Exhibit 10.16

                UNCOMMITTED GUIDANCE LINE DEMAND PROMISSORY NOTE

$15,000,000.00                                                     March 1, 1999
                                                                Atlanta, Georgia

     FOR  VALUE  RECEIVED,  HUGHES  SUPPLY,  INC.,  a Florida  corporation  (the
"Borrower" or the "undersigned"), promises to pay to the order of SUNTRUST BANK,
CENTRAL FLORIDA,  NATIONAL  ASSOCIATION,  a national banking  association,  (the
"Lender"),  at the principal  office of the Lender,  at 200 South Orange Avenue,
Orlando,  Florida  32801,  or at such other place as the Lender may designate by
notice in writing to the  Borrower,  in  immediately  available  funds in lawful
money of the United  States of America,  the lesser of (x) the  principal sum of
FIFTEEN MILLION AND NO/100 DOLLARS  ($15,000,000.00),  together with interest on
the unpaid principal balance of this Uncommitted Guidance Line Demand Promissory
Note (this "Note"),  or (y) so much thereof as shall have been from time to time
disbursed  hereunder in the sole  discretion of the Lender,  and not theretofore
repaid,  as shown on the books and records of the Lender,  at the rate per annum
mutually  agreed  upon from time to time by Borrower  and Lender (the  "Interest
Rate"), on the sooner of (i) DEMAND or (ii) January 25, 2000, or such later date
to which the Bank may extend  this Note in writing  and in its sole  discretion,
(the "Termination Date").

     Upon the terms of this Note and in compliance with the terms and conditions
hereof, the Borrower,  from time to time, may request advances hereunder,  repay
and reborrow up to the maximum aggregate principal amount outstanding at any one
time as  indicated  above,  subject to the sole  discretion  of the Lender.  The
Borrower  acknowledges  and agrees that the Lender shall have no  obligation  to
make any  advances to the Borrower  under this Note,  but the Lender may, in its
sole discretion, make such advances to the Borrower upon its request.

     In  addition  to  principal,  the  Borrower  agrees to pay  interest on the
principal  amounts  disbursed  hereunder from time to time from the date of each
disbursement  until paid at the  Interest  Rate on the last day of the  interest
periods  mutually  agreed to from time to time by the  Borrower  and the Lender.
Interest shall accrue on the outstanding  principal balance from the date hereof
up to and through the date on which all principal and interest hereunder is paid
in full, and shall be computed on the basis of the actual number of days elapsed
in a 360-day  year.  Such  interest is to be paid to the Lender at the  Lender's
principal office specified above.

     The Lender  shall at all times have a right of set-off  against any deposit
balances of the  Borrower in the  possession  of the Lender,  and the Lender may
apply the same  against  payment of this Note or any other  indebtedness  of the
Borrower to the Lender.  The payment of any indebtedness  evidenced by this Note
prior to the Termination Date or demand shall not affect the  enforceability  of
this Note as to any future,  different or other indebtedness  incurred hereunder
by the  Borrower.  In the  event  the  indebtedness  evidenced  by this  Note is
collected  by legal  action or through an  attorney-at-law,  the Lender shall be
entitled  to  recover  from the  Borrower  all costs of  collection,  including,
without  limitation,  reasonable  attorneys'  fees if collected by or through an
attorney-at-law.

     The Borrower  acknowledges  that the actual  crediting of the amount of any
disbursement  under this Note to an account of the  Borrower or  recording  such
amount in the books of the  Lender  shall,  in the  absence of  manifest  error,
constitute  presumptive  evidence of such

<PAGE>

disbursement  and that such advance was made and borrowed under this Note.  Such
account records shall constitute,  in the absence of manifest error, presumptive
evidence of principal amounts  outstanding and the payments made under the Notes
at any time and from time to time,  provided  that the  failure of the Lender to
record in its books or in such  account the type or amount of any advance  shall
not affect the obligation of the  undersigned to repay such amount together with
interest thereon in accordance with this Note.

     Prepayment of this Note in part or in whole is permitted.

     Failure or  forbearance of the Lender to exercise any right  hereunder,  or
otherwise  granted  by this Note or by law,  shall not  affect  or  release  the
liability of the Borrower  hereunder,  and shall not constitute a waiver of such
right unless so stated by the Lender in writing. THIS NOTE SHALL BE DEEMED TO BE
MADE UNDER,  AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY, THE LAWS
OF THE STATE OF GEORGIA. Time is of the essence of this Note.

     PRESENTMENT FOR PAYMENT, NOTICE OF DISHONOR AND PROTEST ARE HEREBY WAIVED.

Executed under hand of the Borrower as of the day and year first above written.

                                               HUGHES SUPPLY, INC.


                                               By: _____________________________
                                                   J. Stephen Zepf
                                                   Treasurer

<PAGE>

                  UNCOMMITTED SWING LINE DEMAND PROMISSORY NOTE

$10,000,000.00                                                     March 1, 1999
                                                                Atlanta, Georgia

     FOR  VALUE  RECEIVED,  HUGHES  SUPPLY,  INC.,  a Florida  corporation  (the
"Borrower" or the "undersigned"), promises to pay to the order of SUNTRUST BANK,
CENTRAL FLORIDA,  NATIONAL  ASSOCIATION,  a national banking  association,  (the
"Lender"),  at the principal  office of the Lender,  at 200 South Orange Avenue,
Orlando,  Florida  32801,  or at such other place as the Lender may designate by
notice in writing to the  Borrower,  in  immediately  available  funds in lawful
money of the United  States of America,  the lesser of (x) the  principal sum of
TEN MILLION AND NO/100 DOLLARS  ($10,000,000.00),  together with interest on the
unpaid principal  balance of this Uncommitted  Swing Line Demand Promissory Note
(this  "Note"),  or (y) so much  thereof  as shall  have  been from time to time
disbursed  hereunder in the sole  discretion of the Lender,  and not theretofore
repaid,  as shown on the books and records of the Lender,  at the rate per annum
mutually  agreed  upon from time to time by Borrower  and Lender (the  "Interest
Rate"), on the sooner of (i) DEMAND or (ii) January 25, 2000, or such later date
to which the Bank may extend  this Note in writing  and in its sole  discretion,
(the "Termination Date").

     Upon the terms of this Note and in compliance with the terms and conditions
hereof, the Borrower,  from time to time, may request advances hereunder,  repay
and reborrow up to the maximum aggregate principal amount outstanding at any one
time as  indicated  above,  subject to the sole  discretion  of the Lender.  The
Borrower  acknowledges  and agrees that the Lender shall have no  obligation  to
make any  advances to the Borrower  under this Note,  but the Lender may, in its
sole discretion, make such advances to the Borrower upon its request.

     In  addition  to  principal,  the  Borrower  agrees to pay  interest on the
principal  amounts  disbursed  hereunder from time to time from the date of each
disbursement  until paid at the  Interest  Rate on the last day of the  interest
periods  mutually  agreed to from time to time by the  Borrower  and the Lender.
Interest shall accrue on the outstanding  principal balance from the date hereof
up to and through the date on which all principal and interest hereunder is paid
in full, and shall be computed on the basis of the actual number of days elapsed
in a 360-day  year.  Such  interest is to be paid to the Lender at the  Lender's
principal office specified above.

     The Lender  shall at all times have a right of set-off  against any deposit
balances of the  Borrower in the  possession  of the Lender,  and the Lender may
apply the same  against  payment of this Note or any other  indebtedness  of the
Borrower to the Lender.  The payment of any indebtedness  evidenced by this Note
prior to the Termination Date or demand shall not affect the  enforceability  of
this Note as to any future,  different or other indebtedness  incurred hereunder
by the  Borrower.  In the  event  the  indebtedness  evidenced  by this  Note is
collected  by legal  action or through an  attorney-at-law,  the Lender shall be
entitled  to  recover  from the  Borrower  all costs of

<PAGE>

collection,   including,  without  limitation,  reasonable  attorneys'  fees  if
collected by or through an attorney-at-law.

     The Borrower  acknowledges  that the actual  crediting of the amount of any
disbursement  under this Note to an account of the  Borrower or  recording  such
amount in the books of the  Lender  shall,  in the  absence of  manifest  error,
constitute  presumptive  evidence of such disbursement and that such advance was
made and borrowed under this Note. Such account records shall constitute, in the
absence of manifest error, presumptive evidence of principal amounts outstanding
and the  payments  made  under  the  Notes at any  time  and from  time to time,
provided  that the  failure  of the  Lender  to  record  in its books or in such
account the type or amount of any advance shall not affect the obligation of the
undersigned  to repay such amount  together with interest  thereon in accordance
with this Note.

     Prepayment of this Note in part or in whole is permitted.

     Failure or  forbearance of the Lender to exercise any right  hereunder,  or
otherwise  granted  by this Note or by law,  shall not  affect  or  release  the
liability of the Borrower  hereunder,  and shall not constitute a waiver of such
right unless so stated by the Lender in writing. THIS NOTE SHALL BE DEEMED TO BE
MADE UNDER,  AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY, THE LAWS
OF THE STATE OF GEORGIA. Time is of the essence of this Note.

     PRESENTMENT FOR PAYMENT, NOTICE OF DISHONOR AND PROTEST ARE HEREBY WAIVED.

Executed under hand of the Borrower as of the day and year first above written.

                                               HUGHES SUPPLY, INC.


                                               By: _____________________________
                                                   J. Stephen Zepf
                                                   Treasurer
<PAGE>

                          SUBSIDIARY GUARANTY AGREEMENT
        (Uncommitted Swing Line Note and Uncommitted Guidance Line Note)

          THIS  SUBSIDIARY  GUARANTY  AGREEMENT (this  "Guaranty"),  dated as of
March 1, 1999 made by each of the subsidiaries of Hughes Supply, Inc., a Florida
corporation ("Hughes"),  listed on the signature pages hereof, together with all
other subsidiaries of Hughes that hereafter become parties hereto (individually,
a "Guarantor" and collectively,  the  "Guarantors"),  in favor of SUNTRUST BANK,
CENTRAL FLORIDA, NATIONAL ASSOCIATION (the "Lender");

                              W I T N E S S E T H:

          WHEREAS,  Hughes executed and delivered that certain Uncommitted Swing
Line Note  dated as of the date  hereof,  in favor of Lender,  in the  principal
amount of $10,000,000.00 (as hereafter  amended,  restated,  renewed,  extended,
supplemented  or otherwise  modified from time to time,  the "Swing Line Note"),
and that certain  Uncommitted  Guidance  Line Note dated as the date hereof,  in
favor of  Lender,  in the  principal  amount  of  $15,000,000.00  (as  hereafter
amended,  restated,  renewed,  extended  supplemented or otherwise modified from
time to time, the "Guidance  Line Note",  and together with the Swing Line Note,
the "Notes");

          WHEREAS, Hughes owns, directly or indirectly, all or a majority of the
outstanding capital stock of each of the Guarantors;

          WHEREAS,  Hughes and the  Guarantors  share an identity of interest as
members of a consolidated  group of companies  engaged in substantially  similar
businesses with Hughes providing certain centralized  financial,  accounting and
management services to each of the Guarantors by virtue of intercompany advances
and loans such that  financial  accommodations  to Hughes  under the Notes shall
inure to the direct and material benefit of the Guarantors; and

          WHEREAS,  the making of loans  evidenced by the Notes will  facilitate
expansion and enhance the overall  financial  strength and stability of Hughes's
entire corporate group, including the Guarantors; and

          WHEREAS,  it is a condition  precedent to Lender making any loan under
the Notes, in its sole discretion,  that the Guarantors enter into this Guaranty
to satisfy such condition precedent;

<PAGE>

          NOW,  THEREFORE,  in  consideration  of the  premises  and in order to
induce the Lender to make loans to Hughes under the Notes, the Guarantors hereby
jointly and severally agree as follows:

          SECTION 1.  Guaranty.  The  Guarantors  hereby  jointly and severally,
irrevocably  and  unconditionally,  guarantee  the  punctual  payment  when due,
whether at stated  maturity,  by acceleration or otherwise,  of all indebtedness
and all  other  obligations  owing by  Hughes to the  Lender  under  the  Notes,
including all renewals, extensions,  modifications and refinancings thereof, now
or  hereafter  owing,  whether  for  principal,   interest,  fees,  expenses  or
otherwise,   and  any  and  all  reasonable  out-of-pocket  expenses  (including
reasonable  attorneys'  fees  actually  incurred and  expenses)  incurred by the
Lender  in  enforcing  any  rights  under  this  Guaranty   (collectively,   the
"Guaranteed Obligations"), including without limitation, all interest which, but
for the filing of a petition in bankruptcy with respect to Hughes,  would accrue
on any principal portion of the Guaranteed Obligations.  Any and all payments by
the Guarantors  hereunder shall be made free and clear of and without  deduction
for any set-off,  counterclaim, or withholding so that, in each case, the Lender
will  receive,  after  giving  effect to any  present or future  taxes,  levies,
imposts, duties, fees, assessments, deductions, withholdings or other charges of
whatever  nature,  including  without  limitation,   income,  receipts,  excise,
property, sales, transfer,  license, payroll,  withholding,  social security and
franchise  taxes now or  hereafter  imposed  or levied by the  United  States of
America, or any state, local or foreign government or by any department,  agency
or other political  subdivision or taxing  authority  thereof or therein and all
interest,  penalties,  additions  to tax and similar  liabilities  with  respect
thereto (collectively, the "Taxes"), (but excluding Taxes imposed on overall net
income of the  Lender),  the full amount that it would  otherwise be entitled to
receive with respect to the Guaranteed  Obligations (but without  duplication of
amounts  for  Taxes  already  included  in  the  Guaranteed  Obligations).   The
Guarantors  acknowledge  and agree that this is a guarantee of payment when due,
and not of  collection,  and that this  Guaranty  may be enforced up to the full
amount of the Guaranteed  Obligations without proceeding against Hughes, against
any  security for the  Guaranteed  Obligations,  against any other  Guarantor or
under any other guaranty covering any portion of the Guaranteed Obligations.

          SECTION  2.  Guaranty  Absolute.  The  Guarantors  guarantee  that the
Guaranteed  Obligations  will be paid strictly in  accordance  with the terms of
this Guaranty and the Notes,  regardless of any law,  regulation or order now or
hereafter  in  effect in any  jurisdiction  affecting  any of such  terms or the
rights of the Lender with respect thereto. The liability of each Guarantor under
this Guaranty shall be absolute and  unconditional  in accordance with its terms
and shall  remain in full force and effect  without  regard to, and shall not be
released,  suspended,  discharged,  terminated  or  otherwise  affected  by, any
circumstance  or  occurrence  whatsoever,  including,  without  limitation,  the
following  (whether  or not  such  Guarantor  consents  thereto  or  has  notice
thereof):

          (a) any change in the time,  place or manner of payment  of, or in any
     other  term  of,  all or any of the  Guaranteed  Obligations,  any  waiver,
     indulgence,  renewal, extension,  amendment or modification of or addition,
     consent or  supplement  to or deletion from or any other action or inaction
     under or in respect of the Notes,  or any other  documents,

<PAGE>

     instruments  or agreements  relating to the  Guaranteed  Obligations or any
     other  instrument  or agreement  referred to therein or any  assignment  or
     transfer of any thereof;

          (b) any lack of validity or  enforceability  of the Notes or any other
     document,  instrument or agreement referred to therein or any assignment or
     transfer of any thereof;

          (c) any  furnishing  to the Lender of any security for the  Guaranteed
     Obligations, or any sale, exchange, release or surrender of, or realization
     on, any security for the Guaranteed Obligations;

          (d) any settlement or compromise of any of the Guaranteed Obligations,
     any security therefor,  or any liability of any other party with respect to
     the  Guaranteed  Obligations,  or any  subordination  of the payment of the
     Guaranteed Obligations to the payment of any other liability of Hughes;

          (e)   any   bankruptcy,   insolvency,   reorganization,   composition,
     adjustment,  dissolution,  liquidation or other like proceeding relating to
     any Guarantor or Hughes,  or any action taken with respect to this Guaranty
     by any trustee or receiver, or by any court, in any such proceeding;

          (f)  any  nonperfection  of  any  security  interest  or  lien  on any
     collateral,  or any amendment or waiver of or consent to departure from any
     guaranty or security, for all or any of the Guaranteed Obligations;

          (g) any  application  of sums paid by  Hughes  or any other  person or
     entity with respect to the liabilities of Hughes to the Lender,  regardless
     of what liabilities of Hughes remain unpaid;.

          (h) any act or failure to act by the Lender which may adversely affect
     a  Guarantor's  subrogation  rights,  if any,  against  Hughes  to  recover
     payments made under this Guaranty; and

          (i) any other circumstance which might otherwise  constitute a defense
     available to, or a discharge of, any Guarantor.

If claim is ever made upon the Lender for repayment or recovery of any amount or
amounts received in payment or on account of any of the Guaranteed  Obligations,
and the Lender  repays all or part of said amount by reason of (a) any judgment,
decree or order of any court or administrative body having jurisdiction over the
Lender or any of its property,  or (b) any  settlement or compromise of any such
claim  effected  by the Lender  with any such  claimant  (including  Hughes or a
trustee in bankruptcy for Hughes),  then and in such event the Guarantors  agree
that any such judgment, decree, order, settlement or compromise shall be binding
on it,


                                       7
<PAGE>

notwithstanding  any revocation  hereof or the cancellation of the Notes, or any
other instrument evidencing any liability of Hughes, and the Guarantors shall be
and remain  liable to the Lender for the amounts so repaid or  recovered  to the
same extent as if such amount had never originally been paid to the Lender.

          SECTION 3. Waiver. The Guarantors hereby waive notice of acceptance of
this Guaranty,  notice of any liability to which it may apply, and further waive
presentment, demand of payment, protest, notice of dishonor or nonpayment of any
such liabilities,  suit or taking of other action by the Lender against, and any
other notice to, Hughes or any other party liable with respect to the Guaranteed
Obligations  (including the Guarantors or any other Person  executing a guaranty
of the obligations of Hughes).

          SECTION 4. Waiver of Subrogation.  Upon the making by any Guarantor of
any  payment  hereunder  for the  account of  Hughes,  such  Guarantor  shall be
subrogated  to the  rights of the payee  against  Hughes  with  respect  to such
payment; provided that such Guarantor shall not enforce any right or receive any
payment by way of subrogation until all of the Guaranteed  Obligations have been
paid in full.  If, prior to the payment in full of the  Guaranteed  Obligations,
any  amount  shall be paid to any  Guarantor  on  account  of such  subrogation,
reimbursement, contribution or setoff rights, such amount shall be held in trust
for  the  benefit  of the  Lender  and  any  other  holders  of  the  Guaranteed
Obligations and shall forthwith be paid to the Lender to be credited and applied
upon the Guaranteed  Obligations,  whether  matured or unmatured,  in accordance
with the terms of the Notes or to be held by the Lender as  collateral  security
for any Guaranteed Obligations thereafter existing.

          SECTION 5.  Contribution.  For the purpose of establishing  rights and
obligations of  contribution  among Hughes and the Guarantors for the benefit of
themselves and for the benefit of the Lender,  the  Guarantors  hereby agree and
Hughes acknowledges the following contribution provisions:

          (a)  Indemnity  and  Subrogation.  In  addition  to all such rights of
indemnity and  subrogation as the Guarantors may have under  applicable law (but
subject  subsection  (c) below),  Hughes  agrees that (i) in the event a payment
shall be made by any Guarantor under this Guaranty in respect of the obligations
of Hughes under the terms of the Notes,  Hughes shall  indemnify  such Guarantor
for the full  amount of such  payment  and (ii) in the  event any  assets of any
Guarantor  shall be sold  pursuant  to any stock  pledge  agreement  or  similar
instrument or agreement to satisfy a claim of the Lender, Hughes shall indemnify
such  Guarantor  in an amount equal to the greater of the book value or the fair
market value of the assets so sold. Each Guarantor has  subordinated  its rights
to subrogation, pursuant to Section 4 of this Guaranty.

          (b) Contribution  and  Subrogation.  Each Guarantor agrees (subject to
subsection (c) below) that in the event a payment shall be made by any Guarantor
under this  Guaranty or assets of any  Guarantor  shall be sold  pursuant to any
stock pledge agreement or similar  instrument or agreement to satisfy a claim of
the Lender,  and such Guarantor (the


                                       8
<PAGE>

"Claiming  Guarantor")  shall not have been indemnified by Hughes as provided in
subsection (a) above,  each other Guarantor (a "Contributing  Guarantor")  shall
indemnify  the  Claiming  Guarantor  in an  amount  equal to the  amount of such
payment  or the  greater  of the book  value or the  fair  market  value of such
assets,  as the case may be,  multiplied  by a fraction,  the numerator of which
shall be as of the date of determination, the total shareholder's equity of such
date as determined in accordance with GAAP (the "Consolidated Net Worth") of the
Contributing Guarantor on the date hereof, and the denominator of which shall be
the sum of the  Consolidated Net Worth of all the Guarantors on the date hereof.
Any Contributing  Guarantor making any payment to a Claiming  Guarantor pursuant
to this  subsection  (b) shall be  subrogated  to the  rights  of such  Claiming
Guarantor under subsection (a) to the extent of such payment.

          (c) Subordination.  Notwithstanding  any provision of this Guaranty to
the contrary,  (i) all rights of the Guarantors  under subsection (a) or (b) and
all other rights of indemnity or contribution  under applicable law or otherwise
shall  be  fully  subordinated  to  the  indefeasible  payment  in  full  of the
Guaranteed Obligations,  and (ii) no such rights shall be exercised until all of
the  Guaranteed  Obligations  shall have been  irrevocably  paid in full. If any
amount  shall  be  paid  to any  Guarantor  on  account  of  such  indemnity  or
contribution rights at any time when all of the Guaranteed Obligations shall not
have been paid in full,  such  amount  shall be held in trust for the benefit of
the Lender and shall  forthwith be paid to the Lender to be credited and applied
upon the Guaranteed  Obligations,  whether  matured or unmatured,  in accordance
with the terms of the Notes.  No failure on the part of Hughes or any  Guarantor
to make the payments  required by subsection  (a) or (b) (or any other  payments
required  under  applicable  law or  otherwise)  shall in any respect  limit the
obligations and liabilities of any Guarantor with respect to this Guaranty,  and
each  Guarantor  shall remain liable for the full amount of the  obligations  of
such Guarantor under this Guaranty.

          (d)  Allocation.  If at any time there  exists more than one  Claiming
Guarantor  with respect to this  Guaranty,  then  payment from other  Guarantors
pursuant to this Section 5 shall be allocated among such Claiming  Guarantors in
proportion to the total amount of money paid for or on account of the Guaranteed
Obligations by each such Claiming Guarantor pursuant to the Guaranty.

          (e)  Preservation of Rights.  This Section 5 shall not limit or affect
any right which any  Guarantor  may have  against any other Person that is not a
party hereto.

          (f) Subsidiary Payment.  The amount of contribution payable under this
Section 5 by any Guarantor  with respect to the Guaranty shall be reduced by the
amount of any  contribution  paid  hereunder  by a  Subsidiary  (as  hereinafter
defined) of such Guarantor with respect to the Guaranty.  The term  "Subsidiary"
shall  mean,  with  respect  to any  Person,  any  corporation  or other  entity
(including, without limitation,  partnerships, joint ventures, and associations)
regardless of its jurisdiction of organization or formation, at least a majority
of the total  combined  voting  power of all  classes  of voting  stock or other
ownership interests of which


                                       9
<PAGE>

shall, at the time as of which any determination is being made, be owned by such
Person, either directly or indirectly through one or more other Subsidiaries.

          (g) Asset Sale. If all of the stock of any Guarantor  shall be sold or
otherwise  disposed of (including by merger or  consolidation)  in an asset sale
not  prohibited  by the Notes or otherwise  consented to by the Lender under the
Notes,  the  agreements  of such  Guarantor  hereunder  shall  automatically  be
discharged  and released  without any further action by such Guarantor and shall
be assumed in full by the corporation  which prior to such asset sale or consent
owned the stock of such  Guarantor,  effective as of the time of such asset sale
or consent.  Hughes shall cause any such corporation which is not a Guarantor to
become a party to this  Guaranty  unless  otherwise  agreed  in  writing  by the
Lender.

          (h)  Equitable  Allocation.  If as a  result  of  any  reorganization,
recapitalization or other corporate change in Hughes or any of its Subsidiaries,
or as a result  of any  amendment,  waiver  or  modification  of the  terms  and
conditions governing the Guaranty or any of the Guaranteed  Obligations,  or for
any other reason, the contributions under this Section 5 become inequitable, the
parties hereto shall promptly  modify and amend this Section 5 to provide for an
equitable  allocation of  contributions.  All such  modifications and amendments
shall be in writing and signed by all parties hereto.

          (i)  Asset  of Party to Which  Contribution  and  Indemnification  Are
Owing.  The  parties  hereto  acknowledge  that the  right to  contribution  and
indemnification  hereunder  shall each constitute an asset in favor of the party
to which such contribution or indemnification is owing.

          SECTION 6.  Severability.  Any  provision  of this  Guaranty  which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

          SECTION 7. Successors and Assigns;  Amendments. This Guaranty shall be
binding upon each party  hereto and its  respective  successors  and assigns and
shall inure to the benefit of the parties hereto,  the Lender and its respective
successors and assigns.  None of any Guarantor's  rights or any interest therein
under this Section 7 may be assigned or transferred  without the written consent
of the Lender.  In the event of any such transfer or assignment of rights by any
Guarantor,  the rights and privileges herein conferred upon that Guarantor shall
automatically  extend to and be  vested  in such  transferee  or  assignee,  all
subject to the terms and conditions hereof.  This Section 7 shall not be amended
without the prior written consent of the Lender.

          SECTION 8. Notices. All notices and other communications  provided for
hereunder shall be given (i) in the case of the Lender, at the address specified
for the  Lender in


                                       10
<PAGE>

the Notes, and (ii) in the case of the Guarantors,  at the respective  addresses
specified for such Guarantors in this Guaranty.

          SECTION 9. No Waiver;  Remedies.  No failure on the part of the Lender
to exercise, and no delay in exercising,  any right hereunder shall operate as a
waiver thereof;  nor shall any single or partial exercise of any right hereunder
preclude  any other or further  exercise  thereof or the  exercise  of any other
right.  No notice to or demand on any  Guarantor in any case shall  entitle such
Guarantor  to any  other  further  notice  or  demand  in any  similar  or other
circumstances or constitute a waiver of the rights of the Lender to any other or
further  action in any  circumstances  without  notice or demand.  The  remedies
herein  provided are  cumulative  and not exclusive of any remedies  provided by
law.

          SECTION 10. Right Of Set Off. In addition to and not in  limitation of
all rights of offset that the Lender may have under  applicable  law, the Lender
shall, upon the occurrence of any Event of Default (as defined in the Notes) and
whether or not the Lender has made any demand or the Guaranteed  Obligations are
matured,  have  the  right  to  appropriate  and  apply  to the  payment  of the
Guaranteed Obligations,  all deposits of any Guarantor (general or special, time
or  demand,  provisional  or  final)  then  or  thereafter  held  by  and  other
indebtedness  or  property  then  or  thereafter  owing  by  the  Lender  to any
Guarantor, whether or not related to this Guaranty or any transaction hereunder.
The Lender shall promptly notify the relevant Guarantor of any offset hereunder.

          SECTION  11.  Continuing  Guaranty;  Transfer  Of  Obligations.   This
Guaranty is a continuing  guaranty and shall (i) remain in full force and effect
until  payment  in full of the  Guaranteed  Obligations  and all  other  amounts
payable under this Guaranty, (ii) be binding upon each Guarantor, its successors
and assigns, and (iii) inure to the benefit of and be enforceable by and for the
benefit of the Lender, its successors, transferees and assigns.

          SECTION  12.  Governing  Law;  Appointment  Of Agent  For  Service  Of
Process; Submission To Jurisdiction; Waiver of Jury Trial.

          (a) THIS  GUARANTY  AND THE  RIGHTS  AND  OBLIGATIONS  OF THE  PARTIES
HEREUNDER  SHALL BE CONSTRUED IN ACCORDANCE  WITH AND BE GOVERNED BY THE LAWS OF
THE STATE OF GEORGIA  (WITHOUT  GIVING EFFECT TO THE CONFLICT OF LAW  PRINCIPLES
THEREOF).

          (b) ANY LEGAL ACTION OR  PROCEEDING  WITH RESPECT TO THIS  GUARANTY OR
OTHERWISE  RELATED  HERETO MAY BE BROUGHT IN THE SUPERIOR COURT OF FULTON COUNTY
OF THE STATE OF  GEORGIA OR OF THE UNITED  STATES OF  AMERICA  FOR THE  NORTHERN
DISTRICT OF GEORGIA,  AND, BY  EXECUTION  AND  DELIVERY OF THIS  GUARANTY,  EACH
GUARANTOR  HEREBY  CONSENTS,  FOR ITSELF AND IN RESPECT OF ITS PROPERTY,  TO THE
JURISDICTION OF THE AFORESAID  COURTS SOLELY FOR THE PURPOSE OF


                                       11
<PAGE>

ADJUDICATING  ITS  RIGHTS  OR THE  RIGHTS OF THE  LENDER  WITH  RESPECT  TO THIS
GUARANTY OR ANY DOCUMENT  RELATED  HERETO.  EACH  GUARANTOR  HEREBY  IRREVOCABLY
DESIGNATES  CORPORATION SERVICE COMPANY AS THE DESIGNEE,  APPOINTEE AND AGENT OF
SUCH  GUARANTOR  TO  RECEIVE,  FOR AND ON BEHALF OF SUCH  GUARANTOR,  SERVICE OF
PROCESS IN SUCH  JURISDICTION  IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS  GUARANTY OR ANY DOCUMENT  RELATED  HERETO AND SUCH SERVICE SHALL BE DEEMED
COMPLETED THIRTY DAYS AFTER MAILING THEREOF TO SAID AGENT. IT IS UNDERSTOOD THAT
A COPY OF SUCH PROCESS  SERVED ON SUCH AGENT WILL BE PROMPTLY  FORWARDED BY SUCH
LOCAL AGENT AND BY THE SERVER OF PROCESS BY MAIL TO THE RESPECTIVE  GUARANTOR AT
ITS ADDRESS SET FORTH HEREIN,  BUT THE FAILURE OF SUCH GUARANTOR TO RECEIVE SUCH
COPY SHALL NOT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, AFFECT IN ANY WAY THE
SERVICE OF SUCH PROCESS. EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING,  WITHOUT LIMITATION, 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 RESPECTIVE JURISDICTIONS IN RESPECT
OF THIS GUARANTY OR ANY DOCUMENT  RELATED  THERETO.  NOTHING HEREIN SHALL AFFECT
THE RIGHT OF THE LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO COMMENCE LEGAL  PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY GUARANTOR IN ANY
OTHER JURISDICTION.

          (c) TO THE EXTENT  PERMITTED BY APPLICABLE LAW, EACH GUARANTOR  HEREBY
IRREVOCABLY  WAIVES  ALL  RIGHT OF TRIAL BY JURY IN ANY  ACTION,  PROCEEDING  OR
COUNTERCLAIM  ARISING OUT OF OR IN  CONNECTION  WITH THIS  GUARANTY OR ANY OTHER
CREDIT DOCUMENT OR ANY MATTER ARISING IN CONNECTION HEREUNDER OR THEREUNDER.

          SECTION 13.  Subordination Of Hughes's  Obligations To the Guarantors.
As an independent covenant, each Guarantor hereby expressly covenants and agrees
for the benefit of the Lender that all  obligations and liabilities of Hughes to
such Guarantor of whatsoever  description  including,  without  limitation,  all
intercompany  receivables of such Guarantor from Hughes ("Junior  Claims") shall
be  subordinate  and junior in right of payment to all  obligations of Hughes to
the Lender under the terms of the Notes ("Senior Claims").

          If an Event of Default shall occur,  then, unless and until such Event
of Default  shall have been cured,  waived,  or shall have  ceased to exist,  no
direct  or  indirect  payment  (in  cash,  property,  securities  by  setoff  or
otherwise)  shall be made by Hughes to any  Guarantor  on  account  of or in any
manner in respect of any Junior Claim except such payments and distributions the
proceeds of which shall be applied to the payment of Senior Claims.


                                       12
<PAGE>

          In the event of a  Proceeding  (as  hereinafter  defined),  all Senior
Claims  shall  first be paid in full  before any direct or  indirect  payment or
distribution  (in cash,  property,  securities by setoff or otherwise)  shall be
made to any  Guarantor  on  account of or in any manner in respect of any Junior
Claim  except such  payments  and  distributions  the proceeds of which shall be
applied to the  payment  of Senior  Claims.  For the  purposes  of the  previous
sentence,  "Proceeding" means Hughes or any Guarantor shall commence a voluntary
case  concerning  itself under The  Bankruptcy  Code of 1978,  as amended and in
effect from time to time (11 U.S.C. ss. 101 et seq.; the "Bankruptcy  Code"). or
any other  applicable  bankruptcy  laws;  or any  involuntary  case is commenced
against  Hughes or any  Guarantor;  or a custodian (as defined in the Bankruptcy
Code or any other applicable  bankruptcy laws) is appointed for, or takes charge
of, all or any substantial  part of the property of Hughes or any Guarantor,  or
Hughes or any Guarantor commences any other proceedings under any reorganization
arrangement,  adjustment of debt, relief of debtor,  dissolution,  insolvency or
liquidation  or similar  law of any  jurisdiction  whether now or  hereafter  in
effect relating to Hughes or any Guarantor,  or any such proceeding is commenced
against  Hughes or any  Guarantor,  or Hughes or any  Guarantor  is  adjudicated
insolvent or bankrupt;  or any order of relief or other order approving any such
case  or  proceeding  is  entered;  or  Hughes  or  any  Guarantor  suffers  any
appointment of any custodian or the like for it or any  substantial  part of its
property;  or Hughes or any Guarantor makes a general assignment for the benefit
of creditors;  or Hughes or any Guarantor shall fail to pay, or shall state that
it is unable to pay,  or shall be unable  to pay,  its debts  generally  as they
become due;  or Hughes or any  Guarantor  shall call a meeting of its  creditors
with a view to arranging a composition or adjustment of its debts;  or Hughes or
any  Guarantor  shall by any act or  failure to act  indicate  its  consent  to,
approval of or  acquiescence  in any of the foregoing;  or any corporate  action
shall be taken by Hughes or any  Guarantor  for the purpose of effecting  any of
the foregoing.

          In the event any direct or indirect payment or distribution is made to
a Guarantor in  contravention  of this Section 13, such payment or  distribution
shall be deemed  received  in trust for the  benefit  of the Lender and shall be
immediately  paid over to the  Lender for  application  against  the  Guaranteed
Obligations in accordance with the terms of the Notes.

          Each  Guarantor  agrees to execute  such  additional  documents as the
Lender may reasonably request to evidence the subordination provided for in this
Section 13.

          SECTION  14.  Judgment  Currency.  (a)  The  Guarantors'   obligations
hereunder to make payments in a particular currency (the "Obligation  Currency")
shall not be discharged  or satisfied by any tender or recovery  pursuant to any
judgment  expressed in or converted  into any currency other than the Obligation
Currency,  except to the  extent  that such  tender or  recovery  results in the
effective  receipt by the Lender of the full amount of the  Obligation  Currency
expressed to be payable under this Guaranty or the Notes.  If for the purpose of
obtaining or  enforcing  judgment  against any  Guarantor in any court or in any
jurisdiction,  it becomes  necessary to convert into or from any currency  other
than the Obligation Currency (such other currency being hereinafter  referred to
as the  "Judgment  Currency")  an amount  due in the  Obligation  Currency,  the
conversion shall be made, at the currency equivalent  determined,  in


                                       13
<PAGE>

each case, as on the day immediately  preceding the day on which the judgment is
given  (such day being any day other  than  Saturday,  Sunday and a day on which
commercial banks are required to be closed for business in Atlanta,  Georgia, or
Orlando,   Florida  being  hereafter  referred  to  as  the  "Judgment  Currency
Conversion Date").

          (b) If there is a change in the rate of  exchange  prevailing  between
the  Judgment  Currency  Conversion  Date and the date of actual  payment of the
amount due, the Guarantors  covenant and agree to pay, or cause to be paid, such
additional  amounts,  if any (but in any event not a lesser  amount),  as may be
necessary  to  ensure  that  the  amount  paid in the  Judgment  Currency,  when
converted  at the  rate of  exchange  prevailing  on the date of  payment,  will
produce the amount of the  Obligation  Currency  which could have been purchased
with the amount of  Judgment  Currency  stipulated  in the  judgment or judicial
award at the rate of exchange  prevailing  on the Judgment  Currency  Conversion
Date.

          (c) For  purposes of  determining  the  currency  equivalent  for this
Section,  such amounts shall include any premium and costs payable in connection
with the purchase of the Obligation Currency.

          (d) If the  Obligation  Currency  is the  lawful  money of the  United
States of America. ("U.S. Dollars"), the currency equivalent shall be the Dollar
Equivalent.  For purposes of this Guaranty,  the term "Dollar  Equivalent" shall
mean, with respect to any monetary amount in a currency other than U.S. Dollars,
at any time for the determination  thereof,  the amount of U.S. Dollars obtained
by converting such currency  involved in such  computation  into U.S. Dollars at
the spot rate for the purchase of U.S.  Dollars with the applicable  currency as
quoted by the Lender at 11:00 a.m.  (local  time for the  Lender) on the date of
determination  thereof specified herein or, if the date of determination thereof
is not otherwise  specified  herein,  on the date two  applicable  Business Days
prior to such determination.  For purposes of this Guaranty,  the term "Business
Day"  shall  mean  any  day  other  than  Saturday,  Sunday  and a day on  which
commercial banks are required to be closed for business in Atlanta,  Georgia, or
Orlando, Florida.

          SECTION  15.  Automatic  Acceleration  in  Certain  Events.  Upon  the
occurrence  of an Event of  Default as  defined  in the  Notes,  all  Guaranteed
Obligations  shall  automatically  become  immediately  due and  payable  by the
Guarantors,  without  notice  or other  action  on the part of the  Lender,  and
regardless of whether  payment of the Guaranteed  Obligations by Hughes has then
been accelerated.  In addition, if any event of the types described in the Notes
should  occur with respect to any  Guarantor,  then the  Guaranteed  Obligations
shall  automatically  become  immediately  due and  payable  by such  Guarantor,
without  notice or other  action on the part of the Lender,  and  regardless  of
whether  payment  of  the  Guaranteed   Obligations  by  Hughes  has  then  been
accelerated.

          SECTION 16. Savings Clause. (a) It is the intent of each Guarantor and
the Lender that each Guarantor's maximum obligations hereunder shall be, but not
in excess of:


                                       14
<PAGE>

                    (i) in a case or  proceeding  commenced  by or against  such
     Guarantor  under the Bankruptcy Code on or within one year from the date on
     which any of the Guaranteed  Obligations  are incurred,  the maximum amount
     which would not otherwise  cause the Guaranteed  Obligations  (or any other
     obligations   of  such   Guarantor  to  the  Lender)  to  be  avoidable  or
     unenforceable   against  such  Guarantor  under  (A)  Section  548  of  the
     Bankruptcy  Code  or  (B)  any  state  fraudulent  transfer  or  fraudulent
     conveyance  act or statute  applied in such case or proceeding by virtue of
     Section 544 of the Bankruptcy Code; or

                    (ii) in a case or  proceeding  commenced  by or against such
     Guarantor under the Bankruptcy Code subsequent to one year from the date on
     which any of the Guaranteed  Obligations  are incurred,  the maximum amount
     which would not otherwise  cause the Guaranteed  Obligations  (or any other
     obligations   of  the   Guarantor   to  the  Lender)  to  be  avoidable  or
     unenforceable against such Guarantor under any state fraudulent transfer or
     fraudulent conveyance act or statute applied in any such case or proceeding
     by virtue of Section 544 of the Bankruptcy Code; or

                    (iii) in a case or  proceeding  commenced by or against such
     Guarantor  under any law,  statute or regulation  other than the Bankruptcy
     Code (including, without limitation, any other bankruptcy,  reorganization,
     arrangement,  moratorium, readjustment of debt, dissolution, liquidation or
     similar  debtor relief laws),  the maximum amount which would not otherwise
     cause  the  Guaranteed  Obligations  (or  any  other  obligations  of  such
     Guarantor  to the Lender) to be  avoidable  or  unenforceable  against such
     Guarantor  under  such  law,  statute  or  regulation  including,   without
     limitation,  any state fraudulent transfer or fraudulent  conveyance act or
     statute applied in any such case or proceeding.

(The substantive laws under which the possible avoidance or  unenforceability of
the Guaranteed  Obligations  (or any other  obligations of such Guarantor to the
Lender) shall be determined in any such case or proceeding shall  hereinafter be
referred to as the "Avoidance Provisions").

          (b) To the end set forth in Section 16(a), but only to the extent that
     the Guaranteed  Obligations  would  otherwise be subject to avoidance under
     the Avoidance  Provisions if such  Guarantor is not deemed to have received
     valuable  consideration,  fair value or reasonably equivalent value for the
     Guaranteed  Obligations,  or if the Guaranteed Obligations would render the
     Guarantor  insolvent,  or leave the Guarantor  with an  unreasonably  small
     capital to conduct its  business,  or cause the  Guarantor to have incurred
     debts (or to have  intended to have  incurred  debts) beyond its ability to
     pay  such  debts  as they  mature,  in each  case as of the time any of the
     Guaranteed Obligations are deemed to have been incurred under the Avoidance
     Provisions and after giving effect to contribution as among Guarantors, the
     maximum  Guaranteed  Obligations  for which such Guarantor  shall be liable
     hereunder  shall be reduced  to that  amount  which,  after  giving  effect
     thereto,   would  not  cause  the  Guaranteed  Obligations  (or  any  other
     obligations of such Guarantor to the Lender),  as so reduced, to be subject
     to avoidance under the Avoidance Provisions. This Section 16(b) is intended
     solely to preserve the rights of the Lender hereunder to the maximum extent
     that would not cause the  Guaranteed  Obligations  of any  Guarantor  to be
     subject to  avoidance  under the


                                       15
<PAGE>

     Avoidance Provisions, and neither such Guarantor nor any other Person shall
     have any right or claim  under this  Section 16 as against  the Lender that
     would not  otherwise  be  available  to such  Person  under  the  Avoidance
     Provisions.

          (c) None of the  provisions  of this  Section 16 are  intended  in any
     manner to alter the obligations of any holder of  subordinated  debt or the
     rights of the holders of "senior  indebtedness" as provided by the terms of
     the  subordinated  debt.  Accordingly,  it is the  intent  of  each  of the
     Guarantors that, in the event that any payment or distribution is made with
     respect  to the  subordinated  debt  prior  to the  payment  in full of the
     Guaranteed  Obligations  by virtue of the provisions of this Section 16, in
     any case or  proceeding  of the kinds  described  in clauses  (i)-(iii)  of
     Section 16(a), the holders of the  subordinated  debt shall be obligated to
     pay or deliver  such payment or  distribution  to or for the benefit of the
     Lender.  Furthermore,  in respect of the  Avoidance  Provisions,  it is the
     intent of each  Guarantor  that the  subrogation  rights of the  holders of
     subordinated  debt with respect to the  obligations of the Guarantor  under
     this  Guaranty,  be subject in all  respects to the  provisions  of Section
     16(b).

          SECTION  17.   Information.   Each  of  the  Guarantors   assumes  all
responsibility  for being and keeping  itself  informed  of  Hughes's  financial
condition and assets,  and of all other  circumstances  bearing upon the risk of
nonpayment of the Guaranteed Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder,  and agrees that none of
the Lender  will have any duty to advise any of the  Guarantors  of  information
known to it or any of them regarding such circumstances or risks.

          SECTION 18. Survival.  All agreements,  representations and warranties
made herein shall survive the execution and delivery of this Guaranty and of the
Notes.

          SECTION 19. Counterparts.  This Guaranty and any amendments,  waivers,
consents or  supplements  may be executed in any number of  counterparts  and by
different  parties  hereto  in  separate  counterparts,  each of  which  when so
executed and delivered  shall be deemed an original,  but all such  counterparts
together shall constitute but one and the same instrument.

          SECTION  20.  Currency  of  Payment.  All  payments  to be made by the
Guarantors  hereunder  shall be made in the relevant  currency or  currencies in
which the Guaranteed Obligations are denominated in immediately available funds.
If any  Guarantor  is unable  for any  reason to  effect  payment  of any of the
Guaranteed  Obligations in the currency in which such Guaranteed Obligations are
denominated, the Lender may, at their option, require such payment to be made in
the  Dollar  Equivalent  of  such  currency.  If in any  case  where  any of the
Guarantors shall make any such payment in the Dollar Equivalent,  the Guarantors
agree to hold the Lender  harmless from any loss incurred by the Lender  arising
from any change in the


                                       16
<PAGE>

value of Dollars in relation  to such  currency  between  the date such  payment
became due and the date of payment thereof.

          SECTION 21. Additional Guarantors.  Upon execution and delivery by any
Subsidiary  of Hughes  of a  supplement  to that  certain  guaranty  dated as of
January  26,  1999  (the  Revolver  Guaranty"),  made by  each  of the  material
subsidiaries  of Hughes,  listed on the  signature  pages  thereto,  in favor of
Lender,  individually and as  Administrative  Agent,  First Union National Bank,
individually and as Documentation Agent, Nationsbank,  N.A., individually and as
Syndication Agent,  Southtrust Bank, National  Association,  individually and as
Co-Agent, or to that certain guaranty dated as of January 26, 1999 (the "Line of
Credit Guaranty") made by each of the material subsidiaries of Hughes, listed on
the  signature  pages  thereof,   in  favor  of  Lender,   individually  and  as
Administrative   Agent,   First  Union  National  Bank,   individually   and  as
Documentation Agent,  Nationsbank,  N.A., individually and as Syndication Agent,
Southtrust  Bank,  National  Association,  individually  and as  Co-Agent,  such
subsidiary shall also execute and deliver to Lender an instrument in the form of
Annex 1, such  Subsidiary of Hughes shall become a Guarantor  hereunder with the
same  force and  effect  as if  originally  named a  Guarantor  herein  (each an
"Additional Guarantor"). The execution and delivery of any such instrument shall
not require the consent of any Guarantor  hereunder.  The rights and obligations
of  each   Guarantor   hereunder   shall   remain  in  full   force  and  effect
notwithstanding  the  addition of any  Additional  Guarantor  as a party to this
Guaranty.


                                       17
<PAGE>

          IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by their  respective duly  authorized  officers as of the
date first above written.

                                    GUARANTORS:

Address:                            ALLIED METALS, INC.
20 North Orange Avenue              APPCO PROCESS EQUIPMENT COMPANY
Suite 200                           ATLANTIC PUMP & EQUIPMENT COMPANY OF
Orlando, FL 32801                     MIAMI, INC.
Attn: J. Stephen Zepf               ATLANTIC PUMP & EQUIPMENT COMPANY OF WEST
                                      PALM BEACH, INC.
                                    CAROLINA PUMP & SUPPLY CORP.
                                    CHAD SUPPLY, INC.
                                    COASTAL WHOLESALE, INC.
                                    DOUGLAS LEONHARDT & ASSOCIATES, INC.
                                    DOMINION PIPE FABRICATORS,
                                      INCORPORATED
                                    DOMINION PIPE & SUPPLY CO.
                                    ELASCO AGENCY SALES, INC.
                                    ELEC-TEL SUPPLY COMPANY
                                    ELECTRIC LABORATORIES AND SALES
                                      CORPORATION
                                    FES MERGER CORP., INC.
                                    FLORIDA PIPE & SUPPLY COMPANY
                                    GAYLE SUPPLY COMPANY, INC.
                                    GILLELAND CONCRETE PRODUCTS, INC.
                                    GPEC, INC.
                                    H VENTURE CORP.
                                    HSI ACQUISITION CORPORATION
                                    HUGHES WATER & SUPPLY COMPANY
                                    HUGHES SUPPLY MANAGEMENT SERVICES, INC.
                                    INTERNATIONAL SUPPLY COMPANY
                                    J. I. SERVICES CORPORATION
                                    J & J, INC.
                                    JUNO INDUSTRIES, INC.
                                    KAMEN MERGER CORP.
                                    MEREX CORPORATION
                                    METALS INCORPORATED
                                    METALS, INC. - GULF COAST DIVISION

<PAGE>

                                    MILLS & LUPTON SUPPLY COMPANY
                                    MOORE ELECTRIC SUPPLY, INC.
                                    MOUNTAIN COUNTRY SUPPLY, INC.
                                    OLANDER & BROPHY, INCORPORATED
                                    ONE-STOP SUPPLY, INC.
                                    PAINE SUPPLY OF JACKSON, INC.
                                    PALM POOL PRODUCTS, INC.
                                    PANHANDLE PIPE AND SUPPLY CO., INC.
                                    PORT CITY ELECTRICAL SUPPLY, INC.
                                    R & G PLUMBING SUPPLY, INC.
                                    SAN ANTONIO PLUMBING DISTRIBUTORS, INC.
                                    SHRADER HOLDING COMPANY, INC.
                                    STAINLESS TUBULAR PRODUCTS, INC.
                                    SUNBELT SUPPLY COMPANY
                                    USCO INCORPORATED
                                    UNION MERGER CORPORATION
                                    U.S. FUSION SERVICES, INC.
                                    VIRGINIA WATER & WASTE SUPPLY COMPANY, INC.
                                    WCC MERGER CORPORATION
                                    WHOLESALE ELECTRIC SUPPLY CORPORATION

                                    By: ________________________________________
                                        J. Stephen Zepf
                                        Treasurer

<PAGE>

Address:                            HHH, INC.
1403 Foulk Road, Suite 102          Z&L ACQUISITION CORP. OF DELAWARE, INC.
Wilmington, DE  19803               L&T OF DELAWARE, INC.
                                    Z&L ACQUISITION CORP.

                                    By:________________________________________
                                       Gordon Stewart
                                       President


Address:                            HSI CORP.
1403 Foulk Road, Suite 101
Wilmington, DE  19803
                                    By:________________________________________
                                       Gordon Stewart
                                       President


Address:                            SOUTHWEST STAINLESS, L.P.
1403 Foulk Road, Suite 102
Wilmington, DE  19803               By:   Z&L ACQUISITION CORP.,
                                            its General Partner

                                            By:_________________________________
                                               Gordon Stewart
                                               President

                [SIGNATURE PAGE TO SUBSIDIARY GUARANTY AGREEMENT]

<PAGE>

SECTION 5 AND 21 OF THE
FOREGOING GUARANTY
ACKNOWLEDGED AND
AGREED TO:

HUGHES SUPPLY, INC.

By:_____________________________
   J. Stephen Zepf
   Treasurer

<PAGE>

                                     ANNEX I

                                   SUPPLEMENT
                                       TO
                          SUBSIDIARY GUARANTY AGREEMENT

          THIS SUPPLEMENT TO SUBSIDIARY  GUARANTY AGREEMENT (this "Supplement to
Guaranty    Agreement"),    dated    as   of    __________________,    made   by
______________________,  a ________ corporation (the "Additional Guarantor"), in
favor of SUNTRUST BANK, CENTRAL FLORIDA, NATIONAL ASSOCIATION (the "Lender");

                              W I T N E S S E T H:

          WHEREAS,  Hughes executed and delivered that certain Uncommitted Swing
Line Note dated as of March 1, 1999, in favor of Lender, in the principal amount
of  $10,000,000.00  (as  hereafter   amended,   restated,   renewed,   extended,
supplemented  or otherwise  modified from time to time,  the "Swing Line Note"),
and that certain  Uncommitted  Guidance  Line Note dated as of March 1, 1999, in
favor of  Lender,  in the  principal  amount  of  $15,000,000.00  (as  hereafter
amended, restated,  renewed,  extended,  supplemented or otherwise modified from
time to time, the "Guidance  Line Note",  and together with the Swing Line Note,
the "Notes");

          WHEREAS,  certain Subsidiaries (the "Subsidiary Guarantors") of Hughes
have executed and delivered a Subsidiary Guaranty  Agreement,  dated as of March
1, 1999 (as amended,  restated,  supplemented or otherwise modified from time to
time, the "Subsidiary  Guaranty"),  pursuant to which the Subsidiary  Guarantors
have agreed to guarantee all of the obligations of Hughes under the Notes;

          WHEREAS,   Hughes,  the  Subsidiary   Guarantors  and  the  Additional
Guarantor  share an identity of interests as members of a consolidated  group of
companies engaged in substantially  similar businesses;  Hughes provides certain
centralized  financial,  accounting  and  management  services to the Additional
Guarantor;  the making of the loans will  facilitate  expansion  and enhance the
overall financial strength and stability of Hughes's corporate group,  including
the Additional Guarantor;  and by virtue of intercompany advances and loans, the
financial accommodations to Hughes under the Notes shall inure to the direct and
material benefit of Guarantors; and

          WHEREAS, it is a condition subsequent to the Lender's making loans, in
its sole  discretion,  to  Hughes  evidenced  by the Notes  that the  Additional
Guarantor  execute  and  deliver  to the  Lender  this  Supplement  to  Guaranty
Agreement,  and the  Additional  Guarantor  desires to execute and deliver  this
Supplement to Guaranty Agreement to satisfy such condition subsequent;

<PAGE>

          NOW,  THEREFORE,  in  consideration  of the  premises  and in order to
induce the Lender to make the loans to Hughes  under the Notes,  the  Additional
Guarantor hereby agrees as follows:

          SECTION 2. Defined  Terms.  Capitalized  terms not  otherwise  defined
herein  shall  have the  meanings  specified  for such  terms in the  Subsidiary
Guaranty.

          SECTION 3. Additional Guarantor.  The Additional Guarantor agrees that
it shall be and become a Guarantor for all purposes of the  Subsidiary  Guaranty
and shall be fully liable  thereunder  to the Lender to the same extent and with
the  same  effect  as  though  the  Additional  Guarantor  had  been  one of the
Guarantors originally executing and delivering the Subsidiary Guaranty.  Without
limiting the foregoing,  the Additional  Guarantor  hereby jointly and severally
(with respect to the  guaranties  made by the  Subsidiary  Guarantors  under the
Subsidiary Guaranty),  irrevocably and unconditionally,  guarantees the punctual
payment when due,  whether at stated maturity by  acceleration or otherwise,  of
all indebtedness and all other obligations,  including all renewals, extensions,
modifications and refinancings  thereof, now or hereafter existing,  whether for
principal,  interest,  fees,  expenses or  otherwise,  and any and all  expenses
(including   reasonable   attorneys'  fees  actually   incurred  and  reasonable
out-of-pocket expenses) incurred by the Lender in enforcing any rights under the
Subsidiary  Guaranty  (as  supplemented  hereby),   subject,   however,  to  the
limitations expressly provided in the Subsidiary Guaranty in Section 16 thereof.
All references in the Subsidiary  Guaranty to  "Guarantors"  or any  "Guarantor"
shall be deemed to include and to refer to the Additional Guarantor.

     3. Enforceability.  This Supplement has been duly authorized,  executed and
delivered by  Additional  Guarantor and  constitutes a legal,  valid and binding
obligation of Additional  Guarantor,  enforceable  against it in accordance with
its terms,  except as the  enforceability  thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting creditors
rights generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).

     4. Counterparts.  This Supplement and any amendments,  waivers, consents or
supplements may be executed in any number of counterparts, each of which when so
executed and delivered  shall be deemed an original,  but all such  counterparts
shall constitute but one and the same instrument.

     5. Effective Upon Delivery.  This  Supplement  shall become  effective upon
execution by Additional Guarantor and delivery of this Supplement,  as executed,
to the Lender.

<PAGE>

     6. Governing Law;  Appointment of Agent for Service of Process;  Submission
        to Jurisdiction; Waiver of Jury Trial.

          (a)  THIS  SUPPLEMENT  TO  GUARANTY   AGREEMENT  AND  THE  RIGHTS  AND
OBLIGATIONS OF THE PARTIES  HEREUNDER  SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF GEORGIA  (WITHOUT  GIVING  EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF).

          (b) ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS SUPPLEMENT TO
GUARANTY AGREEMENT RELATED HERETO MAY BE BROUGHT IN THE SUPERIOR COURT OF FULTON
COUNTY OF THE STATE OF  GEORGIA  OR OF THE  UNITED  STATES  OF  AMERICA  FOR THE
NORTHERN DISTRICT OF GEORGIA,  AND, BY EXECUTION AND DELIVERY OF THIS SUPPLEMENT
TO GUARANTY AGREEMENT,  THE ADDITIONAL GUARANTOR HEREBY CONSENTS, FOR ITSELF AND
IN RESPECT OF ITS PROPERTY,  TO THE  JURISDICTION OF THE AFORESAID COURTS SOLELY
FOR THE  PURPOSE OF  ADJUDICATING  ITS  RIGHTS OR THE RIGHTS OF THE LENDER  WITH
RESPECT TO THIS SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED HERETO.
THE ADDITIONAL  GUARANTOR  HEREBY  IRREVOCABLY  DESIGNATES  CORPORATION  SERVICE
COMPANY AS THE  DESIGNEE,  APPOINTEE  AND AGENT OF THE  ADDITIONAL  GUARANTOR TO
RECEIVE,  FOR AND ON BEHALF OF THE ADDITIONAL  GUARANTOR,  SERVICE OF PROCESS IN
SUCH  JURISDICTION  IN ANY  LEGAL  ACTION OR  PROCEEDING  WITH  RESPECT  TO THIS
SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED HERETO AND SUCH SERVICE
SHALL BE DEEMED  COMPLETED THIRTY (30) DAYS AFTER MAILING THEREOF TO SAID AGENT.
IT IS  UNDERSTOOD  THAT A COPY OF SUCH  PROCESS  SERVED  ON SUCH  AGENT  WILL BE
PROMPTLY  FORWARDED  BY SUCH LOCAL AGENT AND BY THE SERVER OF PROCESS BY MAIL TO
THE ADDITIONAL GUARANTOR AT ITS ADDRESS SET FORTH HEREIN, BUT THE FAILURE OF THE
ADDITIONAL  GUARANTOR TO RECEIVE SUCH COPY SHALL NOT, TO THE EXTENT PERMITTED BY
APPLICABLE  LAW,  AFFECT IN ANY WAY THE SERVICE OF SUCH PROCESS.  THE ADDITIONAL
GUARANTOR  HEREBY   IRREVOCABLY   WAIVES  ANY  OBJECTION,   INCLUDING,   WITHOUT
LIMITATION,  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  RESPECTIVE  JURISDICTIONS  IN  RESPECT  OF THIS
SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED THERETO. NOTHING HEREIN
SHALL  AFFECT  THE RIGHT OF THE  LENDER  TO SERVE  PROCESS  IN ANY OTHER  MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL  PROCEEDINGS OR OTHERWISE  PROCEED AGAINST
THE ADDITIONAL GUARANTOR IN ANY OTHER JURISDICTION.


                                       3
<PAGE>

          (c)  TO  THE  EXTENT  PERMITTED  BY  APPLICABLE  LAW,  THE  ADDITIONAL
GUARANTOR  HEREBY  IRREVOCABLY  WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM  ARISING OUT OF OR IN CONNECTION WITH THIS SUPPLEMENT
TO GUARANTY  AGREEMENT  OR ANY OTHER  CREDIT  DOCUMENT OR ANY MATTER  ARISING IN
CONNECTION HEREUNDER OR THEREUNDER.

     7.  Severability.  In  case  any  provision  in or  obligation  under  this
Supplement shall be invalid,  illegal or unenforceable in any jurisdiction,  the
validity,   legality  and   enforceability   of  the  remaining   provisions  or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.


                                       4
<PAGE>

          IN  WITNESS  WHEREOF,   the  Additional   Guarantor  has  caused  this
Supplement to Guaranty Agreement to be duly executed and delivered to the Lender
under seal by its duly authorized officers as of the date first above written.

Address for Notices:                        ADDITIONAL GUARANTOR:

                                                 _______________________________


                                                 By:____________________________
                                                    Title:______________________
<PAGE>

             AMENDMENT TO UNCOMMITTED GUIDANCE AND SWING LINE DEMAND
                                PROMISSORY NOTE

February 11, 2002

Mr. Robert Hillier
Hughes Supply, Inc.
20 N. Orange Ave., Suite 510
Orlando, FL 32801

Dear Robert:

This letter  serves as official  notice that as of June 30,  2001,  the maturity
date on the  $10,000,000  Swing Line provided by SunTrust Bank,  Inc. (the Bank)
was extended to June 30,  2002.  Concurrently,  the  $15,000,000  Guidance  Line
provided by the Bank has also been  extended to June 30, 2002,  with these funds
now appropriated to a split-trac operating lease agreement.

According  to the Swing Line and  Guidance  Line Notes,  the Bank may extend the
Notes in writing and at its sole discretion.

If you should  have any  questions  or need  assistance  please call me at (407)
237-4752.

Sincerely,

Sarah D. Hudson
Associate
SunTrust Bank, Inc.