HOMEGOLD FINANCIAL INC
SECURITY AGREEMENT
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>exhibit10133.txt
<DESCRIPTION>SECURITY AGREEMENT
<TEXT>
                                                              EXHIBIT 10.13.3

                               SECURITY AGREEMENT



         THIS SECURITY AGREEMENT (as defined in Article 6 hereof, along with all
other defined  terms,  this  "Security  Agreement")  is made and effective as of
January  18,  2002,  by EACH  "BORROWER"  THAT IS FROM  TIME TO TIME  LISTED  ON
SCHEDULE 1 HERETO OR OTHERWISE ADDED AS A SIGNATORY  HERETO (each, as more fully
defined  below,  a  "Borrower";  collectively,  the  "Borrowers"),  in  favor of
HOMEGOLD  FINANCIAL,  INC.  ("Lender"),  (as  defined  in the  Credit  Agreement
referred to below).

                                 R E C I T A L S

         WHEREAS,  pursuant to that certain  Revolving  Credit  Agreement by and
among  Borrowers  and  Lender  (as may be  amended  from  time to time,  "Credit
Agreement"),  each  Borrower is required to have  executed  and  delivered  this
Security  Agreement  encumbering all of each Borrower's  tangible and intangible
personal property assets in favor of Lender; and

         WHEREAS,  each Borrower has determined  that it is in its best interest
to execute this Security Agreement inasmuch as each Borrower has determined that
the execution,  delivery and performance of this Security Agreement is necessary
or  convenient  to the conduct,  promotion or attainment of the business of such
Borrower;

         NOW,  THEREFORE,  for good and valuable  consideration (the receipt and
sufficiency of which are hereby  acknowledged) and intending to be legally bound
hereby, each Borrower and Lender hereby agree as follows:

         ARTICLE 1: SECURITY INTEREST, COLLATERAL ASSIGNMENT AND PLEDGE

     1.1. Grant of Security. Each Borrower (as of the effective date of becoming
a signatory hereto) hereby collaterally assigns and pledges to Lender and hereby
grants to Lender a present,  absolute,  unconditional  and  continuing  security
interest in, all of the following property, assets and equity interests, whether
or not such property and assets are covered by Article 9 of the  applicable  UCC
(collectively, and including all Pledged Collateral, "Collateral"):

         (a) Accounts:  All accounts,  contract rights,  chattel paper, customer
         monitoring contracts,  customer maintenance contracts,  instruments and
         documents,  whether now owned or  hereafter  created or acquired by any
         Borrower or in which any  Borrower  now has or  hereafter  acquires any
         interest,   including  all  accounts  due  to  any  Borrower  from  any
         independent third party financing entity.

         (b) Receivables.  All   Consumer   Loan  receivables,  collateral   for
         Consumer Loans including checks and all trade and other receivables.

         (c)  Equipment:  All  computers,   machinery,   apparatus,   equipment,
         fittings,  furniture,  fixtures,  motor  vehicles,  and other  tangible

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         personal Property of every kind and description, now owned or hereafter
         acquired, and all parts, accessories, and special tools thereto and all
         increases and accessions  thereto and  substitutions  and  replacements
         therefor.

         (d) General Intangibles: All general intangibles,  whether now owned or
         hereafter  created or  acquired,  including,  without  limitation,  all
         choses  in  action,  causes  of  action,  corporate  or other  business
         records,  deposit  accounts,   inventions,   designs,  patents,  patent
         applications,   trademarks,   trade  names,  trade  secrets,  goodwill,
         copyrights,  registrations,  licenses, franchises,  customer lists, tax
         refund claims, computer programs, all claims under guaranties, security
         interests  or other  security  held by or  granted to any  Borrower  to
         secure  payment of any of the Accounts,  all rights to  indemnification
         and all other intangible  property of every kind and nature (other than
         Accounts).

         (e) All monies and other  Property  of any kind,  now or at any time or
         times hereafter, while in the possession or under the control of Lender
         or a bailee of Lender, together with all proceeds relating thereto.

     1.2. Security for Secured Obligations.  This Security Agreement secures the
payment and performance in full of (a) all  obligations  (monetary or otherwise)
of each Borrower now or hereafter  existing under the Credit Agreement,  as well
as under any other  agreement with Lender to extend credit to any Borrower or to
any  Affiliate of any such Borrower  (whether for  principal,  interest,  costs,
fees,  expenses,  protective  advances or  otherwise),  and (b) all  obligations
(monetary or  otherwise)  of any Borrower now or hereafter  existing  under this
Security  Agreement or the Credit Agreement (all such obligations  under Clauses
"(a)" and "(b)" being referred to collectively as the "Secured Obligations").

     1.3. Continuing Security Interest;  Assignment;  Termination. This Security
Agreement creates a continuing  security  interest in and collateral  assignment
and pledge of the  Collateral  and will  remain in full  force and effect  until
terminated  as  described  below in this  Section.  This  Security  Agreement is
binding upon each Borrower and its successors,  transferees  and assignees,  and
(together  with the  rights  and  remedies  of Lender  hereunder)  inures to the
benefit of Lender and its successors,  transferees,  participants and assignees.
Without  limiting  the  generality  of  the  foregoing,  except  to  the  extent
restricted under the Credit Agreement, Lender may assign, syndicate, participate
or otherwise transfer (in whole or in part, and without any Borrower's  consent)
any indebtedness thereunder to any other Person, and such other Person or entity
will thereupon become vested with all the rights and benefits in respect thereof
granted to Lender  under the Credit  Agreement  and this  Security  Agreement or
otherwise,  subject,  however,  to any contrary provisions in such assignment or
transfer.

     1.4.  Security  Interest  Absolute.  All rights of Lender and the  security
interests,  collateral assignments and pledges granted,  assigned and pledged to
Lender hereunder,  and all obligations of each Borrower hereunder,  are absolute
and  unconditional,  irrespective  of the  occurrence  of any one or more of the
following:

     a.   Any lack of validity or enforceability of the Credit Agreement; or

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     b.   The failure of Lender or any holder of any Note:

          i.   To assert any claim or demand or to  enforce  any right or remedy
               under the provisions of the Credit Agreement or otherwise, or

          ii.  To exercise any right or remedy against any other Borrower of, or
               any collateral securing, any obligations of any Borrower owing to
               Lender; or

     c.   Any change in the time, manner or place of payment of, or in any other
          term of, any Secured Obligation; or

     d.   Any other extension, increase, refinancing,  restructuring, compromise
          or renewal of any Secured Obligation; or

     e.   Any  reduction,  limitation,  impairment or termination of any Secured
          Obligation for any reason,  including any waiver, release,  surrender,
          alteration or compromise; or

     f.   Any amendment to, rescission, waiver, or other modification of, or any
          consent to departure from, the terms of the Credit Agreement; or

     g.   Any addition,  exchange,  release,  surrender or  nonperfection of any
          collateral  (including the Collateral),  or any amendment to or waiver
          or  release  of or  addition  to or  consent  to  departure  from  any
          guaranty, for any Secured Obligation; or

     h.   Any other  circumstances  which might  otherwise  constitute a defense
          available  to, or a legal or equitable  discharge  of, any Borrower or
          its obligations hereunder,  including, without limitation, any and all
          suretyship defenses.

         Each Borrower hereby waives any right to or any claim of any defense or
setoff,  counterclaim,  recoupment  or  termination  whatsoever by reason of any
invalidity,    illegality,     nongenuineness,     irregularity,     compromise,
unenforceability  of, or any other event or  occurrence  affecting,  any Secured
Obligation.

     1.5. Deposit Control Agreement. Each Borrower agrees to execute and deliver
to Lender a Deposit Control  Agreement,  substantially  in the form of Exhibit A
hereto, with respect to each deposit account of Borrower.

                    ARTICLE 2: REPRESENTATIONS AND WARRANTIES

         Each Borrower hereby  represents and warrants to Lender as set forth in
this Article.

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     2.1. Valid and Perfected Security Interest. This Security Agreement creates
a valid security  interest in the Collateral and proceeds  thereof  securing the
payment of the Secured  Obligations.  All filings and other actions necessary or
desirable to perfect and protect such security interest,  collateral  assignment
and pledge have been duly taken or will be duly taken as of the  effective  date
hereof.  Upon perfection,  such security  interest and pledge will be of a first
priority ranking.

     2.2. Authorization and Approval. No authorization, approval or other action
by (and no notice  to or  filing  with)  any  Official  Body or other  Person is
required  either (a) for the grant by any  Borrower  of the  security  interest,
collateral  assignment  and pledge  granted  hereby,  or (b) for the  execution,
delivery and performance of this Security Agreement by any Borrower,  or (c) for
the perfection by Lender of its rights and interests  hereunder,  or (d) for the
exercise by Lender of its rights and remedies hereunder.

     2.3.  Compliance  with Laws and  Contracts.  Each  Borrower  is (and  after
execution and delivery of the Loan  Documents to which such Borrower is a party,
such  Borrower  will  be)  in  compliance  in all  material  respects  with  the
requirements of all applicable laws, rules,  regulations,  policies,  orders and
decrees of every Official Body and with all contractual restrictions,  in either
instance the  non-compliance  with which  individually or in the aggregate could
reasonably be expected to have or cause a Material Adverse Effect.

     2.4.  Validity of  Obligations.  This Security  Agreement  constitutes  the
legal, valid and binding obligation of each Borrower and is enforceable  against
each Borrower in accordance with the terms hereof.

                              ARTICLE 3: COVENANTS

     Each Borrower covenants and agrees that, so long as this Security Agreement
remains  effective,  each  Borrower  will comply with the covenants set forth in
this Article, unless Lender otherwise consents in writing.

     3.1.  Further  Assurances.  Each  Borrower  (from  time  to time at its own
expense)  will  promptly  execute  and  deliver  all  further   instruments  and
documents,  and will take all further action, that may be necessary or desirable
(or that  Lender may  reasonably  request)  in order to  perfect,  preserve  and
protect  any  security  interest,  collateral  assignment  or pledge  granted or
purported to be granted  hereby or to enable  Lender to exercise and enforce its
rights and remedies  hereunder with respect to any Collateral.  Without limiting
the generality of the foregoing, each Borrower:

          a. Will mark conspicuously each chattel paper included in the Contract
     Rights and, at the request of Lender, each of its records pertaining to the
     Collateral with a legend (in form and substance reasonably  satisfactory to
     Lender)  indicating  that such  chattel  paper is subject  to the  security
     interest, collateral assignment and pledge granted hereby, and in the event
     any  such  chattel  paper  is in  electronic  form,  will  ensure  that the
     electronic  record of chattel paper has only one  authoritative  copy, that
     authoritative  copy  identifies  the  Lender  and its  interest,  that  the
     authoritative copy is communicated to and maintained by the Lender or its

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<PAGE>

     designated  custodian,  that the authoritative copy is readily identifiable
     as such and that  there  are  appropriate  controls  in place  relating  to
     revisions of the copy; and

          b. If any Contract  Rights shall be evidenced by a promissory  note or
     other instrument,  negotiable  document or chattel paper, then will deliver
     and pledge to Lender hereunder such promissory note, instrument, negotiable
     document or chattel  paper duly endorsed and  accompanied  by duly executed
     instruments of transfer or assignment, all in form and substance reasonably
     satisfactory to Lender; and

          c. Will execute and file such financing or continuation statements, or
     amendments  thereto,  and  such  other  instruments  or  notices  as may be
     necessary  (or as Lender may  reasonably  request)  in order to perfect and
     preserve the security interests, collateral assignments,  pledges and other
     rights granted or purported to be granted to Lender hereby; and

          d. Will  furnish  to Lender  (from time to time at  Lender's  request)
     statements and schedules further  identifying and describing the Collateral
     and such other  reports in  connection  with the  Collateral  as Lender may
     reasonably request, all in reasonable detail.

With respect to the foregoing and the grant of the security interest, collateral
assignment and pledge hereunder,  each Borrower hereby authorizes Lender to file
one or more  financing  or  continuation  statements,  and  amendments  thereto,
relative  to all or any part of the  Collateral  without the  signature  of such
Borrower where permitted by law. A carbon, photographic or other reproduction of
this Security  Agreement or any financing  statement  covering the Collateral or
any part thereof shall be sufficient as a financing statement where permitted by
law.

                                ARTICLE 4: LENDER

     4.1. Lender Appointed  Attorney-in-Fact.  Each Borrower hereby  irrevocably
appoints Lender as such Borrower's attorney-in-fact,  with full authority in the
name,  place  and  stead of such  Borrower  or  otherwise,  from time to time in
Lender's reasonable discretion, to take any action and to execute any instrument
which  Lender may deem  reasonably  necessary or  advisable  to  accomplish  the
purposes of this Security Agreement. This authority includes the following:

     a.   To ask, demand,  collect, sue for, recover,  compromise,  restructure,
          receive and give acquittance and receipts for moneys due and to become
          due under or in respect of any of the Collateral  including proceeding
          against any of the Collateral provided by any account debtor; and/or

     b.   To notify  the  parties  obligated  on any of the  Collateral  to make
          payment to Lender of any  amount  due or to become  due in  connection
          therewith; and/or

     c.   To  receive,   endorse,  and  collect  any  drafts,  checks  or  other
          instruments, documents and chattel paper in connection with Clause "a"
          of this Section; and/or

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<PAGE>

     d.   To file any claims or take any  action or  institute  any  proceedings
          which  Lender  may deem  reasonably  necessary  or  desirable  for the
          collection of any of the Collateral or otherwise to enforce the rights
          of  Lender,  any  Lender or any  Borrower  with  respect to any of the
          Collateral; and/or

     e.   To  execute   (in  the  name,   place  and  stead  of  any   Borrower)
          endorsements,  assignments, powers and other instruments of conveyance
          or transfer with respect to all or any of the Collateral; and/or

     f.   To perform any and all of the affirmative obligations and covenants of
          such Borrower  hereunder  (with notice  thereof to be provided to such
          Borrower by Lender within a reasonable time thereafter).

Each  Borrower  hereby  acknowledges,  consents  and  agrees  that the  power of
attorney  granted  pursuant to this Section is  irrevocable  and coupled with an
interest.

     4.2.  Lender May  Perform.  From time to time,  Lender (at its  option) may
perform  (or may cause the  performance  of) any act which any  Borrower  agrees
hereunder  to perform  and which such  Borrower  fails to  perform  after  being
requested  in writing so to perform (it being  understood  that no such  request
need be given during the  continuance  of an Event of Default),  and Lender from
time to time may also  take any  other  action  which  Lender  reasonably  deems
necessary  for  the  maintenance,  preservation  or  protection  of  any  of the
Collateral  or of its security  interest  therein or collateral  assignments  or
pledges  thereof.  The costs and expenses of Lender  incurred in connection with
any such  performance  will be  payable by  Borrowers  (jointly  and  severally)
pursuant to Section 5.3 hereof.

     4.3.  Lender  Has No Duty.  The rights and  powers  conferred  upon  Lender
hereunder  are solely to protect  Lender's  and each  Lender's  interest  in the
Collateral  and do not impose any duty on Lender to exercise  any such rights or
powers.  Except for reasonable care of any Collateral in Lender's possession and
the accounting for moneys actually received by it hereunder,  Lender has no duty
as to any  Collateral  or as to the taking of any  necessary  steps to  preserve
rights against prior parties or any other rights pertaining to any Collateral.

     4.4. Reasonable Care. Lender is required to exercise reasonable care in the
custody and  preservation of any of the Collateral in its possession;  provided,
however,  Lender will be deemed to have  exercised such  reasonable  care in the
custody and  preservation  of any of the  Collateral if Lender takes such action
for that purpose as any Borrower  reasonably  requests in writing at times other
than   after  the   occurrence   or  during  the   continuance   of  a  Default.
Notwithstanding  the foregoing,  any failure or refusal by Lender at any time to
comply  with any such  request  by any  Borrower  will not in itself be deemed a
failure to exercise reasonable care.

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<PAGE>

                        ARTICLE 5: DEFAULTS AND REMEDIES

     5.1.  Events of  Default.  The  breach of any term of this  Agreement  by a
Borrower or the occurrence of any "Event of Default" under and as defined in the
Credit  Agreement  will  constitute an independent  Event of Default  ("Event of
Default") hereunder.

     5.2. Certain Remedies. If any Event of Default occurs and is continuing:

          a. In  addition  to other  rights  and  remedies  provided  for herein
     (including  under  Article 4) or otherwise  available to Lender  (including
     under the Credit Agreement and/or applicable law), Lender may also exercise
     in respect of the Collateral all the rights and remedies of a secured party
     upon default  under the UCC (whether or not the UCC applies to the affected
     Collateral).  Upon the occurrence of any Event of Default, Lender will have
     the  immediate  right to enforce  and realize  upon any and all  collateral
     security  granted  under the Credit  Agreement  (including  the  Collateral
     hereunder)  in any  manner or order that  Lender  deems  expedient  without
     regard to any equitable principles of marshalling or otherwise.  All rights
     and remedies available to Lender are to be considered cumulative in nature.

          b. Without notice except as expressly  specified herein or required by
     applicable  law, Lender may also sell the Collateral or any part thereof in
     one or more parcels at public or private sale,  at any of Lender's  offices
     or  elsewhere,  for cash, on credit or for future  delivery,  and upon such
     other  terms as Lender  may deem  commercially  reasonable.  To the  extent
     notice of sale is required by law, each  Borrower  agrees that prior notice
     to a Borrower of at least ten (10)  calendar days  indicating  the time and
     place of any public sale or the time after which any private  sale is to be
     made  shall  constitute  reasonable  notification.   Lender  shall  not  be
     obligated  to make any sale of  Collateral  regardless  of  notice  of sale
     having been given.  Lender may adjourn any public or private sale from time
     to time by announcement at the time and place fixed therefor, and such sale
     (without  further notice) may be made at the time and place to which it was
     so adjourned.

          c. Lender may require  Borrowers to, and each  Borrower  hereby agrees
     (at  its  expense)  that it  will,  forthwith  assemble  all or part of the
     Collateral as directed by Lender and make it available to Lender at a place
     designated  by Lender  that is  reasonably  convenient  to both  Lender and
     Borrowers.

          d. Unless  Lender  otherwise  consents,  each  Borrower  will remit to
     Lender all cash proceeds  received in respect of any sale of, or collection
     from, or other realization upon all or any part of the Collateral. All cash
     proceeds  received by Lender from any  Borrower or  otherwise in respect of
     any sale of,  collection from, or other realization upon all or any part of
     the  Collateral  (in the  discretion  of  Lender)  may be held by Lender as
     additional  Collateral for the Secured  Obligations,  and/or then or at any
     time thereafter may be applied in whole or in part by Lender against all or
     any  part of the  Secured  Obligations  in an  order  consistent  with  the
     designated  application of payments  provided for in the Credit  Agreement.
     Any  surplus of such cash or cash  proceeds  held by Lender  and  remaining
     after payment in full of all the Secured Obligations will be paid over to a
     Borrower  or to  whomsoever  Lender  reasonably  believes  may be  lawfully
     entitled to receive such surplus.

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<PAGE>

     5.3. Indemnity and Expenses.

     a. Each  Borrower  agrees  (jointly and  severally)  to indemnify  and hold
Lender  harmless  from and against any and all  claims,  losses and  liabilities
arising out of or in any manner resulting from any or all of the following:  (1)
any Borrower's  failure to perform or otherwise  observe any of its  obligations
hereunder,  or (2) Lender's  enforcement of any of the provisions hereof, or (3)
any Borrower's gross negligence, misrepresentation, willful misconduct or fraud.

     b. Upon demand,  each Borrower  (jointly and severally) will pay Lender the
amount of any and all costs and  expenses  that  Lender may incur in  connection
with any of the matters  described  under  clause "a" of this  Section.  Without
limitation,  each Borrower's obligation to reimburse Lender for such fees, costs
and expenses  includes all reasonable fees and disbursements of Lender's counsel
and any other experts and agents that Lender may retain in  connection  herewith
(whether or not litigation is commenced).

     c. If any Borrower  fails or refuses to pay Lender any amount due hereunder
or to  otherwise  deliver  to  Lender  any  property  required  to be  delivered
hereunder,  then such amount (or, as appropriate,  the fair market value of such
property) will accrue interest until paid or delivered at a per annum rate equal
to two  percent  (2%) per  annum in excess of the  highest  rate then  otherwise
applicable to  indebtedness  under the Credit  Agreement (or the maximum  amount
permitted by applicable law, whichever is less).

     5.4. Lender's Rights Upon Occurrence of Liquidation Events.

     a. Right to Certain Payments and Distributions.  Upon the occurrence of any
Liquidation Event, any payment or distribution of any kind or character (whether
in cash,  securities or other  property)  that but for this  Security  Agreement
would be payable or  deliverable to a Borrower must instead be paid or delivered
directly to Lender for  application on the Secured  Obligations,  whether or not
then due or mature.

     b. Non-Cash Payments and Distributions.  Notwithstanding  the provisions of
Clause "a" of this Section,  if Lender receives  delivery of any such payment or
distribution in connection  with a Liquidation  Event in a form other than cash,
then Lender may hold such  property  as  additional  Collateral  for the Secured
Obligations,  and no Borrower  will be entitled to a credit with  respect to the
Secured Obligations,  nor will the Secured Obligations  otherwise be adjusted in
any respect, until such time as Lender (in its sole and absolute discretion) has
sold,   discounted  or  otherwise  liquidated  such  distribution  (at  a  price
considered  by Lender to be in its sole best  interest)  and then such credit or
adjustment  to the  Secured  Obligations  will be  limited  only to the net cash
proceeds  realized  therefrom  after  the  payment  of all  costs  and  expenses
associated with such sale or liquidation.

     c.  Collection  of Payments  and  Distributions.  In addition to any rights
otherwise  permitted under the Credit Agreement or applicable law, each Borrower
hereby  irrevocably  authorizes  and empowers  Lender,  upon the occurrence of a
Liquidation  Event, to file and/or vote claims and take such other  proceedings,
in each  instance  in  Lender's  own  name  or in the  name  of a  Borrower,  or
otherwise,  all as Lender may deem  reasonably  necessary or  advisable  for the

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<PAGE>

enforcement of this Security  Agreement.  Each Borrower  further agrees duly and
promptly  (i) to take such action as may be requested by Lender to assist in the
collection  and/or  compromise of any amounts owed to any Borrower,  and (ii) to
file  appropriate  proofs  of claim in  respect  of such  amounts,  and (iii) to
execute  and  deliver to Lender on demand  such  powers of  attorney,  proofs of
claim,  assignments of claim or other  instruments as may be requested by Lender
to enable  Lender to  enforce  any and all claims  upon or with  respect to such
amounts,  and (iv) to collect,  compromise  and receive any and all  payments or
distributions  which  may be  payable  or  deliverable  at any time upon or with
respect to such amounts.

     5.5. Delivery of Payments and  Distributions.  If any Borrower receives any
payment,  distribution  or any other funds or property in  contravention  of the
provisions hereof or the Credit  Agreement,  then such Borrower must immediately
forthwith  deliver  such  payment,  distribution  or other funds or property (or
proceeds  thereof)  to Lender in  precisely  the form  received  (except for the
endorsement or assignment without recourse of such Borrower where necessary) for
application  on the  Secured  Obligations  (or,  at  Lender's  option,  held  as
additional Collateral  therefor),  whether or not then due or mature. Until such
funds or property are delivered to Lender, such Borrower must hold such payment,
distribution  or other funds or property (or proceeds  thereof) (a) in trust for
the  benefit of and as  property  of Lender and (b)  separate  from  (i.e.,  not
commingled  with) its other assets.  If a Borrower  fails or refuses to make any
such  endorsement  or  assignment,  then  Lender  (or  any  of its  officers  or
employees)  are  hereby  irrevocably  authorized  by such  Borrower  to make the
endorsement and/or assignment.

     5.6. Cooperation and Assistance. Each Borrower agrees (during the existence
of a Default) to take any actions that Lender may reasonably request in order to
enable Lender and each Lender to receive the full rights and benefits granted to
Lender  hereunder.  Each Borrower further agrees that, during the existence of a
Default or an Event of Default,  each Borrower  will assist and  cooperate  with
Lender (and will use its best  efforts to cause  others to assist and  cooperate
with Lender) to ensure that each Borrower continues (a) to operate in the normal
course  of  business,  and  (b) to  fulfill  all of its  legal,  regulatory  and
contractual  obligations  and (c) to otherwise  be properly  and  professionally
managed.

                             ARTICLE 6: DEFINITIONS

     6.1. Credit Agreement  Definitions.  Unless otherwise defined herein or the
context otherwise requires, terms used in this Security Agreement (including the
preamble  and  recitals  hereof)  have  the  meanings  provided  in  the  Credit
Agreement.

     6.2. Certain Terms.  The following terms (whether or not underscored)  when
used in this Security  Agreement  (including  the preamble and recitals  hereof)
have the following meanings:

          a. "Borrower(s)" means,  individually and collectively,  each Borrower
     under and as defined in the Credit  Agreement,  including  any successor or
     assignee thereof.

          b. "Collateral" is defined in Section 1.1.

                                       9
<PAGE>

          c. "Credit Agreement" is defined in the Recitals.

          d. "Equipment" is defined in Section 1.1.

          e. "Liquidation  Event" means any foreclosure on or any sale of all or
     any  material  part of the  assets  of any  Borrower,  or any  liquidation,
     dissolution  or other  winding up (partial or  complete) of any Borrower or
     any  Borrower's  business,  or  any  sale,   receivership,   insolvency  or
     bankruptcy proceeding,  any assignment for the benefit of creditors, or any
     other  proceeding  by or against any  Borrower or its assets for any relief
     under any  bankruptcy or insolvency  law relating to the relief of debtors,
     readjustment of indebtedness, arrangements,  reorganizations,  compositions
     or extensions.

          f.  "Official  Body"  means  any  federal,   state,  local,  or  other
     government  (or  any  political  subdivision,  agency,  authority,  bureau,
     commission, department or instrumentality thereof) and any court, tribunal,
     grand jury or arbitrator, in each instance whether foreign or domestic.

          g.  "Person"  means  any  natural  person,  corporation,  partnership,
     limited  liability   company,   firm,   association,   trust,   government,
     governmental  agency or any other entity,  whether acting in an individual,
     fiduciary or other capacity.

          h. "Secured Obligations" is defined in Section 1.2.

          i.  "Security   Agreement"  means  this  Security  Agreement  and  all
     exhibits,  schedules and supplemental addenda hereto, all as may be amended
     and otherwise modified from time to time hereafter.

          j.  "UCC"  means  the  Uniform  Commercial  Code as in effect in South
     Carolina  or, if the laws of some other  jurisdiction  otherwise  dictates,
     then the Uniform  Commercial  Code as in effect in the  jurisdiction  whose
     laws govern the interpretation of the relevant  provisions of this Security
     Agreement.

     6.3.  UCC  Definitions.  Unless  otherwise  defined  herein or the  context
otherwise requires, terms for which meanings are provided in the UCC are used in
this Security  Agreement  (including  in the preamble and recitals  hereof) with
such meanings.

                       ARTICLE 7: MISCELLANEOUS PROVISIONS

     7.1.  Amendments.  No  amendment  to or  waiver  of any  provision  of this
Security Agreement, nor consent to any departure by any Borrower herefrom, shall
in any event be effective unless such amendment, waiver or consent is in writing
and signed by Lender.  Any such waiver or consent will be effective  only in the
specific instance and for the specific purpose for which given.

     7.2. Addresses for Notices. Any notice,  request,  consent, waiver or other
communication  required or permitted  under or in connection  with this Security
Agreement  will  be  deemed  satisfactorily  given  if it is in  writing  and is
delivered either personally to the addressee  thereof,  or by prepaid registered

                                       10
<PAGE>

or certified U.S. mail (return receipt requested), or by a nationally recognized
commercial  courier  service  with  next-day  delivery  charges  prepaid,  or by
telegraph,  or by facsimile (voice confirmed),  or by any other reasonable means
of personal delivery to the party entitled thereto at its respective address set
forth below its signature to this Security Agreement (or, if blank, then to such
party at its address or facsimile number set forth in the Credit Agreement).  If
any  Borrower  fails to insert an address  below (and in the Credit  Agreement),
then such failure shall  constitute a  designation  of its last known address as
the address for all notices, including notices of default and sale. Any party to
this Security  Agreement  may change its address or facsimile  number for notice
purposes by giving notice thereof to the other parties hereto in accordance with
this Section,  provided that such change shall not be effective until 2 calendar
days after notice of such change. All such notices and other communications will
be deemed  given and  effective  (a) if by mail,  then upon actual  receipt or 5
calendar days after mailing as provided above (whichever is earlier),  or (b) if
by  facsimile,  then upon  successful  transmittal  to such  party's  designated
number,  or (c) if by  telegraph,  then upon actual  receipt or 2 Business  Days
after  delivery to the telegraph  company  (whichever is earlier),  or (d) if by
nationally  recognized commercial courier service, then upon actual receipt or 2
Business Days after delivery to the courier service  (whichever is earlier),  or
(e) if otherwise delivered, then upon actual receipt.

     7.3.  Severability.  Wherever  possible,  each  provision of this  Security
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law. If any provision of this Security  Agreement shall be prohibited
by or invalid under such law, then such  provision  shall be  ineffective to the
extent of such prohibition or invalidity,  without invalidating the remainder of
such provision or the remaining provisions of this Security Agreement.

     7.4.  Governing Law;  Entire  Agreement.  This Security  Agreement shall be
governed  by and  construed  in  accordance  with  the  internal  laws of  South
Carolina,  except to the extent that the validity or  perfection of the security
interest,  collateral  assignment or pledge hereunder (or remedies hereunder) in
respect of any particular  Collateral are required to be governed by the laws of
a jurisdiction other than South Carolina.  This Security Agreement and the other
loan documents constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and supersede any prior agreements (written
or oral) with respect thereto.

     7.5. Reinstatement. To the maximum extent not prohibited by applicable law,
this Security  Agreement  shall  continue to be effective or be reinstated if at
any time any amount  received  by Lender in respect of the Credit  Agreement  is
rescinded  or must  otherwise  be  restored  or  returned  by  Lender  upon  the
insolvency,  bankruptcy,  dissolution,  liquidation  or  reorganization  of  any
Borrower  or upon the  appointment  of any  receiver,  intervenor,  conservator,
trustee or similar  official  for any  Borrower or any  substantial  part of any
Borrower's assets, or otherwise, all as though such payments had not been made.

     7.6.  Conflict  Provision.  In the  event  of any  irreconcilable  conflict
between the terms and  conditions of this  Security  Agreement and the terms and
conditions  of the  Credit  Agreement,  the terms and  conditions  of the Credit
Agreement shall govern.

                                       11
<PAGE>

     7.7. Waiver of Suretyship Defenses. Each Borrower hereby waives any and all
defenses and rights of discharge based on suretyship or impairment of collateral
(including  any lack of attachment or perfection  with respect  thereto) that it
may now have or may  hereafter  acquire  with  respect  to Lender or any of such
Borrower's  obligations  hereunder or under any other agreement that it may have
or hereafter enter into with Lender.

     7.8.  WAIVER OF NOTICE;  WAIVER OF BOND. EACH BORROWER WAIVES ALL RIGHTS OF
NOTICE AND  HEARING OF ANY KIND  PRIOR TO THE  EXERCISE  BY LENDER OF ITS RIGHTS
DURING THE  CONTINUANCE OF ANY EVENT OF DEFAULT TO REPOSSESS THE COLLATERAL WITH
JUDICIAL  PROCESS  OR TO  REPLEVY,  ATTACH  OR LEVY  UPON THE  COLLATERAL.  EACH
BORROWER  WAIVES  THE  POSTING  OF ANY BOND  OTHERWISE  REQUIRED  OF  LENDER  IN
CONNECTION  WITH ANY JUDICIAL  PROCESS OR  PROCEEDING TO OBTAIN  POSSESSION  OF,
REPLEVY,  ATTACH OR LEVY  UPON  COLLATERAL  OR OTHER  SECURITY  FOR THE  SECURED
OBLIGATIONS,  TO ENFORCE ANY  JUDGMENT OR OTHER COURT ORDER  ENTERED IN FAVOR OF
LENDER, OR TO ENFORCE BY SPECIFIC  PERFORMANCE,  TEMPORARY  RESTRAINING ORDER OR
PRELIMINARY  OR  PERMANENT  INJUNCTION  THIS  SECURITY  AGREEMENT  OR THE CREDIT
AGREEMENT.

     7.9. WAIVER OF LIABILITY. EACH BORROWER (A) AGREES THAT NEITHER LENDER (NOR
ANY DIRECTOR,  OFFICER, EMPLOYEE OR AGENT OF LENDER) SHALL HAVE ANY LIABILITY TO
ANY BORROWER  (WHETHER  SOUNDING IN TORT,  CONTRACT OR OTHERWISE)  FOR LOSSES OR
COSTS  SUFFERED  OR  INCURRED  BY  ANY  BORROWER  IN  ANY  WAY  RELATED  TO  THE
TRANSACTIONS   CONTEMPLATED  OR  THE  RELATIONSHIP  ESTABLISHED  BY  THE  CREDIT
AGREEMENT,  OR ANY ACT,  OMISSION OR EVENT  OCCURRING IN  CONNECTION  THEREWITH,
EXCEPT FOR FORESEEABLE  ACTUAL LOSSES  RESULTING  DIRECTLY AND EXCLUSIVELY  FROM
LENDER'S OWN GROSS  NEGLIGENCE,  WILLFUL  MISCONDUCT  OR FRAUD,  AND (B) WAIVES,
RELEASES AND AGREES NOT TO SUE UPON ANY CLAIM AGAINST  LENDER (OR ITS DIRECTORS,
OFFICERS,  EMPLOYEES OR AGENTS) WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE.
MOREOVER,  WHETHER OR NOT SUCH DAMAGES ARE RELATED TO A CLAIM THAT IS SUBJECT TO
THE WAIVER  EFFECTED  ABOVE AND WHETHER OR NOT SUCH WAIVER IS EFFECTIVE,  LENDER
(INCLUDING  ANY DIRECTOR,  OFFICER,  EMPLOYEE OR AGENT OF LENDER) SHALL NOT HAVE
ANY LIABILITY  WITH RESPECT TO (AND EACH BORROWER  HEREBY  WAIVES,  RELEASES AND
AGREES  NOT TO SUE UPON ANY CLAIM  FOR) ANY  SPECIAL,  INDIRECT,  CONSEQUENTIAL,
PUNITIVE OR NON-FORESEEABLE  DAMAGES SUFFERED BY ANY BORROWER IN ANY WAY RELATED
TO THE TRANSACTIONS  CONTEMPLATED OR THE RELATIONSHIP  ESTABLISHED BY THE CREDIT
AGREEMENT OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH.

     7.10.  FORUM SELECTION AND CONSENT TO  JURISDICTION.  ANY LITIGATION IN ANY
WAY  RELATED TO THIS  AGREEMENT,  OR ANY COURSE OF  CONDUCT,  COURSE OF DEALING,
STATEMENTS  (WHETHER  VERBAL OR WRITTEN),  ACTIONS OR INACTIONS OF LENDER OR ANY
LENDER OR ANY BORROWER WILL BE BROUGHT AND MAINTAINED  EXCLUSIVELY IN THE COURTS
OF SOUTH  CAROLINA OR IN THE UNITED  STATES  DISTRICT  COURT FOR THE DISTRICT OF
SOUTH CAROLINA; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
BORROWER OR ANY  COLLATERAL  MAY ALSO BE BROUGHT (AT  LENDER'S OR SUCH  LENDER'S
OPTION) IN THE COURTS OF ANY JURISDICTION  WHERE SUCH COLLATERAL MAY BE FOUND OR
WHERE LENDER OR ANY LENDER MAY OTHERWISE OBTAIN PERSONAL  JURISDICTION OVER SUCH
BORROWER.  EACH  BORROWER  HEREBY  EXPRESSLY  AND  IRREVOCABLY  SUBMITS  TO  THE
JURISDICTION  OF THE COURTS OF SOUTH CAROLINA AND OF THE UNITED STATES  DISTRICT
COURT FOR THE DISTRICT OF SOUTH CAROLINA FOR THE PURPOSE OF ANY SUCH  LITIGATION
AS SET  FORTH  ABOVE  AND  IRREVOCABLY  AGREES  TO BE  BOUND  BY ANY  FINAL  AND
NON-APPEALABLE  JUDGMENT  RENDERED  THEREBY IN CONNECTION WITH SUCH  LITIGATION.
EACH  BORROWER  FURTHER  IRREVOCABLY  CONSENTS  TO THE  SERVICE  OF  PROCESS  BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID,  OR BY PERSONAL SERVICE WITHIN OR
OUTSIDE SOUTH CAROLINA.  EACH BORROWER HEREBY  EXPRESSLY AND IRREVOCABLY  WAIVES
(TO THE FULLEST  EXTENT  PERMITTED  BY LAW) ANY  OBJECTION  WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION  BROUGHT IN ANY
SUCH COURT  REFERRED  TO ABOVE AND ANY CLAIM THAT ANY SUCH  LITIGATION  HAS BEEN
BROUGHT  IN AN  INCONVENIENT  FORUM.  TO THE  EXTENT  THAT ANY  BORROWER  HAS OR

                                       12
<PAGE>

HEREAFTER  MAY ACQUIRE ANY IMMUNITY FROM  JURISDICTION  OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE,  ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT  IN AID OF  EXECUTION  OR  OTHERWISE)  WITH  RESPECT TO ITSELF OR ITS
PROPERTY,  THEN SUCH BORROWER HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT
OF ITS OBLIGATIONS UNDER THIS SECURITY AGREEMENT.

     7.11. WAIVER OF JURY TRIAL. LENDER AND EACH BORROWER EACH HEREBY KNOWINGLY,
VOLUNTARILY AND  INTENTIONALLY  WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT  OF ANY  LITIGATION  (WHETHER  AS CLAIM,  COUNTER-CLAIM,  AFFIRMATIVE
DEFENSE OR OTHERWISE) IN ANY WAY RELATED TO THE CREDIT AGREEMENT,  OR ANY COURSE
OF CONDUCT, COURSE OF DEALING,  STATEMENTS (WHETHER VERBAL OR WRITTEN),  ACTIONS
OR INACTIONS OF LENDER OR ANY BORROWER.  EACH BORROWER  ACKNOWLEDGES  AND AGREES
(A) THAT IT HAS RECEIVED FULL AND  SUFFICIENT  CONSIDERATION  FOR THIS PROVISION
(AND EACH OTHER  PROVISION  OF THE CREDIT  AGREEMENT),  AND (B) THAT IT HAS BEEN
ADVISED BY LEGAL COUNSEL IN CONNECTION HEREWITH,  AND (C) THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR LENDER ENTERING INTO THE CREDIT AGREEMENT.

     7.12.  Counterparts.  This Security Agreement may be executed in any number
of  counterparts  with  the  same  effect  as if  all  the  signatures  on  such
counterparts appeared on one document.  Each counterpart will be deemed to be an
original,  but all  counterparts  together  will  constitute  one  and the  same
instrument.

                      [BALANCE OF PAGE INTENTIONALLY BLANK]









                                       13
<PAGE>




                  IN WITNESS  WHEREOF,  the parties  hereto have  executed  this
Security  Agreement,  as an instrument under seal (whether or not any such seals
are physically attached hereto),  through their duly authorized officers,  as of
the date first written above.


ATTEST:                            FLEXCHECK HOLDINGS LLC


                                   (as a Borrower)



By:      ______________________     By:
                                        -----------------------------

Name:    __________________________ Name:   Brendan R. Carpenter

Title:   __________________________ Title:      Sole Manager


[SEAL]










                    [ADDITIONAL SIGNATURES ON FOLLOWING PAGE]

<PAGE>


     IN  WITNESS  WHEREOF,  the  parties  hereto  have  executed  this  Security
Agreement,  as an  instrument  under  seal  (whether  or not any such  seals are
physically attached hereto),  through their duly authorized officers,  as of the
date first written above.

WITNESS:                                    HOMEGOLD FINANCIAL, INC.
(Lender)

By:                                         By:
         ---------------------------            ---------------------
         Name:                                  Forrest E. Ferrell:
                   -----------------
         Title:                                 Title:   President
                   -----------------
                                                Address:

                                                Facsimile:



































</TEXT>
</DOCUMENT>
