all or  substantially  all of its assets,  or to  liquidate,
dissolve or wind up; or (e) offer holders of registration rights the opportunity
to participate in an underwritten  public  offering of the company's  securities
for cash,  then,  in  connection  with each such event,  the Company  shall give
Holder (1) at least 20 days prior  written  notice of the date on which a record
will be taken for such  dividend,  distribution,  or  subscription  rights  (and
specifying  the date on which the  holders  of  common  stock  will be  entitled
thereto) or for  determining  rights to vote,  if any, in respect of the matters
referred to in (a) and (b) above;  (2) in the case of the matters referred to in
(c) and (d)  above at least 20 days  prior  written  notice of the date when the
same will take place  (and  specifying  the date on which the  holders of common
stock will be entitled to exchange  their common stock for  securities  or other
property  deliverable upon the occurrence of such event); and (3) in the case of
the matter referred to in (e) above,  the same notice as is given to the holders
of such registration rights.

     3.3     REGISTRATION RIGHTS. The Shares, or the common stock into which the
Shares are convertible, shall be "Registrable Securities", and Holder shall have
the rights of a "Holder" under such investor  rights  agreement or  registration
rights agreement as the Company may enter into from time to time.

     3.4     INFORMATION RIGHTS. So long as the Holder holds this Warrant and/or
any of the Shares,  the Company  shall  deliver to the Holder (a) within  ninety
(90) days after the end of each fiscal year of the Company,  the annual  audited
financial  statements of the Company certified by independent public accountants
of recognized standing and (b) within forty-five (45) days after the end of each
of the first three  quarters  of each  fiscal  year,  the


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Company's quarterly,  unaudited financial statements,  provided Company need not
provide such information for any period in which Company has filed Form 10Q with
the Securities and Exchange Commission.

ARTICLE 4.   MISCELLANEOUS.

     4.1     TERM. This Warrant is exercisable, in whole or in part, at any time
and from time to time on or before the Expiration Date set forth above.

     4.2     LEGENDS.  This Warrant and the Shares (and the securities issuable,
directly  or  indirectly,  upon  conversion  of the  Shares,  if any)  shall  be
imprinted with a legend in substantially the following form:

     THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
     AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED
     WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR IN
     ACCORDANCE WITH APPLICABLE LAW.

     4.3     COMPLIANCE WITH SECURITIES  LAWS ON TRANSFER.  This Warrant and the
Shares  issuable  upon  exercise  this  Warrant  (and the  securities  issuable,
directly  or  indirectly,  upon  conversion  of the  Shares,  if any) may not be
transferred or assigned in whole or in part without  compliance  with applicable
federal and state securities laws by the transferor and the transferee.

     4.4     TRANSFER  PROCEDURE.  Subject  to  the  provisions  of Section 4.3,
Holder may  transfer  all or part of this  Warrant or the Shares  issuable  upon
exercise of this Warrant (or the  securities  issuable,  directly or indirectly,
upon  conversion  of the  Shares,  if any) by giving the  Company  notice of the
portion of the Warrant being  transferred  setting  forth the name,  address and
taxpayer  identification  number of the transferee and surrendering this Warrant
to the Company for reissuance to the transferee(s)  (and Holder, if applicable),
provided that no such notice shall be required for a transfer to an affiliate of
Holder.

     4.5     NOTICES.  All notices and other communications from the  Company to
the Holder,  or vice versa,  shall be deemed  delivered and effective when given
personally  or mailed by  first-class  registered  or  certified  mail,  postage
prepaid,  at such  address  as may have been  furnished  to the  Company  or the
Holder,  as the case may be, in writing by the  Company or such Holder from time
to time.

     4.6     WAIVER.  This  Warrant  and any term hereof may be changed, waived,
discharged  or terminated  only by an instrument in writing  signed by the party
against which  enforcement of such change,  waiver,  discharge or termination is
sought.

     4.7     ATTORNEYS' FEES.  In the event of  any dispute  between the parties
concerning  the terms and  provisions of this Warrant,  the party  prevailing in
such  dispute  shall be  entitled  to  collect  from the  other  party all costs
incurred in such dispute, including reasonable attorneys' fees.


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     4.8     GOVERNING LAW.  This  Warrant shall be governed by and construed in
accordance  with the laws of the State of  California,  without giving effect to
its principles regarding conflicts of law.

                                       CIROND CORPORATION


                                       By: /s/ NICHOLAS R. MILLER
                                          --------------------------------------

                                       Name:   Nicholas R. Miller
                                            ------------------------------------

                                       Title:  C.E.O.
                                             -----------------------------------

















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