PLEDGE AND SECURITY AGREEMENT

                          PLEDGE AND SECURITY AGREEMENT

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         This Pledge and Security Agreement (the "AGREEMENT") is made as of

March 9, 2005, by I/OMAGIC CORPORATION ("PLEDGOR"), and GMAC Commercial Finance

LLC ("LENDER").

                                    RECITALS

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         A. Pledgor is the owner of the following shares of capital stock (the

"STOCK"):

                  625,000 shares of the stock of IOM Holdings , Inc., a Nevada

                  corporation ("SUBSIDIARY")

         B. Pledgor owns no other stock, shares, options, warrants or rights to

acquire stock or shares of stock in Subsidiary and the shares referenced above

represent 100% of the outstanding capital stock of Subsidiary.

         C. Simultaneous with the execution of this Pledge and Security

Agreement, Lender is entering into a Loan and Security Agreement and related

documents (collectively, the "LOAN AGREEMENT") with Pledgor. Capitalized terms

not otherwise defined in this Agreement shall have the meanings given in the

Loan Agreement.

         D. Pledgor is executing this Agreement as an inducement to Lender to

grant credit to Pledgor.

         THEREFORE, based on the foregoing recitals and for good and valuable

consideration, the receipt and adequacy of which are expressly acknowledged,

Pledgor agrees with Lender as follows:

                              TERMS AND CONDITIONS

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         1. PLEDGOR'S PLEDGE. As security for the payment and performance of the

Obligations, Pledgor hereby pledges and grants to Lender a continuing security

interest in the following (the "COLLATERAL"):

                  (a) the Stock referenced in Recital A above and all other

types or items of property which may be pledged to Lender in the future and held

as Collateral under this Agreement, and

                  (b) any Proceeds of the Stock.

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For purposes of this Agreement, the term "Proceeds" shall have the meaning

assigned to it under the Michigan Uniform Commercial Code and, in any event,

shall include, but not be limited to, (i) any and all proceeds of any insurance,

indemnity, warranty or guaranty payable to Pledgor from time to time with

respect to any of the Collateral, (ii) any and all payments (in any form

whatsoever) made or due and payable to Pledgor from time to time in connection

with any requisition, confiscation, condemnation, seizure or forfeiture of all

or any part of the Collateral by any governmental body, authority, bureau or

agency (or any person acting under color of governmental authority) and (iii)

any and all other amounts from time to time paid or payable under or in

connection with any of the Collateral, including, without limitation, any and

all interest, cash, instruments, warrants, rights, options and other property

from time to time received, receivable or otherwise distributed in respect or on

account of, or in exchange for, any of the Stock.

         2. LENDER'S DUTIES. Subject to Section 9-207 of the Michigan Uniform

Commercial Code ("CODE") to the extent applicable, Lender shall have no duties

with respect to the Collateral beyond reasonable care of the actual certificates

pledged hereunder. Without limiting the generality of the foregoing, Lender

shall be under no obligation to take any steps to preserve rights in the

Collateral against any other parties or to exercise any rights represented

thereby; provided, however, at its option, Lender may do so, and any and all

expenses incurred in connection therewith shall be for the sole account of

Pledgor.

         3. PLEDGOR'S REPRESENTATIONS. Pledgor represents, warrants and agrees

that:

                  (a) Pledgor has the right to pledge and grant a security

         interest in or otherwise transfer such Collateral free of any liens or

         rights of third parties other than laws affecting the offering and sale

         of securities and corporate law generally.

                  (b) All of the Collateral is and shall remain free from all

         liens, claims, encumbrances, and purchase money or other security

         interests other than as provided for herein or as permitted by the Loan

         Agreement.

                  (c) This Agreement, together with the delivery of Stock by

         Pledgor to Lender pursuant to Section 3(f), creates a valid, perfected,

         and first priority security interest in the Stock in favor of Lender

         other than Permitted Liens, as defined in the Loan Agreement, and all

         actions necessary or desirable to such perfection have been duly taken.

                  (d) No authorization or other action by, and no notice to or

         filing with, any governmental authority or regulatory body is required

         either: (i) for the grant by Pledgor of the security interest granted

         hereby or for the executi