CENTRAL FREIGHT LINES INC
CREDIT AGREEMENT
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>a8-kloanagreement20405.txt
<DESCRIPTION>CREDIT AGREEMENT
<TEXT>


                                CREDIT AGREEMENT

                          Dated as of January 31, 2005

                                      Among

                     THE FINANCIAL INSTITUTIONS NAMED HEREIN

                                 as the Lenders

                                       and

                              BANK OF AMERICA, N.A.

                                  as the Agent

                                       and

                           CENTRAL FREIGHT LINES, INC.

                                 as the Borrower



                                       1
<PAGE>


<TABLE>
<CAPTION>

                                TABLE OF CONTENTS

Section                                                                                                       Page
<S>                                                                                                             <C>

ARTICLE 1 LOANS AND LETTERS OF CREDIT.............................................................................1

         1.1      Total Facility..................................................................................1
         1.2      Revolving Loans.................................................................................1
         1.3      Letters of Credit...............................................................................4
         1.4      Bank Products...................................................................................7

ARTICLE 2 INTEREST AND FEES.......................................................................................7

         2.1      Interest........................................................................................7
         2.2      Continuation and Conversion Elections...........................................................8
         2.3      Maximum Interest Rate...........................................................................9
         2.4      Arrangement Fee.................................................................................9
         2.5      Unused Line Fee.................................................................................9
         2.6      Letter of Credit Fee...........................................................................10
         2.7      Vehicle Maintenance Fee........................................................................10

ARTICLE 3 PAYMENTS AND PREPAYMENTS...............................................................................10

         3.1      Revolving Loans................................................................................10
         3.2      Termination of Facility........................................................................10
         3.3      Repayments of Obligations......................................................................11
         3.4      LIBOR Revolving Loan Prepayments...............................................................11
         3.5      Payments by the Borrower.......................................................................11
         3.6      Payments as Revolving Loans....................................................................12
         3.7      Apportionment, Application and Reversal of Payments............................................12
         3.8      Indemnity for Returned Payments................................................................12
         3.9      Agent's and Lenders' Books and Records; Monthly Statements.....................................13
         3.10     Collection of Accounts.........................................................................13

ARTICLE 4 TAXES, YIELD PROTECTION AND ILLEGALITY.................................................................14

         4.1      Taxes..........................................................................................14
         4.2      Illegality.....................................................................................14
         4.3      Increased Costs and Reduction of Return........................................................15
         4.4      Funding Losses.................................................................................15
         4.5      Inability to Determine Rates...................................................................16
         4.6      Certificates of Agent..........................................................................16
         4.7      Survival.......................................................................................16

ARTICLE 5 BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES......................................................16

         5.1      Books and Records..............................................................................16
         5.2      Financial Information..........................................................................16
         5.3      Notices to the Lenders.........................................................................19

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ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS.................................................................21

         6.1      Authorization, Validity, and Enforceability of this Agreement and the Loan Documents...........21
         6.2      Validity and Priority of Security Interest.....................................................21
         6.3      Organization and Qualification.................................................................22
         6.4      Corporate Name; Prior Transactions.............................................................22
         6.5      Subsidiaries and Affiliates....................................................................22
         6.6      Financial Statements and Projections...........................................................22
         6.7      Capitalization.................................................................................22
         6.8      Solvency.......................................................................................23
         6.9      Debt...........................................................................................23
         6.10     Distributions..................................................................................23
         6.11     Real Estate; Leases............................................................................23
         6.12     Proprietary Rights.............................................................................23
         6.13     Trade Names....................................................................................23
         6.14     Litigation.....................................................................................23
         6.15     Labor Disputes.................................................................................24
         6.16     Environmental Laws.............................................................................24
         6.17     No Violation of Law............................................................................25
         6.18     No Default.....................................................................................25
         6.19     ERISA Compliance...............................................................................25
         6.20     Taxes..........................................................................................26
         6.21     Regulated Entities.............................................................................26
         6.22     Use of Proceeds; Margin Regulations............................................................26
         6.23     Copyrights, Patents, Trademarks and Licenses, etc..............................................26
         6.24     No Material Adverse Change.....................................................................27
         6.25     Full Disclosure................................................................................27
         6.26     Material Agreements............................................................................27
         6.27     Bank Accounts..................................................................................27
         6.28     Governmental Authorization.....................................................................27

ARTICLE 7 AFFIRMATIVE AND NEGATIVE COVENANTS.....................................................................27

         7.1      Taxes and Other Obligations....................................................................27
         7.2      Legal Existence and Good Standing..............................................................28
         7.3      Compliance with Law and Agreements; Maintenance of Licenses....................................28
         7.4      Maintenance of Property; Inspection of Property................................................28
         7.5      Insurance......................................................................................28
         7.6      Insurance and Condemnation Proceeds............................................................29
         7.7      Environmental Laws.............................................................................29
         7.8      Compliance with ERISA..........................................................................30
         7.9      Mergers, Consolidations or Sales...............................................................30
         7.10     Distributions; Capital Change; Restricted Investments..........................................30
         7.11     Transactions Affecting Collateral or Obligations...............................................30
         7.12     Guaranties.....................................................................................30
         7.13     Debt...........................................................................................30
         7.14     Prepayment.....................................................................................31
         7.15     Transactions with Affiliates...................................................................31
         7.16     Investment Banking and Finder's Fees...........................................................31
         7.17     Business Conducted.............................................................................31


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         7.18     Liens..........................................................................................31
         7.19     Sale and Leaseback Transactions................................................................31
         7.20     Subsidiaries...................................................................................32
         7.21     Fiscal Year....................................................................................32
         7.22     Capital Expenditures...........................................................................32
         7.23     Fixed Charge Coverage Ratio/Minimum EBITDA.....................................................32
         7.24     Use of Proceeds................................................................................33
         7.25     Further Assurances.............................................................................34
         7.26     Collateral.....................................................................................34
         7.27     Tax Shelter Regulations........................................................................34
         7.28     Permitted Acquisitions.........................................................................35
         7.29     Appraisals.....................................................................................36
         7.30     Post Closing Agreements........................................................................36
         7.31     Solvency.......................................................................................36

ARTICLE 8 CONDITIONS OF LENDING..................................................................................37

         8.1      Conditions Precedent to Making of Loans on the Closing Date....................................37
         8.2      Conditions Precedent to Each Loan..............................................................38

ARTICLE 9 DEFAULT; REMEDIES......................................................................................39

         9.1      Events of Default..............................................................................39
         9.2      Remedies.......................................................................................41

ARTICLE 10 TERM AND TERMINATION..................................................................................42

         10.1     Term and Termination...........................................................................42

ARTICLE 11 AMENDMENTS; WAIVERs; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS..........................................43

         11.1     Amendments and Waivers.........................................................................43
         11.2     Assignments; Participations....................................................................44

ARTICLE 12 THE AGENT.............................................................................................46

         12.1     Appointment and Authorization..................................................................46
         12.2     Delegation of Duties...........................................................................46
         12.3     Liability of Agent.............................................................................46
         12.4     Reliance by Agent..............................................................................47
         12.5     Notice of Default..............................................................................47
         12.6     Credit Decision................................................................................47
         12.7     Indemnification................................................................................48
         12.8     Agent in Individual Capacity...................................................................48
         12.9     Successor Agent................................................................................48
         12.10    Withholding Tax................................................................................49
         12.11    Collateral Matters.............................................................................50
         12.12    Restrictions on Actions by Lenders; Sharing of Payments........................................51
         12.13    Agency for Perfection..........................................................................51
         12.14    Payments by Agent to Lenders...................................................................51


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         12.15    Settlement.....................................................................................52
         12.16    Letters of Credit; Intra-Lender Issues.........................................................54
         12.17    Concerning the Collateral and the Related Loan Documents.......................................56
         12.18    Field Audit and Examination Reports; Disclaimer by Lenders.....................................56
         12.19    Relation Among Lenders.........................................................................57

ARTICLE 13 MISCELLANEOUS.........................................................................................57

         13.1     No Waivers; Cumulative Remedies................................................................57
         13.2     Severability...................................................................................57
         13.3     Governing Law; Choice of Forum; Service of Process.............................................58
         13.4     WAIVER OF JURY TRIAL...........................................................................58
         13.5     Survival of Representations and Warranties.....................................................59
         13.6     Other Security and Guaranties..................................................................59
         13.7     Fees and Expenses..............................................................................59
         13.8     Notices........................................................................................60
         13.9     Waiver of Notices..............................................................................61
         13.10    Binding Effect.................................................................................61
         13.11    Indemnity of the Agent and the Lenders by the Borrower.........................................61
         13.12    Limitation of Liability........................................................................62
         13.13    Final Agreement................................................................................62
         13.14    Counterparts...................................................................................62
         13.15    Captions 62
         13.16    Right of Setoff................................................................................63
         13.17    Confidentiality................................................................................63
         13.18    Conflicts with Other Loan Documents............................................................63
         13.19    USA PATRIOT Act Notice.........................................................................64


</TABLE>


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                         ANNEXES, EXHIBITS AND SCHEDULES

ANNEX A             -    DEFINED TERMS

EXHIBIT A           -    FORM OF REVOLVING LOAN NOTE

EXHIBIT B           -    FORM OF BORROWING BASE CERTIFICATE

EXHIBIT C           -    LEFT INTENTIONALLY BLANK

EXHIBIT D           -    FORM OF NOTICE OF BORROWING

EXHIBIT E           -    FORM OF NOTICE OF CONTINUATION/CONVERSION

EXHIBIT F           -    FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

SCHEDULE 1.2 - LENDERS' COMMITMENTS (ANNEX A - DEFINED TERMS)

SCHEDULE 6.3 - ORGANIZATION AND QUALIFICATIONS

SCHEDULE 6.4 - PRIOR TRANSACTIONS

SCHEDULE 6.5 - SUBSIDIARIES AND AFFILIATES

SCHEDULE 6.9 - DEBT AND EXISTING LETTERS OF CREDIT

SCHEDULE 6.11 - REAL ESTATE; LEASES

SCHEDULE 6.12 - PROPRIETARY RIGHTS

SCHEDULE 6.13 - TRADE NAMES

SCHEDULE 6.14 - LITIGATION

SCHEDULE 6.15 - LABOR DISPUTES

SCHEDULE 6.16 - ENVIRONMENTAL LAW

SCHEDULE 6.19 - ERISA COMPLIANCE

SCHEDULE 6.26 - MATERIAL AGREEMENTS

SCHEDULE 6.27 - BANK ACCOUNTS

SCHEDULE 7.9 -  REAL PROPERTY HELD FOR SALE OR OTHER DISPOSITION

SCHEDULE 7.30(c) -REAL PROPERTY COLLATERAL


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<PAGE>
                                CREDIT AGREEMENT

     This Credit  Agreement,  dated as of January 31, 2005,  (this  "Agreement")
among  the  financial  institutions  from  time to  time  parties  hereto  (such
financial  institutions,  together with their respective successors and assigns,
are referred to hereinafter each  individually as a "Lender" and collectively as
the "Lenders"),  Bank of America,  N.A. with an office at 901 Main Street,  22nd
Floor,  Dallas, Texas 75202, as agent for the Lenders (in its capacity as agent,
the "Agent"), and Central Freight Lines, Inc., a Texas corporation, with offices
at 5601 West Waco Drive, Waco, Texas 76710 (the "Borrower").

                              W I T N E S S E T H:
                               - - - - - - - - - -

     WHEREAS,  the Borrower has requested  the Lenders to make  available to the
Borrower a revolving line of credit for loans and letters of credit in an amount
not to exceed $70,000,000,  which extensions of credit the Borrower will use for
the purposes permitted hereunder;

     WHEREAS, capitalized terms used in this Agreement and not otherwise defined
herein  shall have the  meanings  ascribed  thereto in Annex A which is attached
hereto and  incorporated  herein;  the rules of construction  contained  therein
shall govern the interpretation of this Agreement, and all Annexes, Exhibits and
Schedules attached hereto are incorporated herein by reference;

     WHEREAS,  the  Lenders  have  agreed to make  available  to the  Borrower a
revolving  credit  facility  upon the  terms  and  conditions  set forth in this
Agreement.

     NOW,  THEREFORE,  in consideration of the mutual  conditions and agreements
set  forth  in this  Agreement,  and for good and  valuable  consideration,  the
receipt  of which is  hereby  acknowledged,  the  Lenders,  the  Agent,  and the
Borrower hereby agree as follows.

                                   ARTICLE 1
                           LOANS AND LETTERS OF CREDIT

     1.1 Total  Facility.  Subject  to all of the terms and  conditions  of this
Agreement,  the Lenders agree to make available a total credit facility of up to
$70,000,000 (the "Total  Facility") to the Borrower from time to time during the
term of this Agreement. The Total Facility shall be composed of a revolving line
of credit consisting of Revolving Loans and Letters of Credit.

     1.2 Revolving Loans.

          (a)  (i)  Amounts.  Subject  to the  satisfaction  of  the  conditions
     precedent set forth in Article 8, each Lender  severally,  but not jointly,
     agrees,  upon the Borrower's  request from time to time on any Business Day
     during the period from the Closing Date to the  Termination  Date,  to make
     revolving loans (the  "Revolving  Loans") to the Borrower in amounts not to
     exceed such Lender's Pro Rata Share of Availability, except for Non-Ratable
     Loans  and  Agent  Advances.  The  Lenders,  however,  in  their  unanimous
     discretion,  may elect to make Revolving  Loans or issue or arrange to have
     issued  Letters  of Credit in excess of the  Borrowing  Base on one or more
     occasions,  but if they do so,  neither the Agent nor the Lenders  shall be
     deemed  thereby to have changed the limits of the  Borrowing  Base or to be
     obligated  to exceed such limits on any other  occasion.  If the  Aggregate
     Revolver  Outstandings would exceed Availability after giving effect to any
     Borrowing,  the Lenders may refuse to make or may  otherwise  restrict  the


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<PAGE>

     making of Revolving  Loans as the Lenders  determine  until such excess has
     been eliminated,  subject to the Agent's authority, in its sole discretion,
     to make Agent Advances pursuant to the terms of Section 1.2(i).

          (ii) Upon the  request  of any  Lender,  Borrower  shall  execute  and
     deliver  to such  Lender  a note to  evidence  the  Revolving  Loan of that
     Lender. Each note shall be in the principal amount of the Lender's Pro Rata
     Share  of the  Revolving  Loan  Commitments,  dated  the  date  hereof  and
     substantially  in the form of Exhibit A (each a "Revolving  Loan Note" and,
     collectively,  the "Revolving Loan Notes").  Each Revolving Loan Note shall
     represent the obligation of Borrower to pay the amount of Lender's Pro Rata
     Share of the Revolving  Loan  Commitments,  or, if less,  such Lender's Pro
     Rata Share of the aggregate  unpaid principal amount of all Revolving Loans
     to Borrower  together with  interest  thereon as prescribed in Section 1.2.
     The  entire   unpaid   balance  of  the   Revolving   Loan  and  all  other
     non-contingent  Obligations shall be immediately due and payable in full in
     immediately available funds on the Termination Date.

          (b) Procedure for Borrowing.

          (1) Each  Borrowing  shall be made  upon  the  Borrower's  irrevocable
     written notice  delivered to the Agent in the form of a notice of borrowing
     ("Notice of  Borrowing"),  which must be received by the Agent prior to (i)
     11:00  a.m.  (Central  Standard  Time)  three  Business  Days  prior to the
     requested Funding Date, in the case of LIBOR Revolving Loans and (ii) 11:00
     a.m.  (Central Standard Time) on the requested Funding Date, in the case of
     Base Rate Revolving Loans, specifying:

          (A)  the  amount  of the  Borrowing,  which  in the  case  of a  LIBOR
     Revolving Loan must equal or exceed  $2,000,000 (and increments of $500,000
     in excess of such amount);

          (B) the requested Funding Date, which must be a Business Day;

          (C)  whether  the  Revolving  Loans  requested  are  to be  Base  Rate
     Revolving Loans or LIBOR Revolving Loans (and if not specified, it shall be
     deemed a request for a Base Rate Revolving Loan); and

          (D) the duration of the Interest Period for LIBOR Revolving Loans (and
     if not  specified,  it shall be deemed a request for an Interest  Period of
     one month);

     provided,  however,  that with  respect to the  Borrowing to be made on the
     Closing Date,  such  Borrowing  will consist of Base Rate  Revolving  Loans
     only.

          (2) In lieu of delivering a Notice of Borrowing, the Borrower may give
     the Agent telephonic  notice of such request for advances to the Designated
     Account on or before the deadline  set forth above.  The Agent at all times
     shall  be  entitled  to rely on  such  telephonic  notice  in  making  such
     Revolving  Loans,   regardless  of  whether  any  written  confirmation  is
     received.

          (3) The Borrower shall have no right to request a LIBOR Revolving Loan
     while a Default or Event of Default has occurred and is continuing.

          (c) Reliance upon  Authority.  Prior to the Closing Date, the Borrower
     shall  deliver  to the Agent,  a notice  setting  forth the  account of the
     Borrower  (including  any  account  which  Borrower  may from  time to time
     designate  in  writing to Agent as a  successor  account,  the  "Designated
     Account") to which the Agent is  authorized to transfer the proceeds of the
     Revolving  Loans  requested   hereunder.   The  Borrower  may  designate  a
     replacement  account  from  time  to  time  by  written  notice.  All  such


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<PAGE>

     Designated Accounts must be reasonably satisfactory to the Agent. The Agent
     is entitled to rely  conclusively  on any  person's  request for  Revolving
     Loans on behalf of the Borrower,  so long as the proceeds thereof are to be
     transferred to the Designated Account.  The Agent has no duty to verify the
     identity  of any  individual  representing  himself  or herself as a person
     authorized by the Borrower to make such requests on its behalf.

          (d) No  Liability.  The Agent  shall not  incur any  liability  to the
     Borrower  as a result of acting  upon any notice  referred  to in  Sections
     1.2(b) and (c),  which the Agent  believes in good faith to have been given
     by an officer or other  person duly  authorized  by the Borrower to request
     Revolving  Loans on its behalf.  The  crediting of  Revolving  Loans to the
     Designated Account conclusively  establishes the obligation of the Borrower
     to repay such Revolving Loans as provided herein.

          (e) Notice Irrevocable.  Any Notice of Borrowing (or telephonic notice
     in lieu thereof) made pursuant to Section 1.2(b) shall be irrevocable.  The
     Borrower shall be bound to borrow the funds requested therein in accordance
     therewith.

          (f) Agent's Election.  Promptly after receipt of a Notice of Borrowing
     (or telephonic  notice in lieu thereof),  the Agent shall elect to have the
     terms of  Section  1.2(g)  or the  terms of  Section  1.2(h)  apply to such
     requested Borrowing.  If the Bank declines in its sole discretion to make a
     Non-Ratable  Loan pursuant to Section  1.2(h),  the terms of Section 1.2(g)
     shall apply to the requested Borrowing.

          (g) Making of  Revolving  Loans.  If Agent elects to have the terms of
     this Section  1.2(g) apply to a requested  Borrowing,  then promptly  after
     receipt of a Notice of Borrowing or telephonic notice in lieu thereof,  the
     Agent shall  notify the  Lenders by  telecopy,  telephone  or e-mail of the
     requested  Borrowing.  Each Lender shall transfer its Pro Rata Share of the
     requested Borrowing available to the Agent in immediately  available funds,
     to the account from time to time designated by Agent,  not later than 12:00
     noon (Central  Standard  Time) on the  applicable  Funding Date.  After the
     Agent's  receipt of all proceeds of such Revolving  Loans,  the Agent shall
     make the proceeds of such Revolving  Loans available to the Borrower on the
     applicable  Funding Date by  transferring  same day funds to the Designated
     Account;  provided,  however, that the amount of Revolving Loans so made on
     any date shall not exceed the Availability on such date.

          (h) Making of Non-Ratable Loans.

          (A)......If  Agent  elects,  with the consent of the Bank, to have the
     terms of this Section 1.2(h) apply to a requested Borrowing, the Bank shall
     make a  Revolving  Loan in the amount of that  Borrowing  available  to the
     Borrower on the applicable  Funding Date by transferring  same day funds to
     Borrower's  Designated Account. Each Revolving Loan made solely by the Bank
     pursuant to this Section is herein referred to as a "Non-Ratable Loan", and
     such  Revolving  Loans are  collectively  referred  to as the  "Non-Ratable
     Loans."  Each  Non-Ratable  Loan  shall be  subject  to all the  terms  and
     conditions  applicable  to other  Revolving  Loans except that all payments
     thereon  shall be  payable  to the Bank  solely  for its own  account.  The
     aggregate  amount of  Non-Ratable  Loans  outstanding at any time shall not
     exceed  $10,000,000.  The  Agent  shall  not  request  the Bank to make any
     Non-Ratable  Loan if (1) the Agent has  received  written  notice  from any
     Lender that one or more of the applicable conditions precedent set forth in
     Article  8 will not be  satisfied  on the  requested  Funding  Date for the
     applicable   Borrowing,   or  (2)  the  requested  Borrowing  would  exceed
     Availability on that Funding Date.

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<PAGE>

          (B)......The  Non-Ratable  Loans shall be secured by the Agent's Liens
     in and to the Collateral and shall constitute Base Rate Revolving Loans, or
     LIBOR Revolving  Loans, as requested by Borrower,  and shall be Obligations
     hereunder.

          (i) Agent Advances.

          (A)......Subject  to the  limitations  set forth  below,  the Agent is
     authorized  by the  Borrower  and  the  Lenders,  from  time to time in the
     Agent's sole discretion,  (A) after the occurrence of a Default or an Event
     of Default,  or (B) at any time that any of the other conditions  precedent
     set forth in Article 8 have not been satisfied, to make Base Rate Revolving
     Loans to the  Borrower  on behalf of the  Lenders  in an  aggregate  amount
     outstanding  at any time not to exceed 10% of the Borrowing  Base which the
     Agent, in its reasonable  business  judgment,  deems necessary or desirable
     (1) to preserve or protect the Collateral,  or any portion thereof,  (2) to
     enhance the  likelihood  of, or maximize  the amount of,  repayment  of the
     Loans and other  Obligations,  or (3) to pay any other amount chargeable to
     the Borrower pursuant to the terms of this Agreement, including costs, fees
     and expenses as described in Section 13.7 (any of such  advances are herein
     referred to as "Agent Advances");  provided,  that the Majority Lenders may
     at any time revoke the Agent's  authorization  to make Agent Advances.  Any
     such revocation must be in writing and shall become effective prospectively
     upon the Agent's receipt thereof.

          (B)......The  Agent  Advances shall be secured by the Agent's Liens in
     and to the Collateral and shall  constitute  Base Rate Revolving  Loans and
     Obligations hereunder.

     1.3 Letters of Credit.

          (a)  Agreement  to Issue or Cause To Issue.  Subject  to the terms and
     conditions of this  Agreement,  the Agent agrees (i) to cause the Letter of
     Credit  Issuer  to  issue  for  the  account  of the  Borrower  one or more
     commercial/documentary  and  standby  letters of credit  (each a "Letter of
     Credit" and  collectively,  the "Letters of Credit") and/or (ii) to provide
     credit support or other enhancement to a Letter of Credit Issuer acceptable
     to Agent,  which  issues a Letter of Credit for the account of the Borrower
     (any such  credit  support or  enhancement  being  herein  referred to as a
     "Credit Support") from time to time during the term of this Agreement.

          (b) Amounts;  Outside  Expiration  Date.  The Agent shall not have any
     obligation  to issue or cause to be  issued  any  Letter  of  Credit  or to
     provide  Credit  Support  for any  Letter of Credit at any time if: (i) the
     maximum face amount of the  requested  Letter of Credit is greater than the
     Unused Letter of Credit  Subfacility at such time; (ii) the maximum undrawn
     amount of the requested  Letter of Credit and all  commissions,  fees,  and
     charges due from the Borrower in connection  with the opening thereof would
     exceed  Availability  at such time;  or (iii) such  Letter of Credit has an
     expiration date less than 30 days prior to the Stated  Termination  Date or
     more than 12 months from the date of issuance for standby letters of credit
     and 180 days for documentary  letters of credit. With respect to any Letter
     of Credit which contains any  "evergreen" or automatic  renewal  provision,
     each Lender  shall be deemed to have  consented  to any such  extension  or
     renewal  unless any such Lender shall have  provided to the Agent,  written
     notice  that it  declines  to consent to any such  extension  or renewal at
     least  thirty  (30) days  prior to the date on which  the  Letter of Credit
     Issuer is entitled  to decline to extend or renew the Letter of Credit.  If
     all of the requirements of this Section 1.3 are met and no Default or Event
     of Default has  occurred  and is  continuing,  no Lender  shall  decline to
     consent to any such extension or renewal.  Unless otherwise consented to by
     Agent,  all Letters of Credit must call for sight  drafts to be drawn,  and
     must be issued in Dollars.

          (c) Other Conditions. In addition to conditions precedent contained in
     Article  8, the  obligation  of the Agent to issue or to cause to be issued


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<PAGE>

     any Letter of Credit or to provide  Credit Support for any Letter of Credit
     is subject to the following conditions precedent having been satisfied in a
     manner satisfactory to the Agent in its sole discretion:

          (1) The Borrower  shall have delivered to the Letter of Credit Issuer,
     at such  times and in such  manner as such  Letter  of  Credit  Issuer  may
     prescribe, an application in form and substance satisfactory to such Letter
     of Credit Issuer and reasonably  satisfactory to the Agent for the issuance
     of the  Letter  of  Credit  and such  other  documents  as may be  required
     pursuant  to the terms  thereof,  and the form,  terms and  purpose  of the
     proposed Letter of Credit shall be reasonably satisfactory to the Agent and
     the Letter of Credit Issuer; and

          (2) As of the date of issuance,  no order of any court,  arbitrator or
     Governmental  Authority  shall  purport by its terms to enjoin or  restrain
     money center banks generally from issuing letters of credit of the type and
     in the  amount  of the  proposed  Letter  of  Credit,  and no law,  rule or
     regulation  applicable  to money center banks  generally  and no request or
     directive  (whether  or not having the force of law) from any  Governmental
     Authority  with  jurisdiction  over  money  center  banks  generally  shall
     prohibit,  or request that the  proposed  Letter of Credit  Issuer  refrain
     from,  the issuance of letters of credit  generally or the issuance of such
     Letter of Credit.

          (d) Issuance of Letters of Credit.

          (1)  Request  for  Issuance.  Borrower  must  notify  the  Agent  of a
     requested  Letter of Credit at least three (3)  Business  Days prior to the
     proposed  issuance date.  Such notice shall be irrevocable and must specify
     the maximum face amount of the Letter of Credit requested, the Business Day
     of  issuance of such  requested  Letter of Credit,  whether  such Letter of
     Credit may be drawn in a single or in partial  draws,  the  Business Day on
     which the  requested  Letter of Credit is to expire,  the purpose for which
     such Letter of Credit is to be issued, and the beneficiary of the requested
     Letter of Credit.  The  Borrower  shall  attach to such notice the proposed
     form of the Letter of Credit.

          (2)  Responsibilities of the Agent;  Issuance.  As of the Business Day
     immediately  preceding the requested issuance date of the Letter of Credit,
     the Agent shall  determine  the amount of the  applicable  Unused Letter of
     Credit Subfacility and Availability.  If (i) the maximum face amount of the
     requested  Letter  of  Credit  is less  than the  Unused  Letter  of Credit
     Subfacility and (ii) the amount of such requested  Letter of Credit and all
     commissions, fees, and charges due from the Borrower in connection with the
     opening  thereof would not exceed  Availability,  the Agent shall cause the
     Letter of Credit  Issuer  to issue  the  requested  Letter of Credit on the
     requested issuance date so long as the other conditions hereof are met.

          (3) No Extensions  or  Amendment.  The Agent shall not be obligated to
     cause the  Letter of Credit  Issuer to extend or amend any Letter of Credit
     issued pursuant hereto unless the  requirements of this Section 1.3 are met
     as though a new Letter of Credit were being requested and issued.

          (e) Payments  Pursuant to Letters of Credit.  The  Borrower  agrees to
     reimburse  immediately  the Letter of Credit  Issuer for any draw under any
     Letter of Credit  and the Agent for the  account  of the  Lenders  upon any
     payment  pursuant  to any Credit  Support,  and to pay the Letter of Credit
     Issuer the amount of all other  charges  and fees  payable to the Letter of
     Credit Issuer in connection with any Letter of Credit immediately when due,
     irrespective  of any  claim,  setoff,  defense  or other  right  which  the
     Borrower  may have at any time  against the Letter of Credit  Issuer or any
     other Person.  Each drawing  under any Letter of Credit shall  constitute a
     request  by the  Borrower  to the  Agent  for a  Borrowing  of a Base  Rate
     Revolving Loan in the amount of such drawing. The Funding Date with respect
     to such borrowing shall be the date of such drawing.

                                       11
<PAGE>

          (f) Indemnification; Exoneration; Power of Attorney.

          (1)  Indemnification.  In  addition  to amounts  payable as  elsewhere
     provided in this Section 1.3,  the Borrower  agrees to protect,  indemnify,
     pay and save the  Letter  of  Credit  Issuer,  the  Lenders  and the  Agent
     harmless  from  and  against  any and  all  claims,  demands,  liabilities,
     damages,   losses,   costs,  charges  and  expenses  (including  reasonable
     attorneys'  fees) which any Lender or the Agent (other than a Lender in its
     capacity  as Letter  of Credit  Issuer)  may  incur or be  subject  to as a
     consequence, direct or indirect, of the issuance of any Letter of Credit or
     the provision of any Credit Support or enhancement in connection therewith.
     The Borrower's  obligations under this Section shall survive payment of all
     other Obligations.

          (2)  Assumption  of Risk by the Borrower.  As among the Borrower,  the
     Lenders,  the Letter of Credit Issuer,  and the Agent, the Borrower assumes
     all risks of the acts and  omissions of, or misuse of any of the Letters of
     Credit by,  the  respective  beneficiaries  of such  Letters of Credit.  In
     furtherance  and not in  limitation of the  foregoing,  the Lenders and the
     Agent shall not be  responsible  for and the Borrower shall not be relieved
     of any of its obligations  hereunder on account of: (A) the form, validity,
     sufficiency,   accuracy,  genuineness  or  legal  effect  of  any  document
     submitted by any Person in connection with the application for and issuance
     of and presentation of drafts with respect to any of the Letters of Credit,
     even if it should prove to be in any or all respects invalid, insufficient,
     inaccurate,  fraudulent or forged;  (B) the validity or  sufficiency of any
     instrument  transferring  or assigning or  purporting to transfer or assign
     any  Letter of Credit or the  rights or  benefits  thereunder  or  proceeds
     thereof,  in whole or in part, which may prove to be invalid or ineffective
     for any reason;  (C) the failure of the beneficiary of any Letter of Credit
     to comply duly with  conditions  required in order to draw upon such Letter
     of Credit; (D) errors, omissions,  interruptions, or delays in transmission
     or delivery of any messages, by mail, cable, telegraph, telex or otherwise,
     whether or not they be in cipher; (E) errors in interpretation of technical
     terms;  (F) any loss or  delay  in the  transmission  or  otherwise  of any
     document  required in order to make a drawing under any Letter of Credit or
     of the proceeds thereof;  (G) the  misapplication by the beneficiary of any
     Letter  of Credit of the  proceeds  of any  drawing  under  such  Letter of
     Credit; (H) any consequences  arising from causes beyond the control of the
     Lenders or the Agent,  including any act or omission,  whether  rightful or
     wrongful,  of any  present  or  future  de  jure or de  facto  Governmental
     Authority  or (I) the Letter of Credit  Issuer's  honor of a draw for which
     the draw,  any  certificate,  or any other  document fails to comply in any
     respect with the terms of the Letter of Credit. None of the foregoing shall
     affect,  impair or prevent the vesting of any rights or powers of the Agent
     or any Lender under this Section 1.3(f).

          (3) Exoneration. Without limiting the foregoing, no action or omission
     whatsoever  by Agent,  any  Lender,  or the Letter of Credit  Issuer  shall
     result in any  liability  of Agent,  any  Lender,  or the  Letter of Credit
     Issuer to the Borrower,  or relieve the Borrower of any of its  obligations
     hereunder to any such Person.

          (4) Rights Against Letter of Credit Issuer.  Nothing contained in this
     Agreement is intended to limit the Borrower's  rights, if any, with respect
     to the  Letter of Credit  Issuer  which  arise as a result of the letter of
     credit  application  and  related  documents  executed  by and  between the
     Borrower and the Letter of Credit Issuer.

          (5) Account  Party.  The Borrower  hereby  authorizes  and directs any
     Letter of Credit Issuer to name the Borrower as the "Account Party" therein
     and to deliver to the Agent all  instruments,  documents and other writings
     and property received by the Letter of Credit Issuer pursuant to the Letter
     of  Credit,  and to  accept  and rely  upon the  Agent's  instructions  and
     agreements  with  respect to all  matters  arising in  connection  with the
     Letter of Credit or the application therefor.

                                       12
<PAGE>

          (g) Supporting Letter of Credit; Cash Collateral.  If, notwithstanding
     the  provisions of Section 1.3(b) and Section 10.1, any Letter of Credit or
     Credit Support is outstanding upon the termination of this Agreement,  then
     upon such  termination  the Borrower  shall, at the request of Agent in its
     sole  discretion,  either:  (A)  deposit  with the Agent,  for the  ratable
     benefit of the Agent and the Lenders, with respect to each Letter of Credit
     or  Credit  Support  then  outstanding  (the  "Remaining  Letter  of Credit
     Obligations"), a standby letter of credit (a "Supporting Letter of Credit")
     in form and  substance  satisfactory  to the  Agent,  issued  by an  issuer
     satisfactory to the Agent in an amount equal to 110% of the greatest amount
     for which such Letter of Credit or such Credit Support may be drawn,  under
     which  Supporting  Letter of Credit the Agent is entitled  to draw  amounts
     necessary to reimburse the Agent and the Lenders for payments to be made by
     the Agent and the Lenders under such Letter of Credit or Credit Support and
     any fees and  expenses  associated  with  such  Letter  of Credit or Credit
     Support.  Such Supporting  Letter of Credit shall be held by the Agent, for
     the ratable  benefit of the Agent and the Lenders,  as security for, and to
     provide for the payment of, the aggregate undrawn amount of such Letters of
     Credit or such  Credit  Support  remaining  outstanding,  or (B)  pledge or
     deposit  with or deliver to Agent,  for the benefit of the Letter of Credit
     Issuer, the Agent, and the Lenders,  as collateral for the Remaining Letter
     of Credit  Obligations,  cash or deposit account  balances in the amount of
     110%  of  the  Remaining   Letter  of  Credit   Obligations,   pursuant  to
     documentation  in form and  substance  satisfactory  to the  Agent  and the
     Letter of Credit  Issuer (which  documents  are hereby  consented to by the
     Lenders).  The Borrower hereby grants to the Agent,  for the benefit of the
     Agent, the Letter of Credit Issuer, and the Lenders, a security interest in
     all such cash, deposit accounts, and all balances therein, and all proceeds
     of  the  foregoing.   Cash  Collateral  shall  be  maintained  in  blocked,
     non-interest bearing deposit accounts at Bank of America, N.A..

          1.4 Bank Products.  The Borrower may request and the Agent may, in its
     sole and absolute  discretion,  arrange for the Borrower to obtain from the
     Bank or the Bank's  Affiliates  Bank Products  although the Borrower is not
     required to do so. If Bank  Products  are  provided by an  Affiliate of the
     Bank, the Borrower agrees to indemnify and hold the Agent, the Bank and the
     Lenders  harmless from any and all costs and  obligations  now or hereafter
     incurred by the Agent,  the Bank or any of the Lenders which arise from any
     indemnity  given  by the  Agent  to its  Affiliates  related  to such  Bank
     Products;  provided, however, nothing contained herein is intended to limit
     the Borrower's rights, with respect to the Bank or its Affiliates,  if any,
     which arise as a result of the  execution  of  documents by and between the
     Borrower  and the  Bank  which  relate  to  Bank  Products.  The  agreement
     contained in this Section shall survive termination of this Agreement.  The
     Borrower  acknowledges  and agrees that the obtaining of Bank Products from
     the  Bank  or  the  Bank's  Affiliates  (a)  is in the  sole  and  absolute
     discretion of the Bank or the Bank's Affiliates,  and (b) is subject to all
     rules and regulations of the Bank or the Bank's Affiliates.

                                   ARTICLE 2
                                INTEREST AND FEES

          2.1 Interest.

          (a) Interest Rates. All outstanding Obligations shall bear interest on
     the unpaid principal amount thereof (including,  to the extent permitted by
     law, on  interest  thereon not paid when due) from the date made until paid
     in full in cash at a rate  determined  by reference to the Base Rate or the
     LIBOR  Rate plus the  Applicable  Margins  as set forth  below,  but not to
     exceed the Maximum Rate. If at any time Loans are outstanding  with respect
     to which the  Borrower has not  delivered to the Agent a notice  specifying
     the  basis  for  determining  the  interest  rate  applicable   thereto  in
     accordance  herewith,  those Loans shall bear interest at a rate determined
     by  reference  to the Base Rate until notice to the contrary has been given
     to the Agent in accordance  with this  Agreement and such notice has become
     effective. Except as otherwise provided herein, the outstanding Obligations
     shall bear interest as follows:

                                       13
<PAGE>

          (i) For all Base Rate  Revolving  Loans and other  Obligations  (other
     than LIBOR  Revolving  Loans) at a fluctuating  per annum rate equal to the
     lesser of : (A) the Maximum Rate, and (B) the Base Rate plus the Applicable
     Margin; and

          (ii) For all LIBOR  Revolving  Loans at a per annum  rate equal to the
     lesser  of : (A) the  Maximum  Rate,  and  (B)  the  LIBOR  Rate  plus  the
     Applicable Margin.

     Each  change in the Base  Rate  shall be  reflected  in the  interest  rate
     applicable to Base Rate  Revolving  Loans as of the effective  date of such
     change.  All interest  charges  shall be computed on the basis of a year of
     360 days and actual days elapsed.  The Borrower shall pay to the Agent, for
     the ratable benefit of Lenders, interest accrued on all Base Rate Revolving
     Loans in  arrears  on the  first  day of each  month  hereafter  and on the
     Termination  Date.  The  Borrower  shall pay to the Agent,  for the ratable
     benefit of  Lenders,  interest on all LIBOR  Revolving  Loans in arrears on
     each LIBOR Interest Payment Date.

          (b) Default  Rate.  If any  Default or Event of Default  occurs and is
     continuing  and the Agent or the Required  Lenders in their  discretion  so
     elect, then, while any such Default or Event of Default is continuing,  all
     of the  Obligations  shall bear  interest  at the lesser of (i) the Maximum
     Rate, and (ii) the Default Rate applicable thereto.

          2.2 Continuation and Conversion Elections.

          (a) The Borrower may:

          (i) elect,  as of any Business Day, in the case of Base Rate Revolving
     Loans to convert any Base Rate  Revolving  Loans (or any part thereof in an
     amount not less than  $2,000,000,  or that is in an  integral  multiple  of
     $500,000 in excess thereof) into LIBOR Revolving Loans; or

          (ii) elect, as of the last day of the applicable  Interest Period,  to
     continue any LIBOR Revolving Loans having Interest Periods expiring on such
     day (or any part thereof in an amount not less than $2,000,000,  or that is
     in an integral multiple of $500,000 in excess thereof);

     provided, that if at any time the aggregate amount of LIBOR Revolving Loans
     in  respect  of any  Borrowing  is  reduced,  by  payment,  prepayment,  or
     conversion of part thereof to be less than $500,000,  such LIBOR  Revolving
     Loans shall automatically  convert into Base Rate Revolving Loans; provided
     further  that if the  notice  shall  fail to specify  the  duration  of the
     Interest Period, such Interest Period shall be one month.

          (b) The  Borrower  shall  deliver a notice of  continuation/conversion
     ("Notice  of  Continuation/Conversion")  to the Agent not later  than 11:00
     a.m. (Central Standard Time) at least three (3) Business Days in advance of
     the Continuation/Conversion  Date, if the Loans are to be converted into or
     continued as LIBOR Revolving Loans and specifying:

          (i) the proposed Continuation/Conversion Date;

          (ii) the aggregate amount of Loans to be converted or renewed;

          (iii) the type of Loans  resulting  from the  proposed  conversion  or
     continuation; and

                                       14
<PAGE>

          (iv) the duration of the requested Interest Period, provided, however,
     the Borrower  may not select an Interest  Period that ends after the Stated
     Termination Date.

          (c) If upon the expiration of any Interest Period  applicable to LIBOR
     Revolving  Loans,  the Borrower has failed to select  timely a new Interest
     Period to be applicable to LIBOR Revolving Loans or if any Default or Event
     of Default  then exists,  the  Borrower  shall be deemed to have elected to
     convert such LIBOR Revolving Loans into Base Rate Revolving Loans effective
     as of the expiration date of such Interest Period.

          (d) The Agent will  promptly  notify  each  Lender of its receipt of a
     Notice of Continuation/Conversion.  All conversions and continuations shall
     be made ratably according to the respective  outstanding  principal amounts
     of the Loans  with  respect  to which  the  notice  was given  held by each
     Lender.

          (e) There may not be more than six (6) different LIBOR Revolving Loans
     in effect hereunder at any time.

          2.3  Maximum  Interest  Rate.  In no event  shall  any  interest  rate
     provided for hereunder  (including any fees or other compensation which are
     deemed or  determined  to be  interest)  exceed the  maximum  rate  legally
     chargeable by any Lender under  applicable law for such Lender with respect
     to loans of the type provided for hereunder  (the "Maximum  Rate").  If, in
     any period, any interest,  absent such limitation,  would have exceeded the
     Maximum  Rate,  then the interest rate for that period shall be the Maximum
     Rate, and, if in future periods, that interest rate would otherwise be less
     than the Maximum Rate,  then that interest rate shall remain at the Maximum
     Rate until such time as the amount of interest  paid  hereunder  equals the
     amount  of  interest  which  would  have been paid if the same had not been
     limited by the Maximum Rate. In the event that, upon payment in full of the
     Obligations,  the total amount of interest  paid or accrued under the terms
     of this  Agreement is less than the total  amount of interest  which would,
     but for this  Section 2.3,  have been paid or accrued if the interest  rate
     otherwise set forth in this Agreement had at all times been in effect, then
     the Borrower  shall,  to the extent  permitted by  applicable  law, pay the
     Agent, for the account of the Lenders, an amount equal to the excess of (a)
     the lesser of (i) the amount of interest  which would have been  charged if
     the Maximum  Rate had,  at all times,  been in effect or (ii) the amount of
     interest which would have accrued had the interest rate otherwise set forth
     in this  Agreement,  at all  times,  been in effect  over (b) the amount of
     interest actually paid or accrued under this Agreement. If the Agent and/or
     any Lender has received  interest and other charges  hereunder in excess of
     the Maximum Rate,  such excess shall be deemed  received on account of, and
     shall  automatically  be  applied  to reduce,  the  Obligations  other than
     interest,  and if there are no  Obligations  outstanding,  the Agent and/or
     such Lender shall refund to the Borrower such excess.

          2.4  Arrangement  Fee.  The  Borrower  agrees  to pay the Agent on the
     Closing Date an arrangement fee (the "Arrangement Fee") as set forth in the
     letter dated January 14, 2005, between the Agent and Borrower, as amended.

          2.5 Unused Line Fee. On the first day of each month  hereafter  and on
     the  Termination  Date the  Borrower  agrees to pay to the  Agent,  for the
     account  of the  Lenders,  in  accordance  with their  respective  Pro Rata
     Shares,  an unused line fee (the "Unused Line Fee") equal to the Applicable
     Margin  for the  Unused  Line Fee  times the  amount  by which the  Maximum
     Revolver Amount exceeded the sum of the average daily outstanding amount of
     Revolving  Loans and the average daily  undrawn face amount of  outstanding
     Letters of Credit, during the immediately preceding month or shorter period
     if calculated for the first month hereafter or on the Termination Date. The
     Unused Line Fee shall be  computed  on the basis of a 360-day  year for the
     actual number of days elapsed. All principal payments received by the Agent
     shall be deemed to be credited to the Borrower's  Loan Account  immediately


                                       15
<PAGE>

     upon  receipt for purposes of  calculating  the Unused Line Fee pursuant to
     this Section 2.5.

          2.6 Letter of Credit Fee. The Borrower agrees to pay (a) to the Agent,
     for the account of the Lenders,  in accordance  with their  respective  Pro
     Rata  Shares,  for each Letter of Credit,  a per annum fee (the  "Letter of
     Credit  Fee") equal to the  Applicable  Margin  with  respect to Letters of
     Credit  multiplied  by the maximum  stated amount of each Letter of Credit,
     (b) to Agent for the benefit of the Letter of Credit Issuer, a fronting fee
     of one-quarter of one percent (0.25%) per annum (the "Fronting Fee") of the
     undrawn  maximum face amount of each Letter of Credit,  and (c) on the date
     of issuance, increase, and/or extension, including, without limitation, any
     automatic  extension  of any  Letter  of  Credit,  to the  Letter of Credit
     Issuer,  all out-of-pocket  costs, fees and expenses incurred by the Letter
     of Credit Issuer in connection  with the  application  for,  processing of,
     issuance of, or amendment  to any Letter of Credit,  which costs,  fees and
     expenses  shall  include a "fronting  fee"  payable to the Letter of Credit
     Issuer.  The  Letter of Credit  Fee and the  Fronting  Fee shall be payable
     monthly in arrears  on the first day of each month  following  any month in
     which a Letter of Credit is outstanding  and on the  Termination  Date. The
     Letter of Credit Fee and the Fronting Fee shall be computed on the basis of
     a 360-day year for the actual number of days elapsed.

          2.7 Vehicle Maintenance Fee. At Agent's sole and absolute  discretion,
     Agent may retain any third  party  servicer  ("Title  Servicer")  to house,
     maintain,  service, release, perfect, and perform other matters relating to
     the  certificates  of title  relating to the Rolling  Stock.  The  Borrower
     agrees to pay all fees and expenses of such Title Servicer on demand.

                                   ARTICLE 3
                            PAYMENTS AND PREPAYMENTS

          3.1  Revolving   Loans.  The  Borrower  shall  repay  the  outstanding
     principal  balance of the  Revolving  Loans,  plus all  accrued  but unpaid
     interest  thereon,  on  the  Termination  Date.  The  Borrower  may  prepay
     Revolving  Loans at any time,  and  reborrow  subject  to the terms of this
     Agreement.  In  addition,  and  without  limiting  the  generality  of  the
     foregoing,  upon demand the Borrower shall pay to the Agent, for account of
     the  Lenders,  the  amount,  without  duplication,  by which the  Aggregate
     Revolver  Outstandings  exceeds  the  lesser of the  Borrowing  Base or the
     Maximum Revolver Amount.

          3.2 Termination of Facility. The Borrower may terminate this Agreement
     upon at least ten (10) Business  Days' notice to the Agent and the Lenders,
     upon (a) the payment in full of all outstanding  Revolving Loans,  together
     with  accrued  interest  thereon,  and the  cancellation  and return of all
     outstanding  Letters  of  Credit,  (b) the  payment  in full in cash of all
     reimbursable  expenses and other  Obligations,  and (c) with respect to any
     LIBOR  Revolving  Loans  prepaid,  payment of the amounts due under Section
     4.4, if any. If this Agreement is terminated at any time prior to the First
     Anniversary  Date,  whether pursuant to this Section or pursuant to Section
     9.2, the Borrower  shall pay to the Agent,  for the account of the Lenders,
     an early termination fee equal to 1.0% of the Maximum Revolver Amount.

          3.3 Repayments of Obligations.

          (a)  Immediately  upon  receipt by  Borrower  or its  Subsidiaries  of
     proceeds  of  any  asset  disposition  or any  sale  of  the  stock  of any
     Subsidiary,  Borrower shall prepay the Loans in an amount equal to all such
     proceeds,  net  of (A)  commissions  and  other  reasonable  and  customary
     transaction  costs,  fees  and  expenses  properly   attributable  to  such
     transaction and payable by Borrower in connection  therewith (in each case,
     paid to non-Affiliates), (B) transfer taxes, (C) amounts payable to holders
     of senior Liens (to the extent such Liens constitute  Permitted Liens under
     subpart (j) of the  definition  of  Permitted  Liens),  if any,  and (D) an
     appropriate  reserve for income taxes in accordance with GAAP in connection


                                       16
<PAGE>

     therewith  ("Net  Proceeds").  Any  such  prepayment  shall be  applied  in
     accordance with Section 3.3(b).

          (b) Prepayments from Net Proceeds shall be applied as follows:  first,
     to accrued interest with respect to the Base Rate Revolving Loans,  second,
     to pay the principal of the Base Rate  Revolving  Loans,  and third to cash
     collateralize outstanding Letters of Credit. So long as no Default or Event
     of  Default  has  occurred  and  is  continuing,  the  Borrower  may at its
     election,  prepay  interest and  principal of any LIBOR Rate Loan or direct
     the  Agent  to hold  such  proceeds  as  Collateral  for  the  Obligations.
     Notwithstanding   the  foregoing,   any  prepayments   made  following  the
     occurrence and during the  continuation  of any Default or Event of Default
     shall be applied to the Obligations in any order the Agent elects.

          (c) No  provision  contained  in this  Section 3.3 shall  constitute a
     consent to an asset  disposition  that is  otherwise  not  permitted by the
     terms of this Agreement.

          3.4  LIBOR  Revolving  Loan   Prepayments.   In  connection  with  any
     prepayment,  if  any  LIBOR  Revolving  Loans  are  prepaid  prior  to  the
     expiration date of the Interest  Period  applicable  thereto,  the Borrower
     shall pay to the Lenders the amounts described in Section 4.4.

          3.5 Payments by the Borrower.

          (a) All  payments  to be made by the  Borrower  shall be made  without
     set-off, recoupment or counterclaim. Except as otherwise expressly provided
     herein,  all  payments by the  Borrower  shall be made to the Agent for the
     account of the Lenders, at the account designated by the Agent and shall be
     made in Dollars and in  immediately  available  funds,  no later than 12:00
     noon (Central  Standard  Time) on the date  specified  herein.  Any payment
     received  by the Agent  after such time shall be deemed  (for  purposes  of
     calculating  interest only) to have been received on the following Business
     Day and any applicable interest shall continue to accrue.

          (b) Subject to the provisions set forth in the definition of "Interest
     Period",  whenever  any payment is due on a day other than a Business  Day,
     such payment shall be due on the following Business Day, and such extension
     of time shall in such case be  included in the  computation  of interest or
     fees, as the case may be.

          3.6  Payments  as  Revolving  Loans.  At the  election  of Agent,  all
     payments of principal,  interest,  reimbursement  obligations in connection
     with  Letters of Credit and Credit  Support  for  Letters of Credit,  fees,
     premiums,  reimbursable  expenses and other sums payable hereunder,  may be
     paid from the  proceeds of  Revolving  Loans made  hereunder.  The Borrower
     hereby irrevocably  authorizes the Agent to charge the Loan Account for the
     purpose of paying all amounts  from time to time due  hereunder  and agrees
     that all such amounts charged shall  constitute  Revolving Loans (including
     Non-Ratable Loans and Agent Advances).

          3.7 Apportionment, Application and Reversal of Payments. Principal and
     interest payments shall be apportioned ratably among the Lenders (according
     to the unpaid principal  balance of the Loans to which such payments relate
     held by each  Lender) and  payments of the fees shall,  as  applicable,  be
     apportioned  ratably among the Lenders,  except for fees payable  solely to
     Agent and the Letter of Credit  Issuer and  except as  provided  in Section
     11.1(b).  All payments shall be remitted to the Agent and all such payments
     not  relating  to  principal  or  interest  of  specific   Loans,   or  not
     constituting  payment of  specific  fees,  and all  proceeds of Accounts or
     other Collateral received by the Agent, shall be applied,  ratably, subject

                                       17
<PAGE>

     to the provisions of this Agreement, first, to pay any fees, indemnities or
     expense reimbursements including any amounts relating to Bank Products then
     due to the Agent  from the  Borrower;  second,  to pay any fees or  expense
     reimbursements  then due to the Lenders from the  Borrower;  third,  to pay
     interest due in respect of all Loans, including Non-Ratable Loans and Agent
     Advances;  fourth,  to pay or prepay principal of the Non-Ratable Loans and
     Agent Advances;  fifth,  to pay or prepay  principal of the Revolving Loans
     (other than Non-Ratable Loans and Agent Advances) and unpaid  reimbursement
     obligations  in respect of  Letters of Credit;  sixth,  to pay an amount to
     Agent equal to all outstanding  Letter of Credit  Obligations to be held as
     cash collateral for such  Obligations;  and seventh,  to the payment of any
     other  Obligation  due  to  the  Agent  or  any  Lender  by  the  Borrower.
     Notwithstanding  anything  to the  contrary  contained  in this  Agreement,
     unless so  directed  by the  Borrower,  or unless an Event of  Default  has
     occurred  and is  continuing,  neither the Agent nor any Lender shall apply
     any payments which it receives to any LIBOR Revolving  Loan,  except (a) on
     the  expiration  date of the Interest  Period  applicable to any such LIBOR
     Revolving Loan, or (b) in the event, and only to the extent, that there are
     no outstanding  Base Rate Revolving  Loans and, in any event,  the Borrower
     shall pay LIBOR breakage  losses in accordance  with Section 4.4. The Agent
     and the Lenders shall have the continuing and exclusive  right to apply and
     reverse and reapply any and all such  proceeds  and payments to any portion
     of the Obligations.

          3.8 Indemnity for Returned  Payments.  If after receipt of any payment
     which is applied to the payment of all or any part of the Obligations,  the
     Agent, any Lender,  the Bank or any Affiliate of the Bank is for any reason
     compelled to surrender  such payment or proceeds to any Person because such
     payment or application of proceeds is invalidated, declared fraudulent, set
     aside,  determined  to be void or voidable as a  preference,  impermissible
     setoff,  or a diversion of trust funds,  or for any other reason,  then the
     Obligations or part thereof  intended to be satisfied  shall be revived and
     continued  and  this  Agreement  shall  continue  in full  force as if such
     payment or proceeds  had not been  received by the Agent or such Lender and
     the  Borrower  shall be liable to pay to the  Agent  and the  Lenders,  and
     hereby does  indemnify the Agent and the Lenders and hold the Agent and the
     Lenders  harmless for the amount of such  payment or proceeds  surrendered.
     The  provisions  of  this  Section  3.8  shall  be  and  remain   effective
     notwithstanding  any contrary action which may have been taken by the Agent
     or any Lender in reliance upon such payment or application of proceeds, and
     any such contrary action so taken shall be without prejudice to the Agent's
     and the Lenders'  rights under this  Agreement  and shall be deemed to have
     been conditioned upon such payment or application of proceeds having become
     final and irrevocable. The provisions of this Section 3.8 shall survive the
     termination of this Agreement.

          3.9 Agent's and Lenders' Books and Records;  Monthly  Statements.  The
     Agent shall record the principal  amount of the Loans owing to each Lender,
     the  undrawn  face  amount of all  outstanding  Letters  of Credit  and the
     aggregate  amount  of unpaid  reimbursement  obligations  outstanding  with
     respect  to the  Letters  of  Credit  from  time to time on its  books.  In
     addition,  each  Lender  may note the date and  amount of each  payment  or
     prepayment  of principal of such  Lender's  Loans in its books and records.
     Failure by Agent or any Lender to make such  notation  shall not affect the
     obligations  of the  Borrower  with  respect to the Loans or the Letters of
     Credit.  The Borrower  agrees that the Agent's and each Lender's  books and
     records  showing  the  Obligations  and the  transactions  pursuant to this
     Agreement and the other Loan Documents shall be admissible in any action or
     proceeding arising therefrom,  and shall constitute rebuttably  presumptive
     proof thereof,  irrespective of whether any Obligation is also evidenced by
     a  promissory  note or other  instrument.  The Agent  will  provide  to the
     Borrower a monthly  statement of Loans,  payments,  and other  transactions
     pursuant  to this  Agreement.  Such  statement  shall  be  deemed  correct,
     accurate,  and binding on the  Borrower and an account  stated  (except for
     reversals  and  reapplications  of payments made as provided in Section 3.7
     and  corrections  of errors  discovered by the Agent),  unless the Borrower
     notifies the Agent in writing to the contrary within thirty (30) days after
     such  statement  is  rendered.  In the  event a timely  written  notice  of
     objections is given by the Borrower,  only the items to which  exception is
     expressly made will be considered to be disputed by the Borrower.

                                       18
<PAGE>

          3.10  Collection  of  Accounts.  Borrower  shall  at all  times  after
     February 28, 2005 maintain lockboxes  ("Lockboxes") and shall, on or before
     February  28, 2005,  instruct all Account  Debtors with respect to Accounts
     and General  Intangibles  of Borrower to remit all  Collections  in respect
     thereof  to  such   Lockboxes  or  local  deposit   accounts  at  financial
     institutions acceptable to the Agent. Borrower, Agent and the Lockbox Banks
     shall enter into the Lockbox  Agreements,  which among other  things  shall
     provide for the opening of a Lockbox Account for the deposit of Collections
     at a Lockbox Bank.  Borrower  agrees that: (a) all good funds on deposit in
     each local collection  account (other than a local collection account which
     is subject to a Control  Agreement)  in excess of $25,000 per account shall
     be  swept  pursuant  to  standing  instructions  (by wire  transfer  or ACH
     transaction) on a daily basis to a Lockbox Account; and (b) all Collections
     and other amounts received by Borrower from any Account Debtor or any other
     source  immediately upon receipt shall be deposited into a Lockbox Account.
     No Lockbox Agreement or arrangement  contemplated thereby shall be modified
     by Borrower  without the prior  written  consent of the Agent.  All amounts
     received in each Lockbox  Account  shall be wired each Business Day into an
     account  ("Agent's  Account") with the Agent. If at any one time Borrower's
     Availability  has been  $30,000,000  or more for at least  the last  thirty
     consecutive   Business  Days  (for  the  purposes  of  this  Section  3.10,
     Availability  shall  not  be  deemed  to be  reduced  by the  reduction  of
     Availability  attributed  to the  issuance  of any  Replacement  Letters of
     Credit),  then,  upon  Borrower's  request,  Agent shall give the  relevant
     Lockbox Bank an instruction  permitting Borrower to direct the disbursement
     of funds on  deposit in such  Lockbox  Account.  If at any time  thereafter
     either:  (x)  Borrower's  Availability  is  less  than  $30,000,000  on any
     Business  Day,  or (y) the  occurrence  of an  Event of  Default,  then all
     amounts  received in each Lockbox  Account shall be wired each Business Day
     into the  Agent's  Account  and  Borrower  shall  thereafter  no  longer be
     permitted  to direct  disbursement  of any funds in deposit in such Lockbox
     Account.

                                   ARTICLE 4
                     TAXES, YIELD PROTECTION AND ILLEGALITY

          4.1 Taxes.

          (a) Any and all  payments by the  Borrower to each Lender or the Agent
     under this  Agreement  and any other Loan  Document  shall be made free and
     clear of, and without  deduction or withholding for any Taxes. In addition,
     the Borrower shall pay all Other Taxes.

          (b) The Borrower agrees to indemnify and hold harmless each Lender and
     the Agent for the full amount of Taxes or Other Taxes  (including any Taxes
     or Other Taxes imposed by any  jurisdiction  on amounts  payable under this
     Section)  paid by any  Lender  or the Agent  and any  liability  (including
     penalties,  interest,  additions to tax and expenses)  arising therefrom or
     with  respect  thereto,  whether  or not such  Taxes or  Other  Taxes  were
     correctly or legally asserted.  Payment under this indemnification shall be
     made within 30 days after the date such  Lender or the Agent makes  written
     demand therefor.

          (c) If the Borrower shall be required by law to deduct or withhold any
     Taxes or Other Taxes from or in respect of any sum payable hereunder to any
     Lender or the Agent, then:

          (i) the sum payable  shall be  increased  as  necessary  so that after
     making all required deductions and withholdings  (including  deductions and
     withholdings applicable to additional sums payable under this Section) such
     Lender or the Agent,  as the case may be,  receives an amount  equal to the
     sum it would have  received had no such  deductions  or  withholdings  been
     made;

          (ii) the Borrower shall make such deductions and withholdings;

                                       19
<PAGE>

          (iii) the Borrower  shall pay the full amount  deducted or withheld to
     the  relevant  taxing  authority  or other  authority  in  accordance  with
     applicable law; and

          (iv) the  Borrower  shall also pay to each Lender or the Agent for the
     account  of such  Lender,  at the time  interest  is paid,  all  additional
     amounts which the respective  Lender specifies as necessary to preserve the
     after-tax  yield such  Lender  would have  received  if such Taxes or Other
     Taxes had not been imposed.

          (d) At the  Agent's  request,  within  30 days  after  the date of any
     payment by the Borrower of Taxes or Other Taxes, the Borrower shall furnish
     the Agent the original or a certified copy of a receipt  evidencing payment
     thereof, or other evidence of payment satisfactory to the Agent.

          (e) If the  Borrower  is  required  to pay  additional  amounts to any
     Lender or the Agent pursuant to subsection  (c) of this Section,  then such
     Lender shall use reasonable  efforts  (consistent with legal and regulatory
     restrictions)  to change the  jurisdiction  of its lending  office so as to
     eliminate any such additional  payment by the Borrower which may thereafter
     accrue,  if such change in the  judgment  of such  Lender is not  otherwise
     disadvantageous to such Lender.

          4.2 Illegality.

          (a) If any Lender  determines that the introduction of any Requirement
     of Law, or any change in any  Requirement of Law, or in the  interpretation
     or administration of any Requirement of Law, has made it unlawful,  or that
     any central bank or other  Governmental  Authority  has asserted that it is
     unlawful,  for any Lender or its  applicable  lending  office to make LIBOR
     Revolving  Loans,  then,  on notice  thereof by that Lender to the Borrower
     through the Agent,  any  obligation of that Lender to make LIBOR  Revolving
     Loans  shall be  suspended  until that  Lender  notifies  the Agent and the
     Borrower that the circumstances giving rise to such determination no longer
     exist.

          (b) If a Lender  determines  that it is unlawful to maintain any LIBOR
     Revolving Loan, the Borrower shall, upon its receipt of notice of such fact
     and demand from such Lender (with a copy to the Agent), prepay in full such
     LIBOR  Revolving  Loans of that  Lender  then  outstanding,  together  with
     interest  accrued thereon and amounts required under Section 4.4, either on
     the last day of the Interest  Period  thereof,  if that Lender may lawfully
     continue  to  maintain  such  LIBOR   Revolving   Loans  to  such  day,  or
     immediately,  if that Lender may not  lawfully  continue  to maintain  such
     LIBOR  Revolving  Loans. If the Borrower is required to so prepay any LIBOR
     Revolving Loans, then concurrently with such prepayment, the Borrower shall
     borrow from the affected  Lender,  in the amount of such repayment,  a Base
     Rate Revolving Loan.

          4.3 Increased Costs and Reduction of Return.

          (a) If any Lender  determines that due to either (i) the  introduction
     of or any change in the interpretation of any law or regulation or (ii) the
     compliance  by that Lender with any  guideline  or request from any central
     bank or other  Governmental  Authority  (whether or not having the force of
     law), there shall be any increase in the cost to such Lender of agreeing to
     make or making,  funding or maintaining any LIBOR Revolving Loans, then the
     Borrower  shall be liable  for,  and shall from time to time,  upon  demand
     (with a copy of such demand to be sent to the Agent),  pay to the Agent for
     the  account  of such  Lender,  additional  amounts  as are  sufficient  to
     compensate such Lender for such increased costs.

                                       20
<PAGE>

          (b) If any Lender shall have determined  that (i) the  introduction of
     any Capital  Adequacy  Regulation,  (ii) any change in any Capital Adequacy
     Regulation, (iii) any change in the interpretation or administration of any
     Capital  Adequacy  Regulation  by any  central  bank or other  Governmental
     Authority charged with the  interpretation or  administration  thereof,  or
     (iv)  compliance  by  such  Lender  or  any  corporation  or  other  entity
     controlling  such Lender with any Capital Adequacy  Regulation,  affects or
     would affect the amount of capital required or expected to be maintained by
     such Lender or any corporation or other entity  controlling such Lender and
     (taking into  consideration  such Lender's or such  corporation's  or other
     entity's  policies  with  respect to  capital  adequacy  and such  Lender's
     desired  return on capital)  determines  that the amount of such capital is
     increased  as  a  consequence  of  its  Commitments,   loans,   credits  or
     obligations  under this Agreement,  then, upon demand of such Lender to the
     Borrower  through the Agent,  the Borrower  shall pay to such Lender,  from
     time to time as specified by such Lender,  additional amounts sufficient to
     compensate such Lender for such increase.

          4.4 Funding Losses.  The Borrower shall reimburse each Lender and hold
     each Lender harmless from any loss or expense which such Lender may sustain
     or incur as a consequence of:

          (a) the failure of the  Borrower to make on a timely basis any payment
     of principal of any LIBOR Revolving Loan;

          (b) the failure of the Borrower to borrow,  continue or convert a Loan
     after the  Borrower  has  given  (or is  deemed to have  given) a Notice of
     Borrowing or a Notice of Continuation/Conversion; or

          (c) the  prepayment or other  payment  (including  after  acceleration
     thereof) of any LIBOR  Revolving Loans on a day that is not the last day of
     the relevant Interest Period;

     including  any such  loss of  anticipated  profit  and any loss or  expense
     arising from the  liquidation  or  reemployment  of funds obtained by it to
     maintain its LIBOR  Revolving  Loans or from fees payable to terminate  the
     deposits from which such funds were  obtained.  Borrower shall also pay any
     customary  administrative fees charged by any Lender in connection with the
     foregoing.

          4.5 Inability to Determine Rates. If the Agent determines that for any
     reason adequate and reasonable means do not exist for determining the LIBOR
     Rate for any  requested  Interest  Period with respect to a proposed  LIBOR
     Revolving  Loan, or that the LIBOR Rate for any requested  Interest  Period
     with respect to a proposed  LIBOR  Revolving  Loan does not  adequately and
     fairly reflect the cost to the Lenders of funding such Loan, the Agent will
     promptly so notify the Borrower and each Lender. Thereafter, the obligation
     of the Lenders to make or maintain LIBOR Revolving Loans hereunder shall be
     suspended  until the Agent revokes such notice in writing.  Upon receipt of
     such  notice,  the Borrower may revoke any Notice of Borrowing or Notice of
     Continuation/Conversion  then  submitted  by it. If the  Borrower  does not
     revoke such Notice,  the Lenders shall make, convert or continue the Loans,
     as proposed by the  Borrower,  in the amount  specified  in the  applicable
     notice submitted by the Borrower,  but such Loans shall be made,  converted
     or continued as Base Rate Revolving Loans instead of LIBOR Revolving Loans.

          4.6  Certificates  of Agent.  If any Lender  claims  reimbursement  or
     compensation under this Article 4, Agent shall determine the amount thereof
     and shall  deliver to the Borrower  (with a copy to the affected  Lender) a
     certificate  setting forth in reasonable  detail the amount  payable to the
     affected Lender,  and such  certificate  shall be conclusive and binding on
     the Borrower in the absence of manifest error.

                                       21
<PAGE>

          4.7 Survival.  The agreements and  obligations of the Borrower in this
     Article 4 shall survive the payment of all other Obligations.

                                   ARTICLE 5
                BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES

          5.1 Books and Records.  The  Borrower  shall  maintain,  at all times,
     correct and complete books, records and accounts in which complete, correct
     and timely  entries are made of its  transactions  in accordance  with GAAP
     applied  consistently with the audited Financial  Statements required to be
     delivered  pursuant to Section  5.2(a).  The  Borrower  shall,  by means of
     appropriate  entries,  reflect  in  such  accounts  and  in  all  Financial
     Statements  proper  liabilities  and  reserves  for all  taxes  and  proper
     provision for  depreciation and amortization of property and bad debts, all
     in accordance with GAAP. The Borrower shall maintain at all times books and
     records pertaining to the Collateral in such detail,  form and scope as the
     Agent or any Lender shall reasonably  require,  including,  but not limited
     to,  records of (a) all payments  received  and all credits and  extensions
     granted with respect to the Accounts;  and (b) all other dealings affecting
     the Collateral.

          5.2 Financial Information. The Borrower shall promptly furnish to each
     Lender,  all such  financial  information  as the  Agent  shall  reasonably
     request.  Without limiting the foregoing,  the Borrower will furnish to the
     Agent, in sufficient  copies for  distribution by the Agent to each Lender,
     in such detail as the Agent or the Lenders shall request, the following:

          (a) As soon as available,  but in any event not later than ninety (90)
     days after the close of each  Fiscal  Year,  consolidated  audited  balance
     sheets,  and  income  statements,  cash  flow  statements  and  changes  in
     stockholders'  equity for the Parent and its  Subsidiaries  for such Fiscal
     Year, and the  accompanying  notes  thereto,  setting forth in each case in
     comparative  form figures for the previous  Fiscal Year,  all in reasonable
     detail,  fairly  presenting  the  financial  position  and the  results  of
     operations of the Parent and its  consolidated  Subsidiaries as at the date
     thereof and for the Fiscal Year then ended, and prepared in accordance with
     GAAP.  Such  statements  shall be examined  in  accordance  with  generally
     accepted  auditing  standards  by  and,  in the  case  of  such  statements
     performed on a  consolidated  basis,  accompanied  by: (i) a report thereon
     from Parent's  Registered Public Accounting Firm selected by the Parent and
     reasonably  satisfactory  to the Agent,  which report and opinion  shall be
     prepared in  accordance  with  generally  accepted  auditing  standards and
     applicable  Securities Laws and shall not be subject to any "going concern"
     or like  qualification or exception or any qualification or exception as to
     the scope of such audit,  and (ii) with  respect to  statements  for fiscal
     year 2005 and thereafter,  an attestation  report of such Registered Public
     Accounting Firm as to the Parent's  internal  controls  pursuant to Section
     404 of  Sarbanes-Oxley  expressing a conclusion to which the Agent does not
     reasonably  object,  and in all cases, such  consolidated  statements to be
     certified by a Responsible  Officer of the Borrower to the effect that such
     statements  are fairly stated in all material  respects when  considered in
     relation to the  consolidated  financial  statements  of the Parent and its
     Subsidiaries.  The Borrower and the Parent,  simultaneously  with retaining
     such  independent  public  accountants to conduct such annual audit,  shall
     send a  letter  to  such  accountants,  with a copy  to the  Agent  and the
     Lenders,  notifying such  accountants  that one of the primary purposes for
     retaining  such   accountants'   services  and  having  audited   financial
     statements  prepared by them is for use by the Agent and the  Lenders.  The
     Borrower and the Parent hereby authorize the Agent to communicate  directly
     with their Registered Public Accountants and, by this provision,  authorize
     those accountants to disclose to the Agent any and all financial statements
     and other  supporting  financial  documents and  schedules  relating to the
     Borrower and the Parent and to discuss directly with the Agent the finances
     and affairs of the Borrower and the Parent.

                                       22
<PAGE>

          (b) As soon as available,  but in any event not later than the earlier
     of: (i) the filing  thereof  with the SEC,  and (ii)  forty-five  (45) days
     after the last day of the first three fiscal  quarters of each Fiscal Year,
     consolidated   unaudited   balance  sheets  and  income   statements,   and
     consolidated cash flow statements and changes in stockholders'  equity, for
     Parent and its Subsidiaries for such fiscal quarter and for the period from
     the  beginning  of the then  current  fiscal  year to such  last  day.  The
     Borrower shall certify by a certificate signed by a Responsible  Officer of
     Borrower that all such  statements  have been  prepared in accordance  with
     GAAP and  present  fairly  the  financial  position  for the Parent and its
     Subsidiaries  as at the dates thereof and its results of operations for the
     periods then ended,  subject to normal year-end adjustments and the absence
     of applicable footnotes.

          (c) As soon as available,  but in any event not later than thirty (30)
     days after the end of each fiscal  month,  consolidated  unaudited  balance
     sheets of the Parent  and its  consolidated  Subsidiaries  as at the end of
     such fiscal month,  and consolidated  unaudited income  statements and cash
     flow statements for the Parent and its  consolidated  Subsidiaries for such
     fiscal  month and for the period from the  beginning  of the Fiscal Year to
     the end of such fiscal month, all in reasonable  detail,  fairly presenting
     the  financial  position  and results of  operations  of the Parent and its
     consolidated Subsidiaries as at the date thereof and for such periods, and,
     in each case, in comparable form,  figures for the corresponding  period in
     the prior  Fiscal  Year,  and  prepared  in  accordance  with GAAP  applied
     consistently with the audited Financial Statements required to be delivered
     pursuant to Section  5.2(a).  The Borrower  shall  certify by a certificate
     signed by its chief  financial  officer that all such  statements have been
     prepared  in  accordance  with  GAAP  and  present  fairly  the  Borrower's
     financial  position as at the dates  thereof and its results of  operations
     for the periods then ended,  subject to normal year-end adjustments and the
     absence of applicable footnotes.

          (d) With each of the audited Financial  Statements  delivered pursuant
     to Section  5.2(a),  a certificate  of the  independent  Registered  Public
     Accountants  that  examined  such  statement  to the effect  that they have
     reviewed and are familiar with this  Agreement and that, in examining  such
     Financial  Statements,  they did not become  aware of any fact or condition
     which then  constituted  a Default or Event of  Default  with  respect to a
     financial  covenant,  except for those,  if any,  described  in  reasonable
     detail in such certificate.

          (e) With each of the annual  audited  Financial  Statements  delivered
     pursuant to Section  5.2(a),  and within  thirty (30) days after the end of
     each fiscal month,  and within  forty-five  (45) days after the end of each
     fiscal  quarter,  a  certificate  of the  chief  financial  officer  of the
     Borrower setting forth in reasonable  detail the  calculations  required to
     establish that the Borrower was in compliance  with the covenants set forth
     in  Sections  7.22 and 7.23  during  the period  covered in such  Financial
     Statements and as at the end thereof. Within thirty (30) days after the end
     of each fiscal month, a certificate of the chief  financial  officer of the
     Borrower  stating that,  except as explained in  reasonable  detail in such
     certificate,  (A) all of the representations and warranties of the Borrower
     contained in this  Agreement  and the other Loan  Documents are correct and
     complete in all material  respects as at the date of such certificate as if
     made at such time, except for those that speak as of a particular date, (B)
     the  Borrower is, at the date of such  certificate,  in  compliance  in all
     material  respects with all of its  respective  covenants and agreements in
     this Agreement and the other Loan Documents, and (C) no Default or Event of
     Default then exists or existed  during the period  covered by the Financial
     Statements  for such fiscal month.  If such  certificate  discloses  that a
     representation  or warranty is not correct or complete,  or that a covenant
     has not been complied  with, or that a Default or Event of Default  existed
     or exists,  such  certificate  shall set forth what action the Borrower has
     taken or proposes to take with respect thereto.

          (f) No less than  fifteen  (15) days  prior to the  beginning  of each
     Fiscal Year, annual forecasts (to include forecasted  consolidated  balance
     sheets,  income statements and cash flow statements) for the Parent and its
     Subsidiaries as at the end of and for each quarter of such Fiscal Year.

                                       23
<PAGE>

          (g)  Promptly  after  filing with the PBGC and the IRS, a copy of each
     annual  report  or other  filing  filed  with  respect  to each Plan of the
     Borrower or the Parent.

          (h) Promptly upon the filing thereof,  copies of all reports,  if any,
     to or other documents filed by the Parent or any of its  Subsidiaries  with
     the SEC under the Exchange  Act, and all reports,  notices,  or  statements
     sent or  received by the Parent or any of its  Subsidiaries  to or from the
     holders  of  any  equity  interests  of  the  Parent  (other  than  routine
     non-material  correspondence  sent by  shareholders  of the  Parent  to the
     Parent) or any such  Subsidiary  or of any Debt of the Parent or any of its
     Subsidiaries  registered under the Securities Act of 1933 or to or from the
     trustee under any indenture under which the same is issued.

          (i) As soon as  available,  but in any event  not  later  than 15 days
     after  the  Borrower's  or the  Parent's  receipt  thereof,  a copy  of all
     management  reports and management letters prepared for the Borrower or the
     Parent by any Registered Public Accountants of the Borrower or the Parent.

          (j)  Promptly  after  their  preparation,  copies of any and all proxy
     statements,  financial  statements,  and  reports  which the  Parent  makes
     available to its shareholders.

          (k) If at any time Availability is less than $20,000,000,  at the sole
     discretion  of the  Agent,  either:  (a)  daily,  or (b)  weekly as soon as
     available, but in such case by the second Business Day of each week for the
     prior week ending on the last  Business  Day of such prior week;  in either
     case, in form and substance  reasonably  satisfactory  to the Agent:  (i) a
     schedule  of  the  Borrower's  Accounts  created,  credit  memoranda,   and
     collections for the applicable week,  together with a reconciliation of the
     Borrower's   Accounts   created,   credit  memos,   collections  and  other
     adjustments  to Accounts  since the last such weekly  reconciliation  and a
     Borrowing  Base  Certificate;  (ii) a summary of each credit  memorandum in
     excess of $250,000; and (iii) with the delivery of each of the foregoing, a
     certificate  executed by a  Responsible  Officer on behalf of the  Borrower
     certifying as to the accuracy and completeness of the foregoing.

          (l) As soon as  available,  but in any event within  fifteen (15) days
     after the end of each fiscal month or more  frequently  if requested by the
     Agent to determine  Availability  or otherwise,  each in form and substance
     reasonably   satisfactory  to  the  Agent:  (i)  a  reconciliation  of  the
     Borrower's  Accounts  created,  credit  memoranda,  collections  and  other
     adjustments to Accounts since the last such monthly reconciliation and (for
     such month) a Borrowing Base  Certificate;  (ii) an aging of the Borrower's
     Accounts   together   supporting   information   in   accordance   with   a
     reconciliation  to the  previous  fiscal  month end's  accounts  receivable
     balance of the  Borrower's  Accounts  and to its general  ledger;  (iii) an
     aging of the Borrower's  accounts payable;  (iv) a detailed  calculation of
     Eligible  Accounts  and  Eligible  Rolling  Stock;  (v)  upon  the  Agent's
     reasonable  request,  copies of invoices in connection  with the Borrower's
     Accounts,  customer  statements,   credit  memos,  remittance  advices  and
     reports,  deposit slips, and shipping and delivery  documents in connection
     with the Borrower's Accounts;  (vi) a summary of all Rolling Stock disposed
     of or  acquired  during  such  period,  including  the  amount of  proceeds
     therefor or the purchase  price thereof,  as  applicable;  (vii) such other
     reports as to the  Collateral  as the Agent shall  reasonably  request from
     time to time;  and (viii)  with the  delivery of each of the  foregoing,  a
     certificate  executed by a  Responsible  Officer on behalf of the  Borrower
     certifying as to the accuracy and  completeness  of the  foregoing.  If the
     Borrower's  records  or  reports  of  the  Collateral  are  prepared  by an
     accounting  service or other agent,  the Borrower  hereby  authorizes  such
     service or agent to deliver such records, reports, and related documents to
     the Agent for distribution to the Lenders.

          (m) Such  additional  information  as the Agent  and/or any Lender may
     from time to time reasonably  request  regarding the financial and business
     affairs of the Borrower or any Subsidiary.

                                       24
<PAGE>

          5.3 Notices to the Lenders.  The  Borrower  shall notify the Agent and
     the Lenders in writing of the following matters at the following times:

          (a)  Immediately  after  becoming  aware  of any  Default  or Event of
     Default;

          (b) Immediately after becoming aware of the assertion by the holder of
     any capital stock of the Borrower or of any Subsidiary or the holder of any
     Debt of the  Borrower  or any  Subsidiary  in a face  amount  in  excess of
     $100,000 that a default exists with respect thereto or that the Borrower or
     such Subsidiary is not in compliance with the terms thereof,  or the threat
     or commencement  by such holder of any  enforcement  action because of such
     asserted default or non-compliance;

          (c)  Immediately  after  becoming  aware of any event or  circumstance
     which could have a Material Adverse Effect;

          (d)  Immediately  after  becoming  aware of any pending or  threatened
     action,  suit, or proceeding,  by any Person,  or any pending or threatened
     investigation  by a  Governmental  Authority,  which  could  reasonably  be
     expected to have a Material Adverse Effect;

          (e)  Immediately  after  becoming  aware of any pending or  threatened
     strike, work stoppage,  unfair labor practice claim, or other labor dispute
     affecting the Borrower or any of its  Subsidiaries  in a manner which could
     reasonably be expected to have a Material Adverse Effect;

          (f)  Immediately  after  becoming  aware of any  violation of any law,
     statute, regulation, or ordinance of a Governmental Authority affecting the
     Borrower or any  Subsidiary  which could  reasonably  be expected to have a
     Material Adverse Effect;

          (g)  Immediately  after  receipt of any notice of any violation by the
     Borrower or any of its  Subsidiaries of any  Environmental  Law which could
     reasonably be expected to have a Material Adverse Effect;

          (h) Immediately  after receipt of any written notice that the Borrower
     or any of its Subsidiaries is or may be liable to any Person as a result of
     the Release or threatened  Release of any  Contaminant or that the Borrower
     or any Subsidiary is subject to investigation by any Governmental Authority
     evaluating  whether any remedial action is needed to respond to the Release
     or  threatened  Release  of any  Contaminant  which,  in  either  case,  is
     reasonably likely to give rise to liability in excess of $1,000,000;

          (i) Immediately  after receipt of any written notice of the imposition
     of any  Environmental  Lien  against any property of the Borrower or any of
     its Subsidiaries;

          (j)  Any  change  in  the  Borrower's  name,  state  of  organization,
     locations of Collateral,  or form of organization,  trade names under which
     the Borrower will create  Accounts,  or to which  instruments in payment of
     Accounts may be made payable,  in each case at least thirty (30) days prior
     thereto;

          (k) Within ten (10)  Business  Days  after the  Borrower  or any ERISA
     Affiliate  knows or has reason to know, that an ERISA Event or a prohibited
     transaction  (as defined in Sections 406 of ERISA and 4975 of the Code) has
     occurred,  and, when known,  any action taken or threatened by the IRS, the
     DOL or the PBGC with respect thereto;

                                       25
<PAGE>

          (l) Upon  request,  or,  in the  event  that such  filing  reflects  a
     significant  change with  respect to the matters  covered  thereby,  within
     three (3) Business Days after the filing  thereof with the PBGC, the DOL or
     the IRS, as  applicable,  copies of the  following:  (i) each annual report
     (form 5500 series),  including Schedule B thereto, filed with the PBGC, the
     DOL or the IRS  with  respect  to each  Plan,  (ii) a copy of each  funding
     waiver  request filed with the PBGC, the DOL or the IRS with respect to any
     Plan and all communications received by the Borrower or any ERISA Affiliate
     from the PBGC, the DOL or the IRS with respect to such request, and (iii) a
     copy of each other  filing or notice  filed  with the PBGC,  the DOL or the
     IRS,  with  respect  to each  Plan by  either  the  Borrower  or any  ERISA
     Affiliate;

          (m) Upon  request,  copies of each  actuarial  report  for any Plan or
     Multi-employer  Plan and annual  report for any  Multi-employer  Plan;  and
     within three (3) Business Days after receipt thereof by the Borrower or any
     ERISA  Affiliate,  copies of the  following:  (i) any notices of the PBGC's
     intention to terminate a Plan or to have a trustee  appointed to administer
     such Plan; (ii) any favorable or unfavorable  determination letter from the
     IRS regarding the qualification of a Plan under Section 401(a) of the Code;
     or (iii) any notice from a Multi-employer  Plan regarding the imposition of
     withdrawal liability;

          (n) Within three (3) Business Days after the occurrence  thereof:  (i)
     any  changes  in the  benefits  of any  existing  Plan which  increase  the
     Borrower's  annual  costs  with  respect  thereto by an amount in excess of
     $1,000,000,  or the  establishment  of any new Plan or the  commencement of
     contributions  to any Plan to which the Borrower or any ERISA Affiliate was
     not  previously  contributing;  or (ii) any failure by the  Borrower or any
     ERISA  Affiliate  to make a  required  installment  or any  other  required
     payment  under  Section  412 of the Code on or before the due date for such
     installment or payment; or

          (o) Within  three (3)  Business  Days after the  Borrower or any ERISA
     Affiliate knows or has reason to know that any of the following  events has
     or will occur:  (i) a  Multi-employer  Plan has been or will be terminated;
     (ii) the administrator or plan sponsor of a Multi-employer  Plan intends to
     terminate a  Multi-employer  Plan; or (iii) the PBGC has instituted or will
     institute   proceedings   under  Section  4042  of  ERISA  to  terminate  a
     Multi-employer Plan.

          Each notice given under this Section shall describe the subject matter
     thereof  in  reasonable  detail,  and shall set forth the  action  that the
     Borrower, its Subsidiary, or any ERISA Affiliate, as applicable,  has taken
     or proposes to take with respect thereto.

                                   ARTICLE 6
                     GENERAL WARRANTIES AND REPRESENTATIONS

     The  Borrower  warrants  and  represents  to the Agent and the Lenders that
except as  hereafter  disclosed  to and  accepted by the Agent and the  Required
Lenders in writing:

          6.1 Authorization,  Validity, and Enforceability of this Agreement and
     the Loan  Documents.  The Borrower has the power and  authority to execute,
     deliver and perform this Agreement and the other Loan Documents to which it
     is a party, to incur the Obligations,  and to grant to the Agent Liens upon
     and  security  interests  in the  Collateral.  The  Borrower  has taken all
     necessary  action  (including  obtaining  approval of its  stockholders  if
     necessary) to authorize its execution,  delivery,  and  performance of this
     Agreement  and the  other  Loan  Documents  to which  it is a  party.  This
     Agreement  and the other  Loan  Documents  to which it is a party have been


                                       26
<PAGE>

     duly  executed and  delivered by the Borrower,  and  constitute  the legal,
     valid and binding  obligations of the Borrower,  enforceable  against it in
     accordance with their respective terms. The Borrower's execution, delivery,
     and  performance of this Agreement and the other Loan Documents to which it
     is a party do not and will not conflict  with, or constitute a violation or
     breach of, or result in the imposition of any Lien upon the property of the
     Borrower  or any of its  Subsidiaries,  by  reason  of the terms of (a) any
     contract, mortgage, lease, agreement, indenture, or instrument to which the
     Borrower is a party or which is binding upon it, (b) any Requirement of Law
     applicable  to  the  Borrower  or  any of  its  Subsidiaries,  or  (c)  the
     certificate  or  articles  of  incorporation  or  by-laws  or  the  limited
     liability company or limited  partnership  agreement of the Borrower or any
     of its Subsidiaries.

          6.2 Validity and Priority of Security Interest. The provisions of this
     Agreement and the other Loan Documents  create legal and valid Liens on all
     the Collateral in favor of the Agent,  for the ratable benefit of the Agent
     and the Lenders,  and such Liens constitute  perfected and continuing Liens
     on all  the  Collateral,  having  priority  over  all  other  Liens  on the
     Collateral,  except for those Liens  identified in clauses (c), (d) and (e)
     of the  definition of Permitted  Liens  securing all the  Obligations,  and
     enforceable against the Borrower and all third parties.

          6.3 Organization and Qualification. The Borrower (a) is duly organized
     or incorporated and validly existing in good standing under the laws of the
     state of its organization or incorporation, (b) is qualified to do business
     and is in good  standing in the  jurisdictions  set forth on  Schedule  6.3
     which are the only  jurisdictions  in which  qualification  is necessary in
     order for it to own or lease its property and conduct its business, and (c)
     has all  requisite  power and  authority to conduct its business and to own
     its property.

          6.4 Corporate Name; Prior  Transactions.  The Borrower has not, during
     the past  five (5)  years,  been  known by or used any other  corporate  or
     fictitious  name,  or been a  party  to any  merger  or  consolidation,  or
     acquired all or substantially  all of the assets of any Person, or acquired
     any of its property  outside of the ordinary course of business,  except as
     described on Schedule 6.4 attached hereto.

          6.5  Subsidiaries  and  Affiliates.  Schedule  6.5  is a  correct  and
     complete list of the name and relationship to the Parent of each and all of
     the Parent's  Subsidiaries.  Each  Subsidiary is (a) duly  incorporated  or
     organized and validly existing in good standing under the laws of its state
     of  incorporation  or  organization  set  forth on  Schedule  6.5,  and (b)
     qualified to do business and in good standing in each jurisdiction in which
     the  failure to so  qualify  or be in good  standing  could  reasonably  be
     expected  to  have a  material  adverse  effect  on any  such  Subsidiary's
     business,  operations,  prospects,  property,  or condition  (financial  or
     otherwise)  and (c) has all  requisite  power and  authority to conduct its
     business and own its property.

          6.6 Financial Statements and Projections.

          (a) The  Borrower  has  delivered  to the  Agent and the  Lenders  the
     audited balance sheet and related statements of income,  retained earnings,
     cash  flows,  and  changes  in  stockholders  equity for the Parent and its
     consolidated  Subsidiaries as of December 31, 2003, and for the Fiscal Year
     then ended,  accompanied by the report  thereon of the Parent's  Registered
     Public Accountants,  KPMG LLP. The Borrower has also delivered to the Agent
     and the Lenders the  unaudited  balance  sheet and  related  statements  of
     income and cash flows for the Parent and its  consolidated  Subsidiaries as
     of October 2, 2004.  All such  financial  statements  have been prepared in
     accordance  with GAAP and  present  accurately  and fairly in all  material
     respects  the  financial  position  of the  Borrower  and its  consolidated
     Subsidiaries  as at the dates thereof and their  results of operations  for
     the periods then ended.

          (b) The Latest  Projections  when submitted to the Lenders as required
     herein  represent  the  Borrower's  best  estimate of the future  financial
     performance  of the  Borrower  and its  consolidated  Subsidiaries  for the
                                       27
<PAGE>

     periods set forth therein. The Latest Projections have been prepared on the
     basis of the assumptions set forth therein, which the Borrower believes are
     fair and reasonable in light of current and reasonably foreseeable business
     conditions at the time submitted to the Lenders.

          6.7 Capitalization.  The Borrower's  authorized capital stock consists
     of 20,000,000  shares of common stock, par value $0.001 per share, of which
     10,945,794  shares  are  validly  issued  and  outstanding,  fully paid and
     non-assessable and are owned beneficially and of record by Parent.

          6.8 Solvency. The Borrower is Solvent prior to and after giving effect
     to the  Borrowings  to be made on the Closing  Date and the issuance of the
     Letters of Credit to be issued on the Closing Date.

          6.9 Debt.  After giving effect to the making of the Revolving Loans to
     be made on the Closing Date and the  application  of the proceeds  thereof,
     including the repayment of the Existing SunTrust Debt, the Borrower and its
     Subsidiaries  have no  Debt,  except  (a)  the  Obligations,  and (b)  Debt
     described on Schedule 6.9.

          6.10  Distributions.  Since December 31, 2003 no Distribution has been
     declared,  paid,  or made upon or in respect of any capital  stock or other
     securities of the Borrower or any of its Subsidiaries.

          6.11 Real Estate; Leases.  Schedule 6.11 sets forth, as of the Closing
     Date, a correct and complete  list of all Real Estate owned by the Borrower
     and all  Real  Estate  owned by any of its  Subsidiaries,  all  leases  and
     subleases  of real or personal  property  held by the Borrower as lessee or
     sublessee  (other than leases of computer  equipment  and  copiers) and all
     leases and  subleases of real or personal  property held by the Borrower as
     lessor,  or  sublessor.  Each of such  leases  and  subleases  is valid and
     enforceable  in accordance  with its terms and is in full force and effect,
     and no  default  by any party to any such  lease or  sublease  exists.  The
     Borrower  has good and  marketable  title in fee simple to the Real  Estate
     identified on Schedule 6.11 as owned by the  Borrower,  or valid  leasehold
     interests in all Real Estate designated therein as "leased" by the Borrower
     and the Borrower has good,  indefeasible,  and merchantable title to all of
     its other property  reflected on the October 2, 2004  Financial  Statements
     delivered  to the  Agent and the  Lenders,  except  as  disposed  of in the
     ordinary  course  of  business  since the date  thereof,  free of all Liens
     except Permitted Liens.

          6.12  Proprietary  Rights.  Schedule  6.12 sets  forth a  correct  and
     complete list of all of the Borrower's Proprietary Rights, which consist of
     patents, trademarks,  service marks, or copyrights. None of the Proprietary
     Rights is subject to any licensing  agreement or similar arrangement except
     as set forth on Schedule  6.12.  To the best of the  Borrower's  knowledge,
     none of the  Proprietary  Rights  infringes on or conflicts  with any other
     Person's property, and no other Person's property infringes on or conflicts
     with the Proprietary  Rights.  The Proprietary Rights described on Schedule
     6.12  constitute  all of the property of such type necessary to the current
     conduct of the Borrower's business.

          6.13 Trade  Names.  All trade names or styles under which the Borrower
     or any of its Subsidiaries will create Accounts, or to which instruments in
     payment of Accounts may be made payable, are listed on Schedule 6.13.

          6.14  Litigation.  Except as set forth on Schedule  6.14,  there is no
     pending,  or to the best of the Borrower's  knowledge  threatened,  action,
     suit,  proceeding,  or  counterclaim  by any Person,  or to the best of the
     Borrower's knowledge,  investigation by any Governmental  Authority, or any
     basis for any of the foregoing,  which could reasonably be expected to have
     a Material Adverse Effect.


                                       28
<PAGE>

          6.15 Labor  Disputes.  Except as set forth on Schedule 6.15, as of the
     Closing Date (a) there is no collective bargaining agreement or other labor
     contract covering employees of the Borrower or any of its Subsidiaries, (b)
     no  such  collective  bargaining  agreement  or  other  labor  contract  is
     scheduled to expire during the term of this  Agreement,  (c) to the best of
     Borrower's  knowledge,  no union or other labor  organization is seeking to
     organize, or to be recognized as, a collective bargaining unit of employees
     of the Borrower or any of its Subsidiaries or for any similar purpose,  and
     (d)  there  is no  pending  or (to the  best of the  Borrower's  knowledge)
     threatened, strike, work stoppage, material unfair labor practice claim, or
     other  material  labor  dispute  against or  affecting  the Borrower or its
     Subsidiaries or their employees.

          6.16  Environmental  Laws.  Except as otherwise  disclosed on Schedule
     6.16 and  except as could not  reasonably  be  expected  to have a Material
     Adverse Effect:

          (a) The Borrower and its  Subsidiaries  have  complied in all material
     respects  with all  Environmental  Laws and  neither the  Borrower  nor any
     Subsidiary  nor any of its  presently  owned  real  property  or  presently
     conducted  operations,  nor its  previously  owned real  property  or prior
     operations, is subject to any enforcement order from or liability agreement
     with any Governmental Authority or private Person respecting (i) compliance
     with any Environmental  Law or (ii) any potential  liabilities and costs or
     remedial  action  arising  from the  Release  or  threatened  Release  of a
     Contaminant.

          (b) The  Borrower  and its  Subsidiaries  have  obtained  all  permits
     necessary for their current  operations under  Environmental  Laws, and all
     such permits are in good standing and the Borrower and its Subsidiaries are
     in compliance with all material terms and conditions of such permits.

          (c) Neither the Borrower nor any of its Subsidiaries, nor, to the best
     of the Borrower's  knowledge,  any of its predecessors in interest,  has in
     violation of  applicable  law stored,  treated or disposed of any hazardous
     waste.

          (d) Neither the Borrower nor any of its  Subsidiaries has received any
     summons,  complaint,  order or similar written notice indicating that it is
     not currently in compliance  with,  or that any  Governmental  Authority is
     investigating its compliance with, any Environmental  Laws or that it is or
     may be liable to any other  Person as a result of a Release  or  threatened
     Release of a Contaminant.

          (e) To the best of the  Borrower's  knowledge,  none of the present or
     past operations of the Borrower and its  Subsidiaries is the subject of any
     investigation by any Governmental Authority evaluating whether any remedial
     action  is needed  to  respond  to a Release  or  threatened  Release  of a
     Contaminant.

          (f) There is not now, nor to the best of the Borrower's  knowledge has
     there ever been on or in the Real Estate:

          (1) any underground storage tanks or surface impoundments,

          (2) any asbestos-containing material, or

          (3) any  polychlorinated  biphenyls  (PCBs)  used in  hydraulic  oils,
     electrical transformers or other equipment.

          (g) Neither the  Borrower  nor any of its  Subsidiaries  has filed any
     notice under any  requirement  of  Environmental  Law  reporting a spill or
     accidental and unpermitted  Release or discharge of a Contaminant  into the
     environment.

                                       29
<PAGE>

          (h) Neither the Borrower nor any of its  Subsidiaries has entered into
     any  negotiations or settlement  agreements with any Person  (including the
     prior owner of its property)  imposing material  obligations or liabilities
     on the  Borrower or any of its  Subsidiaries  with  respect to any remedial
     action in  response  to the  Release of a  Contaminant  or  environmentally
     related claim.

          (i)  None of the  products  manufactured,  distributed  or sold by the
     Borrower or any of its Subsidiaries contain asbestos containing material.

          (j) No Environmental Lien has attached to the Real Estate.

          6.17  No  Violation  of  Law.  Neither  the  Borrower  nor  any of its
     Subsidiaries is in violation of any law,  statute,  regulation,  ordinance,
     judgment,   order,  or  decree  applicable  to  it  which  violation  could
     reasonably be expected to have a Material Adverse Effect.

          6.18 No Default.  Neither the Borrower nor any of its  Subsidiaries is
     in default with respect to any note, indenture,  loan agreement,  mortgage,
     lease, deed, or other agreement to which the Borrower or such Subsidiary is
     a party or by which it is bound, which default could reasonably be expected
     to have a Material Adverse Effect.

          6.19 ERISA  Compliance.  Except as specifically  disclosed in Schedule
     6.19:

          (a) Each  Plan is in  compliance  in all  material  respects  with the
     applicable  provisions  of ERISA,  the Code and other federal or state law.
     Each Plan which is intended to qualify under Section 401(a) of the Code has
     received  a  favorable  determination  letter  from the IRS and to the best
     knowledge of the Borrower,  nothing has occurred which would cause the loss
     of such  qualification.  The Borrower and each ERISA Affiliate has made all
     required  contributions to any Plan subject to Section 412 of the Code, and
     no  application  for a funding  waiver or an extension of any  amortization
     period  pursuant to Section  412 of the Code has been made with  respect to
     any Plan.

          (b)  There  are no  pending  or, to the best  knowledge  of  Borrower,
     threatened  claims,  actions  or  lawsuits,  or action by any  Governmental
     Authority,  with respect to any Plan which has resulted or could reasonably
     be  expected  to result in a  Material  Adverse  Effect.  There has been no
     prohibited  transaction or violation of the fiduciary  responsibility rules
     with respect to any Plan which has resulted or could reasonably be expected
     to result in a Material Adverse Effect.

          (c) (i) No ERISA  Event has  occurred  or is  reasonably  expected  to
     occur;  (ii) no Pension  Plan has any  Unfunded  Pension  Liability;  (iii)
     neither the Borrower nor any ERISA  Affiliate has  incurred,  or reasonably
     expects to incur, any liability under Title IV of ERISA with respect to any
     Pension Plan (other than premiums due and not delinquent under Section 4007
     of ERISA);  (iv) neither the Borrower nor any ERISA Affiliate has incurred,
     or reasonably  expects to incur,  any liability  (and no event has occurred
     which, with the giving of notice under Section 4219 of ERISA,  would result
     in such  liability)  under  Section 4201 or 4243 of ERISA with respect to a
     Multi-employer  Plan; and (v) neither the Borrower nor any ERISA  Affiliate
     has  engaged in a  transaction  that  could be  subject to Section  4069 or
     4212(c) of ERISA.

          6.20 Taxes. The Borrower and its  Subsidiaries  have filed all federal
     and other tax returns and reports  required to be filed,  and have paid all
     federal and other taxes,  assessments,  fees and other governmental charges
     levied or imposed upon them or their properties, income or assets otherwise
     due and payable unless such unpaid taxes and assessments would constitute a
     Permitted Lien.

                                       30
<PAGE>

          6.21 Regulated Entities.  None of the Borrower, any Person controlling
     the Borrower,  or any  Subsidiary,  is an "Investment  Company"  within the
     meaning of the Investment  Company Act of 1940. The Borrower is not subject
     to regulation  under the Public  Utility  Holding  Company Act of 1935, the
     Federal Power Act, the Interstate  Commerce Act, any state public utilities
     code or law, or any other federal or state  statute or regulation  limiting
     its ability to incur indebtedness.

          6.22 Use of Proceeds;  Margin  Regulations.  The proceeds of the Loans
     are to be used solely (a) to refinance  existing Debt, (b) to pay the costs
     and expenses related to this Agreement,  (c) for working capital  purposes,
     and (d) for general corporate purposes.  None of such proceeds will be used
     for the purpose of purchasing or carrying any "margin  stock" as defined in
     Regulations  T, U, or X of the Board of  Governors  of the Federal  Reserve
     System or for any other purpose which might  constitute this  transaction a
     "purpose  credit"  within the meaning of such  Regulations.  No part of the
     proceeds of the Loan will be used for any  purpose  which  violates,  or is
     inconsistent with, the provisions of Regulation X. Neither the Borrower nor
     any  Subsidiary is engaged in the business of purchasing or selling  Margin
     Stock or extending  credit for the purpose of purchasing or carrying Margin
     Stock.  Following the  application  of the proceeds of each Loan or drawing
     under each  Letter of Credit,  not more than 25% of the value of the assets
     of the Borrower or subject to any restriction contained in any agreement or
     instrument  between the  Borrower  and any Lender or any  Affiliate  of any
     Lender relating to Debt will be Margin Stock.

          6.23 Copyrights,  Patents,  Trademarks and Licenses, etc. The Borrower
     owns or is licensed or  otherwise  has the right to use all of the patents,
     trademarks, service marks, trade names, copyrights, contractual franchises,
     licenses,   rights  of  way,  authorizations  and  other  rights  that  are
     reasonably necessary for the operation of its businesses,  without conflict
     with the rights of any other Person. To the best knowledge of the Borrower,
     no slogan or other advertising device, product, process, method, substance,
     part or other material now employed, or now contemplated to be employed, by
     the Borrower or any Subsidiary  infringes upon any rights held by any other
     Person. No claim or litigation regarding any of the foregoing is pending or
     to the best of Borrower's knowledge,  threatened, and no patent, invention,
     device,  application,  principle or any  statute,  law,  rule,  regulation,
     standard or code is pending or, to the knowledge of the Borrower, proposed,
     which,  in either  case,  could  reasonably  be expected to have a Material
     Adverse Effect.

          6.24 No  Material  Adverse  Change.  No  Material  Adverse  Effect has
     occurred since the latest date of the Financial Statements delivered to the
     Lenders.

          6.25 Full Disclosure.  None of the  representations or warranties made
     by the Borrower or any Subsidiary in the Loan Documents as of the date such
     representations  and  warranties  are made or deemed made,  and none of the
     statements  contained in any  exhibit,  report,  statement  or  certificate
     furnished by or on behalf of the Borrower or any  Subsidiary  in connection
     with the Loan Documents  (including  the offering and disclosure  materials
     delivered  by or on  behalf of the  Borrower  to the  Lenders  prior to the
     Closing  Date),  contains any untrue  statement of a material fact or omits
     any material  fact  required to be stated  therein or necessary to make the
     statements made therein, in light of the circumstances under which they are
     made, not misleading as of the time when made or delivered.

          6.26  Material  Agreements.  Schedule 6.26 hereto sets forth as of the
     Closing Date all material agreements and contracts to which the Borrower or
     any of its Subsidiaries is a party or is bound as of the date hereof.

          6.27 Bank  Accounts.  Schedule  6.27 contains as of the Closing Date a
     complete and accurate list of all bank accounts  maintained by the Borrower
     with any bank or other financial institution.

                                       31
<PAGE>

          6.28  Governmental  Authorization.  No approval,  consent,  exemption,
     authorization,  or other  action  by, or notice  to,  or filing  with,  any
     Governmental  Authority  or  other  Person  is  necessary  or  required  in
     connection  with the execution,  delivery or performance by, or enforcement
     against,  the Borrower or any of its  Subsidiaries of this Agreement or any
     other Loan  Document,  except for  filings  necessary  to perfect  security
     interests and the payment of fees related  thereto.  Borrower is authorized
     to perform all services under its carriage agreements,  has all permits and
     licenses issued by the U.S. Department of Transportation, or its successor,
     the  Surface  Transportation  Board,  or by all  applicable  state or local
     regulatory  agencies  necessary  to  conduct  its  business.   Borrower  is
     authorized to transport, as a motor contract carrier,  freight of all kinds
     in interstate and intrastate  commerce from, to, and between all points and
     places in the United States.

                                   ARTICLE 7
                       AFFIRMATIVE AND NEGATIVE COVENANTS

     The Borrower  covenants to the Agent and each Lender that so long as any of
the Obligations remain outstanding or this Agreement is in effect:

          7.1 Taxes and Other  Obligations.  The Borrower shall, and shall cause
     each of its  Subsidiaries  to, (a) file when due all tax  returns and other
     reports which it is required to file;  (b) pay, or provide for the payment,
     when due, of all taxes, fees,  assessments and other  governmental  charges
     against it or upon its property,  income and franchises,  make all required
     withholding and other tax deposits, and establish adequate reserves for the
     payment of all such items,  and provide to the Agent and the Lenders,  upon
     request, satisfactory evidence of its timely compliance with the foregoing;
     and (c) pay when due all Debt  owed by it and all  claims  of  materialmen,
     mechanics,  carriers,  warehousemen,  landlords,  processors and other like
     Persons, and all other indebtedness owed by it and perform and discharge in
     a timely manner all other obligations undertaken by it; provided,  however,
     so long as the  Borrower  has  notified  the Agent in writing,  neither the
     Borrower nor any of its Subsidiaries need pay any tax, fee, assessment,  or
     governmental  charge  (i) it is  contesting  in good  faith by  appropriate
     proceedings  diligently  pursued,  (ii) as to  which  the  Borrower  or its
     Subsidiary, as the case may be, has established proper reserves as required
     under  GAAP,  and  (iii) the  nonpayment  of which  does not  result in the
     imposition of a Lien (other than a Permitted Lien).

          7.2 Legal Existence and Good Standing.  The Borrower shall,  and shall
     cause each of its  Subsidiaries  to,  maintain its legal  existence and its
     qualification  and good standing in all  jurisdictions in which the failure
     to  maintain  such  existence  and  qualification  or good  standing  could
     reasonably be expected to have a Material Adverse Effect.

          7.3 Compliance with Law and Agreements;  Maintenance of Licenses.  The
     Borrower shall comply,  and shall cause each  Subsidiary to comply,  in all
     material  respects  with  all  Requirements  of  Law  of  any  Governmental
     Authority  having  jurisdiction  over  it or its  business  (including  the
     Federal Fair Labor Standards Act and all  Environmental  Laws),  except for
     such  non-compliance  as would  not have a  Material  Adverse  Effect.  The
     Borrower  shall,  and shall cause each of its  Subsidiaries  to, obtain and
     maintain all licenses, permits, franchises, and governmental authorizations
     necessary  to own its  property and to conduct its business as conducted on
     the  Closing  Date.  The  Borrower  shall  not  modify,  amend or alter its
     certificate or articles of incorporation,  or its limited liability company
     operating agreement or limited partnership agreement, as applicable,  other
     than in a manner which does not adversely  affect the rights of the Lenders
     or the Agent.

                                       32
<PAGE>

          7.4 Maintenance of Property; Inspection of Property.

          (a) The Borrower shall,  and shall cause each of its  Subsidiaries to,
     maintain  all of its  property  necessary  and useful in the conduct of its
     business,  in good operating  condition and repair,  ordinary wear and tear
     excepted.

          (b)  The  Borrower  shall  permit   representatives   and  independent
     contractors of the Agent (at the expense of the Borrower not to exceed four
     (4)  times  per year  unless  an  Event  of  Default  has  occurred  and is
     continuing)  to visit and  inspect  any of its  properties,  to examine its
     corporate,  financial and  operating  records,  and make copies  thereof or
     abstracts therefrom and to discuss its affairs,  finances and accounts with
     its  directors,  officers  and  independent  public  accountants,  at  such
     reasonable  times  during  normal  business  hours  and as  soon  as may be
     reasonably  desired,  upon  reasonable  advance  notice  to  the  Borrower;
     provided, however, when an Event of Default exists, the Agent or any Lender
     may do any of the  foregoing  at the  expense of the  Borrower  at any time
     during normal business hours and without advance notice.

          7.5 Insurance.

          (a)  The  Borrower  shall  maintain,  and  shall  cause  each  of  its
     Subsidiaries to maintain,  with  financially  sound and reputable  insurers
     having a rating  of at least A or better by Best  Rating  Guide,  insurance
     against loss or damage by fire with  extended  coverage;  theft,  burglary,
     pilferage and loss in transit;  public  liability and third party  property
     damage;  larceny,   embezzlement  or  other  criminal  liability;  business
     interruption;  public liability and third party property  damage;  and such
     other hazards or of such other types as is customary for Persons engaged in
     the same or similar business, as the Agent, in its discretion, or acting at
     the direction of the Required Lenders, shall specify, in amounts, and under
     policies acceptable to the Agent and the Required Lenders

          (b) The Borrower shall cause the Agent, for the ratable benefit of the
     Agent and the Lenders,  to be named as secured  party or mortgagee and sole
     loss payee or additional insured, in a manner acceptable to the Agent. Each
     policy of insurance  shall  contain a clause or  endorsement  requiring the
     insurer to give not less than thirty (30) days' prior written notice to the
     Agent in the event of cancellation of the policy for any reason  whatsoever
     and a clause or  endorsement  stating  that the interest of the Agent shall
     not be impaired or invalidated by any act or neglect of the Borrower or any
     of its  Subsidiaries  or the owner of any Real  Estate  for  purposes  more
     hazardous  than  are  permitted  by such  policy.  All  premiums  for  such
     insurance  shall be paid by the  Borrower  when due,  and  certificates  of
     insurance and, if requested by the Agent or any Lender,  photocopies of the
     policies,  shall be  delivered  to the  Agent,  in each case in  sufficient
     quantity  for  distribution  by the  Agent to each of the  Lenders.  If the
     Borrower  fails to procure such  insurance or to pay the premiums  therefor
     when due,  the Agent may,  and at the  direction  of the  Required  Lenders
     shall, do so from the proceeds of Revolving Loans.

          7.6 Insurance and  Condemnation  Proceeds.The  Borrower shall promptly
     notify the Agent and the Lenders of any loss, damage, or destruction to the
     Collateral,  exceeding $250,000,  whether or not covered by insurance.  The
     Agent is hereby  authorized  to  collect  all  insurance  and  condemnation
     proceeds  in  respect  of  Collateral  directly  and to apply  them,  after
     deducting from such proceeds the reasonable  expenses,  if any, incurred by
     the Agent in the collection or handling thereof,  ratably, to the reduction
     of the Obligations in the order provided for in Section 3. 3.

          7.7 Environmental Laws.

          (a) The Borrower shall,  and shall cause each of its  Subsidiaries to,


                                       33
<PAGE>

     conduct its business in compliance with all  Environmental  Laws applicable
     to it, including those relating to the generation,  handling, use, storage,
     and disposal of any Contaminant, except where such non-compliance would not
     have a Material Adverse Effect. The Borrower shall, and shall cause each of
     its Subsidiaries  to, take prompt and appropriate  action to respond to any
     non-compliance  with  Environmental  Laws and shall regularly report to the
     Agent on such response.

          (b) Without  limiting the  generality of the  foregoing,  the Borrower
     shall submit to the Agent and the Lenders annually, commencing on the first
     Anniversary Date, and on each Anniversary Date thereafter, an update of the
     status of each material  environmental  compliance or liability  issue. The
     Agent or any Lender may request copies of technical reports prepared by the
     Borrower  and  its  communications  with  any  Governmental   Authority  to
     determine  whether the Borrower or any of its  Subsidiaries  is  proceeding
     reasonably  to  correct,   cure  or  contest  in  good  faith  any  alleged
     non-compliance  or  environmental  liability.  The Borrower  shall,  at the
     Agent's or the Required Lenders' request and at the Borrower's expense, (i)
     retain an  independent  environmental  engineer  acceptable to the Agent to
     evaluate  the site,  including  tests if  appropriate,  where the  material
     non-compliance or alleged material  non-compliance  with Environmental Laws
     has occurred and prepare and deliver to the Agent,  in sufficient  quantity
     for  distribution  by the Agent to the Lenders,  a report setting forth the
     results  of  such  evaluation,  a  proposed  plan  for  responding  to  any
     environmental  problems  described  therein,  and an  estimate of the costs
     thereof,  and (ii)  provide  to the  Agent and the  Lenders a  supplemental
     report of such engineer whenever the scope of the  environmental  problems,
     or the response  thereto or the estimated costs thereof,  shall increase in
     any material respect.

          7.8 Compliance with ERISA. The Borrower shall, and shall cause each of
     its ERISA  Affiliates  to:  (a)  maintain  each Plan in  compliance  in all
     material  respects with the  applicable  provisions of ERISA,  the Code and
     other  federal or state law; (b) cause each Plan which is  qualified  under
     Section  401(a) of the Code to maintain  such  qualification;  (c) make all
     required  contributions to any Plan subject to Section 412 of the Code; (d)
     not  engage in a  prohibited  transaction  or  violation  of the  fiduciary
     responsibility  rules  with  respect  to any Plan;  and (e) not engage in a
     transaction that could be subject to Section 4069 or 4212(c) of ERISA.

          7.9 Mergers,  Consolidations or Sales.  Except as permitted by Section
     7.28, neither the Borrower nor any of its Subsidiaries shall enter into any
     transaction of merger, reorganization, or consolidation, or transfer, sell,
     assign,  lease, or otherwise dispose of all or any part of its property, or
     wind up, liquidate or dissolve, or agree to do any of the foregoing, except
     for: (i) sales or other dispositions of real property described on Schedule
     7.9 attached hereto, or otherwise  consented to by Agent; and (ii) sales or
     other  dispositions  of Rolling  Stock and other  Equipment in the ordinary
     course of business in accordance  with  standard  business  practices.  The
     Borrower  shall apply the proceeds of all sales of real  property,  Rolling
     Stock, and other Equipment to the Loans in accordance with Sections 3.3(b).

          7.10 Distributions;  Capital Change;  Restricted Investments.  Neither
     the Borrower nor any of its  Subsidiaries  shall (i) directly or indirectly
     declare or make, or incur any liability to make, any  Distribution,  except
     Distributions to the Borrower by its Subsidiaries,  (ii) make any change in
     its capital  structure which could have a Material  Adverse Effect or (iii)
     make any Restricted Investment.

          7.11  Transactions  Affecting  Collateral or Obligations.  Neither the
     Borrower nor any of its Subsidiaries shall enter into any transaction which
     would be reasonably expected to have a Material Adverse Effect.

          7.12  Guaranties.  Neither the  Borrower  nor any of its  Subsidiaries
     shall make,  issue, or become liable on any Guaranty,  except Guaranties of
     the Obligations in favor of the Agent.

                                       34
<PAGE>

          7.13 Debt.  Neither the  Borrower  nor any of its  Subsidiaries  shall
     incur or maintain  any Debt,  other  than:  (a) the  Obligations;  (b) Debt
     described  on Schedule  6.9; (c) Capital  Leases of Equipment  and purchase
     money secured Debt incurred to purchase  Equipment and Debt secured by real
     property  described in Schedule  7.30(c),  provided that (i) Liens securing
     the same attach only to the  Equipment  acquired by the  incurrence of such
     Debt, or in the case of the real property  Liens,  such real property,  and
     (ii)  the  aggregate  amount  of  such  Debt  (including   Capital  Leases)
     outstanding  does not exceed  $50,000,000  at any time;  (d) other Debt not
     exceeding $100,000 in aggregate  outstanding principal amount; and (e) Debt
     evidencing  a  refunding,  renewal or  extension  of the Debt  described on
     Schedule  6.9;  provided  that  (i) the  principal  amount  thereof  is not
     increased,  (ii) the Liens,  if any,  securing  such  refunded,  renewed or
     extended Debt do not attach to any assets in addition to those  assets,  if
     any, securing the Debt to be refunded, renewed or extended, (iii) no Person
     that is not an obligor or  guarantor  of such Debt as of the  Closing  Date
     shall  become an obligor or guarantor  thereof,  and (iv) the terms of such
     refunding,  renewal or extension are no less favorable to the Borrower, the
     Agent or the Lenders than the original Debt.

          7.14  Prepayment.  Neither the  Borrower  nor any of its  Subsidiaries
     shall  voluntarily  prepay any Debt,  except the Existing SunTrust Debt and
     the Obligations in accordance  with the terms of this Agreement,  except as
     otherwise approved by the Agent in writing.

          7.15 Transactions with Affiliates.  Except as set forth below, neither
     the Borrower nor any of its Subsidiaries shall, sell, transfer, distribute,
     or pay any money or  property,  including,  but not limited to, any fees or
     expenses of any nature (including, but not limited to, any fees or expenses
     for management  services),  to any  Affiliate,  or lend or advance money or
     property  to any  Affiliate,  or  invest  in (by  capital  contribution  or
     otherwise)  or purchase or  repurchase  any stock or  indebtedness,  or any
     property,  of any  Affiliate,  or  become  liable  on any  Guaranty  of the
     indebtedness,   dividends,   or  other   obligations   of  any   Affiliate.
     Notwithstanding  the  foregoing,  and except as  permitted  by Section 7.19
     hereof,  while no Event of Default  has  occurred  and is  continuing,  the
     Borrower and its Subsidiaries may engage in transactions with Affiliates in
     the ordinary course of business consistent with past practices,  in amounts
     and upon terms fully  disclosed to the Agent and the  Lenders,  and no less
     favorable to the Borrower and its Subsidiaries  than would be obtained in a
     comparable  arm's-length  transaction  with  a  third  party  who is not an
     Affiliate.

          7.16  Investment  Banking and Finder's Fees.  Neither the Borrower nor
     any of its  Subsidiaries  shall pay or agree to pay, or reimburse any other
     party with  respect to, any  investment  banking or similar or related fee,
     underwriter's  fee,  finder's  fee,  or  broker's  fee  to  any  Person  in
     connection  with this  Agreement,  except for fees payable to Agent and its
     Affiliates.  The  Borrower  shall  defend and  indemnify  the Agent and the
     Lenders  against and hold them  harmless from all claims of any Person that
     the  Borrower  is  obligated  to pay for any such  fees,  and all costs and
     expenses  (including  attorneys'  fees)  incurred  by the Agent  and/or any
     Lender in connection therewith.

          7.17 Business  Conducted.  The Borrower shall not and shall not permit
     any of its Subsidiaries  to, engage directly or indirectly,  in any line of
     business that is  substantially  different than the businesses in which the
     Borrower is engaged on the Closing Date.

          7.18 Liens.  Neither the  Borrower nor any of its  Subsidiaries  shall
     create,  incur,  assume,  or permit to exist any Lien on any  property  now
     owned or hereafter  acquired by any of them,  except  Permitted  Liens, and
     Liens,  if any, in effect as of the Closing Date  described in Schedule 6.9
     securing Debt described in Schedule 6.9 and Liens  securing  Capital Leases
     and purchase money Debt and Debt secured by certain real property permitted
     in Section 7.13.

                                       35
<PAGE>

          7.19 Sale and Leaseback Transactions.  Neither the Borrower nor any of
     its Subsidiaries shall, directly or indirectly,  enter into any arrangement
     with any Person  providing for the Borrower or such  Subsidiary to lease or
     rent property that the Borrower or such Subsidiary has sold or will sell or
     otherwise transfer to such Person, other than the Southwest Sale/Leaseback,
     the GE  Capital  Sale/Leaseback,  and any  sale and  leaseback  of any real
     property of Borrower  described in Schedule 7.30, or all or any of the 2005
     Sterling  tractors,  upon terms and conditions in accordance  with standard
     business practices.

          7.20  Subsidiaries.  Except as permitted by Section 7.28, the Borrower
     shall not, directly or indirectly,  organize,  create, acquire or permit to
     exist  any  Subsidiary.  Within  two  Business  Days of the  Closing  Date,
     Borrower shall cause Central  Receivables,  Inc. to be merged into Borrower
     and shall provide Agent with written evidence of such merger.

          7.21  Fiscal  Year.  The  Borrower  shall not change its Fiscal  Year.

          7.22  Capital  Expenditures.  Neither  the  Borrower  nor  any  of its
     Subsidiaries  shall make or incur any Capital  Expenditure if, after giving
     effect  thereto,  the aggregate  amount of all Capital  Expenditures by the
     Borrower  and  its  Subsidiaries  on  a  consolidated  basis  would  exceed
     $10,000,000 in the Fiscal Year ending  December 31, 2005, and thereafter as
     follows:
<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------
                              Capital Expenditures
--------------------------- ------------------------------------------------- ----------------------------------------
    Fiscal Year Ending               If Fixed Charge Coverage Ratio                  If Fixed Charge Coverage
    ------------------
                                < 1.0 to 1.0 after giving effect to such             Ratio > 1.0 to 1.0 after
                                           Capital Expenditure                     giving effect to such Capital
                            -              -------------------                               Expenditure
                                                                                             -----------
<S>                                              <C>                                            <C>
--------------------------- ------------------------------------------------- ----------------------------------------
December 31, 2006                             $7,000,000                      After giving effect to such Capital
--------------------------- ------------------------------------------------- Expenditure(s), Availability shall be
December, 31, 2007                            $7,000,000                      greater than $30,000,000 for a period
--------------------------- ------------------------------------------------- of at least 60 days after such Capital
December 31, 2008                             $7,000,000                      Expenditure
--------------------------- -------------------------------------------------
</TABLE>

          7.23 Fixed Charge Coverage Ratio/Minimum EBITDA. At all times from the
     earlier of: (i)  delivery by the  Borrower to the Agent of the April,  2005
     financial  statements in compliance with Section  5.2(c),  and (ii) May 30,
     2005,  until the earlier of:  delivery by the  Borrower to the Agent of the
     May, 2006 financial  statements in compliance with Section 5.2(c), and (ii)
     June 30, 2006,  as of the last day of each fiscal month of the Borrower set
     forth below, the fiscal  year-to-date  (fiscal  year-to-date in fiscal year
     2005  shall mean  fiscal  year-to-date,  and with  respect to each month in
     fiscal  year  2006,  shall mean the  immediately  preceding  twelve  fiscal
     months)  EBITDA of Parent and its  Subsidiaries  shall not be less than the
     amount set forth  opposite each date.  During any period  commencing on the
     date that  Availability  exceeds  $15,000,000  for at least 60  consecutive
     Business  Days, and ending on any date on which  Availability  is less than
     $15,000,000,  Borrower  shall  not be  required  to  maintain  the  Minimum
     Year-to-Date  EBITDA set forth below.  For  purposes of this Section  7.23,
     Availability  shall  not  be  deemed  to be  reduced  by the  reduction  of
     Availability  attributed  to the  issuance  of any  Replacement  Letters of
     Credit.  Commencing  on and after the earlier of: (i) August 15, 2006,  and
     (ii) the  delivery of the June,  2006  quarterly  financial  statements  in
     compliance  with  Section  5.2(b),  on any date  Availability  is less than


                                       36
<PAGE>

     $15,000,000,  the Borrower will maintain a Fixed Charge  Coverage Ratio for
     each period of four  consecutive  fiscal  quarters ended on the last day of
     each  fiscal  quarter  of not less than 1.0 to 1.0.  For  purposes  of this
     Section  7.23,  on any date  compliance  hereunder is required,  compliance
     shall commence on such date with reference to then most recently previously
     reported monthly or quarterly financial information, as the case may be.


<TABLE>
<CAPTION>

------------------------------------------------------------ ---------------------------------------------------------
                  Fiscal Month Ending on                                   Minimum Year-to-Date EBITDA
                         <S>                                                        <C>
------------------------------------------------------------ ---------------------------------------------------------
                      April 30, 2005                                                ($585,000)
------------------------------------------------------------ ---------------------------------------------------------
                       May 31, 2005                                                  $143,000
------------------------------------------------------------ ---------------------------------------------------------
                       June 30, 2005                                               $1,177,000
------------------------------------------------------------ ---------------------------------------------------------
                       July 31, 2005                                               $2,651,000
------------------------------------------------------------ ---------------------------------------------------------
                      August 31, 2005                                              $4,794,000
------------------------------------------------------------ ---------------------------------------------------------
                    September 30, 2005                                             $7,174,000
------------------------------------------------------------ ---------------------------------------------------------
                     October 31, 2005                                              $9,896,000
------------------------------------------------------------ ---------------------------------------------------------
                     November 30, 2005                                            $11,665,000
------------------------------------------------------------ ---------------------------------------------------------
                     December 31, 2005                                            $14,130,000
------------------------------------------------------------ ---------------------------------------------------------
                     January 31, 2006                                             $15,764,000
------------------------------------------------------------ ---------------------------------------------------------
                     February 28, 2006                                            $17,590,000
------------------------------------------------------------ ---------------------------------------------------------
                      March 31, 2006                                              $19,494,000
------------------------------------------------------------ ---------------------------------------------------------
                      April 30, 2006                                              $20,882,000
------------------------------------------------------------ ---------------------------------------------------------
                       May 31, 2006                                               $22,359,000
------------------------------------------------------------ ---------------------------------------------------------
                       June 30, 2006                                              $25,000,000
------------------------------------------------------------ ---------------------------------------------------------
</TABLE>


          7.24 Use of Proceeds.  The Borrower shall not, and shall not suffer or
     permit any Subsidiary to, use any portion of the Loan proceeds, directly or
     indirectly,  (i) to  purchase  or  carry  Margin  Stock,  (ii) to  repay or
     otherwise  refinance  indebtedness  of the  Borrower or others  incurred to
     purchase or carry Margin  Stock,  (iii) to extend credit for the purpose of
     purchasing or carrying any Margin Stock, or (iv) to acquire any security in
     any transaction that is subject to Section 13 or 14 of the Exchange Act.

          7.25 Further  Assurances.  The Borrower shall execute and deliver,  or
     cause to be executed  and  delivered,  to the Agent and/or the Lenders such
     documents and agreements, and shall take or cause to be taken such actions,
     as the Agent or any Lender may, from time to time, request to carry out the
     terms and conditions of this Agreement and the other Loan Documents.

                                       37
<PAGE>

          7.26  Collateral.   To  secure  the  full  and  complete  payment  and
     performance  of the  Obligations,  Borrower  shall  (and  shall  cause each
     Subsidiary to) enter into Loan Documents (in form and substance  acceptable
     to the Agent)  pursuant  to which,  among  other  things,  each such entity
     shall, to the extent  permitted by applicable law, grant,  pledge,  assign,
     and create first  priority  Agent's Liens  (except to the extent  Permitted
     Liens affect such priority) in and to all Collateral  owned by such entity.
     Borrower agrees that all Rolling Stock (other than Rolling Stock subject to
     Permitted Liens under subpart (j) of the definition of Permitted Liens, but
     only so long as such  Permitted  Liens  exist)  shall be subject to Agent's
     Liens,  and  Borrower  shall  deliver all  original  certificates  of title
     relating  thereto to the Agent,  together  with any  necessary  releases of
     Liens,  lien  documents,   powers  of  attorney,   or  other  certificates,
     instruments,  documents,  odometer readings,  and other matters so that the
     Agent  shall at all times on and after  March  31,  2005 have a  perfected,
     first priority  Agent's Lien on all Rolling Stock (other than Rolling Stock
     subject to Permitted Liens under subpart (j) of the definition of Permitted
     Liens, but only so long as such Permitted Liens exist),  and other than the
     Rolling Stock described on Schedule  7.30(a)  hereto.  Borrower agrees that
     upon the  occurrence  of any Default or Event of Default  hereunder,  Agent
     may,  but shall not be required  to perfect its liens on the Rolling  Stock
     described  on Schedule  7.30(a)  hereto.  Borrower  also agrees to execute,
     deliver,  and record  mortgages  and/or  deeds of trust on each of the real
     properties  described in Schedule 7.30(c) attached hereto,  creating valid,
     perfected, first priority Agent's Liens on such real property, subject only
     to such  exceptions as are  acceptable to Agent,  all in form and substance
     acceptance to Agent on or before  February 28, 2005. In the event  Borrower
     creates  any  investment  accounts,  it  agrees  to  enter  into a  control
     agreement,  in  form  and  substance  acceptable  to  Agent,  executed  and
     delivered  by  Borrower,   Agent,  and  the  applicable  broker,  bank,  or
     investment house with respect to such investment account.

     7.27 Tax Shelter Regulations.

          (a) The Borrower does not intend to treat the Loans and/or  Letters of
     Credit and related transactions as being a "reportable transaction" (within
     the  meaning of Treasury  Regulation  Section  1.6011-4).  In the event the
     Borrower determines to take any action inconsistent with such intention, it
     will  promptly  notify the Agent  thereof.  If the Borrower so notifies the
     Agent, the Borrower  acknowledges that one or more of the Lenders may treat
     its Loans and/or its interest in  Non-Ratable  Loans and/or Agent  Advances
     and/or  Letters  of  Credit as part of a  transaction  that is  subject  to
     Treasury  Regulation  Section  301.6112-1,  and such Lender or Lenders,  as
     applicable,  will  maintain  the lists and other  records  required by such
     Treasury Regulation.

          (b) Neither the Agent nor any Lender intends to treat the Loans and/or
     Letters  of  Credit  and  related   transactions  as  being  a  "reportable
     transaction"  (within the meaning of Treasury Regulation Section 1.6011-4).
     In the  event  the  Agent  or any  Lender  determines  to take  any  action
     inconsistent with this intention,  such person will so notify Borrower.  If
     the Agent or any Lender so  notifies  Borrower,  the Agent and such  Lender
     acknowledge  that the Borrower may treat any Loans and/or  Letter of Credit
     as part of a  transaction  that is subject to Treasury  Regulation  Section
     301.6112-1,  and the Borrower  will  maintain  the lists and other  records
     required by such Treasury Regulation.

          7.28 Permitted Acquisitions. The Borrower may consummate Acquisitions,
     so long as:

          (a) the Acquisition by the Borrower is of a Person or assets which are
     in  substantially  the same lines of business as the business  conducted by
     the Borrower on the date hereof, or any other business  reasonably  related
     thereto;

                                       38
<PAGE>

          (b) as of the closing thereof,  each Acquisition has been approved and
     recommended by the board of directors (or equivalent body) of the Person to
     be acquired or from which such business or asset is to be acquired;

          (c)  prior  to  the  closing  of  such  Acquisition   (other  than  an
     Acquisition of assets), the Person to be acquired is Solvent;

          (d) as of the closing of the Acquisition, after giving effect thereto,
     the Borrower  must be Solvent and the Borrower and its  Subsidiaries,  on a
     consolidated basis, must be Solvent;

          (e) as of the closing of any such Acquisition, (i) such Acquisition is
     structured as a merger, a Borrower or a wholly-owned Subsidiary must be the
     surviving  entity  after  giving  effect to such  merger;  and (ii) if such
     Acquisition is structured as a stock/equity acquisition, the Borrower shall
     own not less than a 100%  interest in the entity  being  acquired  and such
     acquired entity will be a domestic company that is or becomes a borrower or
     a  guarantor  hereunder  and  grants a lien on its  assets to Agent for the
     benefit  of the  Agent and the  Lenders,  all in a manner  satisfactory  to
     Agent, as set forth in subparagraph (g) below;

          (f) as of the  closing  of any  Acquisition,  no  Default  or Event of
     Default shall exist or occur as a result  thereof,  and after giving effect
     thereto;

          (g) if the Acquisition target is to be a Subsidiary or if the survivor
     is a  Subsidiary,  then  Borrower  shall cause such  Subsidiary  to deliver
     articles of incorporation,  bylaws, and resolutions (or other corresponding
     constituent  documents) and such opinions as the Agent shall require and to
     execute a joinder agreement,  guaranty,  a security  agreement,  and pledge
     agreement  (if  applicable)  as shall be  required  by the  Agent,  for the
     benefit  of the Agent and the  Lenders,  in such  Subsidiary's  assets,  to
     secure the Obligations;

          (h) the absence of action, suit, investigation,  or proceeding pending
     or  threatened  in a any court or before  any  arbitrator  or  Governmental
     Authority that affects the target or the proposed Acquisition,  which could
     reasonably be expected to have a Material  Adverse  Effect on the target or
     the Loan Parties;

          (i) no  Acquisition  results  in the  formation  or  Acquisition  of a
     Foreign Subsidiary of the Borrower;

          (j) the Purchase Price for such Acquisition,  when aggregated with the
     Purchase  Price of all other  Acquisitions  consummated  during such Fiscal
     Year, does not exceed $5,000,000 in the aggregate;

          (k) immediately  prior to such  Acquisition and after giving effect to
     any  Revolving  Loans to be made in connection  therewith,  (A) there is at
     least $30,000,000 of Availability,  and (B) the Fixed Charge Coverage Ratio
     for the  most-recently  ended four fiscal  quarters  after giving pro forma
     effect to the  transaction,  is at least 1.00 to 1.00; for purposes hereof,
     EBITDA for any period shall include on a pro forma basis all EBITDA for the
     Parent and its  Subsidiaries  for such period  relating to assets  acquired
     (including  any  Subsidiaries  formed or acquired) in accordance  with this
     Agreement  during such period,  but shall  exclude on a pro forma basis all
     EBITDA for the Parent and its  Subsidiaries for such period relating to any
     such  assets  disposed of in  accordance  with this  Agreement  during such
     period; and

                                       39
<PAGE>

          (l) for the purposes of  calculating  Availability  under this Section
     7.28,  no assets of the Person to be  acquired or the assets to be acquired
     shall be included in the Borrowing  Base unless such assets are  acceptable
     to the Agent in its sole discretion.

          7.29 Appraisals.  Upon Agent's request, Agent may require annually, on
     or before January 31 of each year,  commencing January 31, 2006, an updated
     appraisal  of  the  Eligible  Rolling  Stock,  performed  by  an  appraiser
     acceptable  to  Agent,  and in  form  and  substance  acceptable  to  Agent
     ("Required  Appraisal").   Notwithstanding  the  foregoing,  in  the  event
     Availability on any day is equal to or less than  $25,000,000,  but greater
     than  $20,000,000  Agent may request  two  Required  Appraisals  during the
     twelve  months  following  such  request.   Further   notwithstanding   the
     foregoing,  in the  event the  Availability  on any day is equal to or less
     than  $20,000,000  Agent may request  four  Required  Appraisal  during the
     twelve months  following such request.  Borrower  shall  cooperate with all
     reasonable  requests and do all acts  reasonably  required by the Agent and
     any Persons employed by it as appraisers to assure the timely completion of
     such new  appraisals,  and Borrower  shall pay to Agent the actual  charges
     paid or incurred therefor.

          7.30 Post Closing Agreements.

          (a)  Borrower  agrees  that it shall  cause  the  Agent's  Lien on all
     Rolling  Stock owned by the  Borrower  as of the  Closing  Date (other than
     Rolling  Stock  which is  subject to a  perfected  Lien in favor of a third
     party as of the Closing Date and as of March 31, 2005 and the Rolling Stock
     described on a list  furnished by Borrower to Agent on the Closing Date) to
     be  properly  perfected  on or before  March 31,  2005;  provided  that the
     failure of the Agent to receive a  certificate  of title noting the Agent's
     Lien thereon from the applicable  Governmental Authority prior to March 31,
     2005 shall not  constitute a breach of this Section  7.30(a) so long as the
     Borrower has taken all action necessary to obtain such certificate of title
     with the Agent's Lien noted thereon.

          (b) Borrower  will cause each of its  principal  depository  accounts,
     including operating, administrative, cash management, collection, and other
     deposit accounts to be maintained with Agent (unless Agent otherwise agrees
     in writing) to be maintained at the Agent, on or before March 31, 2005.

          (c)......Borrower  agrees to execute,  deliver,  and record  mortgages
     and/or  deeds of  trust on all of the  Borrower's  owned  real  properties,
     including, without limitation, those described in Schedule 7.30(c) attached
     hereto,  creating valid,  perfected,  first priority  Agent's Liens on such
     real property,  subject only to such exceptions as are acceptable to Agent,
     all in form and  substance  acceptance  to Agent on or before  February 28,
     2005.

          7.31 Solvency.  The Borrower shall at all times be Solvent,  including
     prior to and after giving effect to the  Borrowings and the issuance of the
     Letters of Credit hereunder.

                                   ARTICLE 8
                              CONDITIONS OF LENDING

          8.1  Conditions  Precedent to Making of Loans on the Closing Date. The
     obligation  of the  Lenders  to make  the  initial  Revolving  Loans on the
     Closing Date, and the obligation of the Agent to cause the Letter of Credit
     Issuer to issue any Letter of Credit on the  Closing  Date,  are subject to
     the  following  conditions  precedent  having  been  satisfied  in a manner
     satisfactory to the Agent and each Lender:

                                       40
<PAGE>

          (a) This  Agreement  and the  other  Loan  Documents  shall  have been
     executed  by each party  hereto and  thereto  and the  Borrower  shall have
     performed  and  complied  with all  covenants,  agreements  and  conditions
     contained  herein and in the other Loan Documents  which are required to be
     performed or complied with by the Borrower before or on such Closing Date.

          (b) Upon making the Revolving  Loans  (including  such Revolving Loans
     made to finance the Closing Fee or  otherwise  as  reimbursement  for fees,
     costs and expenses  then  payable  under this  Agreement)  and with all its
     obligations  current,  the  Borrower  shall have  Availability  of at least
     $14,000,000 (without giving effect to the deduction required by subpart (d)
     of the definition of Availability).

          (c) All representations and warranties made hereunder and in the other
     Loan Documents shall be true and correct as if made on such date.

          (d) No  Default  or  Event  of  Default  shall  have  occurred  and be
     continuing  after giving  effect to the Loans to be made and the Letters of
     Credit to be issued on the Closing Date.

          (e) The Agent and the Lenders  shall have  received  such  opinions of
     counsel for the  Borrower and its  Subsidiaries  as the Agent or any Lender
     shall  request,  each such opinion to be in a form,  scope,  and  substance
     satisfactory to the Agent, the Lenders, and their respective counsel.

          (f) The Agent shall have received:

          (i) acknowledgment copies of proper financing  statements,  duly filed
     on or before the Closing Date under the UCC of all  jurisdictions  that the
     Agent may deem  necessary  or  desirable  in order to perfect  the  Agent's
     Liens;

          (ii) duly executed documents acceptable in form and substance to Agent
     to perfect  Agent's  Liens on the Rolling  Stock (other than Rolling  Stock
     which is subject to a  perfected  Lien in favor of a third  party as of the
     Closing  Date and as of March 31, 2005 and the Rolling  Stock  described on
     Schedule 7.30 attached hereto);

          (iii)  original  titles to all Rolling  Stock other than Rolling Stock
     which is subject to a  perfected  Lien in favor of a third  party as of the
     Closing Date; and

          (iv)  duly  executed  UCC-3  Termination  Statements  and  such  other
     instruments,  in form and substance  satisfactory to the Agent, as shall be
     necessary  to  terminate  and  satisfy  all  Liens on the  Property  of the
     Borrower and its Subsidiaries except Permitted Liens.

          (g) The  Borrower  shall have paid all fees and  expenses of the Agent
     and  the  Attorney  Costs  incurred  in  connection  with  any of the  Loan
     Documents and the transactions contemplated thereby to the extent invoiced.

          (h) The Agent  shall  have  received  evidence,  in form,  scope,  and
     substance,  reasonably satisfactory to the Agent, of all insurance coverage
     as required by this Agreement.

          (i) The Agent and the Lenders shall have had an  opportunity,  if they
     so choose,  to examine the books of account and other  records and files of
     the Borrower and to make copies thereof, and to conduct a pre-closing audit
     which shall include,  without  limitation,  verification  of Rolling Stock,
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<PAGE>

     Accounts,  and the Borrowing Base, and the results of such  examination and
     audit  shall  have been  satisfactory  to the Agent and the  Lenders in all
     respects.

          (j) All  proceedings  taken in  connection  with the execution of this
     Agreement,  all other Loan Documents and all documents and papers  relating
     thereto shall be  satisfactory in form,  scope,  and substance to the Agent
     and the Lenders.

          (k) The Agent shall have received an appraisal,  satisfactory  in form
     and  substance to Agent,  of all Rolling  Stock  included in the  Borrowing
     Base.

          (l) Borrower shall have established all of its deposit accounts at the
     Bank or shall have  entered  into  Blocked  Account  Agreements  or control
     agreements  (on terms  acceptable to the Agent) with respect to all deposit
     accounts not  established  at the Bank,  for which the Agent has  requested
     such Blocked Account Agreements.

          (m) Without  limiting the generality of the items described above, the
     Borrower and each Person guarantying or securing payment of the Obligations
     shall have  delivered  or caused to be  delivered to the Agent (in form and
     substance reasonably  satisfactory to the Agent), the financial statements,
     instruments,  resolutions, documents, agreements,  certificates,  opinions,
     pay off  letters,  and other  items set  forth on the  "Closing  Checklist"
     delivered by the Agent to the Borrower prior to the Closing Date.

          The  acceptance by the Borrower of any Loans made or Letters of Credit
     issued on the  Closing  Date  shall be deemed  to be a  representation  and
     warranty  made by the  Borrower  to the effect  that all of the  conditions
     precedent  to the making of such Loans or the  issuance of such  Letters of
     Credit have been  satisfied,  with the same effect as delivery to the Agent
     and the Lenders of a  certificate  signed by a  Responsible  Officer of the
     Borrower, dated the Closing Date, to such effect.

          Execution  and delivery to the Agent by a Lender of a  counterpart  of
     this  Agreement  shall be deemed  confirmation  by such Lender that (i) all
     conditions  precedent  in this  Section  8.1  have  been  fulfilled  to the
     satisfaction  of such  Lender,  (ii) the decision of such Lender to execute
     and deliver to the Agent an executed counterpart of this Agreement was made
     by such Lender independently and without reliance on the Agent or any other
     Lender as to the satisfaction of any condition  precedent set forth in this
     Section  8.1,  and (iii) all  documents  sent to such  Lender for  approval
     consent, or satisfaction were acceptable to such Lender.

          8.2  Conditions  Precedent to Each Loan. The obligation of the Lenders
     to make each Loan,  including  the initial  Revolving  Loans on the Closing
     Date,  and the obligation of the Agent to cause the Letter of Credit Issuer
     to issue any Letter of Credit  shall be subject to the  further  conditions
     precedent that on and as of the date of any such extension of credit:

          (a) The following  statements shall be true, and the acceptance by the
     Borrower of any  extension  of credit  shall be deemed to be a statement to
     the effect set forth in clauses (i), (ii) and (iii) with the same effect as
     the  delivery  to the Agent and the  Lenders of a  certificate  signed by a
     Responsible  Officer,  dated the date of such extension of credit,  stating
     that:

          (i) The representations and warranties contained in this Agreement and
     the other Loan Documents are correct in all material  respects on and as of
     the date of such extension of credit as though made on and as of such date,
     other than any such representation or warranty which relates to a specified
     prior date and except to the  extent  the Agent and the  Lenders  have been
     notified in writing by the Borrower that any  representation or warranty is


                                       42
<PAGE>

     not correct and the  Required  Lenders  have  explicitly  waived in writing
     compliance with such representation or warranty; and

          (ii) No event has  occurred  and is  continuing,  or would result from
     such  extension  of  credit,  which  constitutes  a Default  or an Event of
     Default; and

          (iii) No event has  occurred and is  continuing,  or would result from
     such  extension of credit,  which has had or would have a Material  Adverse
     Effect.

          (b) No such Borrowing shall exceed  Availability,  provided,  however,
     that the foregoing  conditions  precedent are not conditions to each Lender
     participating in or reimbursing the Bank or the Agent for such Lenders' Pro
     Rata Share of any Non-Ratable Loan or Agent Advance made in accordance with
     the provisions of Sections 1.2(h) and (i).

                                   ARTICLE 9
                                DEFAULT; REMEDIES

          9.1 Events of Default. It shall constitute an event of default ("Event
     of Default") if any one  -----------------  or more of the following  shall
     occur for any reason:

          (a) any failure by the Borrower to pay the principal of or interest or
     premium  on any of  the  Obligations  or any  fee  or  other  amount  owing
     hereunder when due, whether upon demand or otherwise;

          (b) any representation or warranty made or deemed made by the Borrower
     in this Agreement or by the Borrower or any of its  Subsidiaries  in any of
     the other Loan  Documents,  any  Financial  Statement,  or any  certificate
     furnished  by the  Borrower or any of its  Subsidiaries  at any time to the
     Agent or any Lender shall prove to be untrue in any material  respect as of
     the date on which made, deemed made, or furnished;

          (c) (i) any default shall occur in the  observance or  performance  of
     any of the covenants and agreements contained in Sections 5.2(k), 7.2, 7.5,
     7.9-7.27,  or Section 11 of the Security Agreement,  (ii) any default shall
     occur  in the  observance  or  performance  of any  of  the  covenants  and
     agreements  contained  in Sections  5.2 (other than 5.2(k) or 5.3) and such
     default  shall  continue  for three (3) days or more;  or (iii) any default
     shall occur in the observance or performance of any of the other  covenants
     or agreements contained in any other Section of this Agreement or any other
     Loan Document,  any other Loan Documents,  or any other  agreement  entered
     into at any time to which the Borrower or any  Subsidiary  and the Agent or
     any Lender are party  (including in respect of any Bank  Products) and such
     default shall continue for fifteen (15) days or more;

          (d) any default  shall occur with  respect to any Debt (other than the
     Obligations)  of the Borrower or any of its  Subsidiaries in an outstanding
     principal amount which  individually or in the aggregate  exceeds $500,000,
     or under any  agreement or  instrument  under or pursuant to which any such
     Debt may have been issued, created,  assumed, or guaranteed by the Borrower
     or any of its  Subsidiaries,  and such default shall continue for more than
     the period of grace, if any, therein specified, if the effect thereof (with
     or without  the  giving of notice or  further  lapse of time or both) is to
     accelerate,  or to permit the holders of any such Debt to  accelerate,  the
     maturity  of any such  Debt;  or any such Debt  shall be  declared  due and
     payable or be required to be prepaid  (other than by a regularly  scheduled
     required prepayment) prior to the stated maturity thereof;

                                       43
<PAGE>

          (e) the Borrower or any of its Subsidiaries shall (i) file a voluntary
     petition  in  bankruptcy  or file a  voluntary  petition  or an  answer  or
     otherwise  commence  any  action  or  proceeding  seeking   reorganization,
     arrangement or  readjustment of its debts or for any other relief under the
     federal  Bankruptcy  Code,  as amended,  or under any other  bankruptcy  or
     insolvency  act or law,  state or federal,  now or hereafter  existing,  or
     consent  to,  approve of, or  acquiesce  in, any such  petition,  action or
     proceeding;  (ii) apply for or acquiesce in the  appointment of a receiver,
     assignee, liquidator, sequestrator,  custodian, monitor, trustee or similar
     officer  for it or for  all or any  part  of its  property;  (iii)  make an
     assignment for the benefit of creditors; or (iv) be unable generally to pay
     its debts as they become due;

          (f) an involuntary  petition shall be filed or an action or proceeding
     otherwise commenced seeking reorganization,  arrangement,  consolidation or
     readjustment of the debts of the Borrower or any of its Subsidiaries or for
     any other relief under the federal  Bankruptcy  Code, as amended,  or under
     any other  bankruptcy or insolvency  act or law,  state or federal,  now or
     hereafter  existing and such petition or proceeding  shall not be dismissed
     within  thirty  (30) days  after the filing or  commencement  thereof or an
     order of relief shall be entered with respect thereto;

          (g)  a  receiver,  assignee,  liquidator,   sequestrator,   custodian,
     monitor,  trustee  or  similar  officer  for  the  Borrower  or  any of its
     Subsidiaries or for all or any part of its property shall be appointed or a
     warrant of attachment, execution or similar process shall be issued against
     any part of the property of the Borrower or any of its Subsidiaries;

          (h) the Borrower or any of its  Subsidiaries  shall file a certificate
     of dissolution under applicable state law or shall be liquidated, dissolved
     or wound-up or shall  commence or have  commenced  against it any action or
     proceeding for  dissolution,  winding-up or liquidation,  or shall take any
     corporate action in furtherance thereof;

          (i) all or any material part of the property of the Borrower or any of
     its Subsidiaries shall be nationalized,  expropriated or condemned,  seized
     or otherwise appropriated, or custody or control of such property or of the
     Borrower or such Subsidiary shall be assumed by any Governmental  Authority
     or any court of competent  jurisdiction at the instance of any Governmental
     Authority,  except  where  contested  in good  faith by proper  proceedings
     diligently pursued where a stay of enforcement is in effect;

          (j) any Loan Document shall be terminated, revoked or declared void or
     invalid  or  unenforceable  or  challenged  by the  Borrower  or any  other
     obligor;

          (k) one or more judgments,  orders,  decrees or arbitration  awards is
     entered against the Borrower  involving in the aggregate  liability (to the
     extent not covered by  independent  third-party  insurance  as to which the
     insurer does not dispute coverage) as to any single or related or unrelated
     series of transactions,  incidents or conditions,  of $500,000 or more, and
     the same shall remain  unsatisfied,  unvacated and unstayed  pending appeal
     for a period of thirty (30) days after the entry thereof;

          (l) any loss,  theft,  damage or  destruction  of any item or items of
     Collateral or other property of the Borrower or any Subsidiary occurs which
     could  reasonably be expected to cause a Material Adverse Effect and is not
     adequately covered by insurance;

          (m) there is filed against the Borrower or any of its Subsidiaries any
     action, suit or proceeding under any federal or state racketeering  statute
     (including the Racketeer  Influenced and Corrupt Organization Act of 1970),
     which action,  suit or proceeding  (i) is not dismissed  within one hundred
     twenty (120) days,  and (ii) could  reasonably be expected to result in the
     confiscation or forfeiture of any material portion of the Collateral;

                                       44
<PAGE>

          (n) for any  reason  other  than the  failure of the Agent to take any
     action  available  to it to  maintain  perfection  of  the  Agent's  Liens,
     pursuant  to the Loan  Documents,  any Loan  Document  ceases to be in full
     force and effect or any Lien with  respect to any  material  portion of the
     Collateral  intended to be secured  thereby ceases to be, or is not, valid,
     perfected and prior to all other Liens (other than  Permitted  Liens) or is
     terminated, revoked or declared void;

          (o) (i) an ERISA Event shall occur with  respect to a Pension  Plan or
     Multi-employer  Plan which has resulted or could  reasonably be expected to
     result in liability of the Borrower  under Title IV of ERISA to the Pension
     Plan,  Multi-employer  Plan or the PBGC in an aggregate amount in excess of
     $250,000 ; (ii) the aggregate  amount of Unfunded  Pension  Liability among
     all Pension  Plans at any time exceeds  $250,000;  or (iii) the Borrower or
     any ERISA Affiliate shall fail to pay when due, after the expiration of any
     applicable  grace  period,  any  installment  payment  with  respect to its
     withdrawal  liability  under  Section 4201 of ERISA under a  Multi-employer
     Plan in an aggregate amount in excess of $250,000;

          (p) there occurs a Change of Control; or

          (q) there occurs an event having a Material Adverse Effect.

          9.2 Remedies.

          (a) If a Default or an Event of Default exists,  the Agent may, in its
     discretion,  and shall, at the direction of the Required Lenders, do one or
     more of the following at any time or times and in any order, without notice
     to or demand on the Borrower:  (i) reduce the Maximum Revolver  Amount,  or
     the advance rates against  Eligible  Accounts and/or Eligible Rolling Stock
     used in computing  the  Borrowing  Base, or reduce one or more of the other
     elements used in computing the Borrowing  Base; (ii) restrict the amount of
     or refuse to make Revolving  Loans; and (iii) restrict or refuse to provide
     Letters of Credit or Credit  Support.  If an Event of Default  exists,  the
     Agent shall,  at the direction of the Required  Lenders,  do one or more of
     the  following,  in  addition  to the actions  described  in the  preceding
     sentence,  at any time or times  and in any  order,  without  notice  to or
     demand on the Borrower:  (A) terminate the  Commitments and this Agreement;
     (B) declare  any or all  Obligations  to be  immediately  due and  payable;
     provided,  however,  that  upon the  occurrence  of any  Event  of  Default
     described in Sections 9.1(e),  9.1(f),  9.1(g), or 9.1(h),  the Commitments
     shall  automatically  and  immediately  expire  and all  Obligations  shall
     automatically  become  immediately due and payable without notice or demand
     of any kind; (C) require the Borrower to cash collateralize all outstanding
     Letter of Credit Obligations;  and (D) pursue its other rights and remedies
     under the Loan Documents and applicable law.

          (b) If an Event of Default has  occurred  and is  continuing:  (i) the
     Agent shall have for the benefit of the  Lenders,  in addition to all other
     rights of the Agent and the  Lenders,  the rights and remedies of a secured
     party  under the Loan  Documents  and the UCC;  (ii) the Agent may,  at any
     time,  take  possession  of the  Collateral  and keep it on the  Borrower's
     premises,  at no cost to the Agent or any Lender,  or remove any part of it
     to such  other  place or places as the Agent may  desire,  or the  Borrower
     shall,  upon the Agent's  demand,  at the  Borrower's  cost,  assemble  the
     Collateral  and  make it  available  to the  Agent  at a  place  reasonably
     convenient  to the  Agent;  and (iii) the  Agent may sell and  deliver  any
     Collateral at public or private sales,  for cash, upon credit or otherwise,
     at such  prices and upon such terms as the Agent  deems  advisable,  in its
     sole  discretion,  and may, if the Agent deems it  reasonable,  postpone or
     adjourn any sale of the Collateral by an announcement at the time and place
     of sale or of such  postponed or adjourned sale without giving a new notice
     of sale.  Without in any way requiring  notice to be given in the following
     manner,  the  Borrower  agrees  that  any  notice  by the  Agent  of  sale,
     disposition or other intended action  hereunder or in connection  herewith,
     whether  required  by the UCC or  otherwise,  shall  constitute  reasonable
     notice to the Borrower if such notice is mailed by  registered or certified
     mail, return receipt requested, postage prepaid, or is delivered personally
     against  receipt,  at least five (5) Business  Days prior to such action to
     the  Borrower's  address  specified in or pursuant to Section  13.8. If any
     Collateral is sold on terms other than payment in full at the time of sale,
     no credit  shall be given  against the  Obligations  until the Agent or the
     Lenders receive  payment,  and if the buyer defaults in payment,  the Agent


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<PAGE>

     may resell the Collateral  without  further notice to the Borrower.  In the
     event the  Agent  seeks to take  possession  of all or any  portion  of the
     Collateral by judicial process,  the Borrower  irrevocably  waives: (A) the
     posting of any bond,  surety or security  with respect  thereto which might
     otherwise  be  required;  (B)  any  demand  for  possession  prior  to  the
     commencement of any suit or action to recover the  Collateral;  and (C) any
     requirement  that  the  Agent  retain  possession  and not  dispose  of any
     Collateral  until after trial or final  judgment.  The Borrower agrees that
     the Agent has no obligation to preserve rights to the Collateral or marshal
     any Collateral for the benefit of any Person. The Agent is hereby granted a
     license or other  right to use,  without  charge,  the  Borrower's  labels,
     patents,  copyrights,  name, trade secrets,  trade names,  trademarks,  and
     advertising matter, or any similar property,  in completing  production of,
     advertising or selling any Collateral,  and the Borrower's rights under all
     licenses and all franchise  agreements  shall inure to the Agent's  benefit
     for such  purpose.  The  proceeds  of sale  shall be  applied  first to all
     expenses of sale,  including  attorneys' fees, and then to the Obligations.
     The Agent will return any excess to the  Borrower  and the  Borrower  shall
     remain liable for any deficiency.

          (c) If an Event of Default  occurs,  the  Borrower  hereby  waives all
     rights to notice  and  hearing  prior to the  exercise  by the Agent of the
     Agent's rights to repossess the Collateral  without  judicial process or to
     reply, attach or levy upon the Collateral without notice or hearing.

                                   ARTICLE 10
                              TERM AND TERMINATION

          10.1 Term and Termination. The term of this Agreement shall end on the
     Stated  Termination  Date unless sooner  terminated in accordance  with the
     terms  hereof.  The Agent upon  direction  from the  Required  Lenders  may
     terminate this Agreement  without notice upon the occurrence of an Event of
     Default.  Upon the effective  date of termination of this Agreement for any
     reason whatsoever, all Obligations (including all unpaid principal, accrued
     and  unpaid  interest  and any  early  termination  or  prepayment  fees or
     penalties) shall become  immediately due and payable and the Borrower shall
     immediately  arrange for the  cancellation  and return of Letters of Credit
     then outstanding.  Notwithstanding the termination of this Agreement, until
     all  Obligations are  indefeasibly  paid and performed in full in cash, the
     Borrower shall remain bound by the terms of this Agreement and shall not be
     relieved  of any of its  Obligations  hereunder  or under  any  other  Loan
     Document,  and the Agent and the Lenders  shall retain all their rights and
     remedies  hereunder  (including  the  Agent's  Liens in and all  rights and
     remedies with respect to all then existing and after-arising Collateral).

                                   ARTICLE 11
          AMENDMENTS; WAIVERs; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS

          11.1 Amendments and Waivers.

          (a) No amendment or waiver of any  provision of this  Agreement or any
     other Loan  Document,  and no consent with respect to any  departure by the
     Borrower therefrom,  shall be effective unless the same shall be in writing
     and signed by the Required  Lenders (or by the Agent at the written request
     of the  Required  Lenders)  and the  Borrower  and then any such  waiver or
     consent  shall  be  effective  only in the  specific  instance  and for the
     specific purpose for which given;  provided,  however, that no such waiver,
     amendment,  or  consent  shall,  unless in  writing  and  signed by all the
     Lenders  and the  Borrower  and  acknowledged  by the Agent,  do any of the
     following:

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<PAGE>

          (i) increase or extend the Commitment of any Lender;

          (ii)  postpone or delay any date fixed by this  Agreement or any other
     Loan Document for any payment of principal, interest, fees or other amounts
     due to the  Lenders  (or any of them)  hereunder  or under any  other  Loan
     Document;

          (iii)  reduce  the  principal  of, or the rate of  interest  specified
     herein on any Loan, or any fees or other amounts payable hereunder or under
     any other Loan Document;

          (iv) change the  percentage  of the  Commitments  or of the  aggregate
     unpaid  principal  amount of the Loans which is required for the Lenders or
     any of them to take any action hereunder;

          (v) increase any of the percentages set forth in the definition of the
     Borrowing Base;

          (vi) amend this Section or any provision of this  Agreement  providing
     for consent or other action by all Lenders;

          (vii) release any Guaranties of the Obligations or release  Collateral
     other than as permitted by Section 12.11;

          (viii)  change the  definitions  of  "Majority  Lenders" or  "Required
     Lenders"; or

          (ix) increase the Maximum Revolver  Amount,  the Maximum Rolling Stock
     Loan Amount, and Letter of Credit Subfacility;

provided, however, the Agent may, in its sole discretion and notwithstanding the
limitations  contained in clauses (v) and (ix) above and any other terms of this
Agreement,  make Agent Advances in accordance with Section 1.2(i) and,  provided
further,  that no  amendment,  waiver or consent  shall,  unless in writing  and
signed by the  Agent,  affect  the  rights or  duties  of the Agent  under  this
Agreement or any other Loan  Document and provided  further,  that  Schedule 1.2
hereto  (Commitments) may be amended from time to time by Agent alone to reflect
assignments of Commitments in accordance herewith.

          (b) If  any  fees  are  paid  to  the  Lenders  as  consideration  for
     amendments,  waivers or consents with respect to this Agreement, at Agent's
     election,  such fees may be paid only to those  Lenders  that agree to such
     amendments,  waivers or consents  within the time  specified for submission
     thereof.

          (c) If, in connection with any proposed amendment, waiver or consent :

          (i)  requiring  the  consent of all  Lenders,  the consent of Required
     Lenders is obtained,  but the consent of other Lenders is not obtained (any
     such Lender  whose  consent is not obtained as described in this clause (i)
     and in clause (ii) below being referred to as a  "Non-Consenting  Lender"),
     or

          (ii)  requiring  the  consent  of  Required  Lenders,  the  consent of
     Majority  Lenders  is  obtained,then,  so  long  as  the  Agent  is  not  a


                                       47
<PAGE>

     Non-Consenting  Lender, at the Borrower's request, the Agent or an Eligible
     Assignee  shall have the right (but not the  obligation)  with the  Agent's
     approval,   to  purchase   from  the   Non-Consenting   Lenders,   and  the
     Non-Consenting  Lenders agree that they shall sell, all the  Non-Consenting
     Lenders'  Commitments for an amount equal to the principal balances thereof
     and all accrued  interest and fees with respect thereto through the date of
     sale pursuant to Assignment and Acceptance Agreement(s), without premium or
     discount.

          11.2 Assignments; Participations.

          (a) Any Lender  may,  with the  written  consent  of the Agent  (which
     consent shall not be unreasonably withheld),  assign and delegate to one or
     more  Eligible  Assignees  (provided  that no consent of the Agent shall be
     required in connection with any assignment and delegation by a Lender to an
     Affiliate of such Lender) (each an "Assignee")  all, or any ratable part of
     all, of the Loans,  the Commitments and the other rights and obligations of
     such Lender hereunder,  in a minimum amount of $5,000,000;  (provided that,
     unless an assignor  Lender has assigned and  delegated all of its Loans and
     Commitments,  no such  assignment  and/or  delegation  shall  be  permitted
     unless,  after  giving  effect  thereto,  such  assignor  Lender  retains a
     Commitment in a minimum amount of $5,000,000;  provided,  however, that the
     Borrower and the Agent may  continue to deal solely and directly  with such
     Lender in connection with the interest so assigned to an Assignee until (i)
     written  notice of such  assignment,  together  with payment  instructions,
     addresses and related information with respect to the Assignee,  shall have
     been given to the Borrower  and the Agent by such Lender and the  Assignee;
     (ii) such Lender and its Assignee  shall have delivered to the Borrower and
     the  Agent  an  Assignment   and  Acceptance  in  the  form  of  Exhibit  F
     ("Assignment  and  Acceptance")  together with any note or notes subject to
     such  assignment and (iii) the assignor  Lender or Assignee has paid to the
     Agent a  processing  fee in the amount of $3,500.  The  Borrower  agrees to
     promptly   execute  and  deliver  new  promissory   notes  and  replacement
     promissory  notes  as  reasonably   requested  by  the  Agent  to  evidence
     assignments of the Loans and Commitments in accordance herewith.

          (b) From and  after  the date that the  Agent  notifies  the  assignor
     Lender that it has  received  an executed  Assignment  and  Acceptance  and
     payment of the above-referenced processing fee, (i) the Assignee thereunder
     shall be a party  hereto and,  to the extent  that rights and  obligations,
     including,  but not limited to, the obligation to participate in Letters of
     Credit  and  Credit  Support  have been  assigned  to it  pursuant  to such
     Assignment  and  Acceptance,  shall have the rights  and  obligations  of a
     Lender under the Loan Documents, and (ii) the assignor Lender shall, to the
     extent  that  rights  and  obligations  hereunder  and under the other Loan
     Documents  have  been  assigned  by it  pursuant  to  such  Assignment  and
     Acceptance,  relinquish  its rights and be  released  from its  obligations
     under  this  Agreement  (and in the case of an  Assignment  and  Acceptance
     covering all or the remaining  portion of an assigning  Lender's rights and
     obligations  under this  Agreement,  such Lender  shall cease to be a party
     hereto).

          (c) By executing  and  delivering an Assignment  and  Acceptance,  the
     assigning  Lender  thereunder  and the Assignee  thereunder  confirm to and
     agree with each other and the other  parties  hereto as follows:  (i) other
     than as provided in such Assignment and Acceptance,  such assigning  Lender
     makes no  representation  or warranty  and assumes no  responsibility  with
     respect to any  statements,  warranties  or  representations  made in or in
     connection  with  this  Agreement  or the  execution,  legality,  validity,
     enforceability,  genuineness, sufficiency or value of this Agreement or any
     other  Loan  Document   furnished   pursuant   hereto  or  the  attachment,
     perfection, or priority of any Lien granted by the Borrower to the Agent or
     any  Lender  in  the  Collateral;  (ii)  such  assigning  Lender  makes  no
     representation  or warranty and assumes no  responsibility  with respect to
     the financial condition of the Borrower or the performance or observance by
     the Borrower of any of its  obligations  under this  Agreement or any other
     Loan Document furnished pursuant hereto;  (iii) such Assignee confirms that
     it has  received  a copy  of  this  Agreement,  together  with  such  other


                                       48
<PAGE>

     documents  and  information  as it has deemed  appropriate  to make its own
     credit  analysis and decision to enter into such Assignment and Acceptance;
     (iv) such Assignee will, independently and without reliance upon the Agent,
     such assigning Lender or any other Lender,  and based on such documents and
     information as it shall deem appropriate at the time,  continue to make its
     own credit  decisions in taking or not taking action under this  Agreement;
     (v) such Assignee  appoints and authorizes the Agent to take such action as
     agent on its behalf and to exercise such powers under this Agreement as are
     delegated  to the Agent by the terms  hereof,  together  with such  powers,
     including the discretionary  rights and incidental power, as are reasonably
     incidental  thereto;  and (vi) such Assignee agrees that it will perform in
     accordance  with their terms all of the  obligations  which by the terms of
     this Agreement are required to be performed by it as a Lender.

          (d)  Immediately  upon  satisfaction  of the  requirements  of Section
     11.2(a),  this Agreement  shall be deemed to be amended to the extent,  but
     only to the extent,  necessary  to reflect the addition of the Assignee and
     the  resulting  adjustment  of  the  Commitments  arising  therefrom.   The
     Commitment  allocated to each Assignee shall reduce such Commitments of the
     assigning Lender pro tanto.

          (e) Any Lender may at any time sell to one or more  commercial  banks,
     financial institutions,  or other Persons not Affiliates of the Borrower (a
     "Participant") participating interests in any Loans, the Commitment of that
     Lender and the other  interests of that Lender (the  "originating  Lender")
     hereunder and under the other Loan Documents;  provided,  however, that (i)
     the  originating  Lender's  obligations  under this Agreement  shall remain
     unchanged,  (ii) the originating Lender shall remain solely responsible for
     the performance of such obligations, (iii) the Borrower and the Agent shall
     continue  to deal  solely  and  directly  with the  originating  Lender  in
     connection with the originating  Lender's rights and obligations under this
     Agreement and the other Loan  Documents,  and (iv) no Lender shall transfer
     or grant any participating  interest under which the Participant has rights
     to approve any amendment to, or any consent or waiver with respect to, this
     Agreement  or any other  Loan  Document  except  the  matters  set forth in
     Section  11.1(a)  (i),  (ii) and  (iii),  and all  amounts  payable  by the
     Borrower  hereunder shall be determined as if such Lender had not sold such
     participation; except that, if amounts outstanding under this Agreement are
     due and unpaid, or shall have become due and payable upon the occurrence of
     an Event of Default,  each Participant shall be deemed to have the right of
     set-off in respect of its  participating  interest  in amounts  owing under
     this Agreement to the same extent and subject to the same  limitation as if
     the amount of its  participating  interest  were owing  directly to it as a
     Lender under this Agreement.

          (f) Notwithstanding any other provision in this Agreement,  any Lender
     may at any time  create a  security  interest  in,  or  pledge,  all or any
     portion of its rights under and interest in this  Agreement in favor of any
     Federal Reserve Bank in accordance with Regulation A of the Federal Reserve
     Board or U.S.  Treasury  Regulation  31 CFR  ss.203.14,  and  such  Federal
     Reserve  Bank may enforce  such  pledge or security  interest in any manner
     permitted under applicable law.

                                   ARTICLE 12
                                    THE AGENT

          12.1 Appointment and Authorization.  Each Lender hereby designates and
     appoints  Bank  as its  Agent  under  this  Agreement  and the  other  Loan
     Documents and each Lender hereby  irrevocably  authorizes the Agent to take
     such action on its behalf under the  provisions of this  Agreement and each
     other Loan  Document and to exercise such powers and perform such duties as
     are expressly  delegated to it by the terms of this  Agreement or any other
     Loan  Document,  together  with such  powers as are  reasonably  incidental
     thereto.  The  Agent  agrees  to act as  such  on  the  express  conditions
     contained in this Article 12. The  provisions of this Article 12 are solely

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<PAGE>

     for the benefit of the Agent and the Lenders and the Borrower shall have no
     rights as a third  party  beneficiary  of any of the  provisions  contained
     herein.  Notwithstanding  any provision to the contrary contained elsewhere
     in this Agreement or in any other Loan  Document,  the Agent shall not have
     any duties or  responsibilities,  except those  expressly set forth herein,
     nor shall the Agent  have or be deemed to have any  fiduciary  relationship
     with any Lender,  and no implied  covenants,  functions,  responsibilities,
     duties, obligations or liabilities shall be read into this Agreement or any
     other Loan Document or otherwise exist against the Agent.  Without limiting
     the  generality of the foregoing  sentence,  the use of the term "agent" in
     this  Agreement  with reference to the Agent is not intended to connote any
     fiduciary or other  implied (or express)  obligations  arising under agency
     doctrine  of any  applicable  law.  Instead,  such term is used merely as a
     matter of market  custom,  and is  intended  to create or  reflect  only an
     administrative relationship between independent contracting parties. Except
     as expressly otherwise provided in this Agreement, the Agent shall have and
     may use its sole  discretion  with respect to exercising or refraining from
     exercising any discretionary rights or taking or refraining from taking any
     actions which the Agent is expressly  entitled to take or assert under this
     Agreement and the other Loan Documents,  including (a) the determination of
     the applicability of ineligibility criteria with respect to the calculation
     of the Borrowing Base, (b) the making of Agent Advances pursuant to Section
     1.2(i),  and (c) the exercise of remedies  pursuant to Section 9.2, and any
     action so taken or not taken shall be deemed consented to by the Lenders.

          12.2  Delegation  of Duties.  The Agent may  execute any of its duties
     under this  Agreement  or any other  Loan  Document  by or through  agents,
     employees or  attorneys-in-fact  and shall be entitled to advice of counsel
     concerning  all matters  pertaining to such duties.  The Agent shall not be
     responsible   for  the   negligence   or   misconduct   of  any   agent  or
     attorney-in-fact that it selects as long as such selection was made without
     gross negligence or willful misconduct.

          12.3 Liability of Agent. None of the  Agent-Related  Persons shall (i)
     be liable for any action  taken or omitted to be taken by any of them under
     or in  connection  with this  Agreement  or any other Loan  Document or the
     transactions  contemplated  hereby (except for its own gross  negligence or
     willful  misconduct),  or (ii) be  responsible  in any manner to any of the
     Lenders for any recital, statement,  representation or warranty made by the
     Borrower or any  Subsidiary  or Affiliate of the  Borrower,  or any officer
     thereof,  contained in this Agreement or in any other Loan Document,  or in
     any  certificate,  report,  statement  or  other  document  referred  to or
     provided for in, or received by the Agent under or in connection with, this
     Agreement  or any other  Loan  Document,  or the  validity,  effectiveness,
     genuineness,  enforceability  or sufficiency of this Agreement or any other
     Loan Document, or for any failure of the Borrower or any other party to any
     Loan  Document to perform  its  obligations  hereunder  or  thereunder.  No
     Agent-Related  Person  shall be  under  any  obligation  to any  Lender  to
     ascertain or to inquire as to the  observance or  performance of any of the
     agreements contained in, or conditions of, this Agreement or any other Loan
     Document, or to inspect the properties, books or records of the Borrower or
     any of the Borrower's Subsidiaries or Affiliates.

          12.4 Reliance by Agent. The Agent shall be entitled to rely, and shall
     be fully  protected  in  relying,  upon any  writing,  resolution,  notice,
     consent,  certificate,  affidavit,  letter, telegram,  facsimile,  telex or
     telephone message,  statement or other document or conversation believed by
     it to be genuine and correct and to have been  signed,  sent or made by the
     proper Person or Persons,  and upon advice and  statements of legal counsel
     (including  counsel to the  Borrower),  independent  accountants  and other
     experts  selected  by the  Agent.  The Agent  shall be fully  justified  in
     failing or refusing to take any action  under this  Agreement  or any other
     Loan Document  unless it shall first receive such advice or  concurrence of
     the Required  Lenders as it deems  appropriate  and, if it so requests,  it
     shall first be indemnified to its  satisfaction  by the Lenders against any


                                       50
<PAGE>

     and all  liability  and  expense  which may be  incurred by it by reason of
     taking or continuing to take any such action.  The Agent shall in all cases
     be fully  protected in acting,  or in  refraining  from acting,  under this
     Agreement  or any other  Loan  Document  in  accordance  with a request  or
     consent of the  Required  Lenders (or all Lenders if so required by Section
     11.1) and such  request  and any action  taken or  failure to act  pursuant
     thereto shall be binding upon all of the Lenders.

          12.5  Notice  of  Default.  The  Agent  shall  not be  deemed  to have
     knowledge or notice of the  occurrence  of any Default or Event of Default,
     unless the Agent shall have  received  written  notice from a Lender or the
     Borrower  referring to this Agreement,  describing such Default or Event of
     Default and stating  that such notice is a "notice of  default."  The Agent
     will notify the Lenders of its receipt of any such notice.  The Agent shall
     take such action with respect to such Default or Event of Default as may be
     requested by the Required  Lenders in accordance  with Section 9; provided,
     however, that unless and until the Agent has received any such request, the
     Agent may (but shall not be obligated to) take such action, or refrain from
     taking such action,  with respect to such Default or Event of Default as it
     shall deem advisable.

          12.6  Credit  Decision.  Each  Lender  acknowledges  that  none of the
     Agent-Related  Persons has made any  representation  or warranty to it, and
     that no act by the Agent  hereinafter  taken,  including  any review of the
     affairs of the Borrower and its  Affiliates,  shall be deemed to constitute
     any  representation or warranty by any Agent-Related  Person to any Lender.
     Each Lender represents to the Agent that it has,  independently and without
     reliance  upon any  Agent-Related  Person and based on such  documents  and
     information  as it has deemed  appropriate,  made its own  appraisal of and
     investigation into the business, prospects, operations, property, financial
     and  other  condition  and   creditworthiness   of  the  Borrower  and  its
     Affiliates,  and  all  applicable  bank  regulatory  laws  relating  to the
     transactions  contemplated  hereby, and made its own decision to enter into
     this  Agreement  and to extend  credit to the  Borrower.  Each  Lender also
     represents  that it  will,  independently  and  without  reliance  upon any
     Agent-Related  Person and based on such  documents  and  information  as it
     shall  deem  appropriate  at the  time,  continue  to make  its own  credit
     analysis,  appraisals  and  decisions in taking or not taking  action under
     this   Agreement   and  the  other  Loan   Documents,   and  to  make  such
     investigations  as it deems  necessary to inform itself as to the business,
     prospects,   operations,   property,  financial  and  other  condition  and
     creditworthiness  of the  Borrower.  Except for notices,  reports and other
     documents  expressly  herein required to be furnished to the Lenders by the
     Agent, the Agent shall not have any duty or  responsibility  to provide any
     Lender  with any  credit  or other  information  concerning  the  business,
     prospects,   operations,   property,   financial  and  other  condition  or
     creditworthiness  of the Borrower which may come into the possession of any
     of the Agent-Related Persons.

          12.7  Indemnification.  Whether or not the  transactions  contemplated
     hereby  are  consummated,  the  Lenders  shall  indemnify  upon  demand the
     Agent-Related  Persons (to the extent not reimbursed by or on behalf of the
     Borrower and without  limiting the obligation of the Borrower to do so), in
     accordance  with  their  Pro  Rata  Shares,  from and  against  any and all
     Indemnified Liabilities as such term is defined in Section 13.11; provided,
     however,   that  no  Lender   shall  be  liable  for  the  payment  to  the
     Agent-Related  Persons  of any  portion  of  such  Indemnified  Liabilities
     resulting solely from such Person's gross negligence or willful misconduct.
     Without limitation of the foregoing,  each Lender shall reimburse the Agent
     upon demand for its Pro Rata Share of any costs or  out-of-pocket  expenses
     (including  Attorney  Costs)  incurred by the Agent in connection  with the
     preparation, execution, delivery, administration,  modification,  amendment
     or  enforcement  (whether  through   negotiations,   legal  proceedings  or
     otherwise)  of, or legal  advice in respect  of rights or  responsibilities
     under,   this  Agreement,   any  other  Loan  Document,   or  any  document
     contemplated by or referred to herein,  to the extent that the Agent is not
     reimbursed  for  such  expenses  by or  on  behalf  of  the  Borrower.  The
     undertaking  in this Section shall  survive the payment of all  Obligations
     hereunder and the resignation or replacement of the Agent.

          12.8 Agent in Individual  Capacity.  The Bank and its  Affiliates  may
     make loans to, issue letters of credit for the account of, accept  deposits


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<PAGE>

     from,  acquire  equity  interests  in and  generally  engage in any kind of
     banking, trust, financial advisory, underwriting or other business with the
     Borrower and its  Subsidiaries  and  Affiliates as though the Bank were not
     the Agent  hereunder and without  notice to or consent of the Lenders.  The
     Bank or its Affiliates may receive information regarding the Borrower,  its
     Affiliates and Account Debtors  (including  information that may be subject
     to confidentiality obligations in favor of the Borrower or such Subsidiary)
     and acknowledge that the Agent and the Bank shall be under no obligation to
     provide such information to them. With respect to its Loans, the Bank shall
     have the same rights and powers  under this  Agreement  as any other Lender
     and may  exercise  the same as though it were not the Agent,  and the terms
     "Lender" and "Lenders" include the Bank in its individual capacity.

          12.9 Successor  Agent.  The Agent may resign as Agent upon at least 30
     days' prior notice to the Lenders and the Borrower,  such resignation to be
     effective  upon the acceptance of a successor  agent to its  appointment as
     Agent.  In the event the Bank  sells all of its  Commitment  and  Revolving
     Loans  as part of a sale,  transfer  or  other  disposition  by the Bank of
     substantially all of its loan portfolio, the Bank shall resign as Agent and
     such purchaser or transferee  shall become the successor  Agent  hereunder.
     Subject to the foregoing,  if the Agent resigns under this  Agreement,  the
     Required Lenders shall appoint from among the Lenders a successor agent for
     the Lenders. If no successor agent is appointed prior to the effective date
     of the resignation of the Agent,  the Agent may appoint,  after  consulting
     with the  Lenders  and the  Borrower,  a  successor  agent  from  among the
     Lenders.  Upon  the  acceptance  of  its  appointment  as  successor  agent
     hereunder, such successor agent shall succeed to all the rights, powers and
     duties of the retiring Agent and the term "Agent" shall mean such successor
     agent and the  retiring  Agent's  appointment,  powers  and duties as Agent
     shall be terminated.  After any retiring Agent's  resignation  hereunder as
     Agent,  the  provisions  of this Article 12 shall  continue to inure to its
     benefit as to any  actions  taken or omitted to be taken by it while it was
     Agent under this Agreement.

          12.10 Withholding Tax.

          (a) If any Lender is a  "foreign  corporation,  partnership  or trust"
     within the meaning of the Code and such Lender claims  exemption from, or a
     reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code,
     such Lender agrees with and in favor of the Agent, to deliver to the Agent:

          (i) if such  Lender  claims an  exemption  from,  or a  reduction  of,
     withholding  tax under a United  States of  America  tax  treaty,  properly
     completed IRS Forms W-8BEN and W-8ECI before the payment of any interest in
     the first  calendar  year and before the  payment of any  interest  in each
     third succeeding calendar year during which interest may be paid under this
     Agreement;

          (ii) if such Lender claims that interest paid under this  Agreement is
     exempt  from  United  States  of  America  withholding  tax  because  it is
     effectively  connected with a United States of America trade or business of
     such Lender,  two properly completed and executed copies of IRS Form W-8ECI
     before the payment of any interest is due in the first taxable year of such
     Lender and in each  succeeding  taxable  year of such Lender  during  which
     interest may be paid under this Agreement, and IRS Form W-9; and

          (iii) such other  form or forms as may be  required  under the Code or
     other laws of the United  States of America  as a  condition  to  exemption
     from, or reduction of, United States of America withholding tax.

          Such  Lender  agrees to  promptly  notify  the Agent of any  change in
     circumstances which would modify or render invalid any claimed exemption or
     reduction.

                                       52
<PAGE>

          (b) If any Lender claims exemption from, or reduction of,  withholding
     tax under a United  States of  America  tax  treaty by  providing  IRS Form
     W-8BEN  and such  Lender  sells,  assigns,  grants a  participation  in, or
     otherwise  transfers all or part of the  Obligations  owing to such Lender,
     such Lender agrees to notify the Agent of the percentage amount in which it
     is no longer the  beneficial  owner of  Obligations of the Borrower to such
     Lender. To the extent of such percentage  amount, the Agent will treat such
     Lender's IRS Form W-8BEN as no longer valid.

          (c) If any Lender  claiming  exemption  from United  States of America
     withholding  tax by filing IRS Form W-8ECI with the Agent  sells,  assigns,
     grants  a  participation  in,  or  otherwise  transfers  all or part of the
     Obligations  owing to such Lender,  such Lender  agrees to  undertake  sole
     responsibility for complying with the withholding tax requirements  imposed
     by Sections 1441 and 1442 of the Code.

          (d) If  any  Lender  is  entitled  to a  reduction  in the  applicable
     withholding  tax, the Agent may withhold from any interest  payment to such
     Lender an amount equivalent to the applicable  withholding tax after taking
     into account such reduction.  If the forms or other documentation  required
     by subsection (a) of this Section are not delivered to the Agent,  then the
     Agent may withhold  from any interest  payment to such Lender not providing
     such forms or other  documentation  an amount  equivalent to the applicable
     withholding tax.

          (e) If the  IRS or any  other  Governmental  Authority  of the  United
     States of America or other jurisdiction  asserts a claim that the Agent did
     not  properly  withhold  tax from amounts paid to or for the account of any
     Lender  (because the appropriate  form was not delivered,  was not properly
     executed,  or because such Lender failed to notify the Agent of a change in
     circumstances   which  rendered  the  exemption   from,  or  reduction  of,
     withholding  tax  ineffective,  or for any other  reason) such Lender shall
     indemnify the Agent fully for all amounts paid, directly or indirectly,  by
     the  Agent as tax or  otherwise,  including  penalties  and  interest,  and
     including any taxes imposed by any  jurisdiction  on the amounts payable to
     the  Agent  under  this  Section,  together  with all  costs  and  expenses
     (including  Attorney  Costs).  The  obligation  of the  Lenders  under this
     subsection shall survive the payment of all Obligations and the resignation
     or replacement of the Agent.

          12.11 Collateral Matters.

          (a) The Lenders hereby irrevocably  authorize the Agent, at its option
     and in  its  sole  discretion,  to  release  any  Agent's  Liens  upon  any
     Collateral  (i) upon the  termination  of the  Commitments  and payment and
     satisfaction in full by Borrower of all Loans and reimbursement obligations
     in respect of Letters of Credit and Credit Support,  and the termination of
     all outstanding  Letters of Credit (whether or not any of such  obligations
     are due) and all other Obligations;  (ii) constituting  property being sold
     or  disposed  of if the  Borrower  certifies  to the Agent that the sale or
     disposition is made in compliance  with Section 7.9 (and the Agent may rely
     conclusively  on any such  certificate,  without  further  inquiry);  (iii)
     constituting  property in which the Borrower  owned no interest at the time
     the  Lien  was  granted  or at any time  thereafter;  or (iv)  constituting
     property  leased to the  Borrower  under a lease  which has expired or been
     terminated in a transaction permitted under this Agreement. Any other sale,
     lease,  sale/leaseback,  or  mortgaging of any  collateral  shall be solely
     subject to the Agent's consent.

          (b) Upon receipt by the Agent of any  authorization  required pursuant
     to Section  12.11(a)  from the Lenders of the Agent's  authority to release
     Agent's Liens upon  particular  types or items of  Collateral,  and upon at
     least five (5) Business  Days prior written  request by the  Borrower,  the
     Agent  shall  (and is hereby  irrevocably  authorized  by the  Lenders  to)
     execute  such  documents as may be necessary to evidence the release of the
     Agent's Liens upon such Collateral;  provided,  however, that (i) the Agent


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<PAGE>

     shall not be required to execute any such  document on terms which,  in the
     Agent's  opinion,  would  expose  the  Agent to  liability  or  create  any
     obligation or entail any  consequence  other than the release of such Liens
     without recourse or warranty, and (ii) such release shall not in any manner
     discharge,  affect or impair the Obligations or any Liens (other than those
     expressly  being  released) upon (or obligations of the Borrower in respect
     of) all interests  retained by the Borrower,  including the proceeds of any
     sale, all of which shall continue to constitute part of the Collateral.

          (c) The  Agent  shall  have  no  obligation  whatsoever  to any of the
     Lenders to assure that the Collateral exists or is owned by the Borrower or
     is cared for,  protected  or insured  or has been  encumbered,  or that the
     Agent's  Liens have been  properly or  sufficiently  or  lawfully  created,
     perfected,  protected  or  enforced  or  are  entitled  to  any  particular
     priority,  or to exercise at all or in any  particular  manner or under any
     duty of care, disclosure or fidelity, or to continue exercising, any of the
     rights,  authorities  and powers granted or available to the Agent pursuant
     to any of the  Loan  Documents,  it being  understood  and  agreed  that in
     respect of the Collateral,  or any act,  omission or event related thereto,
     the  Agent  may act in any  manner  it may  deem  appropriate,  in its sole
     discretion given the Agent's own interest in the Collateral in its capacity
     as one of the  Lenders  and  that the  Agent  shall  have no other  duty or
     liability whatsoever to any Lender as to any of the foregoing.

          12.12  Restrictions  on  Actions  by  Lenders;  Sharing  of  Payments.

          (a) Each of the Lenders agrees that it shall not,  without the express
     consent of all  Lenders,  and that it shall,  to the extent it is  lawfully
     entitled  to do so, upon the  request of all  Lenders,  set off against the
     Obligations,  any  amounts  owing by such  Lender  to the  Borrower  or any
     accounts of the Borrower now or hereafter maintained with such Lender. Each
     of the  Lenders  further  agrees  that it shall  not,  unless  specifically
     requested  to do so by the  Agent,  take or cause to be taken any action to
     enforce its rights under this Agreement or against the Borrower,  including
     the  commencement of any legal or equitable  proceedings,  to foreclose any
     Lien  on,  or  otherwise  enforce  any  security  interest  in,  any of the
     Collateral.

          (b) If at any time or times any Lender  shall  receive (i) by payment,
     foreclosure,  setoff  or  otherwise,  any  proceeds  of  Collateral  or any
     payments  with  respect to the  Obligations  of the Borrower to such Lender
     arising under,  or relating to, this Agreement or the other Loan Documents,
     except for any such  proceeds or payments  received by such Lender from the
     Agent  pursuant to the terms of this  Agreement,  or (ii) payments from the
     Agent in excess of such Lender's ratable portion of all such  distributions
     by the Agent,  such  Lender  shall  promptly  (1) turn the same over to the
     Agent, in kind, and with such  endorsements as may be required to negotiate
     the same to the Agent, or in same day funds, as applicable, for the account
     of all of the Lenders and for  application to the Obligations in accordance
     with the applicable provisions of this Agreement, or (2) purchase,  without
     recourse or  warranty,  an  undivided  interest  and  participation  in the
     Obligations  owed to the other Lenders so that such excess payment received
     shall be applied  ratably as among the Lenders in accordance with their Pro
     Rata Shares; provided,  however, that if all or part of such excess payment
     received by the  purchasing  party is thereafter  recovered  from it, those
     purchases of  participations  shall be  rescinded  in whole or in part,  as
     applicable,  and the applicable portion of the purchase price paid therefor
     shall be returned to such purchasing  party, but without interest except to
     the extent  that such  purchasing  party is  required  to pay  interest  in
     connection with the recovery of the excess payment.

          12.13 Agency for  Perfection.  Each Lender hereby  appoints each other
     Lender  as agent  for the  purpose  of  perfecting  the  Lenders'  security
     interest in assets which,  in  accordance  with Article 9 of the UCC can be


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<PAGE>

     perfected  only by  possession.  Should any Lender  (other  than the Agent)
     obtain  possession  of any such  Collateral,  such Lender  shall notify the
     Agent  thereof,  and,  promptly  upon the Agent's  request  therefor  shall
     deliver  such  Collateral  to the Agent or in  accordance  with the Agent's
     instructions.

          12.14  Payments  by Agent to Lenders.  All  payments to be made by the
     Agent  to the  Lenders  shall be made by bank  wire  transfer  or  internal
     transfer of  immediately  available  funds to each Lender  pursuant to wire
     transfer instructions  delivered in writing to the Agent on or prior to the
     Closing  Date  (or  if  such  Lender  is an  Assignee,  on  the  applicable
     Assignment  and  Acceptance),  or  pursuant  to such  other  wire  transfer
     instructions  as each party may designate  for itself by written  notice to
     the Agent.  Concurrently  with each such payment,  the Agent shall identify
     whether such payment (or any portion thereof) represents principal, premium
     or interest on the Revolving Loans or otherwise.  Unless the Agent receives
     notice from the  Borrower  prior to the date on which any payment is due to
     the Lenders  that the  Borrower  will not make such  payment in full as and
     when required, the Agent may assume that the Borrower has made such payment
     in full to the Agent on such date in  immediately  available  funds and the
     Agent may (but shall not be so required), in reliance upon such assumption,
     distribute  to each  Lender on such due date an amount  equal to the amount
     then due such  Lender.  If and to the extent the Borrower has not made such
     payment  in full to the  Agent,  each  Lender  shall  repay to the Agent on
     demand such amount  distributed  to such  Lender,  together  with  interest
     thereon at the Federal Funds Rate for each day from the date such amount is
     distributed to such Lender until the date repaid.

          12.15 Settlement.

          (a) (i)  Each  Lender's  funded  portion  of the  Revolving  Loans  is
     intended by the Lenders to be equal at all times to such  Lender's Pro Rata
     Share of the outstanding  Revolving Loans.  Notwithstanding such agreement,
     the Agent, the Bank, and the other Lenders agree (which agreement shall not
     be for the  benefit of or  enforceable  by the  Borrower)  that in order to
     facilitate  the  administration  of  this  Agreement  and  the  other  Loan
     Documents, settlement among them as to the Revolving Loans, the Non-Ratable
     Loans  and the Agent  Advances  shall  take  place on a  periodic  basis in
     accordance with the following provisions:

          (ii) The Agent may request settlement  ("Settlement") with the Lenders
     on at  least  a  weekly  basis,  or on a more  frequent  basis  at  Agent's
     election,  (A) on behalf  of the Bank,  with  respect  to each  outstanding
     Non-Ratable Loan, (B) for itself,  with respect to each Agent Advance,  and
     (C) with respect to  collections  received,  in each case, by notifying the
     Lenders  of such  requested  Settlement  by  telecopy,  telephone  or other
     similar form of transmission,  of such requested Settlement,  no later than
     12:00 noon (Central Standard Time) on the date of such requested Settlement
     (the "Settlement  Date").  Each Lender (other than the Bank, in the case of
     Non-Ratable  Loans  and the  Agent  in the case of  Agent  Advances)  shall
     transfer  the amount of such  Lender's  Pro Rata  Share of the  outstanding
     principal  amount of the Non-Ratable  Loans and Agent Advances with respect
     to each  Settlement to the Agent, to Agent's  account,  not later than 2:00
     p.m.  (Central  Standard Time), on the Settlement Date applicable  thereto.
     Settlements  may occur during the  continuation of a Default or an Event of
     Default and whether or not the applicable conditions precedent set forth in
     Article 8 have then been  satisfied.  Such  amounts  made  available to the
     Agent shall be applied  against the amounts of the  applicable  Non-Ratable
     Loan or Agent Advance and,  together  with the portion of such  Non-Ratable
     Loan or Agent Advance representing the Bank's Pro Rata Share thereof, shall
     constitute  Revolving  Loans of such  Lenders.  If any such  amount  is not
     transferred  to the Agent by any Lender on the Settlement  Date  applicable
     thereto,  the Agent shall be entitled to recover such amount on demand from
     such Lender  together with  interest  thereon at the Federal Funds Rate for
     the first three (3) days from and after the Settlement  Date and thereafter
     at the Interest Rate then  applicable to the Revolving  Loans (A) on behalf
     of the Bank, with respect to each outstanding Non-Ratable Loan, and (B) for
     itself, with respect to each Agent Advance.

                                       55
<PAGE>

          (iii)  Notwithstanding  the foregoing,  not more than one (1) Business
     Day  after  demand  is made by the  Agent  (whether  before  or  after  the
     occurrence  of a Default or an Event of Default and  regardless  of whether
     the Agent has requested a Settlement with respect to a Non-Ratable  Loan or
     Agent Advance), each other Lender (A) shall irrevocably and unconditionally
     purchase and receive  from the Bank or the Agent,  as  applicable,  without
     recourse or warranty,  an  undivided  interest  and  participation  in such
     Non-Ratable  Loan or Agent Advance equal to such Lender's Pro Rata Share of
     such  Non-Ratable  Loan or  Agent  Advance  and (B) if  Settlement  has not
     previously  occurred  with  respect  to such  Non-Ratable  Loans  or  Agent
     Advances, upon demand by Bank or Agent, as applicable, shall pay to Bank or
     Agent, as applicable, as the purchase price of such participation an amount
     equal to one-hundred percent (100%) of such Lender's Pro Rata Share of such
     Non-Ratable  Loans or Agent  Advances.  If such  amount is not in fact made
     available  to the Agent by any  Lender,  the  Agent  shall be  entitled  to
     recover  such  amount on demand  from such Lender  together  with  interest
     thereon at the  Federal  Funds  Rate for the first  three (3) days from and
     after such demand and  thereafter at the Interest  Rate then  applicable to
     Base Rate Revolving Loans.

          (iv) From and after the date, if any, on which any Lender purchases an
     undivided  interest  and  participation  in any  Non-Ratable  Loan or Agent
     Advance pursuant to clause (iii) above, the Agent shall promptly distribute
     to such Lender,  such  Lender's Pro Rata Share of all payments of principal
     and  interest  and all  proceeds  of  Collateral  received  by the Agent in
     respect of such Non-Ratable Loan or Agent Advance.

          (v)  Between  Settlement  Dates,  the  Agent,  to the  extent no Agent
     Advances are outstanding, may pay over to the Bank any payments received by
     the Agent,  which in accordance  with the terms of this Agreement  would be
     applied to the reduction of the Revolving  Loans,  for  application  to the
     Bank's  Revolving  Loans  including   Non-Ratable  Loans.  If,  as  of  any
     Settlement Date,  collections received since the then immediately preceding
     Settlement Date have been applied to the Bank's Revolving Loans (other than
     to  Non-Ratable  Loans or Agent  Advances  in which such Lender has not yet
     funded its purchase of a participation  pursuant to clause (iii) above), as
     provided for in the previous sentence,  the Bank shall pay to the Agent for
     the accounts of the  Lenders,  to be applied to the  outstanding  Revolving
     Loans of such Lenders,  an amount such that each Lender shall, upon receipt
     of such amount, have, as of such Settlement Date, its Pro Rata Share of the
     Revolving Loans.  During the period between Settlement Dates, the Bank with
     respect to Non-Ratable Loans, the Agent with respect to Agent Advances, and
     each  Lender with  respect to the  Revolving  Loans other than  Non-Ratable
     Loans and Agent  Advances,  shall be entitled to interest at the applicable
     rate or rates  payable  under this  Agreement on the actual  average  daily
     amount of funds employed by the Bank, the Agent and the other Lenders.

          (vi) Unless the Agent has received written notice from a Lender to the
     contrary, the Agent may assume that the applicable conditions precedent set
     forth in Article 8 have been satisfied and the requested Borrowing will not
     exceed Availability on any Funding Date for a Revolving Loan or Non-Ratable
     Loan.

          (b)  Lenders'  Failure to Perform.  All  Revolving  Loans  (other than
     Non-Ratable  Loans  and  Agent  Advances)  shall  be  made  by the  Lenders
     simultaneously  and  in  accordance  with  their  Pro  Rata  Shares.  It is
     understood  that (i) no Lender shall be responsible  for any failure by any
     other  Lender  to  perform  its  obligation  to make  any  Revolving  Loans
     hereunder, nor shall any Commitment of any Lender be increased or decreased
     as a result of any failure by any other Lender to perform its obligation to
     make any  Revolving  Loans  hereunder,  (ii) no  failure  by any  Lender to
     perform its obligation to make any Revolving  Loans  hereunder shall excuse
     any other Lender from its obligation to make any Revolving Loans hereunder,
     and (iii) the obligations of each Lender  hereunder  shall be several,  not
     joint and several.

                                       56
<PAGE>

          (c) Defaulting Lenders. Unless the Agent receives notice from a Lender
     on or prior to the Closing Date or, with respect to any Borrowing after the
     Closing  Date,  at  least  one  Business  Day  prior  to the  date  of such
     Borrowing,  that such Lender will not make  available as and when  required
     hereunder to the Agent that  Lender's  Pro Rata Share of a  Borrowing,  the
     Agent may assume  that each Lender has made such  amount  available  to the
     Agent in immediately available funds on the Funding Date. Furthermore,  the
     Agent may, in reliance upon such assumption, make available to the Borrower
     on such date a corresponding  amount. If any Lender has not transferred its
     full Pro Rata  Share to the Agent in  immediately  available  funds and the
     Agent has transferred  corresponding amount to the Borrower on the Business
     Day  following  such  Funding  Date that  Lender  shall  make  such  amount
     available to the Agent,  together  with  interest at the Federal Funds Rate
     for that day. A notice by the Agent submitted to any Lender with respect to
     amounts owing shall be conclusive,  absent manifest error. If each Lender's
     full Pro Rata Share is  transferred  to the Agent as  required,  the amount
     transferred to the Agent shall constitute that Lender's  Revolving Loan for
     all purposes of this  Agreement.  If that amount is not  transferred to the
     Agent on the Business Day following the Funding Date, the Agent will notify
     the  Borrower of such  failure to fund and,  upon demand by the Agent,  the
     Borrower  shall  pay such  amount to the  Agent  for the  Agent's  account,
     together with interest  thereon for each day elapsed since the date of such
     Borrowing, at a rate per annum equal to the Interest Rate applicable at the
     time to the Revolving  Loans  comprising  that  particular  Borrowing.  The
     failure of any Lender to make any  Revolving  Loan on any Funding Date (any
     such Lender, prior to the cure of such failure,  being hereinafter referred
     to as a  "Defaulting  Lender")  shall not relieve  any other  Lender of its
     obligation  hereunder  to make a Revolving  Loan on that Funding  Date.  No
     Lender shall be responsible for any other Lender's  failure to advance such
     other Lenders' Pro Rata Share of any Borrowing.

          (d) Retention of Defaulting Lender's Payments.  The Agent shall not be
     obligated to transfer to a Defaulting  Lender any payments made by Borrower
     to the Agent for the Defaulting  Lender's  benefit;  nor shall a Defaulting
     Lender be  entitled  to the  sharing  of any  payments  hereunder.  Amounts
     payable to a Defaulting  Lender shall instead be paid to or retained by the
     Agent.  In its  discretion,  the Agent may loan  Borrower the amount of all
     such payments received or retained by it for the account of such Defaulting
     Lender.  Any amounts so loaned to the Borrower  shall bear  interest at the
     rate  applicable to Base Rate Revolving Loans and for all other purposes of
     this Agreement shall be treated as if they were Revolving Loans,  provided,
     however,  that for purposes of voting or consenting to matters with respect
     to the Loan  Documents and  determining  Pro Rata Shares,  such  Defaulting
     Lender  shall be deemed not to be a  "Lender".  Until a  Defaulting  Lender
     cures its  failure  to fund its Pro Rata  Share of any  Borrowing  (A) such
     Defaulting  Lender  shall not be entitled to any portion of the Unused Line
     Fee and (B) the Unused Line Fee shall accrue in favor of the Lenders  which
     have funded their  respective Pro Rata Shares of such  requested  Borrowing
     and shall be allocated  among such  performing  Lenders  ratably based upon
     their  relative  Commitments.  This  Section  shall remain  effective  with
     respect to such Lender  until such time as the  Defaulting  Lender shall no
     longer be in default of any of its obligations  under this  Agreement.  The
     terms of this  Section  shall not be  construed  to increase  or  otherwise
     affect the Commitment of any Lender,  or relieve or excuse the  performance
     by the Borrower of its duties and obligations hereunder.

          (e) Removal of Defaulting Lender. At the Borrower's request, the Agent
     or an Eligible Assignee reasonably acceptable to the Agent and the Borrower
     shall  have  the  right  (but  not the  obligation)  to  purchase  from any
     Defaulting  Lender,  and each Defaulting  Lender shall,  upon such request,
     sell  and  assign  to the  Agent  or  such  Eligible  Assignee,  all of the
     Defaulting Lender's outstanding  Commitments hereunder.  Such sale shall be
     consummated promptly after Agent has arranged for a purchase by Agent or an
     Eligible Assignee pursuant to an Assignment and Acceptance,  and at a price
     equal to the  outstanding  principal  balance  of the  Defaulting  Lender's
     Loans, plus accrued interest and fees, without premium or discount.

                                       57
<PAGE>

          12.16 Letters of Credit; Intra-Lender Issues.

          (a) Notice of Letter of Credit  Balance.  On each  Settlement Date the
     Agent shall  notify  each  Lender of the  issuance of all Letters of Credit
     since the prior Settlement Date.

          (b) Participations in Letters of Credit.

          (i)  Purchase  of  Participations.  Immediately  upon  issuance of any
     Letter of Credit in accordance  with Section  1.4(d),  each Lender shall be
     deemed to have  irrevocably  and  unconditionally  purchased  and  received
     without recourse or warranty, an undivided interest and participation equal
     to such Lender's Pro Rata Share of the face amount of such Letter of Credit
     or the Credit  Support  provided  through the Agent to the Letter of Credit
     Issuer,  if not the Bank, in connection with the issuance of such Letter of
     Credit (including all obligations of the Borrower with respect thereto, and
     any security therefor or guaranty pertaining thereto).

          (ii) Sharing of Reimbursement Obligation Payments.  Whenever the Agent
     receives  a  payment  from  the   Borrower  on  account  of   reimbursement
     obligations  in respect of a Letter of Credit or Credit Support as to which
     the Agent has  previously  received for the account of the Letter of Credit
     Issuer thereof payment from a Lender,  the Agent shall promptly pay to such
     Lender such Lender's Pro Rata Share of such payment from the Borrower. Each
     such payment shall be made by the Agent on the next Settlement Date.

          (iii)  Documentation.  Upon the request of any Lender, the Agent shall
     furnish to such Lender copies of any Letter of Credit,  Credit  Support for
     any Letter of  Credit,  reimbursement  agreements  executed  in  connection
     therewith,   applications  for  any  Letter  of  Credit,   and  such  other
     documentation as may reasonably be requested by such Lender.

          (iv) Obligations  Irrevocable.  The obligations of each Lender to make
     payments to the Agent with  respect to any Letter of Credit or with respect
     to their  participation  therein or with respect to any Credit  Support for
     any  Letter of Credit or with  respect  to the  Revolving  Loans  made as a
     result of a drawing  under a Letter of Credit  and the  obligations  of the
     Borrower  for whose  account  the  Letter of Credit or Credit  Support  was
     issued to make payments to the Agent, for the account of the Lenders, shall
     be irrevocable and shall not be subject to any  qualification  or exception
     whatsoever, including any of the following circumstances:

          (1) any lack of validity or enforceability of this Agreement or any of
     the other Loan Documents;

          (2) the existence of any claim,  setoff,  defense or other right which
     the Borrower may have at any time against a  beneficiary  named in a Letter
     of Credit or any transferee of any Letter of Credit (or any Person for whom
     any such transferee may be acting),  any Lender,  the Agent,  the issuer of
     such Letter of Credit, or any other Person, whether in connection with this
     Agreement,  any Letter of Credit, the transactions  contemplated  herein or
     any unrelated transactions  (including any underlying  transactions between
     the Borrower or any other Person and the beneficiary named in any Letter of
     Credit);

          (3) any draft,  certificate or any other document  presented under the
     Letter of Credit proving to be forged, fraudulent,  invalid or insufficient
     in any respect or any  statement  therein being untrue or inaccurate in any
     respect;

                                       58
<PAGE>

          (4) the surrender or impairment of any security for the performance or
     observance of any of the terms of any of the Loan Documents;

          (5) the occurrence of any Default or Event of Default; or

          (6) the failure of the Borrower to satisfy the  applicable  conditions
     precedent set forth in Article 8.

          (c) Recovery or Avoidance of Payments; Refund of Payments In Error. In
     the event any payment by or on behalf of the Borrower received by the Agent
     with  respect to any Letter of Credit or Credit  Support  provided  for any
     Letter of Credit and  distributed by the Agent to the Lenders on account of
     their respective participations therein is thereafter set aside, avoided or
     recovered from the Agent in connection with any  receivership,  liquidation
     or bankruptcy proceeding,  the Lenders shall, upon demand by the Agent, pay
     to the Agent  their  respective  Pro Rata  Shares of such amount set aside,
     avoided or  recovered,  together  with  interest at the rate required to be
     paid by the Agent upon the amount  required to be repaid by it.  Unless the
     Agent  receives  notice  from the  Borrower  prior to the date on which any
     payment is due to the Lenders that the Borrower  will not make such payment
     in full as and when  required,  the Agent may assume that the  Borrower has
     made  such  payment  in  full to the  Agent  on  such  date in  immediately
     available  funds  and the  Agent may (but  shall  not be so  required),  in
     reliance upon such  assumption,  distribute to each Lender on such due date
     an amount  equal to the amount then due such  Lender.  If and to the extent
     the Borrower  has not made such  payment in full to the Agent,  each Lender
     shall repay to the Agent on demand such amount  distributed to such Lender,
     together with interest  thereon at the Federal Funds Rate for each day from
     the date such amount is distributed to such Lender until the date repaid.

          (d)  Indemnification  by Lenders.  To the extent not reimbursed by the
     Borrower and without  limiting the  obligations of the Borrower  hereunder,
     the  Lenders  agree to  indemnify  the Letter of Credit  Issuer  ratably in
     accordance  with  their  respective  Pro  Rata  Shares,  for  any  and  all
     liabilities,  obligations,  losses, damages, penalties, actions, judgments,
     suits, costs,  expenses (including attorneys' fees) or disbursements of any
     kind and nature  whatsoever that may be imposed on, incurred by or asserted
     against the Letter of Credit  Issuer in any way  relating to or arising out
     of any  Letter of Credit or the  transactions  contemplated  thereby or any
     action taken or omitted by the Letter of Credit  Issuer under any Letter of
     Credit or any Loan  Document  in  connection  therewith;  provided  that no
     Lender  shall be liable  for any of the  foregoing  to the extent it arises
     from the  gross  negligence  or  willful  misconduct  of the  Person  to be
     indemnified.  Without  limitation of the  foregoing,  each Lender agrees to
     reimburse the Letter of Credit Issuer promptly upon demand for its Pro Rata
     Share of any costs or  expenses  payable by the  Borrower  to the Letter of
     Credit  Issuer,  to the  extent  that the  Letter of  Credit  Issuer is not
     promptly  reimbursed  for such  costs and  expenses  by the  Borrower.  The
     agreement  contained in this Section shall  survive  payment in full of all
     other Obligations.

          12.17  Concerning the Collateral and the Related Loan Documents.  Each
     Lender  authorizes  and  directs  the Agent to enter  into the  other  Loan
     Documents,  for the  ratable  benefit and  obligation  of the Agent and the
     Lenders.  Each Lender  agrees that any action taken by the Agent,  Majority
     Lenders or Required Lenders, as applicable, in accordance with the terms of
     this Agreement or the other Loan Documents,  and the exercise by the Agent,
     the Majority  Lenders,  or the Required  Lenders,  as applicable,  of their
     respective  powers set forth  therein or herein,  together  with such other
     powers that are reasonably incidental thereto, shall be binding upon all of
     the  Lenders.  The Lenders  acknowledge  that the  Revolving  Loans,  Agent
     Advances,  Non-Ratable  Loans,  Hedge  Agreements,  Bank  Products  and all
     interest,  fees and expenses  hereunder  constitute one Debt,  secured pari
     passu by all of the Collateral.

                                       59
<PAGE>

          12.18 Field Audit and Examination  Reports;  Disclaimer by Lenders. By
     signing this Agreement, each Lender:

          (a) is deemed to have  requested  that the Agent  furnish such Lender,
     promptly  after  it  becomes  available,  a copy of  each  field  audit  or
     examination report (each a "Report" and collectively,  "Reports")  prepared
     by or on behalf of the Agent;

          (b) expressly  agrees and  acknowledges  that neither the Bank nor the
     Agent (i) makes any  representation  or warranty as to the  accuracy of any
     Report,  or (ii)  shall be  liable  for any  information  contained  in any
     Report;

          (c)  expressly  agrees  and  acknowledges  that  the  Reports  are not
     comprehensive  audits or examinations,  that the Agent or the Bank or other
     party  performing  any audit or  examination  will  inspect  only  specific
     information  regarding  the Borrower and will rely  significantly  upon the
     Borrower's  books  and  records,  as  well  as on  representations  of  the
     Borrower's personnel;

          (d)  agrees to keep all  Reports  confidential  and  strictly  for its
     internal use, and not to distribute except to its participants,  or use any
     Report in any other manner; and

          (e)  without  limiting  the  generality  of any other  indemnification
     provision  contained in this Agreement,  agrees:  (i) to hold the Agent and
     any such  other  Lender  preparing  a Report  harmless  from any action the
     indemnifying  Lender may take or  conclusion  the  indemnifying  Lender may
     reach or draw from any Report in connection  with any loans or other credit
     accommodations  that the  indemnifying  Lender  has made or may make to the
     Borrower,   or  the  indemnifying   Lender's   participation   in,  or  the
     indemnifying  Lender's  purchase of, a loan or loans of the  Borrower;  and
     (ii) to pay and protect,  and indemnify,  defend and hold the Agent and any
     such other Lender preparing a Report harmless from and against, the claims,
     actions, proceedings, damages, costs, expenses and other amounts (including
     Attorney Costs) incurred by the Agent and any such other Lender preparing a
     Report as the  direct or  indirect  result of any third  parties  who might
     obtain all or part of any Report through the indemnifying Lender.

          12.19  Relation  Among  Lenders.  The  Lenders  are  not  partners  or
     co-venturers,  and no Lender shall be liable for the acts or omissions  of,
     or (except as otherwise  set forth herein in case of the Agent)  authorized
     to act for, any other Lender.

                                   ARTICLE 13
                                  MISCELLANEOUS

          13.1 No Waivers;  Cumulative Remedies.  No failure by the Agent or any
     Lender to exercise any right, remedy, or option under this Agreement or any
     present or future supplement  thereto, or in any other agreement between or
     among the Borrower  and the Agent and/or any Lender,  or delay by the Agent
     or any Lender in exercising the same, will operate as a waiver thereof.  No
     waiver  by the  Agent  or any  Lender  will be  effective  unless  it is in
     writing,  and then only to the extent specifically stated. No waiver by the
     Agent or the Lenders on any  occasion  shall affect or diminish the Agent's
     and each Lender's  rights  thereafter to require strict  performance by the
     Borrower of any provision of this Agreement.  The Agent and the Lenders may
     proceed  directly to collect the Obligations  without any prior recourse to
     the  Collateral.  The Agent's and each Lender's rights under this Agreement
     will be cumulative and not exclusive of any other right or remedy which the
     Agent or any Lender may have.

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<PAGE>

          13.2 Severability. The illegality or unenforceability of any provision
     of this  Agreement  or any Loan  Document or any  instrument  or  agreement
     required  hereunder  shall not in any way affect or impair the  legality or
     enforceability  of  the  remaining  provisions  of  this  Agreement  or any
     instrument or agreement required hereunder.

          13.3   Governing   Law;   Choice  of  Forum;   Service   of   Process.

          (a) THIS AGREEMENT SHALL BE INTERPRETED AND THE RIGHTS AND LIABILITIES
     OF THE PARTIES HERETO  DETERMINED IN ACCORDANCE  WITH THE INTERNAL LAWS (AS
     OPPOSED TO THE CONFLICT OF LAWS PROVISIONS  PROVIDED THAT PERFECTION ISSUES
     WITH RESPECT TO ARTICLE 9 OF THE UCC MAY GIVE EFFECT TO  APPLICABLE  CHOICE
     OR CONFLICT OF LAW RULES SET FORTH IN ARTICLE 9 OF THE UCC) OF THE STATE OF
     TEXAS;  PROVIDED  THAT THE AGENT AND THE  LENDERS  SHALL  RETAIN ALL RIGHTS
     ARISING UNDER FEDERAL LAW.

          (b) ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS  AGREEMENT OR
     ANY OTHER LOAN  DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS
     OR OF THE UNITED STATES OF AMERICA LOCATED IN DALLAS COUNTY,  TEXAS, AND BY
     EXECUTION AND DELIVERY OF THIS AGREEMENT,  EACH OF THE BORROWER,  THE AGENT
     AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
     NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE BORROWER, THE AGENT
     AND THE LENDERS  IRREVOCABLY WAIVES ANY OBJECTION,  INCLUDING ANY OBJECTION
     TO THE  LAYING OF VENUE OR BASED ON THE  GROUNDS  OF FORUM NON  CONVENIENS,
     WHICH  IT MAY  NOW OR  HEREAFTER  HAVE TO THE  BRINGING  OF ANY  ACTION  OR
     PROCEEDING  IN  SUCH  JURISDICTION  IN  RESPECT  OF THIS  AGREEMENT  OR ANY
     DOCUMENT RELATED HERETO.  NOTWITHSTANDING THE FOREGOING:  (1) THE AGENT AND
     THE LENDERS SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING  AGAINST
     THE  BORROWER OR ITS PROPERTY IN THE COURTS OF ANY OTHER  JURISDICTION  THE
     AGENT OR THE LENDERS DEEM  NECESSARY OR  APPROPRIATE IN ORDER TO REALIZE ON
     THE  COLLATERAL OR OTHER SECURITY FOR THE  OBLIGATIONS  AND (2) EACH OF THE
     PARTIES HERETO  ACKNOWLEDGES  THAT ANY APPEALS FROM THE COURTS DESCRIBED IN
     THE IMMEDIATELY  PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED
     OUTSIDE THOSE JURISDICTIONS.

          (c) THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS
     UPON IT AND  CONSENTS  THAT  ALL SUCH  SERVICE  OF  PROCESS  MAY BE MADE BY
     REGISTERED MAIL (RETURN RECEIPT REQUESTED)  DIRECTED TO THE BORROWER AT ITS
     ADDRESS SET FORTH IN SECTION 13.8 AND SERVICE SO MADE SHALL BE DEEMED TO BE
     COMPLETED  FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE
     U.S. MAILS POSTAGE PREPAID. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT
     OF  AGENT OR THE  LENDERS  TO  SERVE  LEGAL  PROCESS  BY ANY  OTHER  MANNER
     PERMITTED BY LAW.

          13.4 WAIVER OF JURY  TRIAL.  THE  BORROWER,  THE LENDERS AND THE AGENT
     EACH IRREVOCABLY  WAIVE THEIR  RESPECTIVE  RIGHTS TO A TRIAL BY JURY OF ANY
     CLAIM OR CAUSE OF ACTION  BASED UPON OR  ARISING  OUT OF OR RELATED TO THIS
     AGREEMENT,  THE OTHER  LOAN  DOCUMENTS,  OR THE  TRANSACTIONS  CONTEMPLATED
     HEREBY OR THEREBY,  IN ANY ACTION,  PROCEEDING  OR OTHER  LITIGATION OF ANY
     TYPE  BROUGHT  BY  ANY  OF THE  PARTIES  AGAINST  ANY  OTHER  PARTY  OR ANY
     AGENT-RELATED  PERSON,  PARTICIPANT  OR  ASSIGNEE,  WHETHER WITH RESPECT TO
     CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE.  THE BORROWER,  THE LENDERS AND


                                       61
<PAGE>

     THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION  SHALL BE TRIED
     BY A COURT  TRIAL  WITHOUT A JURY.  WITHOUT  LIMITING  THE  FOREGOING,  THE
     PARTIES  FURTHER  AGREE THAT THEIR  RESPECTIVE  RIGHT TO A TRIAL BY JURY IS
     WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER
     PROCEEDING  WHICH SEEKS,  IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
     ENFORCEABILITY  OF  THIS  AGREEMENT  OR THE  OTHER  LOAN  DOCUMENTS  OR ANY
     PROVISION  HEREOF OR  THEREOF.  THIS WAIVER  SHALL APPLY TO ANY  SUBSEQUENT
     AMENDMENTS,  RENEWALS,  SUPPLEMENTS OR  MODIFICATIONS TO THIS AGREEMENT AND
     THE OTHER LOAN DOCUMENTS.

          13.5 Survival of Representations and Warranties. All of the Borrower's
     representations  and warranties  contained in this Agreement  shall survive
     the  execution,   delivery,   and   acceptance   thereof  by  the  parties,
     notwithstanding  any  investigation  by the Agent or the  Lenders  or their
     respective agents.

          13.6 Other Security and Guaranties.  The Agent, may, without notice or
     demand and without  affecting the Borrower's  obligations  hereunder,  from
     time to time: (a) take from any Person and hold collateral  (other than the
     Collateral)  for the  payment  of all or any  part of the  Obligations  and
     exchange,  enforce or release such collateral or any part thereof;  and (b)
     accept and hold any  endorsement  or guaranty of payment of all or any part
     of  the  Obligations  and  release  or  substitute  any  such  endorser  or
     guarantor,  or any Person who has given any Lien in any other collateral as
     security  for the  payment  of all or any part of the  Obligations,  or any
     other  Person  in  any  way  obligated  to  pay  all  or  any  part  of the
     Obligations.

          13.7 Fees and Expenses.  The Borrower agrees to pay to the Agent,  for
     its benefit, on demand, all costs and expenses that Agent pays or incurs in
     connection with the negotiation,  preparation,  syndication,  consummation,
     administration,  enforcement,  and  termination of this Agreement or any of
     the other Loan  Documents,  including:  (a) Attorney  Costs;  (b) costs and
     expenses (including  attorneys' and paralegals' fees and disbursements) for
     any  amendment,  supplement,  waiver,  consent,  or  subsequent  closing in
     connection  with  the  Loan  Documents  and the  transactions  contemplated
     thereby;  (c)  costs and  expenses  of lien and  title  searches  and title
     insurance;  (d) taxes,  fees and other charges for recording the Mortgages,
     filing  financing  statements  and  continuations,  and  other  actions  to
     perfect,  protect,  and continue  the Agent's  Liens  (including  costs and
     expenses paid or incurred by the Agent in connection with the  consummation
     of  Agreement);  (e) sums paid or  incurred  to pay any  amount or take any
     action  required of the Borrower under the Loan Documents that the Borrower
     fails  to  pay  or  take;  (f)  costs  of  appraisals,   inspections,   and
     verifications of the Collateral,  including travel,  lodging, and meals for
     inspections of the  Collateral  and the Borrower's  operations by the Agent
     plus the Agent's then customary  charge for field  examinations  and audits
     and the preparation of reports thereof (such charge is currently [$750] per
     day (or portion  thereof) for each Person retained or employed by the Agent
     with  respect  to each  field  examination  or  audit);  and (g)  costs and
     expenses of forwarding loan proceeds,  collecting checks and other items of
     payment,  and establishing and maintaining Payment Accounts and lock boxes,
     and costs and expenses of preserving  and  protecting  the  Collateral.  In
     addition,  the Borrower  agrees to pay costs and  expenses  incurred by the
     Agent  (including  Attorneys'  Costs) to the  Agent,  for its  benefit,  on
     demand,  and to the other  Lenders for their  benefit,  on demand,  and all
     reasonable fees, expenses and disbursements  incurred by such other Lenders
     for one law firm  retained  by such other  Lenders,  in each case,  paid or
     incurred to obtain payment of the  Obligations,  enforce the Agent's Liens,
     sell or otherwise  realize upon the Collateral,  and otherwise  enforce the
     provisions  of  the  Loan  Documents,  or to  defend  any  claims  made  or
     threatened  against the Agent or any Lender arising out of the transactions
     contemplated   hereby   (including   preparations  for  and   consultations
     concerning any such matters). The foregoing shall not be construed to limit
     any other provisions of the Loan Documents  regarding costs and expenses to


                                       62
<PAGE>

     be paid by the Borrower.  All of the foregoing  costs and expenses shall be
     charged to the Borrower's  Loan Account as Revolving  Loans as described in
     Section 3.7.

          13.8  Notices.  Except as  otherwise  provided  herein,  all  notices,
     demands  and  requests  that any party is required or elects to give to any
     other shall be in writing,  or by a  telecommunications  device  capable of
     creating a written record,  and any such notice shall become  effective (a)
     upon personal delivery thereof,  including, but not limited to, delivery by
     overnight mail and courier  service,  (b) four (4) days after it shall have
     been mailed by United States mail,  first class,  certified or  registered,
     with   postage   prepaid,   or  (c)  in  the  case  of  notice  by  such  a
     telecommunications   device,  when  properly  transmitted,   in  each  case
     addressed to the party to be notified as follows:

                  If to the Agent or to the Lender:

                           Bank of America, N.A.
                           901 Main Street, 22nd Floor
                           Mailcode:  TX1-492-22-13
                           Dallas, Texas  75202
                           Attention:  Joy L. Bartholomew
                           Telecopy No.:    214.209.4766


                           with copies to:


                           Haynes and Boone, LLP
                           901 Main Street, Suite 3100
                           Dallas, TX  75202
                           Attention:       Sue P. Murphy
                           Telecopy No.:    214.200.0565

                  If to the Borrower:

                           Central Freight Lines, Inc.
                           5601 West Waco Drive
                           Waco, TX  76710
                           Attention:       Steve Owen
                           Telecopy No.:    254.741.5337


                           with copies to:
                           Scudder Law Firm, P.C. L.L.O.
                           411 South 13th St., Second Floor
                           Lincoln, Nebraska 68508
                           Attention:       Mark Scudder
                           Telecopy No.:    402.435.4239

     or to such other  address as each  party may  designate  for itself by like
     notice.  Failure  or delay in  delivering  copies  of any  notice,  demand,
     request,  consent,  approval,  declaration  or other  communication  to the
     persons  designated  above to receive copies shall not adversely affect the
     effectiveness  of  such  notice,  demand,   request,   consent,   approval,
     declaration or other communication.

                                       63
<PAGE>

          13.9 Waiver of Notices.  Unless otherwise  expressly  provided herein,
     the  Borrower  waives  presentment,  and notice of demand or  dishonor  and
     protest  as  to  any  instrument,   notice  of  intent  to  accelerate  the
     Obligations and notice of acceleration of the  Obligations,  as well as any
     and all other notices to which it might otherwise be entitled. No notice to
     or demand on the  Borrower  which the Agent or any Lender may elect to give
     shall entitle the Borrower to any or further  notice or demand in the same,
     similar or other circumstances.

          13.10  Binding  Effect.  The  provisions  of this  Agreement  shall be
     binding  upon and inure to the benefit of the  respective  representatives,
     successors,  and assigns of the parties hereto; provided,  however, that no
     interest  herein may be  assigned by the  Borrower  without  prior  written
     consent of the Agent and each Lender.  The rights and benefits of the Agent
     and the Lenders  hereunder  shall,  if such Persons so agree,  inure to any
     party acquiring any interest in the Obligations or any part thereof.

          13.11  Indemnity  of the  Agent  and  the  Lenders  by  the  Borrower.

          (a)  THE   BORROWER   AGREES  TO  DEFEND,   INDEMNIFY   AND  HOLD  THE
     AGENT-RELATED PERSONS, AND EACH LENDER AND EACH OF ITS RESPECTIVE OFFICERS,
     DIRECTORS,    EMPLOYEES,    COUNSEL,     REPRESENTATIVES,     AGENTS    AND
     ATTORNEYS-IN-FACT (EACH, AN "INDEMNIFIED PERSON") HARMLESS FROM AND AGAINST
     ANY AND ALL LIABILITIES,  OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS,
     JUDGMENTS,  SUITS, COSTS,  CHARGES,  EXPENSES AND DISBURSEMENTS  (INCLUDING
     ATTORNEY  COSTS)  OF ANY KIND OR  NATURE  WHATSOEVER  WHICH MAY AT ANY TIME
     (INCLUDING  AT  ANY  TIME   FOLLOWING   REPAYMENT  OF  THE  LOANS  AND  THE
     TERMINATION,  RESIGNATION OR REPLACEMENT OF THE AGENT OR REPLACEMENT OF ANY
     LENDER) BE IMPOSED ON,  INCURRED BY OR ASSERTED  AGAINST ANY SUCH PERSON IN
     ANY WAY  RELATING  TO OR  ARISING  OUT OF THIS  AGREEMENT  OR ANY  DOCUMENT
     CONTEMPLATED  BY OR REFERRED TO HEREIN,  OR THE  TRANSACTIONS  CONTEMPLATED
     HEREBY,  OR ANY  ACTION  TAKEN OR OMITTED  BY ANY SUCH  PERSON  UNDER OR IN
     CONNECTION  WITH  ANY OF  THE  FOREGOING,  INCLUDING  WITH  RESPECT  TO ANY
     INVESTIGATION,   LITIGATION  OR  PROCEEDING   (INCLUDING   ANY   INSOLVENCY
     PROCEEDING  OR  APPELLATE  PROCEEDING)  RELATED TO OR  ARISING  OUT OF THIS
     AGREEMENT, ANY OTHER LOAN DOCUMENT, OR THE LOANS OR THE USE OF THE PROCEEDS
     THEREOF,  WHETHER OR NOT ANY INDEMNIFIED PERSON IS A PARTY THERETO (ALL THE
     FOREGOING, COLLECTIVELY, THE "INDEMNIFIED LIABILITIES"); PROVIDED, THAT THE
     BORROWER SHALL HAVE NO OBLIGATION  HEREUNDER TO ANY INDEMNIFIED PERSON WITH
     RESPECT  TO  INDEMNIFIED  LIABILITIES  RESULTING  SOLELY  FROM THE  WILLFUL
     MISCONDUCT OF SUCH INDEMNIFIED PERSON. THE AGREEMENTS IN THIS SECTION SHALL
     SURVIVE PAYMENT OF ALL OTHER OBLIGATIONS.

          (b) THE BORROWER  AGREES TO  INDEMNIFY,  DEFEND AND HOLD  HARMLESS THE
     AGENT AND THE LENDERS  FROM ANY LOSS OR  LIABILITY  DIRECTLY OR  INDIRECTLY
     ARISING  OUT OF THE  USE,  GENERATION,  MANUFACTURE,  PRODUCTION,  STORAGE,
     RELEASE, THREATENED RELEASE, DISCHARGE, DISPOSAL OR PRESENCE OF A HAZARDOUS
     SUBSTANCE RELATING TO THE BORROWER'S OPERATIONS, BUSINESS OR PROPERTY. THIS
     INDEMNITY WILL APPLY WHETHER THE HAZARDOUS  SUBSTANCE IS ON, UNDER OR ABOUT
     THE BORROWER'S  PROPERTY OR OPERATIONS OR PROPERTY  LEASED TO THE BORROWER.
     THE INDEMNITY INCLUDES BUT IS NOT LIMITED TO ATTORNEYS COSTS. THE INDEMNITY
     EXTENDS  TO  THE  AGENT  AND  THE  LENDERS,   THEIR  PARENTS,   AFFILIATES,
     SUBSIDIARIES  AND ALL OF  THEIR  DIRECTORS,  OFFICERS,  EMPLOYEES,  AGENTS,

                                       64
<PAGE>

     SUCCESSORS,   ATTORNEYS  AND  ASSIGNS.  "HAZARDOUS  SUBSTANCES"  MEANS  ANY
     SUBSTANCE,  MATERIAL OR WASTE THAT IS OR BECOMES DESIGNATED OR REGULATED AS
     "TOXIC,"   "HAZARDOUS,"   "POLLUTANT,"  OR   "CONTAMINANT"   OR  A  SIMILAR
     DESIGNATION  OR REGULATION  UNDER ANY FEDERAL,  STATE OR LOCAL LAW (WHETHER
     UNDER  COMMON  LAW,  STATUTE,  REGULATION  OR  OTHERWISE)  OR  JUDICIAL  OR
     ADMINISTRATIVE  INTERPRETATION OF SUCH, INCLUDING PETROLEUM OR NATURAL GAS.
     THIS INDEMNITY WILL SURVIVE REPAYMENT OF ALL OTHER OBLIGATIONS.

          13.12  Limitation of Liability.  NO CLAIM MAY BE MADE BY THE BORROWER,
     ANY  LENDER  OR  OTHER  PERSON  AGAINST  THE  AGENT,  ANY  LENDER,  OR  THE
     AFFILIATES,   DIRECTORS,  OFFICERS,  EMPLOYEES,  COUNSEL,  REPRESENTATIVES,
     AGENTS  OR  ATTORNEYS-IN-FACT  OF ANY OF THEM  FOR ANY  SPECIAL,  INDIRECT,
     CONSEQUENTIAL  OR  PUNITIVE  DAMAGES  IN RESPECT OF ANY CLAIM FOR BREACH OF
     CONTRACT OR ANY OTHER THEORY OF LIABILITY  ARISING OUT OF OR RELATED TO THE
     TRANSACTIONS  CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
     ANY ACT,  OMISSION OR EVENT  OCCURRING  IN  CONNECTION  THEREWITH,  AND THE
     BORROWER AND EACH LENDER  HEREBY  WAIVE,  RELEASE AND AGREE NOT TO SUE UPON
     ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN
     OR SUSPECTED TO EXIST IN ITS FAVOR.

          13.13 Final  Agreement.  THIS  AGREEMENT AND THE OTHER LOAN  DOCUMENTS
     REPRESENT  THE  FINAL  AGREEMENT   BETWEEN  THE  PARTIES  AND  MAY  NOT  BE
     CONTRADICTED  BY EVIDENCE OF PRIOR,  CONTEMPORANEOUS,  OR  SUBSEQUENT  ORAL
     AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS  BETWEEN
     THE PARTIES. No modification,  rescission, waiver, release, or amendment of
     any provision of this  Agreement or any other Loan Document  shall be made,
     except by a written  agreement signed by the Borrower and a duly authorized
     officer of each of the Agent and the requisite Lenders.

          13.14  Counterparts.  This  Agreement may be executed in any number of
     counterparts,  and by the Agent,  each Lender and the  Borrower in separate
     counterparts,  each of which shall be an  original,  but all of which shall
     together  constitute  one and the same  agreement;  signature  pages may be
     detached  from  multiple  separate  counterparts  and  attached to a single
     counterpart so that all signature pages are physically attached to the same
     document.

          13.15  Captions.  The  captions  contained in this  Agreement  are for
     convenience of reference only, are without  substantive  meaning and should
     not be construed to modify, enlarge, or restrict any provision.

          13.16 Right of Setoff.  In addition to any rights and  remedies of the
     Lenders  provided by law,  if an Event of Default  exists or the Loans have
     been  accelerated,  each Lender is  authorized at any time and from time to
     time, without prior notice to the Borrower, any such notice being waived by
     the Borrower to the fullest  extent  permitted by law, to set off and apply
     any and all deposits  (general or special,  time or demand,  provisional or
     final) at any time held by,  and other  indebtedness  at any time owing by,
     such  Lender or any  Affiliate  of such  Lender to or for the credit or the
     account  of the  Borrower  against  any and all  Obligations  owing to such
     Lender, now or hereafter existing, irrespective of whether or not the Agent
     or such Lender  shall have made  demand  under this  Agreement  or any Loan
     Document and although such Obligations may be contingent or unmatured. Each
     Lender agrees  promptly to notify the Borrower and the Agent after any such
     set-off and application made by such Lender;  provided,  however,  that the
     failure to give such notice  shall not affect the  validity of such set-off


                                       65
<PAGE>

     and application.  NOTWITHSTANDING  THE FOREGOING,  NO LENDER SHALL EXERCISE
     ANY RIGHT OF  SET-OFF,  BANKER'S  LIEN,  OR THE LIKE  AGAINST  ANY  DEPOSIT
     ACCOUNT OR  PROPERTY  OF THE  BORROWER  HELD OR  MAINTAINED  BY SUCH LENDER
     WITHOUT THE PRIOR WRITTEN UNANIMOUS CONSENT OF THE LENDERS.

          13.17 Confidentiality.

          (a) The Borrower  hereby  consents  that the Agent and each Lender may
     issue and  disseminate  to the public  general  information  describing the
     credit accommodation entered into pursuant to this Agreement, including the
     name  and  address  of  the  Borrower  and a  general  description  of  the
     Borrower's  business and may use the  Borrower's  name in  advertising  and
     other promotional material.

          (b)  Each  Lender  severally  agrees  to take  normal  and  reasonable
     precautions  and exercise due care to maintain the  confidentiality  of all
     information  identified as  "confidential"  or "secret" by the Borrower and
     provided to the Agent or such Lender by or on behalf of the Borrower, under
     this Agreement or any other Loan  Document,  except to the extent that such
     information (i) was or becomes generally available to the public other than
     as a result  of  disclosure  by the  Agent or such  Lender,  or (ii) was or
     becomes available on a  nonconfidential  basis from a source other than the
     Borrower,  provided  that such  source  is not  bound by a  confidentiality
     agreement  with the Borrower  known to the Agent or such Lender;  provided,
     however, that the Agent and any Lender may disclose such information (1) at
     the request or pursuant to any requirement of any Governmental Authority to
     which  the  Agent  or such  Lender  is  subject  or in  connection  with an
     examination of the Agent or such Lender by any such Governmental Authority;
     (2) pursuant to subpoena or other court process; (3) when required to do so
     in accordance with the provisions of any applicable Requirement of Law; (4)
     to the extent  reasonably  required in  connection  with any  litigation or
     proceeding  (including,  but not limited to, any bankruptcy  proceeding) to
     which the Agent,  any Lender or their  respective  Affiliates may be party;
     (5) to the extent  reasonably  required in connection  with the exercise of
     any remedy  hereunder or under any other Loan Document;  (6) to the Agent's
     or such Lender's  independent  auditors,  accountants,  attorneys and other
     professional advisors; (7) to any prospective Participant or Assignee under
     any  Assignment  and  Acceptance,  actual or potential,  provided that such
     prospective  Participant  or  Assignee  agrees  to  keep  such  information
     confidential  to the same  extent  required  of the Agent  and the  Lenders
     hereunder; (8) as expressly permitted under the terms of any other document
     or agreement regarding confidentiality to which the Borrower is party or is
     deemed party with the Agent or such Lender, and (9) to its Affiliates.

          13.18 Conflicts with Other Loan Documents.  Unless otherwise expressly
     provided  in this  Agreement  (or in  another  Loan  Document  by  specific
     reference to the applicable provision contained in this Agreement),  if any
     provision  contained in this Agreement  conflicts with any provision of any
     other Loan Document, the provision contained in this Agreement shall govern
     and control.

          13.19 USA PATRIOT  Act Notice.  Each Lender that is subject to the Act
     (as hereinafter defined) and the Agent (for itself and not on behalf of any
     Lender) hereby  notifies the Borrower that pursuant to the  requirements of
     the USA Patriot Act (Title III of Pub. L. 107-56  (signed  into law October
     26,  2001))  (the  "Act"),  it is  required  to  obtain,  verify and record
     information that identifies the Borrower and the Parent,  which information
     includes  the name and  address  of the  Borrower  and the Parent and other
     information  that will allow such Lender or the Agent,  as  applicable,  to
     identify the Borrower and the Parent in accordance with the Act.


                     [REMAINDER OF PAGE INTENTIONALLY BLANK.
                            SIGNATURE PAGE FOLLOWS.]


                                       66
<PAGE>
          IN WITNESS  WHEREOF,  the parties have entered into this  Agreement on
     the date first above written.

                            "BORROWER"


                            CENTRAL FREIGHT LINES, INC., a Texas corporation

                            By:
                            Title:

                            "AGENT"

                            Bank of America, N.A., as Agent

                            By:
                            Joy L. Bartholomew, Senior Vice President



                            "LENDERS"

                             Bank of America, N.A., as a Lender

                             By:
                             Joy L. Bartholomew, Senior Vice President

                             "PARENT"

                             CENTRAL FREIGHT LINES, INC., a Nevada corporation

                              By:
                              Title:            _____________________________



                                       67
<PAGE>

                                     ANNEX A
                                       to
                                Credit Agreement

                                   Definitions

          Capitalized  terms used in the Loan Documents shall have the following
     respective  meanings (unless otherwise  defined  therein),  and all section
     references  in the  following  definitions  shall  refer to sections of the
     Agreement:

          "Account  Debtor"  means  each  Person  obligated  in any way on or in
     connection  with  an  Account,   Chattel  Paper,   or  General   Intangible
     (including, without limitation, any payment intangible).

          "Accounts" means all of the Borrower's now owned or hereafter acquired
     or arising accounts, as defined in the UCC, including any rights to payment
     for the sale or lease of goods or  rendition  of  services,  whether or not
     they have been earned by performance.

          "ACH  Transactions"  means any cash  management  or  related  services
     including the automatic  clearing  house  transfer of funds by the Bank for
     the account of the Borrower pursuant to agreement or overdrafts.

          "Acquisition" means any transaction or series of related  transactions
     for the purpose  of, or  resulting  in,  directly  or  indirectly,  (a) the
     acquisition by the Borrower of all or substantially  all of the assets of a
     Person or of any business or division of a Person;  (b) the  acquisition by
     the  Borrower  of more than 50% of any class of  Voting  Stock (or  similar
     ownership  interests)  of  any  Person;  or  (c) a  merger,  consolidation,
     amalgamation,  or other  combination by the Borrower with another Person if
     the Borrower is the surviving entity.

          "Adjusted Net Earnings  from  Operations"  means,  with respect to any
     fiscal  period of the Parent,  the Parent's net income after  provision for
     income taxes for such fiscal period,  as determined in accordance with GAAP
     and reported on the Financial Statements for such period, excluding any and
     all of the following  included in such net income: (a) gain or loss arising
     from the sale of any capital assets;  (b) gain arising from any write-up in
     the book value of any asset; (c) earnings of any Person,  substantially all
     the  assets  of  which  have  been  acquired  by the  Parent  or any of its
     Subsidiaries  in any manner,  to the extent  realized by such other  Person
     prior to the date of  acquisition;  (d) earnings of any Person in which the
     Parent or any of its  Subsidiaries  has an ownership  interest  unless (and
     only to the extent) such earnings  shall actually have been received by the
     Parent or any of its  Subsidiaries in the form of cash  distributions;  (e)
     earnings  of  any  Person  to  which  assets  of the  Parent  or any of its
     Subsidiaries  shall have been sold,  transferred  or  disposed  of, or into
     which the  Parent or any of its  Subsidiaries  shall have been  merged,  or
     which has been a party  with the Parent or any of its  Subsidiaries  to any
     consolidation  or other form of  reorganization,  prior to the date of such
     transaction;  (f) gain  arising  from  the  acquisition  of debt or  equity
     securities of the Parent or any of its Subsidiaries or from cancellation or
     forgiveness  of Debt;  and (g) gain arising from  extraordinary  items,  as
     determined  in  accordance  with  GAAP,  or from  any  other  non-recurring
     transaction.

          "Affiliate" means, as to any Person, any other Person which,  directly
     or  indirectly,  is in control  of, is  controlled  by, or is under  common
     control  with,  such Person or which owns,  directly  or  indirectly,  five
     percent (5%) or more of the outstanding  equity interest of such Person.  A
     Person shall be deemed to control another Person if the controlling  Person
     possesses,  directly  or  indirectly,  the  power to  direct  or cause  the
     direction  of the  management  and  policies of the other  Person,  whether
     through the ownership of voting securities, by contract, or otherwise.

                                       68
<PAGE>

          "Agent"  means  the  Bank,  solely  in its  capacity  as agent for the
     Lenders, and any successor agent.

          "Agent Advances" has the meaning specified in Section 1.2(i).

          "Agent's  Liens"  means the  Liens in the  Collateral  granted  to the
     Agent,  for the benefit of the Lenders,  Bank,  and Agent  pursuant to this
     Agreement and the other Loan Documents.

          "Agent-Related Persons" means the Agent, together with its Affiliates,
     and the officers, directors,  employees, counsel,  representatives,  agents
     and attorneys-in-fact of the Agent and such Affiliates.

          "Aggregate Revolver Outstandings" means, at any date of determination,
     and without  duplication:  the sum of (a) the unpaid  balance of  Revolving
     Loans, (b) the aggregate amount of Pending Revolving Loans, (c) one hundred
     percent (100%) of the greater of : (i) the aggregate  undrawn  maximum face
     amount and (ii) the maximum  undrawn  available  amount of all  outstanding
     Letters of Credit, and (d) the aggregate amount of any unpaid reimbursement
     obligations in respect of Letters of Credit.

          "Agreement"  means  the  Credit  Agreement  to which  this  Annex A is
     attached, as from time to time amended, modified or restated.

          "Anniversary Date" means each anniversary of the Closing Date.

          "Applicable Margin" means:

          (i)  with  respect  to  Base  Rate  Revolving   Loans  and  all  other
     Obligations (other than LIBOR Revolving Loans), .25%;

          (ii) with respect to LIBOR Revolving Loans, 2.0%; and

                  (iii) with respect to Letters of Credit, 1.75%.

          The Applicable Margins shall be adjusted (up or down) prospectively on
     a quarterly  basis as  determined  by the Parent's  consolidated  financial
     performance,  commencing  with the earliest of: (x) June 30, 2005,  (y) the
     date a Person (other than Bank of America, N.A.) becomes a Lender under the
     Agreement;  and (z) upon the  occurrence and during the  continuation  of a
     Default or an Event of Default (the "Rate Adjustment Date"). Adjustments in
     Applicable Margins shall be determined by reference to the following grids:

------------------------------------------ ------------------------------------
If Average Quarterly                          Level of
Availability is:                              Applicable Margins:
------------------------------------------ ------------------------------------
< $20,000,000                                 Level I
------------------------------------------ ------------------------------------
> $20,000,000, but < $30,000,000              Level II
-                  -
------------------------------------------ ------------------------------------
> $30,000,000, but < $40,000,000              Level III
                   -
------------------------------------------ ------------------------------------
> $40,000,000, but < $50,000,000              Level IV
                   -
------------------------------------------ ------------------------------------
> $50,000,000, but < $55,000,000 or the       Level V
                   -
Fixed Charge Coverage Ratio is > 1.25 to
1.0, but < 1.5 to 1.0
         -
------------------------------------------ ------------------------------------
> $55,000,000 or the Fixed Charge Coverage    Level VI
Ratio is > 1.5 to 1.0
------------------------------------------ ------------------------------------

                                       69
<PAGE>


<TABLE>
<CAPTION>
------------------------------- -------------------------------------------------------------------------------------
                                Applicable Margins
------------------------------- ------------ ----------- ---------------- ------------- ------------ ----------------
                                Level I      Level II    Level III        Level IV      Level V      Level VI
<S>                                  <C>        <C>          <C>             <C>            <C>          <C>
------------------------------- ------------ ----------- ---------------- ------------- ------------ ----------------
Base Rate Revolving Loans       1.00%        .75%        .50%             0.25%         0.0%         0.0%
------------------------------- ------------ ----------- ---------------- ------------- ------------ ----------------
LIBOR Revolving Loans           2.75%        2.50%       2.25%            2.00%         1.75%        1.50%
------------------------------- ------------ ----------- ---------------- ------------- ------------ ----------------
Applicable L/C Margin           2.50%        2.25%       2.00             1.75%         1.50%        1.25%
------------------------------- ------------ ----------- ---------------- ------------- ------------ ----------------
</TABLE>

          The  Applicable  Margin  with  respect to the Unused Line Fee shall be
     .375% per annum with  respect to any month in which the  average  Aggregate
     Revolver  Outstandings  are less than  $30,000,000,  and in all other cases
     shall be .25% per annum.

          All  adjustments  in the  Applicable  Margins  commencing  on the Rate
     Adjustment Date shall be implemented  quarterly on a prospective basis in a
     two step  process,  provided  that in the  event the Rate  Adjustment  Date
     occurs prior to June 30, 2005, the Average Quarterly  Availability shall be
     calculated as the Average Daily  Availability and the Rate Adjustment shall
     remain in effect  until the first day of the next  fiscal  quarter.  First,
     calculations  based on Average Quarterly  Availability shall be made and be
     effective as of the first day of each fiscal  quarter.  With respect to the
     adjustments  based on Levels V and VI, an  additional  adjustment  shall be
     made, if warranted by the  calculation of the Fixed Charge  Coverage Ratio,
     for any  calendar  month  commencing  at  least 5 days  after  the  date of
     delivery  to the  Lenders of  quarterly  unaudited  or annual  audited  (as
     applicable)  Financial Statements evidencing the need for an adjustment and
     shall become effective as of the first day of such month. Concurrently with
     the delivery of those Financial  Statements,  the Borrower shall deliver to
     the Agent  and the  Lenders a  certificate,  signed by its chief  financial
     officer,  setting forth in reasonable  detail the basis for the continuance
     of, or any change in, the  Applicable  Margins.  Failure to timely  deliver
     such Financial  Statements  shall, in addition to any other remedy provided
     for in this Agreement,  result in an increase in the Applicable  Margins to
     the highest level set forth in the foregoing  grid,  until the first day of
     the  first  calendar  month  following  the  delivery  of  those  Financial
     Statements  demonstrating  that  such an  increase  is not  required.  If a
     Default or Event of Default has occurred and is  continuing at the time any
     reduction in the Applicable Margins is to be implemented,  no reduction may
     occur until the first day of the first calendar month following the date on
     which such Default or Event of Default is waived or cured.

          "Arrangement Fee" has the meaning specified in Section 2.4.

          "Assignee" has the meaning specified in Section 11.2(a).

          "Assignment  and  Acceptance"  has the  meaning  specified  in Section
     11.2(a).

          "Attorney Costs" means and includes all reasonable fees,  expenses and
     disbursements  of any law firm or other counsel  engaged by the Agent,  the
     reasonably  allocated  costs and expenses of internal legal services of the
     Agent.

          "Availability"  means,  at any time (a) the lesser of (i) the  Maximum
     Revolver Amount or (ii) the Borrowing  Base,  minus (b) Reserves other than
     Reserves  deducted in the calculation of the Borrowing  Base,  minus (c) in
     each case, the Aggregate Revolver Outstandings,  minus (d) $5,000,000 until
     the  earlier of: (i) the  delivery by Borrower to Agent of its April,  2005
     monthly financials in compliance with Section 5.2(c), and (ii) May 30, 2005

          "Average Daily  Availability"  means as of any date of  determination,
     (a) the  average  Borrowing  Base,  less (b) the  average  Daily  Aggregate

                                       70
<PAGE>

     Revolver  Outstandings  from the Closing Date to the Rate Adjustment  Date.
     For purposes of determining Average Daily Availability,  Aggregate Revolver
     Outstandings shall not include any Replacement Letters of Credit.

          "Average   Quarterly   Availability"   means   as  of  any   date   of
     determination,  (a) the average  Borrowing Base, less (b) the average Daily
     Aggregate  Revolver  Outstandings  during the immediately  preceding fiscal
     quarter.  For  purposes  of  determining  Average  Quarterly  Availability,
     Aggregate Revolver  Outstandings shall not include any Replacement  Letters
     of Credit.

          "Bank" means Bank of America, N.A., a national banking association, or
     any successor entity thereto.

          "Bank Product  Reserves"  means all reserves which the Agent from time
     to time establishes in its reasonable discretion for the Bank Products then
     provided or outstanding.

          "Bank  Products"  means  any  one or more of the  following  types  of
     services  or  facilities  extended  to  the  Borrower  by the  Bank  or any
     affiliate of the Bank in reliance on the Bank's agreement to indemnify such
     affiliate: (i) credit cards; (ii) ACH Transactions;  (iii) cash management,
     including controlled disbursement services; and (iv) Hedge Agreements.

          "Bankruptcy  Code" means Title 11 of the United States Code (11 U.S.C.
     ss. 101 et seq.).

          "Base  Rate"  means,  for any day,  the rate of interest in effect for
     such day as publicly  announced from time to time by the Bank in Charlotte,
     North  Carolina as its "prime  rate" (the "prime  rate" being a rate set by
     the Bank based upon various factors  including the Bank's costs and desired
     return,  general  economic  conditions and other factors,  and is used as a
     reference  point for pricing some loans,  which may be priced at, above, or
     below such announced  rate).  Any change in the prime rate announced by the
     Bank shall take effect at the opening of business on the day  specified  in
     the public  announcement of such change.  Each Interest Rate based upon the
     Base Rate  shall be  adjusted  simultaneously  with any  change in the Base
     Rate.

          "Base Rate Revolving Loan" means a Revolving Loan during any period in
     which it bears interest based on the Base Rate.

          "Blocked Account Agreement" means an agreement among the Borrower, the
     Agent and a Clearing Bank, in form and substance reasonably satisfactory to
     the Agent,  concerning  the  collection  of payments  which  represent  the
     proceeds of Accounts or of any other Collateral.

          "Borrowing" means a borrowing hereunder  consisting of Revolving Loans
     made on the same day by the Lenders to the  Borrower or by Bank in the case
     of a Borrowing funded by Non-Ratable Loans or by the Agent in the case of a
     Borrowing  consisting  of an Agent  Advance,  or the issuance of Letters of
     Credit hereunder.

          "Borrowing Base" means, at any time, an amount equal to (a) the sum of
     (A) up to eighty-five percent (85%) of the Net Amount of Eligible Accounts;
     plus (B) the sum of (i) up to eighty-five  percent (85%) of the Net Orderly
     Liquidation   Value  of  Eligible   Rolling  Stock   adjusted  for  monthly
     depreciation  and for any  dispositions  of Rolling  Stock,  and (ii) up to
     eighty-five  percent (85%) of the cost of Eligible  Rolling Stock  acquired
     after the Closing Date (excluding sales tax, delivery charges or other soft
     costs) and adjusted for monthly depreciation, but in no event shall the sum
     of (i) and (ii) exceed 90% of the net book value of such  Eligible  Rolling
     Stock; minus (b) Reserves from time to time established by the Agent in its
     reasonable  credit  judgment;  provided that the aggregate  Revolving Loans
     advanced  against  Eligible  Rolling  Stock  shall not exceed  the  Maximum
     Rolling  Stock  Loan  Amount,  and  provided  further  that  the  aggregate


                                       71
<PAGE>

     Revolving  Loans  advanced  against  Eligible  Unbilled  Accounts shall not
     exceed  $5,000,000.   For  the  purposes  hereof,   depreciation  shall  be
     calculated  based upon the average  remaining life of the Eligible  Rolling
     Stock as shown on the then most recent appraisal.

          "Borrowing  Base  Certificate"  means a  certificate  by a Responsible
     Officer of the Borrower, substantially in the form of Exhibit B (or another
     form  acceptable  to  the  Agent)  setting  forth  the  calculation  of the
     Borrowing Base,  including a calculation of each component thereof,  all in
     such  detail  as  shall  be  reasonably  satisfactory  to  the  Agent.  All
     calculations  of the Borrowing Base in connection  with the  preparation of
     any Borrowing Base Certificate shall originally be made by the Borrower and
     certified  to the Agent;  provided,  that the Agent shall have the right to
     review and adjust, in the exercise of its reasonable  credit judgment,  any
     such  calculation  (1) to reflect  its  reasonable  estimate of declines in
     value of any of the  Collateral  described  therein,  and (2) to the extent
     that such calculation is not in accordance with this Agreement.

          "Business Day" means (a) any day that is not a Saturday,  Sunday, or a
     day on which banks in Dallas, Texas,  Pasadena,  California,  or Charlotte,
     North Carolina are required or permitted to be closed, and (b) with respect
     to all notices,  determinations,  fundings and payments in connection  with
     the LIBOR Rate or LIBOR  Revolving  Loans,  any day that is a Business  Day
     pursuant  to clause  (a) above and that is also a day on which  trading  in
     Dollars is carried on by and between banks in the London interbank market.

          "Capital  Adequacy   Regulation"  means  any  guideline,   request  or
     directive of any central bank or other Governmental Authority, or any other
     law,  rule or  regulation,  whether or not having the force of law, in each
     case,  regarding  capital  adequacy  of  any  bank  or of  any  corporation
     controlling a bank.

          "Capital  Expenditures"  means all  payments  due (whether or not paid
     during  any fiscal  period)  in  respect of the cost of any fixed  asset or
     improvement, or replacement, substitution, or addition thereto, which has a
     useful life of more than one year,  including,  without  limitation,  those
     costs arising in connection with the direct or indirect acquisition of such
     asset by way of increased  product or service charges or in connection with
     a Capital Lease.

          "Capital  Lease" means any lease of property by the Borrower which, in
     accordance with GAAP, should be reflected as a capital lease on the balance
     sheet of the Borrower.

          "Change of Control"  shall mean the  occurrence  of one or more of the
     following  events:  (a) any sale,  lease,  exchange or other transfer (in a
     single  transaction  or  a  series  of  related  transactions)  of  all  or
     substantially  all of the assets of the Borrower or Parent to any Person or
     "group" (within the meaning of the Securities  Exchange Act of 1934 and the
     rules of the Securities and Exchange Commission thereunder in effect on the
     date hereof),  (b) the  acquisition  of ownership,  directly or indirectly,
     beneficially or of record,  by any Unrelated  Person or "group" (within the
     meaning  of the  Securities  Exchange  Act of  1934  and the  rules  of the
     Securities  and  Exchange  Commission  thereunder  as in effect on the date
     hereof) of 30% or more of the  outstanding  shares of the  voting  stock of
     Parent;  or (c)  occupation  of a majority of the seats  (other than vacant
     seats) on the board of  directors of Parent by Persons who were neither (i)
     nominated or appointed by the current board of directors or (ii)  nominated
     or appointed by directors so nominated or  appointed.  For purposes of this
     definition,  "Unrelated  Person"  means any Person or "group"  (within  the
     meaning  of the  Securities  Exchange  Act of  1934  and the  rules  of the
     Securities and Exchange Commission thereunder in effect on the date hereof)
     other than: (1) Jerry Moyes and his spouse,  lineal descendants and spouses
     of his lineal  descendents;  (2) the estates of Persons described in clause
     (1);  (3)  trusts  established  for the  benefit  of any  Person or Persons
     described in clause (1); (4)  corporations,  limited  liability  companies,
     partnerships or similar entities 75% or more owned by any Person or Persons
     described in clauses (1) through (3); (5) the Moyes  Children's  Trust; (6)


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<PAGE>

     the Moyes Family Trust;  and (7) Ronald Moyes.  For purposes of calculating
     the number of outstanding shares of the voting stock of Parent beneficially
     owned by any "group"  (within the meaning of the Exchange Act and the rules
     of the SEC  thereunder in effect on the date hereof),  shares  beneficially
     owned by Persons  described  in clauses (1)  through  (7) of the  preceding
     sentence shall be excluded from such calculation.

          "Chattel  Paper"  means all of the  Borrower's  now owned or hereafter
     acquired chattel paper, as defined in the UCC, including electronic chattel
     paper.

          "Clearing Bank" means the Bank or any other banking  institution  with
     whom a Payment Account has been  established  pursuant to a Blocked Account
     Agreement.

          "Closing Date" means the date of this Agreement.

          "Code" means the Internal Revenue Code of 1986.

          "Collateral"  means all of the  Borrower's  personal  property and all
     other  assets of any Person  from time to time  subject  to  Agent's  Liens
     securing payment or performance of the Obligations.

          "Collections" means all cash, checks,  notes,  instruments,  and other
     items  of  payment  (including,  without  limitation,  insurance  proceeds,
     proceeds of sales, rental proceeds, and tax refunds).

          "Commitment"  means,  at  any  time  with  respect  to a  Lender,  the
     principal  amount set forth  beside  such  Lender's  name under the heading
     "Commitment"  on Schedule 1.2 attached to the Agreement or on the signature
     page of the Assignment and Acceptance  pursuant to which such Lender became
     a Lender  hereunder in accordance  with the  provisions of Section 11.2, as
     such  Commitment  may be adjusted from time to time in accordance  with the
     provisions of Section 11.2,  and  "Commitments"  means,  collectively,  the
     aggregate amount of the commitments of all of the Lenders.

          "Contaminant" means any waste, pollutant,  hazardous substance,  toxic
     substance,  hazardous waste, special waste,  petroleum or petroleum-derived
     substance  or waste,  asbestos  in any form or  condition,  polychlorinated
     biphenyls ("PCBs"), or any constituent of any such substance or waste.

          "Continuation/Conversion  Date"  means  the  date  on  which a Loan is
     converted into or continued as a LIBOR Revolving Loan.

          "Control  Agreement" means a control agreement,  in form and substance
     satisfactory to Agent,  executed and delivered by Borrower,  Agent, and the
     applicable bank with respect to a deposit account.

          "Credit Support" has the meaning specified in Section 1.3(a).

          "Daily  Aggregate  Revolver  Outstandings"  means  the  amount  of the
     Aggregate Revolver Outstandings at the end of a given day.

          "Debt" means,  without duplication,  all liabilities,  obligations and
     indebtedness of the Borrower to any Person,  of any kind or nature,  now or
     hereafter owing,  arising, due or payable,  howsoever  evidenced,  created,
     incurred,   acquired  or  owing,   whether  primary,   secondary,   direct,
     contingent,  fixed or otherwise,  consisting of  indebtedness  for borrowed

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<PAGE>

     money or the deferred purchase price of property, excluding trade payables,
     but including (a) all  Obligations;  (b) all obligations and liabilities of
     any Person secured by any Lien on the Borrower's property,  even though the
     Borrower  shall not have assumed or become liable for the payment  thereof;
     provided,  however,  that all such  obligations and  liabilities  which are
     limited in recourse to such property  shall be included in Debt only to the
     extent of the book  value of such  property  as would be shown on a balance
     sheet of the Borrower prepared in accordance with GAAP; (c) all obligations
     or  liabilities  created or arising under any Capital Lease or  conditional
     sale or other title  retention  agreement  with respect to property used or
     acquired by the  Borrower,  even if the rights and  remedies of the lessor,
     seller or lender  thereunder are limited to  repossession of such property;
     provided,  however,  that all such  obligations and  liabilities  which are
     limited in recourse to such property  shall be included in Debt only to the
     extent of the book  value of such  property  as would be shown on a balance
     sheet of the Borrower prepared in accordance with GAAP; (d) all obligations
     and liabilities  under Guaranties and (e) the present value  (discounted at
     the implied interest rate under such synthetic lease) of lease payments due
     under synthetic  leases.  "Default" means any event or circumstance  which,
     with the giving of notice, the lapse of time, or both, would (if not cured,
     waived,  or otherwise  remedied  during such time)  constitute  an Event of
     Default.

          "Default  Rate" means a  fluctuating  per annum  interest  rate at all
     times equal to the sum of (a) the otherwise  applicable  Interest Rate plus
     (b) two  percent  (2%) per  annum.  Each  Default  Rate  shall be  adjusted
     simultaneously  with  any  change  in  the  applicable  Interest  Rate.  In
     addition,  the  Default  Rate shall  result in an increase in the Letter of
     Credit Fee by two (2) percentage points per annum.

          "Defaulting Lender" has the meaning specified in Section 12.15(c).

          "Designated Account" has the meaning specified in Section 1.2(c).

          "Distribution"  means, in respect of any corporation:  (a) the payment
     or making of any dividend or other  distribution  of property in respect of
     capital stock (or any options or warrants for, or other rights with respect
     to, such stock) of such  corporation,  other than  distributions in capital
     stock (or any options or warrants for such stock) of the same class; or (b)
     the  redemption or other  acquisition  by such  corporation  of any capital
     stock (or any options or warrants for such stock) of such corporation.

          "Documents"  means all  documents  as such term is defined in the UCC,
     including bills of lading,  warehouse receipts or other documents of title,
     now owned or hereafter acquired by the Borrower.

          "DOL" means the United  States  Department  of Labor or any  successor
     department or agency.

          "Dollar"  and "$" means  dollars in the lawful  currency of the United
     States. Unless otherwise specified, all payments under the Agreements shall
     be made in Dollars.

          "EBITDA"  means,  with  respect  to any fiscal  period of the  Parent,
     Adjusted Net Earnings from Operations,  plus, to the extent deducted in the
     determination  of Adjusted Net  Earnings  from  Operations  for that fiscal
     period, interest expenses,  Federal, state, local and foreign income taxes,
     depreciation, amortization, and non-cash stock option expense.

          "Eligible Accounts" means the Accounts which the Agent in the exercise
     of its reasonable judgment,  in good faith and consistent with its standard
     lending  procedures,  determines to be Eligible Accounts.  Without limiting
     the discretion of the Agent to establish  other criteria of  ineligibility,
     Eligible  Accounts  shall  not,  unless  the  Agent in its sole  discretion
     elects, include any Account:

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<PAGE>

          (a) with  respect  to which more than 90 days have  elapsed  since the
     date of the original invoice therefor;

          (b) with  respect  to which  any of the  representations,  warranties,
     covenants, and agreements contained in the Security Agreement are incorrect
     or have been breached;

          (c) with respect to which  Account (or any other Account due from such
     Account  Debtor),  in whole or in part, a check,  promissory  note,  draft,
     trade  acceptance  or other  instrument  for the  payment of money has been
     received, presented for payment and returned uncollected for any reason;

          (d) which represents a progress billing (as hereinafter defined) or as
     to which the Borrower has extended the time for payment without the consent
     of the Agent; for the purposes hereof, "progress billing" means any invoice
     for goods sold or leased or services rendered under a contract or agreement
     pursuant to which the Account  Debtor's  obligation  to pay such invoice is
     conditioned upon the Borrower's completion of any further performance under
     the contract or agreement;

          (e) with respect to which any one or more of the following  events has
     occurred  to  the  Account  Debtor  on  such  Account:  death  or  judicial
     declaration of incompetency of an Account Debtor who is an individual;  the
     filing by or  against  the  Account  Debtor of a request  or  petition  for
     liquidation, reorganization, arrangement, adjustment of debts, adjudication
     as  a  bankrupt,   winding-up,   or  other  relief  under  the  bankruptcy,
     insolvency,  or similar laws of the United  States,  any state or territory
     thereof,  or any foreign  jurisdiction,  now or  hereafter  in effect;  the
     making of any general  assignment by the Account  Debtor for the benefit of
     creditors;  the appointment of a receiver or trustee for the Account Debtor
     or  for  any of  the  assets  of the  Account  Debtor,  including,  without
     limitation,  the  appointment of or taking  possession by a "custodian," as
     defined in the Federal  Bankruptcy  Code; the institution by or against the
     Account  Debtor of any  other  type of  insolvency  proceeding  (under  the
     bankruptcy  laws of the  United  States or  otherwise)  or of any formal or
     informal  proceeding for the dissolution or liquidation  of,  settlement of
     claims against,  or winding up of affairs of, the Account Debtor; the sale,
     assignment,  or transfer of all or any  material  part of the assets of the
     Account Debtor; the nonpayment generally by the Account Debtor of its debts
     as they become due; or the cessation of the business of the Account  Debtor
     as a going concern;

          (f) if fifty percent  (50%) or more of the aggregate  Dollar amount of
     outstanding  Accounts  owed at such time by the Account  Debtor  thereon is
     classified as ineligible under clause (a) above;

          (g) owed by an Account  Debtor which:  (i) does not maintain its chief
     executive  office in the United States of America or Canada (other than the
     Province of  Newfoundland);  or (ii) is not organized under the laws of the
     United  States of America or Canada or any state or  province  thereof;  or
     (iii) is the government of any foreign  country or sovereign  state,  or of
     any state, province,  municipality, or other political subdivision thereof,
     or of any department,  agency, public corporation, or other instrumentality
     thereof;  except to the extent that such Account is secured or payable by a
     letter of credit satisfactory to the Agent in its discretion;

          (h) owed by an Account Debtor which is an Affiliate or employee of the
     Borrower;  other than any Accounts owed to Borrower by Swift Transportation
     Co., Inc.;

          (i) except as  provided  in clause (k)  below,  with  respect to which
     either the perfection,  enforceability, or validity of the Agent's Liens in
     such Account,  or the Agent's right or ability to obtain direct  payment to
     the Agent of the  proceeds of such  Account,  is  governed by any  federal,
     state, or local statutory requirements other than those of the UCC;

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<PAGE>

          (j) owed by an  Account  Debtor  to which the  Borrower  or any of its
     Subsidiaries,  is  indebted in any way, or which is subject to any right of
     setoff or recoupment by the Account  Debtor,  unless the Account Debtor has
     entered into an agreement  acceptable to the Agent to waive setoff  rights;
     or if the Account Debtor  thereon has disputed  liability or made any claim
     with respect to any other Account due from such Account Debtor; but in each
     such case  only to the  extent of such  indebtedness,  setoff,  recoupment,
     dispute, or claim;

          (k) owed by the  government  of the United  States of America,  or any
     department,  agency, public corporation,  or other instrumentality thereof,
     unless the Federal  Assignment of Claims Act of 1940, as amended (31 U.S.C.
     ss.  3727 et seq.),  and any other steps  necessary  to perfect the Agent's
     Liens  therein,  have been complied with to the Agent's  satisfaction  with
     respect to such Account;

          (l) owed by any state, municipality, or other political subdivision of
     the  United  States  of  America,   or  any  department,   agency,   public
     corporation,  or other  instrumentality  thereof  and as to which the Agent
     determines that its Lien therein is not or cannot be perfected;

          (m) which represents a sale on a bill-and-hold,  guaranteed sale, sale
     and return,  sale on approval,  consignment,  or other repurchase or return
     basis;

          (n) which is evidenced by a promissory note or other  instrument or by
     chattel paper;

          (o) if the Agent believes, in the exercise of its reasonable judgment,
     that the  prospect of  collection  of such  Account is impaired or that the
     Account  may  not be paid  by  reason  of the  Account  Debtor's  financial
     inability to pay;

          (p) with  respect to which the Account  Debtor is located in any state
     requiring the filing of a Notice of Business  Activities  Report or similar
     report in order to permit the Borrower to seek judicial enforcement in such
     State of payment of such Account,  unless such Borrower has qualified to do
     business in such state or has filed a Notice of Business  Activities Report
     or equivalent report for the then current year;

          (q) which arises out of a sale not made in the ordinary  course of the
     Borrower's business;

          (r) with  respect to which the  delivery of goods  giving rise to such
     Account have not been shipped and delivered to and accepted by the intended
     recipient;

          (s) owed by an  Account  Debtor  which is  obligated  to the  Borrower
     respecting  Accounts the aggregate  unpaid balance of which exceeds fifteen
     percent (15%), or in the case of Dell,  Inc.,  which exceeds twenty percent
     (20%) of the aggregate  unpaid balance of all Accounts owed to the Borrower
     at such time by all of the Borrower's  Account Debtors,  and in the case of
     any other Account Debtor,  a percentage  approved by the Agent, but only to
     the extent of such excess;

          (t) which is subject to any payments to any interline carrier,  but in
     each case only to the extent of the amount owed to such interline carrier;

          (u) on and after a Default, Event of Default, or during the periods in
     which Agent has full  dominion  over the  Borrower's  accounts  pursuant to
     Section 3.10,  with respect to which the Agent does not have control of the
     Payment Accounts;

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<PAGE>

          (v) which is not subject to a first  priority and  perfected  security
     interest in favor of the Agent for the benefit of the Lenders; and

          If any Account at any time ceases to be an Eligible Account, then such
     Account  shall  promptly  be  excluded  from the  calculation  of  Eligible
     Accounts, until such time as it again becomes an Eligible Account.

          "Eligible  Assignee" means (a) a commercial bank,  commercial  finance
     company or other  asset  based  lender,  having  total  assets in excess of
     $1,000,000,000;  (b)  any  Lender  listed  on the  signature  page  of this
     Agreement;  (c) any Affiliate of any Lender; and (d) if an Event of Default
     has occurred and is  continuing,  any Person  reasonably  acceptable to the
     Agent.

          "Eligible Rolling Stock" means Rolling Stock,  which the Agent, in its
     reasonable judgment, in good faith and consistent with its standard lending
     procedures,  determines to be Eligible.  Without limiting the discretion of
     the Agent to establish other criteria of  ineligibility,  Eligible  Rolling
     Stock shall not,  unless the Agent in its sole discretion  elects,  include
     any Rolling Stock:

          (a) that is not owned by the Borrower;

          (b) that is not subject to the Agent's  Liens,  which are perfected as
     to such Rolling Stock, or that are subject to any other Lien whatsoever;

          (c) that is not in good condition, is unmerchantable, or does not meet
     all standards  imposed by any  Governmental  Authority,  having  regulatory
     authority over such Rolling Stock and their use;

          (d) that is not currently either usable or salable;

          (e) that is obsolete;

          (f) that is located outside the United States of America or Canada; or

          (g) that  contains  or bears any  Proprietary  Rights  licensed to the
     Borrower by any Person,  if the Agent is not satisfied  that it may sell or
     otherwise dispose of such Rolling Stock in accordance with the terms of the
     Security  Agreement  and Section 9.2 without  infringing  the rights of the
     licensor of such  Proprietary  Rights or violating  any contract  with such
     licensor (and without payment of any royalties other than any royalties due
     with respect to the sale or  disposition  of such Rolling Stock pursuant to
     the  existing  license  agreement),  and, as to which the  Borrower has not
     delivered to the Agent a consent or sublicense agreement from such licensor
     in form and substance acceptable to the Agent if requested

          If any Rolling Stock at any time ceases to be Eligible  Rolling Stock,
     such  Rolling  Stock shall  promptly be excluded  from the  calculation  of
     Eligible  Rolling  Stock,  until  such  time as it again  becomes  Eligible
     Rolling Stock.

          "Eligible  Unbilled Account' means an Account which would otherwise be
     an Eligible  Account except that it has not been billed by the Borrower and
     it is less than ten days from completion of service by the Borrower.

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<PAGE>

          "Environmental  Claims"  means all claims,  however  asserted,  by any
     Governmental  Authority or other  Person  alleging  potential  liability or
     responsibility  for violation of any Environmental Law, or for a Release or
     injury to the environment.

          "Environmental  Compliance  Reserve" means any reserve which the Agent
     establishes in its reasonable  discretion after prior written notice to the
     Borrower  from time to time for amounts  that are  reasonably  likely to be
     expended by the Borrower in order for the Borrower and its  operations  and
     property  (a) to  comply  with any  notice  from a  Governmental  Authority
     asserting  material  non-compliance  with  Environmental  Laws,  or  (b) to
     correct any such material  non-compliance  identified in a report delivered
     to the Agent and the Lenders pursuant to Section 7.7.

          "Environmental Laws" means all federal, state or local laws, statutes,
     common law duties, rules, regulations,  ordinances and codes, together with
     all administrative orders,  directed duties,  licenses,  authorizations and
     permits of, and agreements with, any Governmental  Authority,  in each case
     relating to environmental, health, safety and land use matters.

          "Environmental  Lien"  means  a Lien  in  favor  of  any  Governmental
     Authority for (a) any liability  under  Environmental  Laws, or (b) damages
     arising from, or costs incurred by such Governmental  Authority in response
     to, a Release or threatened Release of a Contaminant into the environment.

          "Equipment"  means  all of the  Borrower's  now  owned  and  hereafter
     acquired Rolling Stock, wheels, tires,  navigational  equipment,  satellite
     units,  or  tracking  units  installed  on  Rolling  Stock,  or  otherwise,
     machinery, equipment, furniture, furnishings,  fixtures, and other tangible
     personal property (except  Inventory),  including embedded software,  motor
     vehicles  with  respect to which a  certificate  of title has been  issued,
     aircraft,  dies, tools, jigs, molds and office equipment, as well as all of
     such types of property  leased by the  Borrower  and all of the  Borrower's
     rights and interests  with respect  thereto  under such leases  (including,
     without  limitation,  options to  purchase);  together with all present and
     future additions and accessions thereto,  replacements therefor,  component
     and  auxiliary  parts  and  supplies  used  or to  be  used  in  connection
     therewith,  and all substitutes for any of the foregoing,  and all manuals,
     drawings,  instructions,   warranties  and  rights  with  respect  thereto;
     wherever any of the foregoing is located.

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

          "ERISA  Affiliate"  means  any  trade  or  business  (whether  or  not
     incorporated)  under common control with the Borrower within the meaning of
     Section 414(b) or (c) of the Code (and Sections  414(m) and (o) of the Code
     for purposes of provisions relating to Section 412 of the Code).

          "ERISA  Event" means (a) a Reportable  Event with respect to a Pension
     Plan,  (b) a  withdrawal  by the  Borrower  or any ERISA  Affiliate  from a
     Pension  Plan  subject to Section 4063 of ERISA during a plan year in which
     it was a substantial  employer (as defined in Section  4001(a)(2) of ERISA)
     or a cessation of  operations  which is treated as such a withdrawal  under
     Section  4062(e) of ERISA,  (c) a complete  or  partial  withdrawal  by the
     Borrower or any ERISA Affiliate from a Multi-employer  Plan or notification
     that a Multi-employer Plan is in reorganization, (d) the filing of a notice
     of intent to terminate,  the treatment of a Plan amendment as a termination
     under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
     the PBGC to  terminate  a  Pension  Plan or  Multi-employer  Plan,  (e) the
     occurrence of an event or condition  which might  reasonably be expected to
     constitute  grounds under Section 4042 of ERISA for the  termination of, or
     the   appointment  of  a  trustee  to  administer,   any  Pension  Plan  or
     Multi-employer  Plan, or (f) the imposition of any liability under Title IV


                                       78
<PAGE>

     of ERISA, other than for PBGC premiums due but not delinquent under Section
     4007 of ERISA, upon the Borrower or any ERISA Affiliate.

          "Event of Default" has the meaning specified in Section 9.1.

          "Exchange  Act"  means  the  Securities  Exchange  Act  of  1934,  and
     regulations promulgated thereunder.

          "Existing  Letters of Credit" means the letters of credit described on
     Schedule  6.9  hereto,  each issued by  SunTrust  Bank,  for the account of
     Borrower.

          "Existing  SunTrust  Debt"  means  all  amounts  owed by the  Borrower
     pursuant to (i) that certain  First Amended and Restated  Revolving  Credit
     Loan Agreement,  dated as of July 28, 2004, by and between the Borrower and
     SunTrust Bank, as amended, and (ii) that certain Loan Agreement dated April
     30, 2002, by and among Central  Receivables,  Inc.,  Three Pillars  Funding
     Corporation, and SunTrust Capital Markets, Inc., as agent.

          "FDIC"  means  the  Federal  Deposit  Insurance  Corporation,  and any
     Governmental Authority succeeding to any of its principal functions.

          "Federal  Funds Rate" means,  for any day, the rate per annum (rounded
     upwards,  if  necessary,  to the nearest 1/100 of 1%) equal to the weighted
     average of the rates on overnight  Federal funds  transactions with members
     of the Federal  Reserve  System  arranged by Federal  funds brokers on such
     day, as published  by the Federal  Reserve Bank of New York on the Business
     Day  next  succeeding  such  day;  provided  that  (a) if such day is not a
     Business  Day,  the  Federal  Funds Rate for such day shall be such rate on
     such transactions on the next preceding Business Day as so published on the
     next  succeeding  Business  Day, and (b) if no such rate is so published on
     such next  succeeding  Business  Day,  the Federal  Funds Rate for such day
     shall  be the  average  rate  charged  to the  Bank  on  such  day on  such
     transactions as determined by the Agent.

          "Federal  Reserve  Board"  means the Board of Governors of the Federal
     Reserve System or any successor thereto.

          "Financial  Statements" means, according to the context in which it is
     used, the financial  statements  referred to in Sections 5.2 and 6.6 or any
     other financial  statements required to be given to the Lenders pursuant to
     this Agreement.

          "Fiscal  Year"  means  the   Borrower's   fiscal  year  for  financial
     accounting  purposes.  The current  Fiscal Year of the Borrower will end on
     December 31, 2005.

          "Fixed Assets" means the Equipment and Real Estate of the Borrower.

          "Fixed Charge Coverage Ratio" means, with respect to any fiscal period
     of Borrower, the ratio of EBITDA to Fixed Charges.

          "Fixed  Charges"  means,  with  respect  to any  fiscal  period of the
     Borrower on a consolidated basis, without duplication,  the sum of: (a) Net
     Unfinanced  Capital  Expenditures;  (b)  interest  expense  to  the  extent
     actually  paid during such period,  (c)  principal  payments of Debt either
     scheduled to be made or actually made during such period,  and (d) Federal,
     state,  local and foreign income taxes,  excluding  deferred  taxes, to the
     extent actually paid during such period.

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<PAGE>

          "Foreign  Subsidiary"  of any Person means a Subsidiary of such Person
     that is organized or  incorporated  under the laws of a jurisdiction  other
     than a jurisdiction of the United States.

          "Funding Date" means the date on which a Borrowing occurs.

          "GAAP" means generally  accepted  accounting  principles and practices
     set  forth  from time to time in the  opinions  and  pronouncements  of the
     Accounting  Principles Board and the American Institute of Certified Public
     Accountants and statements and  pronouncements of the Financial  Accounting
     Standards Board (or agencies with similar  functions of comparable  stature
     and authority within the U.S. accounting profession),  which are applicable
     to the circumstances as of the Closing Date.

          "GE Capital  Sale/Leaseback"  means the agreement between the Borrower
     and General  Electric  Capital  Corporation  for the sale and  leaseback of
     certain Rolling Stock.

          "General  Intangibles"  means  all  of the  Borrower's  now  owned  or
     hereafter  acquired  general  intangibles,  choses in action  and causes of
     action and all other intangible  personal property of the Borrower of every
     kind and nature (other than Accounts),  including,  without limitation, all
     contract rights,  payment  intangibles,  Proprietary  Rights,  corporate or
     other   business   records,   inventions,   designs,   blueprints,   plans,
     specifications,  patents, patent applications,  trademarks,  service marks,
     trade  names,  trade  secrets,  goodwill,  copyrights,  computer  software,
     customer lists, registrations, licenses, franchises, tax refund claims, any
     funds  which  may  become  due to  the  Borrower  in  connection  with  the
     termination  of any  Plan or  other  employee  benefit  plan or any  rights
     thereto  and any other  amounts  payable to the  Borrower  from any Plan or
     other  employee  benefit  plan,  rights and  claims  against  carriers  and
     shippers,  rights to indemnification,  business interruption  insurance and
     proceeds thereof,  property,  casualty or any similar type of insurance and
     any  proceeds  thereof,  proceeds of  insurance  covering  the lives of key
     employees  on  which  the  Borrower  is  beneficiary,   rights  to  receive
     dividends,  distributions,  cash, Instruments and other property in respect
     of or in exchange for pledged equity  interests or Investment  Property and
     any letter of credit, guarantee, claim, security interest or other security
     held by or granted to the Borrower.

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

          "Guaranty" means, with respect to any Person,  all obligations of such
     Person which in any manner directly or indirectly  guarantee or assure,  or
     in  effect  guarantee  or  assure,   the  payment  or  performance  of  any
     indebtedness,  dividend  or other  obligations  of any  other  Person  (the
     "guaranteed obligations"),  or assure or in effect assure the holder of the
     guaranteed obligations against loss in respect thereof,  including any such
     obligations incurred through an agreement,  contingent or otherwise: (a) to
     purchase the guaranteed  obligations or any property  constituting security
     therefor; (b) to advance or supply funds for the purchase or payment of the
     guaranteed  obligations  or to maintain a working  capital or other balance
     sheet condition; or (c) to lease property or to purchase any debt or equity
     securities or other property or services.

          "Hedge  Agreement"  means  any and  all  transactions,  agreements  or
     documents  now existing or hereafter  entered into,  which  provides for an
     interest  rate,  credit,  commodity or equity  swap,  cap,  floor,  collar,
     forward foreign  exchange  transaction,  currency swap, cross currency rate
     swap,  currency  option,  or any combination of, or option with respect to,
     these or similar  transactions,  for the purpose of hedging the  Borrower's
     exposure  to  fluctuations  in interest or  exchange  rates,  loan,  credit
     exchange, security or currency valuations or commodity prices.

          "Instruments"  means all  instruments  as such term is  defined in the
     UCC, now owned or hereafter acquired by the Borrower.

          "Interest  Period" means,  as to any LIBOR  Revolving Loan, the period
     commencing    on   the   Funding    Date   of   such   Loan   or   on   the
     Continuation/Conversion  Date  on  which  the  Loan  is  converted  into or
     continued as a LIBOR  Revolving  Loan,  and ending on the date one, two, or
     three  months  thereafter  as  selected  by the  Borrower  in its Notice of


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     Borrowing,  in the  form  attached  hereto  as  Exhibit  D,  or  Notice  of
     Continuation/Conversion, in the form attached hereto as Exhibit E, provided
     that:

          (a) if any Interest  Period would otherwise end on a day that is not a
     Business  Day,  that  Interest  Period  shall be extended to the  following
     Business  Day unless the  result of such  extension  would be to carry such
     Interest  Period into another  calendar month, in which event such Interest
     Period shall end on the preceding Business Day;

          (b) any Interest  Period  pertaining  to a LIBOR  Revolving  Loan that
     begins on the last Business Day of a calendar  month (or on a day for which
     there is no numerically  corresponding day in the calendar month at the end
     of such Interest Period) shall end on the last Business Day of the calendar
     month at the end of such Interest Period; and

          (c) no Interest  Period  shall  extend  beyond the Stated  Termination
     Date.

          "Interest Rate" means each or any of the interest rates, including the
     Default Rate, set forth in Section 2.1.

          "Inventory"  means  all of the  Borrower's  now  owned  and  hereafter
     acquired  inventory,  goods  and  merchandise,   wherever  located,  to  be
     furnished  under any  contract  of service  or held for sale or lease,  all
     returned goods, raw materials,  work-in-process,  finished goods (including
     embedded  software),  other  materials and supplies of any kind,  nature or
     description  which are used or consumed in the Borrower's  business or used
     in connection with the packing, shipping, advertising, selling or finishing
     of such goods,  merchandise,  and all documents of title or other Documents
     representing them.

          "Investment  Property"  means all of the  Borrower's  right  title and
     interest in and to any and all:  (a)  securities  whether  certificated  or
     uncertificated;  (b) securities entitlements;  (c) securities accounts; (d)
     commodity contracts; or (e) commodity accounts.

          "IRS"  means  the  Internal   Revenue  Service  and  any  Governmental
     Authority succeeding to any of its principal functions under the Code.

          "Latest  Projections"  means:  (a) on the Closing Date and  thereafter
     until the Agent receives new projections  pursuant to Section  5.2(e),  the
     projections of the Borrower's financial  condition,  results of operations,
     and cash flows, for the period  commencing on January 1, 2005 and ending on
     December 31, 2006 and delivered to the Agent prior to the Closing Date; and
     (b)  thereafter,  the  projections  most  recently  received  by the  Agent
     pursuant to Section 5.2(f).

          "Lender" and "Lenders" have the meanings specified in the introductory
     paragraph  hereof  and shall  include  the Agent to the extent of any Agent
     Advance  outstanding  and the Bank to the  extent of any  Non-Ratable  Loan
     outstanding;  provided that no such Agent Advance or Non-Ratable Loan shall
     be taken into account in determining any Lender's Pro Rata Share.

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<PAGE>

          "Letter of Credit" has the meaning specified in Section 1.4(a).

          "Letter of Credit Fee" has the meaning specified in Section 2.6.

          "Letter of Credit Issuer" means the Bank, any affiliate of the Bank or
     any other financial  institution  that issues any Letter of Credit pursuant
     to this Agreement.

          "Letter of Credit Subfacility" means $40,000,000.

          "LIBOR Interest Payment Date" means, with respect to a LIBOR Revolving
     Loan, the first day of each month hereafter,  the last day of each Interest
     Period applicable to such Loan, and the Termination Date.

          "LIBOR Rate" means,  for any  Interest  Period,  with respect to LIBOR
     Revolving Loans, the rate of interest per annum determined  pursuant to the
     following formula:

           LIBOR Rate  =                   Offshore Base Rate
                             --------------------------------------------------
                                  1.00 - Eurodollar Reserve Percentage
                  Where,

               "Offshore  Base  Rate"  means  the rate per  annum  appearing  on
          Telerate  Page 3750 (or any  successor  page) as the London  interbank
          offered  rate for  deposits  in  Dollars at  approximately  11:00 a.m.
          (London  time)  two  Business  Days  prior  to the  first  day of such
          Interest Period for a term comparable to such Interest Period.  If for
          any reason such rate is not  available,  the Offshore  Base Rate shall
          be, for any Interest  Period,  the rate per annum appearing on Reuters
          Screen LIBO Page as the London interbank  offered rate for deposits in
          Dollars at  approximately  11:00 a.m.  (London time) two Business Days
          prior to the first day of such Interest  Period for a term  comparable
          to such Interest Period;  provided,  however, if more than one rate is
          specified on Reuters Screen LIBO Page,  the  applicable  rate shall be
          the arithmetic  mean of all such rates.  If for any reason none of the
          foregoing rates is available, the Offshore Base Rate shall be, for any
          Interest Period, the rate per annum determined by Agent as the rate of
          interest at which  dollar  deposits in the  approximate  amount of the
          LIBOR  Revolving  Loan  comprising  part of such  Borrowing  would  be
          offered by the Bank's  London  Branch to major  banks in the  offshore
          dollar  market at their  request at or about 11:00 a.m.  (London time)
          two Business Days prior to the first day of such Interest Period for a
          term comparable to such Interest Period.

               "Eurodollar  Reserve  Percentage"  means,  for any day during any
          Interest  Period,  the  reserve  percentage  (expressed  as a decimal,
          rounded  upward  to the  next  1/8th  of 1%) in  effect  on  such  day
          applicable to member banks under regulations  issued from time to time
          by the Federal  Reserve  Board for  determining  the  maximum  reserve
          requirement  (including any emergency,  supplemental or other marginal
          reserve  requirement) with respect to Eurocurrency  funding (currently
          referred to as "Eurocurrency liabilities"). The Offshore Rate for each
          outstanding LIBOR Revolving Loan shall be adjusted automatically as of
          the effective date of any change in the Eurodollar Reserve Percentage.

          "LIBOR  Revolving  Loan" means a  Revolving  Loan during any period in
     which it bears interest based on the LIBOR Rate.

          "Lien" means: (a) any interest in property securing an obligation owed
     to, or a claim by, a Person other than the owner of the  property,  whether
     such  interest  is based on the  common  law,  statute,  or  contract,  and


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     including  a security  interest,  charge,  claim,  or lien  arising  from a
     mortgage, deed of trust, encumbrance,  pledge,  hypothecation,  assignment,
     deposit  arrangement,  agreement,  security agreement,  conditional sale or
     trust receipt or a lease,  consignment  or bailment for security  purposes;
     (b)  to  the  extent  not  included  under  clause  (a),  any  reservation,
     exception,  encroachment,   easement,  right-of-way,  covenant,  condition,
     restriction,  lease or  other  title  exception  or  encumbrance  affecting
     property;  and (c) any contingent or other  agreement to provide any of the
     foregoing.

          "Loan Account"  means the loan account of the Borrower,  which account
     shall be maintained by the Agent.

          "Loan  Documents"  means  this  Agreement,   the  Trademark   Security
     Agreement,  the Security Agreement, the Parent Pledge Agreement, the Parent
     Guaranty, and any other agreements,  instruments, and documents heretofore,
     now or hereafter evidencing,  securing,  guaranteeing or otherwise relating
     to the Obligations, the Collateral, or any other aspect of the transactions
     contemplated by this Agreement.

          "Loans" means,  collectively,  all loans and advances  provided for in
     Article 1.

          "Lockbox Account" means a depository account  established  pursuant to
     one of the Lockbox Agreements.

          "Lockbox  Agreement" means those certain lockbox operating  procedural
     agreements and those certain  depository  account  agreements,  in form and
     substance satisfactory to Agent each of which is among Borrower, Agent, and
     a Lockbox Bank.

          "Lockbox  Bank"  means Bank of America,  N.A,  or any other  financial
     institution mutually acceptable to Borrower and Agent.

          "Majority  Lenders" means at any date of  determination  Lenders whose
     Pro Rata Shares aggregate more than 50%.

          "Margin  Stock"  means  "margin  stock"  as such  term is  defined  in
     Regulation T, U or X of the Federal Reserve Board.

          "Material Adverse Effect" means (a) a material adverse change in, or a
     material  adverse effect upon, the  operations,  business,  properties,  or
     condition  (financial or otherwise) of the Borrower,  the Collateral or any
     guarantor of the Obligations;  (b) a material  impairment of the ability of
     the  Borrower  or any  Affiliate  of  Borrower  to  perform  under any Loan
     Document to which it is a party; or (c) a material  adverse effect upon the
     legality,  validity,  binding effect or enforceability against the Borrower
     of any Loan Document to which it is a party.

          "Maximum Revolver Amount" means $70,000,000.

          "Maximum Rolling Stock Loan Amount" means $30,000,000.

          "Multi-employer  Plan"  means a  "multi-employer  plan" as  defined in
     Section  4001(a)(3) of ERISA which is or was at any time during the current
     year or the  immediately  preceding  six (6)  years  contributed  to by the
     Borrower or any ERISA Affiliate.

          "Net Amount of Eligible Accounts" means, at any time, the gross amount
     of Eligible Accounts less sales, excise or similar taxes, and less returns,


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<PAGE>

     discounts,   claims,  credits,   allowances,   accrued  rebates,   offsets,
     deductions, counterclaims, disputes and other defenses of any nature at any
     time issued, owing, granted, outstanding, available or claimed.

          "Net  Orderly  Liquidation  Value"  shall  mean (a) the  "net  orderly
     liquidation  value"  determined  by a valuation  company  acceptable to the
     Agent after  performance  of a Rolling  Stock  valuation  to be done at the
     Agent's request and the Borrower's  expense,  less the amount  estimated by
     such valuation company for marshalling, reconditioning, carrying, and sales
     expenses  designed to maximize the resale  value of such Rolling  Stock and
     assuming  that the time  required to dispose of such Rolling  Stock is [six
     (6) months];  or (b) if no such Rolling Stock  valuation has been requested
     by the Agent,  the value  customarily  attributed  to Rolling  Stock in the
     appraisal  industry for Rolling Stock of similar quality and quantity,  and
     similarly  dispersed  (under  similar  and  relevant   circumstances  under
     standard  asset-based  lending  procedures),  at the time of the valuation,
     less the amount customarily estimated in the appraisal industry at the time
     of any  determination  for marshalling,  recondition,  carrying,  and sales
     expenses  designed to maximize the resale  value of such Rolling  Stock and
     assuming  that the time  required to dispose of such Rolling  Stock is [six
     (6) months].

          "Net Proceeds" has the meaning specified in Section 3.4(b).

          "Net Unfinanced Capital Expenditures" for any period means the sum of:
     (a) Capital  Expenditures  made during such  period,  less (b) the net cash
     proceeds  received by Borrower  during such period from the sale,  lease or
     other disposition of any capital assets, less (c) cash proceeds received by
     Borrower  during  such  period  from any  financed  purchase of any capital
     assets.

          "Non-Ratable Loan" and "Non-Ratable Loans" have the meanings specified
     in Section 1.2(h).

          "Notes" means Revolving Loan Notes.

          "Notice of Borrowing" has the meaning specified in Section 1.2(b).

          "Notice  of  Continuation/Conversion"  has the  meaning  specified  in
     Section 2.2(b).

          "Obligations"   means  all   present  and  future   loans,   advances,
     liabilities,  obligations,  covenants,  duties,  and  debts  owing  by  the
     Borrower to the Agent and/or any Lender,  arising under or pursuant to this
     Agreement or any of the other Loan  Documents,  whether or not evidenced by
     any  note,  or  other  instrument  or  document,  whether  arising  from an
     extension  of  credit,  opening of a letter of  credit,  acceptance,  loan,
     guaranty,   indemnification  or  otherwise,  whether  direct  or  indirect,
     absolute or  contingent,  due or to become due,  primary or  secondary,  as
     principal or guarantor,  and including all  principal,  interest,  charges,
     expenses,  fees, attorneys' fees, filing fees and any other sums chargeable
     to the  Borrower  hereunder  or  under  any of the  other  Loan  Documents.
     "Obligations" includes, without limitation, (a) all debts, liabilities, and
     obligations now or hereafter arising from or in connection with the Letters
     of Credit and (b) all debts,  liabilities  and obligations now or hereafter
     arising from or in connection with Bank Products.

          "Other Taxes" means any present or future stamp or  documentary  taxes
     or any other  excise or property  taxes,  charges or similar  levies  which
     arise from any payment made  hereunder or from the  execution,  delivery or
     registration  of, or otherwise with respect to, this Agreement or any other
     Loan Documents.

          "Parent" means Central Freight Lines, Inc., a Nevada corporation.

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<PAGE>

          "Parent  Guaranty"  means that  certain  Guaranty  of the  Obligations
     executed by the Parent for the benefit of the Agent and the other Lenders.

          "Parent Pledge Agreement" means that certain Pledge Agreement executed
     by the Parent for the benefit of the Agent and the other Lenders.

          "Participant"  means any Person who shall have been  granted the right
     by any Lender to participate in the financing provided by such Lender under
     this Agreement,  and who shall have entered into a participation  agreement
     in form and substance satisfactory to such Lender.

          "Payment Account" means each bank account established  pursuant to the
     Security Agreement,  to which the proceeds of Accounts and other Collateral
     are deposited or credited, and which is maintained in the name of the Agent
     or the Borrower,  as the Agent may  determine,  on terms  acceptable to the
     Agent.

          "PBGC"  means  the  Pension  Benefit   Guaranty   Corporation  or  any
     Governmental Authority succeeding to the functions thereof.

          "Pending Revolving Loans" means, at any time, the aggregate  principal
     amount of all Revolving Loans requested in any Notice of Borrowing received
     by the Agent which have not yet been advanced.

          "Pension  Plan" means a pension  plan (as  defined in Section  3(2) of
     ERISA) subject to Title IV of ERISA which the Borrower sponsors, maintains,
     or to which it makes, is making, or is obligated to make contributions,  or
     in the case of a  Multi-employer  Plan has made  contributions  at any time
     during the immediately preceding five (5) plan years.

          "Permitted Liens" means:

          (a) Liens for taxes not delinquent or statutory  Liens for taxes in an
     amount not to exceed $100,000 provided that the payment of such taxes which
     are due and  payable is being  contested  in good faith and by  appropriate
     proceedings  diligently pursued and as to which adequate financial reserves
     have  been  established  on  Borrower's  books  and  records  and a stay of
     enforcement of any such Lien is in effect;

          (b) the Agent's Liens;

          (c)  Liens  consisting  of  deposits  made in the  ordinary  course of
     business in connection  with, or to secure  payment of,  obligations  under
     worker's compensation,  unemployment  insurance,  social security and other
     similar laws, or to secure the  performance  of bids,  tenders or contracts
     (other than for the repayment of Debt) or to secure indemnity,  performance
     or other similar bonds for the  performance  of bids,  tenders or contracts
     (other than for the repayment of Debt) or to secure  statutory  obligations
     (other than liens arising under ERISA or Environmental  Liens) or surety or
     appeal bonds, or to secure indemnity, performance or other similar bonds;

          (d) Liens  securing the claims or demands of  materialmen,  mechanics,
     carriers, warehousemen,  landlords and other like Persons, provided that if
     any such Lien arises from the nonpayment of such claims or demand when due,
     such claims or demands do not exceed $100,000 in the aggregate;

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<PAGE>

          (e) Liens  constituting  encumbrances  in the nature of  reservations,
     exceptions, encroachments, easements, rights of way, covenants running with
     the land, and other similar title exceptions or encumbrances  affecting any
     Real Estate;  provided that they do not in the aggregate materially detract
     from the value of the Real Estate or materially  interfere  with its use in
     the ordinary conduct of the Borrower's business;

          (f)  Liens  on  Rolling  Stock  or  other   Equipment   created  under
     Capitalized  Leases  which  attach  only  to the  Rolling  Stock  or  other
     Equipment  subject to the Capital Lease Liens and Liens on Rolling Stock or
     other Equipment to secure purchase money security interests therein so long
     as such Liens  solely  secure the purchase  price of such Rolling  Stock or
     other  Equipment,  and such Debt does not exceed the purchase price of such
     Rolling Stock or other Equipment; and

          (g) Liens arising from judgments and  attachments  in connection  with
     court proceedings provided that the attachment or enforcement of such Liens
     would not result in an Event of Default  hereunder and such Liens are being
     contested in good faith by appropriate proceedings,  adequate reserves have
     been set aside and no material  Property  is subject to a material  risk of
     loss or  forfeiture  and the  claims  in  respect  of such  Liens are fully
     covered by insurance (subject to ordinary and customary  deductibles) and a
     stay of execution pending appeal or proceeding for review is in effect.

          "Person"  means  any  individual,  sole  proprietorship,  partnership,
     limited   liability   company,   joint   venture,   trust,   unincorporated
     organization,  association,  corporation,  Governmental  Authority,  or any
     other entity.

          "Plan"  means an employee  benefit plan (as defined in Section 3(3) of
     ERISA)  which the  Borrower  sponsors or maintains or to which the Borrower
     makes, is making,  or is obligated to make  contributions  and includes any
     Pension Plan.

          "Pro  Rata  Share"  means,  with  respect  to  a  Lender,  a  fraction
     (expressed as a  percentage),  the numerator of which is the amount of such
     Lender's  Commitment and the denominator of which is the sum of the amounts
     of all of the Lenders' Commitments, or if no Commitments are outstanding, a
     fraction (expressed as a percentage),  the numerator of which is the amount
     of  Obligations  owed to such  Lender and the  denominator  of which is the
     aggregate  amount  of the  Obligations  owed to the  Lenders,  in each case
     giving effect to a Lender's  participation  in Non-Ratable  Loans and Agent
     Advances.

          "Proprietary  Rights"  means  all  of the  Borrower's  now  owned  and
     hereafter  arising or acquired:  licenses,  franchises,  permits,  patents,
     patent  rights,   copyrights,   works  which  are  the  subject  matter  of
     copyrights,  trademarks,  service marks, trade names, trade styles, patent,
     trademark  and  service  mark  applications,  and all  licenses  and rights
     related  to any of the  foregoing,  including  those  patents,  trademarks,
     service  marks,  trade  names and  copyrights  set forth on  Schedule  6.12
     hereto,  and all other rights under any of the foregoing,  all  extensions,
     renewals, reissues, divisions,  continuations, and continuations-in-part of
     any of the  foregoing,  and all rights to sue for past,  present and future
     infringement of any of the foregoing.

          "Real Estate" means all of the  Borrower's  now or hereafter  owned or
     leased estates in real property,  including,  without limitation, all fees,
     leaseholds and future interests, together with all of the Borrower's now or
     hereafter  owned or  leased  interests  in the  improvements  thereon,  the
     fixtures attached thereto and the easements appurtenant thereto.

          "Registered  Public  Accounting Firm" has the meaning specified in the
     Securities  Laws and shall be independent of the Borrower and the Parent as


                                       86
<PAGE>

     prescribed by the Securities Laws. Registered Public Accountants shall mean
     the accountants in such Registered Public Accounting Firm.

          "Release"  means  a  release,  spill,  emission,   leaking,   pumping,
     injection, deposit, disposal,  discharge,  dispersal, leaching or migration
     of a Contaminant  into the indoor or outdoor  environment or into or out of
     any Real Estate or other  property,  including the movement of Contaminants
     through or in the air, soil,  surface water,  groundwater or Real Estate or
     other property.

          "Replacement  Letters of Credit" means any Letter of Credit issued, in
     part to replace the Letter of Credit  issued by Fleet  National Bank on the
     Closing Date,  in the maximum  stated  amount of  $20,753,426  to Sun Trust
     Bank.

          "Reportable  Event"  means,  any of the  events  set forth in  Section
     4043(b) of ERISA or the regulations  thereunder,  other than any such event
     for which the 30-day  notice  requirement  under  ERISA has been  waived in
     regulations issued by the PBGC.

          "Required  Lenders"  means at any time  Lenders  whose Pro Rata Shares
     aggregate more than 66-2/3%.

          "Requirement  of Law" means,  as to any Person,  any law (statutory or
     common), treaty, rule or regulation or determination of an arbitrator or of
     a Governmental  Authority,  in each case  applicable to or binding upon the
     Person or any of its property or to which the Person or any of its property
     is subject.

          "Reserves"  means  reserves  that  limit  the  availability  of credit
     hereunder,  consisting of reserves against Availability,  Eligible Accounts
     or  Eligible  Rolling  Stock,  established  by Agent  from  time to time in
     Agent's reasonable credit judgment.  Without limiting the generality of the
     foregoing,  the  following  reserves  shall be  deemed  to be a  reasonable
     exercise of Agent's  credit  judgment:  (a) Bank  Product  Reserves,  (b) a
     reserve for accrued,  unpaid interest on the Obligations,  (c) reserves for
     rent at leased  locations  subject to  statutory  or  contractual  landlord
     liens, (d) Environmental  Compliance Reserves,  (e) insurance reserves, (f)
     dilution,  (g) litigation reserves, and (h) reserves for amounts due to any
     Person with whom the Borrower has a transportation alliance.

          "Responsible   Officer"  means  the  chief  executive   officer,   the
     president, or any executive vice president,  senior vice president, or vice
     president-finance   of  the   Borrower,   or  any  other   officer   having
     substantially  the same authority and  responsibility;  or, with respect to
     compliance  with financial  covenants and the  preparation of the Borrowing
     Base  Certificate,  the chief  financial  officer or the  treasurer  of the
     Borrower,  or any other officer having substantially the same authority and
     responsibility.

          "Restricted  Investment" means, as to the Borrower, any acquisition of
     property by the Borrower in exchange for cash or other property, whether in
     the  form of an  acquisition  of  stock,  debt,  or other  indebtedness  or
     obligation,  or the purchase or  acquisition  of any other  property,  or a
     loan, advance, capital contribution, or subscription, except the following:
     (a) acquisitions of Equipment to be used in the business of the Borrower so
     long as the  acquisition  costs  thereof  constitute  Capital  Expenditures
     permitted  hereunder;  (b)  acquisitions  of Rolling  Stock in the ordinary
     course of business of the  Borrower;  (c)  acquisitions  of current  assets
     acquired in the  ordinary  course of business of the  Borrower;  (d) direct
     obligations  of the United  States of America,  or any agency  thereof,  or
     obligations guaranteed by the United States of America,  provided that such
     obligations  mature within one year from the date of  acquisition  thereof;
     (e)  acquisitions of certificates of deposit  maturing within one year from
     the date of acquisition, bankers' acceptances, Eurodollar bank deposits, or
     overnight bank deposits, in each case issued by, created by, or with a bank
     or trust company  organized  under the laws of the United States of America
     or any state  thereof  having  capital  and  surplus  aggregating  at least
     $100,000,000;  (f)  acquisitions of commercial paper given a rating of "A2"


                                       87
<PAGE>

     or better by  Standard  & Poor's  Corporation  or "P2" or better by Moody's
     Investors Service, Inc. and maturing not more than 90 days from the date of
     creation thereof; (g) Hedge Agreements;  (h) investments made in connection
     with Acquisitions  permitted by Section 7.28; (i) investments  constituting
     Debt  permitted by Section 7.13;  (j)  investments in securities of Account
     Debtors  received  pursuant  to  any  plan  or  reorganization  or  similar
     arrangement upon the bankruptcy or insolvency of such Account  Debtors,  so
     long as Agent has a valid,  perfect first  priority  lien therein;  and (k)
     loans or advances to employees,  officers,  or directors of the Borrower or
     the Parent in the  ordinary  course of  business  for  travel,  relocation,
     entertainment and related expenses not to exceed $50,000 at any time.

          "Revolving  Loan Note" and  "Revolving  Loan Notes" have the  meanings
     specified in Section 1.2(a)(ii).

          "Revolving  Loans"  has  the  meaning  specified  in  Section  1.2 and
     includes each Agent Advance and Non-Ratable Loan.

          "Rolling Stock" means any interest in any tractor,  trailer,  or other
     vehicle now or hereafter owned by the Borrower.

          "Rolling Stock Capital Expenditure" means any Capital Expenditure made
     with respect to Rolling Stock.

          "Sarbanes-Oxley" means the Sarbanes-Oxley Act of 2002.

          "SEC" means the Securities and Exchange Commission or any Governmental
     Authority succeeding to the functions thereof.

          "Securities  Laws" means the  Securities  Act of 1933,  the Securities
     Exchange Act of 1934,  Sarbanes-Oxley  and the  applicable  accounting  and
     auditing principles,  rules, standards and practices promulgated,  approved
     or  incorporated  by the SEC or the  Public  Company  Accounting  Oversight
     Board,  as  each of the  foregoing  may be  amended  and in  effect  on any
     applicable date hereunder.

          "Security  Agreement"  means  the  Security  Agreement  of  even  date
     herewith  between  Borrower  and Agent for the  benefit  of Agent and other
     Lenders.

          "Settlement"  and  "Settlement  Date" have the  meanings  specified in
     Section 12.15(a)(ii).

          "Solvent"  means,  when used with  respect to any Person,  that at the
     time of determination:

          (a) the assets of such Person,  at a fair valuation,  are in excess of
     the total amount of its debts (including contingent liabilities); and

          (b) the present fair saleable  value of its assets is greater than its
     probable  liability on its existing debts as such debts become absolute and
     matured; and

          (c) it is then able and expects to be able to pay its debts (including
     contingent debts and other commitments) as they mature; and

          (d) it has capital  sufficient  to carry on its  business as conducted
     and as proposed to be conducted.

                                       88
<PAGE>

          For purposes of determining whether a Person is Solvent, the amount of
     any contingent  liability shall be computed as the amount that, in light of
     all the facts and  circumstances  existing  at such  time,  represents  the
     amount  that can  reasonably  be  expected  to become an actual or  matured
     liability.

          "Southwest  Sale/Leaseback"  means the agreement  between the Borrower
     and Southwest Premier Properties,  L.L.C. for the sale and leaseback of the
     land, structures, and improvements of certain of the Borrower's terminals.

          "Stated Termination Date" means January 31, 2009.

          "Subsidiary"   of  a  Person  means  any   corporation,   association,
     partnership,  limited  liability  company,  joint venture or other business
     entity of which more than fifty  percent (50%) of the voting stock or other
     equity interests (in the case of Persons other than corporations), is owned
     or controlled  directly or indirectly by the Person,  or one or more of the
     Subsidiaries of the Person,  or a combination  thereof.  Unless the context
     otherwise clearly requires,  references herein to a "Subsidiary" refer to a
     Subsidiary of the Borrower.

          "Supporting Obligations" means all supporting obligations as such term
     is defined in the UCC.

          "Taxes"  means any and all present or future taxes,  levies,  imposts,
     deductions,  charges or  withholdings,  and all  liabilities  with  respect
     thereto,  excluding,  in the case of each Lender and the Agent,  such taxes
     (including  income taxes or franchise  taxes) as are imposed on or measured
     by the Agent's or each  Lender's  net income in any  jurisdiction  (whether
     federal, state or local and including any political subdivision thereof).

          "Termination  Date"  means  the  earliest  to occur of (i) the  Stated
     Termination  Date, (ii) the date the Total Facility is terminated either by
     the Borrower pursuant to Section 3.2 or by the Required Lenders pursuant to
     Section 9.2, and (iii) the date this Agreement is otherwise  terminated for
     any reason whatsoever pursuant to the terms of this Agreement.

          "Total Facility" has the meaning specified in Section 1.1.

          "Trademark  Agreements" means the Trademark Security Agreement,  dated
     as of the date hereof,  executed and delivered by the Borrower to the Agent
     to evidence  and perfect the Agent's  security  interest in the  Borrower's
     present and future patents,  trademarks,  and related  licenses and rights,
     for the benefit of the Agent and the Lenders.

          "UCC" means the  Uniform  Commercial  Code,  as in effect from time to
     time,  of the  State of Texas or of any  other  state the laws of which are
     required as a result thereof to be applied in connection  with the issue of
     perfection of security interests.

          "Unfunded  Pension  Liability"  means the  excess of a Plan's  benefit
     liabilities  under Section  4001(a)(16) of ERISA, over the current value of
     that Plan's assets,  determined in accordance with the assumptions used for
     funding  the  Pension  Plan  pursuant  to  Section  412 of the Code for the
     applicable plan year.

          "Unused  Letter  of  Credit  Subfacility"  means  an  amount  equal to
     $40,000,000  minus  the  sum of (a) the  aggregate  undrawn  amount  of all
     outstanding Letters of Credit plus, without duplication,  (b) the aggregate
     unpaid reimbursement obligations with respect to all Letters of Credit.

                                       89
<PAGE>

          "Unused Line Fee" has the meaning specified in Section 2.5.

          "Voting Stock" of any Person as of any date means the capital stock of
     such  Person that is at the time  entitled  to vote in the  election of the
     board of directors of such Person.

          Accounting  Terms.  Any  accounting  term used in the Agreement  shall
     have,   unless  otherwise   specifically   provided  herein,   the  meaning
     customarily  given in accordance with GAAP, and all financial  computations
     in the Agreement shall be computed,  unless otherwise specifically provided
     therein, in accordance with GAAP as consistently applied and using the same
     method  for  valuations  as  used  in  the  preparation  of  the  Financial
     Statements.

          Interpretive Provisions. (a) The meanings of defined terms are equally
     applicable to the ------------------------ singular and plural forms of the
     defined terms.

          (b) The words "hereof," "herein,"  "hereunder" and similar words refer
     to the  Agreement  as a whole and not to any  particular  provision  of the
     Agreement; and Subsection,  Section, Schedule and Exhibit references are to
     the Agreement unless otherwise specified.

          (c) (i)  The  term  "documents"  includes  any  and  all  instruments,
     documents,   agreements,   certificates,   indentures,  notices  and  other
     writings, however evidenced.

          (ii) The term "including" is not limiting and means "including without
     limitation."

          (iii) In the computation of periods of time from a specified date to a
     later specified date, the word "from" means "from and including," the words
     "to" and "until" each mean "to but excluding" and the word "through"  means
     "to and including."

          (iv) The word "or" is not exclusive.

          (d) Unless  otherwise  expressly  provided  herein,  (i) references to
     agreements  (including  the Agreement)  and other  contractual  instruments
     shall  be  deemed  to  include   all   subsequent   amendments   and  other
     modifications  thereto,  but only to the extent such  amendments  and other
     modifications  are not  prohibited by the terms of any Loan  Document,  and
     (ii)  references  to any  statute  or  regulation  are to be  construed  as
     including all statutory and regulatory provisions consolidating,  amending,
     replacing, supplementing or interpreting the statute or regulation.

          (e)  The  captions  and  headings  of the  Agreement  and  other  Loan
     Documents are for  convenience  of reference  only and shall not affect the
     interpretation of the Agreement.

          (f) The Agreement and other Loan  Documents may use several  different
     limitations, tests or measurements to regulate the same or similar matters.
     All such limitations,  tests and measurements are cumulative and shall each
     be performed in accordance with their terms.

          (g) For  purposes  of Section  9.1, a breach of a  financial  covenant
     contained in Sections  7.22-7.26 shall be deemed to have occurred as of any
     date of  determination  thereof  by the  Agent or as of the last day of any
     specified  measuring  period,  regardless of when the Financial  Statements
     reflecting such breach are delivered to the Agent.

          (h) The  Agreement  and the other  Loan  Documents  are the  result of
     negotiations  among and have been  reviewed  by counsel  to the Agent,  the
     Borrower  and the  other  parties,  and are the  products  of all  parties.
     Accordingly,  they shall not be construed  against the Lenders or the Agent
     merely because of the Agent's or Lenders' involvement in their preparation.


                                       90
<PAGE>

                                    EXHIBIT A

                           FORM OF REVOLVING LOAN NOTE

$--------------------                                    ---------- --, -----

     For Value Received, the undersigned (the "Borrower") hereby promises to pay
to the order of  ____________________(the  "Lender") in care of Bank of America,
N.A.  (the  "Agent"),  at the Agent's  office  located at 901 Main Street,  22nd
Floor,  Dallas,  Texas 75202,  for the account of the Lender,  the lesser of the
principal amount of  _____________________  ($_______________)  or the aggregate
amount of all  outstanding  Revolving  Loans made to Borrower by the Lender from
time to time.  The  undersigned  also  promise  to pay  interest  on the  unpaid
principal  amount of each Borrowing  from the date of such Borrowing  until such
principal  amount  is paid.  This  Note  shall be  subject  to the terms of that
certain Credit Agreement described below, and all principal and interest payable
hereunder  shall be due and payable in  accordance  with the terms of the Credit
Agreement.

     This Note is one of the Notes referred to in the Credit Agreement, dated as
of January 31, 2005 (the "Credit  Agreement"),  among the Borrower,  the Lender,
certain other Lenders party thereto, and Bank of America, N.A., as Agent for the
Lenders.  Terms  defined in the Credit  Agreement  are used herein with the same
meanings.  The Credit  Agreement,  among other things,  contains  provisions for
acceleration  of the maturity of this Note upon the happening of certain  stated
events and also for  prepayments  on account of the principal of this Note prior
to the  maturity  of this Note upon the terms and  conditions  specified  in the
Credit Agreement. Without limiting the immediately preceding sentence, reference
is made to Section 2.3 of the Credit  Agreement  for usury  savings  provisions.
This Note is entitled to the  benefits of the Parent  Guaranty and is secured by
the Collateral.

     Principal and interest  payments  shall be in money of the United States of
America,  lawful at such times for the satisfaction of public and private debts,
and shall be in immediately available funds.

     The  Borrower  hereby  promises to pay the costs of  collection,  including
reasonable attorney's fees, if default is made in the payment of this Note.

     THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF TEXAS.

BORROWER:

Central Freight Lines, Inc., a Texas corporation

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



                                       91
<PAGE>

                                    EXHIBIT B

                       FORM OF BORROWING BASE CERTIFICATE

------------------------------------------------------------------------------
                                 BANK OF AMERICA
------------------------------------------------------------------------------

------------------------------------------------------------------------------
                       MONTHLY BORROWING BASE CERTIFICATE
------------------------------------------------------------------------------

------------------------------------------------------------------------------
Client:                 CENTRAL FREIGHT LINES, INC.
------------------------------------------------------------------------------
Certificate Number:
------------------------------------------------------------------------------
Dates Covered:
------------------------------------------------------------------------------

Eligible Accounts Receivable
85% Eligible
Accounts Receivable Reserve
Net Accounts Receivable Borrowing Base                           ------------

Eligible Unbilled Accounts Receivable
85% Eligible
Unbilled Accounts Receivable Reserve                             ------------
Net Unbilled Accounts Receivable Borrowing Base
Maximum Unbilled Accounts Receivable ($5,000,000)

Eligible Rolling Stock
85% Eligible                                                     ------------
Rolling Stock Reserve
Net Rolling Stock Availability
Maximum Rolling Stock ($30,000,000)

Gross Borrowing Base                                             ------------

Outstanding Letters of Credit                                    ------------

Net Borrowing Base                                               ------------

     The  foregoing  information  is  delivered  to Bank  of  America,  N.A.  in
accordance  with a Credit  Agreement  between Bank of America,  N.A. and Central
Freight  Lines,  Inc.,  dated  January  31,  2005.  I  hereby  certify  that the
information  contained  herein is true and correct as of the dates shown herein.
Nothing contained herein shall constitute a waiver, modification,  or limitation
in any of the terms or conditions set forth in the referenced Credit Agreement.




                                       92
<PAGE>


-------------------------------------------------------------------------------
                                 BANK OF AMERICA
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
                BORROWING BASE CERTIFICATE - ACCOUNTS RECEIVABLE
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
Client:     CENTRAL FREIGHT LINES, INC.
-------------------------------------------------------------------------------
Certificate Number:
-------------------------------------------------------------------------------
 Dates Covered:
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------------------
                  BILLED (#CFL01)                                                       UNBILLED (#CFL02)
                    <S>                                                                        <C>
--------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------
 1. Beginning Billed A/R Balance                                                1. Beginning Unbilled A/R Balance
--------------------------------------------------------------------------------------------------------------------------------
 2. Beginning Unbilled A/R Balance (+)
--------------------------------------------------------------------------------------------------------------------------------
 3. Beginning Total A/R Balance
--------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------
 4. Sales / DRJs (+)
--------------------------------------------------------------------------------------------------------------------------------
 5. Debits / FMJs, PMJs, AMJs & JEs (+)
--------------------------------------------------------------------------------------------------------------------------------
 6. Credits / FMJs, PMJs, AMJs & JEs (-)
--------------------------------------------------------------------------------------------------------------------------------
 7. Adjustments (+)                                                             2. Adjustments (+)
--------------------------------------------------------------------------------------------------------------------------------
 8. Adjustments (-)                                                             3. Adjustments (-)
--------------------------------------------------------------------------------------------------------------------------------
 9. Collections / CRJs & SFJs (-)
--------------------------------------------------------------------------------------------------------------------------------

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

--------------------------------------------------------------------------------------------------------------------------------
10. Current A/R Balance                                                         4. Current Unbilled A/R Balance
--------------------------------------------------------------------------------------------------------------------------------
11. Unbilled A/R (-)
--------------------------------------------------------------------------------------------------------------------------------
12. Billed A/R
--------------------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------------------
13. Ineligible                                                                  5. Ineligible
--------------------------------------------------------------------------------------------------------------------------------
14. Eligible A/R Collateral                                                     6. Eligible Unbilled A/R Collateral
--------------------------------------------------------------------------------------------------------------------------------
15. 85% Eligible                                                                7. 85% Eligible
--------------------------------------------------------------------------------------------------------------------------------
16. Less Interline Payable Reserve                                              8. Less Reserve
--------------------------------------------------------------------------------------------------------------------------------
17. Qualified Collateral                                                        9. Qualified Collateral
--------------------------------------------------------------------------------------------------------------------------------
18. Total Line Limit                                             $70,000,000.00 10. Total Line Limit               $5,000,000.00
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

     The  foregoing  information  is  delivered  to Bank  of  America,  N.A.  in
accordance  with a Credit  Agreement  between Bank of America,  N.A. and Central
Freight  Lines,  Inc.,  dated  January  31,  2005.  I  hereby  certify  that the
information  contained  herein is true and correct as of the dates shown herein.
Nothing contained herein shall constitute a waiver, modification,  or limitation
in any of the terms or conditions set forth in the referenced Credit Agreement.


                                       93
<PAGE>


-----------------------------------------------------------------------------
                                 BANK OF AMERICA
------------------------------------------------------------------------------

-----------------------------------------------------------------------------
                   ACCOUNTS RECEIVABLE INELIGIBLE CALCULATION
 --------------------------------------------------------------------------

------------------------------------------------------------------------------
Client:       CENTRAL FREIGHT LINES, INC.
------------------------------------------------------------------------------
Certificate Number:
------------------------------------------------------------------------------
Dates Covered:
------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                      BILLED (#CFL01)                                            UNBILLED (#CFL02)
<S>                                                                                   <C>
------------------------------------------------------------------------------------------------------------------------
Balances > 90 Days From Invoice Date                         Balances > 10 Days From Freight Bill Date
------------------------------------------------------------------------------------------------------------------------
Balances > 100 Days From Freight Bill Date                   Deferred Revenue
------------------------------------------------------------------------------------------------------------------------
Credits > 90 Days From Invoice Date
------------------------------------------------------------------------------------------------------------------------
50% Cross-Age
------------------------------------------------------------------------------------------------------------------------
Concentration Accounts > 15% (Exclud. Dell)
------------------------------------------------------------------------------------------------------------------------
Balance Due From Dell > 20%
------------------------------------------------------------------------------------------------------------------------
Contra Accounts
------------------------------------------------------------------------------------------------------------------------
Bankrupt Accounts
------------------------------------------------------------------------------------------------------------------------
COD Accounts
------------------------------------------------------------------------------------------------------------------------
Foreign Accounts
------------------------------------------------------------------------------------------------------------------------
Government Accounts
------------------------------------------------------------------------------------------------------------------------
Suspense Account
------------------------------------------------------------------------------------------------------------------------
Intercompany Accounts
------------------------------------------------------------------------------------------------------------------------
Invoices Without Supporting Documents
------------------------------------------------------------------------------------------------------------------------
Unreconciled Difference
------------------------------------------------------------------------------------------------------------------------
Total Ineligible A/R                                         Total Ineligible Unbilled A/R
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------

<FN>
The foregoing information is delivered to Bank of America, N.A. in accordance with a Credit Agreement between Bank of
America, N.A. and Central Freight Lines, Inc., dated January 31, 2005.  I hereby certify  that the information
contained herein is true and correct as of the dates shown herein.  Nothing contained   herein shall constitute a
waiver, modification, or limitation in any of the terms or conditions set forth in the referenced Credit Agreement.
</FN>
</TABLE>
-------------------------------------------------------------------------------


                                       94
<PAGE>

-------------------------------------------------------------------------------
                                 BANK OF AMERICA
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
               BORROWING BASE CERTIFICATE - ROLLING STOCK (#CFL03)
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
Client:      CENTRAL FREIGHT LINES, INC.
-------------------------------------------------------------------------------
Certificate Number:
-------------------------------------------------------------------------------
Dates Covered:
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
                             ROLLING STOCK (#CFL03)
-------------------------------------------------------------------------------
 1. Beginning Appraised Value
-------------------------------------------------------------------------------
 2. Acquisitions/New Titles - See Attached List (+)
-------------------------------------------------------------------------------
 3. Dispositions - See Attached List (-)
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 4. Current Appraised Value
-------------------------------------------------------------------------------
 5. Depreciation
-------------------------------------------------------------------------------
 6. Current Depreciated Appraised Value
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
 7. 85% Eligible
-------------------------------------------------------------------------------
 8. Less Reserve
-------------------------------------------------------------------------------
 9. Qualified Collateral
-------------------------------------------------------------------------------
10. Total Line Limit
-------------------------------------------------------------------------------

The foregoing  information  is delivered to Bank of America,  N.A. in accordance
with a Credit Agreement between Bank of America, N.A. and Central Freight Lines,
Inc.,  dated January 31, 2005. I hereby certify that the  information  contained
herein is true and  correct  as of the dates  shown  herein.  Nothing  contained
herein shall  constitute a waiver,  modification,  or  limitation  in any of the
terms or conditions set forth in the referenced Credit Agreement.


                                       95
<PAGE>
                                    EXHIBIT C

                            LEFT INTENTIONALLY BLANK


                                       96
<PAGE>

                                    EXHIBIT D

                               NOTICE OF BORROWING


                                                  Date:  ______________, 200_


To:  Bank of  America,  N.A.  as Agent for the  Lenders  who are  parties to the
     Credit  Agreement  dated as of  January  31,  2005 (as  extended,  renewed,
     amended  or  restated  from time to time,  the  "Credit  Agreement")  among
     Central Freight Lines, Inc., certain Lenders which are signatories  thereto
     and Bank of America, N.A., as Agent

Ladies and Gentlemen:

     The undersigned,  Central Freight Lines, Inc. (the  "Borrower"),  refers to
the Credit  Agreement,  the terms  defined  therein being used herein as therein
defined,  and hereby gives you notice  irrevocably  of the  Borrowing  specified
below:

1.   The   Business    Day   of   the   proposed    Borrowing   is   ,   200   .
     ----------------------- --

2.   The aggregate amount of the proposed Borrowing is $ . ---------------------

3.   The  Borrowing is to be  comprised of $ of Base Rate and $ of  ------------
     -------------- LIBOR Revolving Loans.

4.   The duration of the Interest Period for the LIBOR Revolving  Loans, if any,
     included in the Borrowing shall be _____ months.

     The undersigned hereby certifies that the following  statements are true on
the date hereof, and will be true on the date of the proposed Borrowing,  before
and  after  giving  effect  thereto  and to  the  application  of  the  proceeds
therefrom:

     (a) The  representations  and  warranties of the Borrower  contained in the
Credit Agreement are true and correct as though made on and as of such date;

     (b) No Default or Event of Default has occurred and is continuing, or would
result from such proposed Borrowing; and

     (c) The proposed Borrowing will not cause the aggregate principal amount of
all outstanding  Revolving Loans plus the maximum aggregate amount available for
drawing under all outstanding Letters of Credit, to exceed the Borrowing Base or
the combined Commitments of the Lenders.

                                        CENTRAL FREIGHT LINES, INC.



                                        By:-----------------------------------

                                     Title:-----------------------------------


                                       97
<PAGE>
                              EXHIBIT E

                 NOTICE OF CONTINUATION/CONVERSION


                                               Date: ___________________, 200_

To:  Bank of  America,  N.A.  as Agent for the  Lenders to the Credit  Agreement
     dated as of January , 2005 ---- (as extended,  renewed, amended or restated
     from time to time,  the "Credit  Agreement")  among Central  Freight Lines,
     Inc.,  certain Lenders which are  signatories  thereto and Bank of America,
     N.A., as Agent

Ladies and Gentlemen:

     The undersigned,  Central Freight Lines, Inc. (the  "Borrower"),  refers to
the Credit  Agreement,  the terms  defined  therein being used herein as therein
defined,   and  hereby  gives  you  notice   irrevocably  of  the   [conversion]
[continuation] of the Loans specified herein, that:

     1.   The Continuation/Conversion Date is , 200 . ------------ -

     2.   The aggregate amount of the Loans to be [converted] [continued] is $ .
          --------------

     3.   The Loans are to be [converted into] [continued as] [LIBOR Rate] [Base
          Rate] Loans.

     4.   The  duration of the  Interest  Period for the LIBOR  Revolving  Loans
          included in the [conversion] [continuation] shall be months.

     The undersigned hereby certifies that the following  statements are true on
the date hereof, and will be true on the proposed  Continuation/Conversion Date,
before and after giving effect  thereto and to the  application  of the proceeds
therefrom:

     (a) The  representations  and  warranties of the Borrower  contained in the
Credit Agreement are true and correct as though made on and as of such date;

     (b) Default or Event of Default has  occurred and is  continuing,  or would
result from such proposed [conversion] [continuation]; and

     (c) The  proposed  conversion-continuation  will not  cause  the  aggregate
principal amount of all outstanding  Revolving Loans plus the maximum  aggregate
amount  available for drawing under all outstanding  Letters of Credit to exceed
the Borrowing Base or the combined Commitments of the Lenders.

                               CENTRAL FREIGHT LINES, INC., a Texas corporation



                               By:
                                    -----------------------------------------

                              Title:
                                    -----------------------------------------



                                       98
<PAGE>

                                    EXHIBIT F

                  [FORM OF] ASSIGNMENT AND ACCEPTANCE AGREEMENT

     This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and Acceptance")
dated     as    of     ____________________,     200_    is     made     between
______________________________  (the "Assignor") and  __________________________
(the "Assignee").

                                    RECITALS

     WHEREAS, the Assignor is party to that certain Credit Agreement dated as of
January , 2005 (as amended,  amended and  restated,  modified,  supplemented  or
renewed,  the "Credit  Agreement")  among Central  Freight Lines,  Inc., a Texas
corporation (the "Borrower"),  the several  financial  institutions from time to
time party thereto (including the Assignor, the "Lenders"), and Bank of America,
N. A., as agent for the Lenders (the  "Agent").  Any terms defined in the Credit
Agreement and not defined in this  Assignment  and Acceptance are used herein as
defined in the Credit Agreement;

     WHEREAS, as provided under the Credit Agreement, the Assignor has committed
to making Loans (the "Committed  Loans") to the Borrower in an aggregate  amount
not to exceed $__________ (the "Commitment");

     WHEREAS,  the Assignor has made Committed Loans in the aggregate  principal
amount of $__________ to the Borrower

     WHEREAS,  [the Assignor has acquired a participation  in its pro rata share
of the Lenders'  liabilities  under Letters of Credit in an aggregate  principal
amount of  $____________  (the "L/C  Obligations")]  [no  Letters  of Credit are
outstanding under the Credit Agreement]; and

     WHEREAS,  the Assignor wishes to assign to the Assignee [part of the] [all]
rights and obligations of the Assignor under the Credit  Agreement in respect of
its Commitment, together with a corresponding portion of each of its outstanding
Committed  Loans and L/C  Obligations,  in an amount equal to  $__________  (the
"Assigned  Amount") on the terms and subject to the  conditions set forth herein
and the Assignee  wishes to accept  assignment of such rights and to assume such
obligations from the Assignor on such terms and subject to such conditions;

     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

     1. Assignment and Acceptance.

     (a) Subject to the terms and conditions of this  Assignment and Acceptance,
(i) the Assignor hereby sells,  transfers and assigns to the Assignee,  and (ii)
the Assignee hereby purchases, assumes and undertakes from the Assignor, without
recourse  and without  representation  or  warranty  (except as provided in this
Assignment and Acceptance) __% (the  "Assignee's  Percentage  Share") of (A) the
Commitment,  the Committed Loans and the L/C Obligations of the Assignor and (B)
all related rights,  benefits,  obligations,  liabilities and indemnities of the
Assignor  under  and in  connection  with  the  Credit  Agreement  and the  Loan
Documents.

     (b) With  effect on and after the  Effective  Date (as defined in Section 5
hereof),  the Assignee  shall be a party to the Credit  Agreement and succeed to


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<PAGE>

all of the rights and be obligated to perform all of the obligations of a Lender
under   the   Credit   Agreement,    including   the   requirements   concerning
confidentiality  and the payment of  indemnification,  with a  Commitment  in an
amount equal to the Assigned Amount. The Assignee agrees that it will perform in
accordance  with their  terms all of the  obligations  which by the terms of the
Credit  Agreement  are  required to be  performed  by it as a Lender.  It is the
intent of the parties  hereto that the Commitment of the Assignor  shall,  as of
the Effective Date, be reduced by an amount equal to the Assigned Amount and the
Assignor shall relinquish its rights and be released from its obligations  under
the Credit  Agreement  to the extent such  obligations  have been assumed by the
Assignee;  provided, however, the Assignor shall not relinquish its rights under
Sections __ and __ of the Credit  Agreement to the extent such rights  relate to
the time prior to the Effective Date.

     (c) After giving effect to the  assignment and assumption set forth herein,
on the Effective Date the Assignee's Commitment will be $__________.

     (d) After giving effect to the  assignment and assumption set forth herein,
on the Effective Date the Assignor's Commitment will be $__________.

     2. Payments.

     (a) As consideration for the sale,  assignment and transfer contemplated in
Section 1 hereof,  the Assignee  shall pay to the Assignor on the Effective Date
in immediately available funds an amount equal to $__________,  representing the
Assignee's Pro Rata Share of the principal amount of all Committed Loans.

     (b) The Assignee further agrees to pay to the Agent a processing fee in the
amount specified in Section 11.2(a) of the Credit Agreement.

     3. Reallocation of Payments.

     Any interest,  fees and other  payments  accrued to the Effective Date with
respect to the Commitment,  and Committed Loans and L/C Obligations shall be for
the account of the Assignor.  Any interest,  fees and other payments  accrued on
and after the  Effective  Date with respect to the Assigned  Amount shall be for
the account of the Assignee.  Each of the Assignor and the Assignee  agrees that
it will hold in trust for the other party any  interest,  fees and other amounts
which it may  receive  to which  the other  party is  entitled  pursuant  to the
preceding  sentence  and pay to the other  party any such  amounts  which it may
receive promptly upon receipt.

     4. Independent Credit Decision.

     The  Assignee  (a)  acknowledges  that it has received a copy of the Credit
Agreement and the Schedules  and Exhibits  thereto,  together with copies of the
most recent financial  statements of the Borrower,  and such other documents and
information  as it has  deemed  appropriate  to make its own  credit  and  legal
analysis  and decision to enter into this  Assignment  and  Acceptance;  and (b)
agrees that it will,  independently and without reliance upon the Assignor,  the
Agent or any other  Lender and based on such  documents  and  information  as it
shall deem  appropriate  at the time,  continue to make its own credit and legal
decisions in taking or not taking action under the Credit Agreement.

     5. Effective Date; Notices.

     (a) As between the Assignor and the Assignee,  the effective  date for this
Assignment and  Acceptance  shall be __________,  200_ (the  "Effective  Date");


                                      100
<PAGE>

provided  that the  following  conditions  precedent  have been  satisfied on or
before the Effective Date:

     (i) this  Assignment and Acceptance  shall be executed and delivered by the
Assignor and the Assignee;

     [(ii) the consent of the Agent required for an effective  assignment of the
Assigned  Amount by the Assignor to the Assignee  shall have been duly  obtained
and shall be in full force and effect as of the Effective Date;]

     (iii)  the  Assignee  shall  pay to the  Assignor  all  amounts  due to the
Assignor under this Assignment and Acceptance;

     [(iv) the  Assignee  shall have  complied  with  Section 11.2 of the Credit
Agreement (if applicable);]

     (v) the  processing  fee  referred to in Section 2(b) hereof and in Section
11.2(a) of the Credit Agreement shall have been paid to the Agent; and

     (b) Promptly following the execution of this Assignment and Acceptance, the
Assignor shall deliver to the Borrower and the Agent for  acknowledgment  by the
Agent, a Notice of Assignment in the form attached hereto as Schedule 1.

     6. [Agent. [INCLUDE ONLY IF ASSIGNOR IS AGENT]

     (a) The Assignee  hereby  appoints and authorizes the Assignor to take such
action as agent on its  behalf  and to  exercise  such  powers  under the Credit
Agreement as are delegated to the Agent by the Lenders  pursuant to the terms of
the Credit Agreement.

     (b) The Assignee shall assume no duties or obligations held by the Assignor
in its capacity as Agent under the Credit Agreement.]

     7. Withholding Tax.

     The Assignee (a) represents  and warrants to the Lender,  the Agent and the
Borrower  that under  applicable  law and treaties no tax will be required to be
withheld by the Lender with  respect to any  payments to be made to the Assignee
hereunder,  (b)  agrees to  furnish  (if it is  organized  under the laws of any
jurisdiction other than the United States or any State thereof) to the Agent and
the  Borrower  prior to the time that the Agent or  Borrower is required to make
any  payment  of  principal,  interest  or fees  hereunder,  duplicate  executed
originals of either U.S.  Internal Revenue Service Form W-8ECI or U.S.  Internal
Revenue  Service Form W-8BEN  (wherein the Assignee  claims  entitlement  to the
benefits  of a tax  treaty  that  provides  for a complete  exemption  from U.S.
federal income withholding tax on all payments  hereunder) and agrees to provide
new Forms W-8ECI or W-8BEN upon the expiration of any previously  delivered form
or comparable  statements in accordance with applicable U.S. law and regulations
and  amendments  thereto,  duly executed and completed by the Assignee,  and (c)
agrees to comply with all applicable  U.S. laws and  regulations  with regard to
such withholding tax exemption.

     8. Representations and Warranties.

     (a) The  Assignor  represents  and  warrants  that (i) it is the  legal and
beneficial  owner of the interest  being  assigned by it hereunder and that such
interest is free and clear of any Lien or other adverse  claim;  (ii) it is duly
organized and existing and it has the full power and authority to take,  and has


                                      101
<PAGE>

taken,  all  action  necessary  to  execute  and  deliver  this  Assignment  and
Acceptance  and any other  documents  required  or  permitted  to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder;  (iii) no notices to, or consents,  authorizations or
approvals of, any Person are required (other than any already given or obtained)
for  its  due  execution,  delivery  and  performance  of  this  Assignment  and
Acceptance, and apart from any agreements or undertakings or filings required by
the Credit  Agreement,  no further  action by, or notice to, or filing with, any
Person is required of it for such execution,  delivery or performance;  and (iv)
this  Assignment  and  Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against  the  Assignor  in  accordance  with the terms  hereof,  subject,  as to
enforcement,  to bankruptcy,  insolvency,  moratorium,  reorganization and other
laws of general  application  relating to or affecting  creditors' rights and to
general equitable principles.

     (b) The  Assignor  makes no  representation  or  warranty  and  assumes  no
responsibility  with respect to any  statements,  warranties or  representations
made in or in connection with the Credit  Agreement or the execution,  legality,
validity,  enforceability,  genuineness,  sufficiency  or  value  of the  Credit
Agreement or any other instrument or document  furnished  pursuant thereto.  The
Assignor makes no  representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency,  financial condition or statements
of the Borrower, or the performance or observance by the Borrower, of any of its
respective  obligations  under the Credit  Agreement or any other  instrument or
document furnished in connection therewith.

     (c) The Assignee  represents and warrants that (i) it is duly organized and
existing and it has full power and authority to take, and has taken,  all action
necessary to execute and deliver this  Assignment  and  Acceptance and any other
documents  required or permitted to be executed or delivered by it in connection
with this Assignment and Acceptance,  and to fulfill its obligations  hereunder;
(ii) no notices to, or consents,  authorizations or approvals of, any Person are
required  (other  than any already  given or  obtained)  for its due  execution,
delivery and performance of this  Assignment and Acceptance;  and apart from any
agreements  or  undertakings  or filings  required by the Credit  Agreement,  no
further  action by, or notice to, or filing  with,  any Person is required of it
for  such  execution,  delivery  or  performance;   (iii)  this  Assignment  and
Acceptance has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignee,  enforceable  against the Assignee
in accordance with the terms hereof, subject, as to enforcement,  to bankruptcy,
insolvency,  moratorium,  reorganization  and other laws of general  application
relating to or affecting creditors' rights and to general equitable  principles;
[and (iv) it is an Eligible Assignee.]

     9. Further Assurances.

     The Assignor and the Assignee each hereby agree to execute and deliver such
other  instruments,  and take such other action,  as either party may reasonably
request in connection with the transactions  contemplated by this Assignment and
Acceptance,  including  the  delivery  of any  notices  or  other  documents  or
instruments  to the Borrower or the Agent,  which may be required in  connection
with the assignment and assumption contemplated hereby.

     10. Miscellaneous.

     (a) Any  amendment  or  waiver  of any  provision  of this  Assignment  and
Acceptance  shall be in writing and signed by the parties hereto.  No failure or
delay by either  party  hereto  in  exercising  any  right,  power or  privilege
hereunder  shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance  shall be without  prejudice to any
rights with respect to any other or further breach thereof.

     (b) All  payments  made  hereunder  shall be made  without  any  set-off or
counterclaim.

                                      102
<PAGE>

     (c) The Assignor and the Assignee shall each pay its own costs and expenses
incurred  in  connection  with  the  negotiation,   preparation,  execution  and
performance  of  this  Assignment  and  Acceptance.   (d)  This  Assignment  and
Acceptance  may be  executed  in any  number  of  counterparts  and  all of such
counterparts  taken  together  shall be  deemed to  constitute  one and the same
instrument.

     (e) THIS  ASSIGNMENT AND  ACCEPTANCE  SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE  WITH THE LAW OF THE STATE OF TEXAS.  The  Assignor  and the Assignee
each  irrevocably  submits  to the  non-exclusive  jurisdiction  of any State or
Federal court sitting in Texas over any suit,  action or proceeding  arising out
of or relating to this Assignment and Acceptance and irrevocably agrees that all
claims in respect of such action or  proceeding  may be heard and  determined in
such Texas State or Federal court.  Each party to this Assignment and Acceptance
hereby  irrevocably  waives, to the fullest extent it may effectively do so, the
defense  of  an  inconvenient  forum  to  the  maintenance  of  such  action  or
proceeding.

     (f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY  KNOWINGLY,  VOLUNTARILY  AND
INTENTIONALLY  WAIVE ANY  RIGHTS  THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION  BASED HEREON,  OR ARISING OUT OF, UNDER,  OR IN CONNECTION  WITH
THIS ASSIGNMENT AND ACCEPTANCE,  THE CREDIT AGREEMENT, ANY RELATED DOCUMENTS AND
AGREEMENTS OR ANY COURSE OF CONDUCT,  COURSE OF DEALING,  OR STATEMENTS (WHETHER
ORAL OR WRITTEN).

     IN  WITNESS  WHEREOF,  the  Assignor  and the  Assignee  have  caused  this
Assignment and Acceptance to be executed and delivered by their duly  authorized
officers as of the date first above written.

                                                    [ASSIGNOR]


                                    By:------------------------------
                                    Title:---------------------------
                                    Address:-------------------------

                                                    [ASSIGNEE]


                                    By:------------------------------
                                    Title:---------------------------
                                    Address:-------------------------


                                      103
<PAGE>
                                   SCHEDULE 1
                                       to
                            ASSIGNMENT AND ACCEPTANCE


                       NOTICE OF ASSIGNMENT AND ACCEPTANCE




                                                         _______________, 200_



Bank of America, N.A
901 Main Street, 22nd Floor
Dallas, Texas  75202
Attn:  Joy L. Bartholomew

Re:  Central Freight Lines, Inc.
     5601 West Waco Drive
     Waco, TX  76710
     Attention:  Steve Owen




Ladies and Gentlemen:

     We refer to the Credit  Agreement dated as of January 31, 2005 (as amended,
amended and restated,  modified,  supplemented  or renewed from time to time the
"Credit  Agreement")  among Central Freight Lines,  Inc. (the  "Borrower"),  the
Lenders referred to therein and Bank of America, N. A., as agent for the Lenders
(the "Agent").  Terms defined in the Credit Agreement are used herein as therein
defined.

     1. We  hereby  give you  notice  of,  and  request  your  consent  to,  the
assignment  by  __________________  (the  "Assignor")  to  _______________  (the
"Assignee") of _____% of the right, title and interest of the Assignor in and to
the Credit Agreement (including the right, title and interest of the Assignor in
and to the  Commitments  of the  Assignor,  all  outstanding  Loans  made by the
Assignor and the Assignor's  participation  in the Letters of Credit pursuant to
the Assignment and Acceptance  Agreement  attached  hereto (the  "Assignment and
Acceptance").  We understand and agree that the Assignor's  Commitment,  as of ,
200 , is $  ___________,  the  aggregate  amount  of its  outstanding  Loans  is
$_____________, and its participation in L/C Obligations is $_____________.

     2. The Assignee  agrees that,  upon receiving the consent of the Agent and,
if applicable,  the Borrower to such  assignment,  the Assignee will be bound by
the terms of the  Credit  Agreement  as fully  and to the same  extent as if the
Assignee  were  the  Lender  originally  holding  such  interest  in the  Credit


                                      104
<PAGE>

Agreement.

     3. The following administrative details apply to the Assignee:

                           (A)      Notice Address:

                                    Assignee name:
                                    Address:
                                              ----------------------------------

                                    Attention:
                                              ----------------------------------
                                    Telephone: (___)
                                    Telecopier: (___)
                                    Telex (Answerback):

                           (B)      Payment Instructions:

                                    Account No.:
                                                    ----------------------------
                                               At:
                                                    ----------------------------

                                    Reference:
                                                    ----------------------------
                                    Attention:
                                                    ----------------------------

     4. You are  entitled  to rely  upon  the  representations,  warranties  and
covenants of each of the Assignor and Assignee  contained in the  Assignment and
Acceptance.

     IN WITNESS  WHEREOF,  the Assignor and the Assignee have caused this Notice
of Assignment and Acceptance to be executed by their  respective duly authorized
officials, officers or agents as of the date first above mentioned.

                                     Very truly yours,








ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:


Bank of America, N. A.
as Agent

By:
        -----------------------------------------

Title:
        -----------------------------------------


                                      105

</TEXT>
</DOCUMENT>
