EXHIBIT 10.74

                         SECURITY AGREEMENT -TAX REFUND


         THIS SECURITY AGREEMENT (the "Agreement") is made as of _______, _____,
by  and  between  TRAVIS  BOATS  &  MOTORS,  INC.  ("Debtor")  and  TRANSAMERICA
COMMERCIAL FINANCE CORPORATION,  as agent ("Agent") for Transamerica  Commercial
Finance Corporation  ("TCFC"),  GE Commercial  Distribution  Finance Corporation
("GE") and TMRC, L.L.P. ("Tracker").


                                P R E A M B L E:

         Debtor has  requested  Agent to provide  certain  financing  to Debtor.
Agent has agreed to do so, so long as,  among other  things,  this  Agreement is
executed and delivered by Debtor to Agent.

         NOW, THEREFORE, in consideration of the premises which are incorporated
herein by this reference and  constitute an integral part hereof,  the execution
and  delivery of this  Agreement  and in order to induce the Agent to extend its
financing to Debtor, the parties agree as follows:


                            ARTICLE ONE. DEFINITIONS

         SECTION 1.1.  DEFINED TERMS. In addition to terms defined  elsewhere in
this  Agreement or any  Supplement  or Exhibit  hereto,  when used  herein,  the
following terms shall have the following meanings:

         "Affiliate" shall mean any Person which,  directly or indirectly,  owns
or controls, on an aggregate basis, at least a five percent (5%) interest in any
other  Person,  or which is  controlled  by or is under common  control with any
other Person.

         "Collateral"  shall  mean  the  following  property  owned  by  Debtor,
howsoever  arising,  wherever  located  and  whether  now owned or  existing  or
hereafter existing or acquired:

                  (A)      the Parent Income Tax Claim/Refund;

                  (B) any and all proceeds of (A) above.

         "Creditor"  shall  mean   individually,   and  "Creditors"  shall  mean
collectively,  each of GE, Tracker and TCFC, and their respective successors and
assigns.

         "Documents" shall mean the collectively, GE Loan Documents, the Tracker
Loan Documents and the TCFC Loan Documents.

         "Event of Default"  shall mean any event or condition  under any of the
Documents  that entitles a Creditor or Creditors,  as the case may be, that is a
party thereto, to accelerate the stated maturity of any of the Obligations owing
in respect thereof.

         "GE Debt" shall mean debts, claims,  obligations and liabilities of the
GE Obligors to GE, whether primary, secondary,  direct, contingent,  fixed, owed
by a GE Obligor to a third party and  acquired by GE or  otherwise,  heretofore,
now and/or from time to time hereafter owing, due or payable, including, without
limitation,  all amounts owed or to become due pursuant to the GE Loan Documents
and all renewals, extensions, replacements and modifications thereof.

         "GE Loan Documents" shall mean shall mean all now existing or hereafter
created notes, loan agreements, security agreements,  guarantees,  subordination
agreements,   waivers,  certificates,   mortgages,   assignments,   indemnities,


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agreements,  instruments or other documents (and any amendments,  substitutions,
restatements,  extensions and renewals to the foregoing) which create, evidence,
secure or otherwise relate to the GE Debt.

         "GE Obligors"  shall mean the Persons  identified on Schedule I to this
Agreement  and any other Person now or  hereafter  becoming an obligor on the GE
Debt.

         "Intercreditor   Agreement"  shall  mean  that  certain   intercreditor
agreement by and among the Agent and the Creditors  dated as of the date of this
Agreement, as may be amended and/or restated from time to time.

         "Obligations  " shall mean the GE Debt,  the Tracker  Debt and the TCFC
Debt.

         "Parent Income Tax Claim/Refund"  shall mean all monies and claims from
monies due and/or to become due to Debtor  from the United  States of America or
any department or agency thereof  arising out of any  application in the name of
Debtor for an income  tax  refund for any tax year,  filed or to be filed at any
time  or from  time  to  time by  Debtor  with  the  Internal  Revenue  Service,
including,  but not  limited  to, the  application  in the name of Debtor for an
income tax refund for tax year 2002.

         "Person"   shall   mean   individually,   and   "Persons"   shall  mean
collectively,  any individual, sole proprietorship,  partnership, joint venture,
trust,  unincorporated  organization,   association,  corporation,  institution,
entity,  party or government (whether national,  federal,  state,  county, city,
municipal or  otherwise  including,  without  limitation,  any  instrumentality,
division, agency, body or department thereof).

         "Related Documents" shall mean this Agreement, any other instruments or
documents  required or  contemplated  hereunder,  whether now existing or at any
time hereafter arising.

         "TCFC Debt" shall mean debts,  claims,  obligations  and liabilities of
the TCFC  Obligors to TCFC,  whether  primary,  secondary,  direct,  contingent,
fixed,  owed  by a TCFC  Obligor  to a  third  party  and  acquired  by  TCFC or
otherwise,  heretofore,  now and/or from time to time  hereafter  owing,  due or
payable,  including,  without  limitation,  all  amounts  owed or to become  due
pursuant to the TCFC Loan Documents and all renewals,  extensions,  replacements
and modifications thereof.

         "TCFC  Loan  Documents"  shall  mean  shall  mean all now  existing  or
hereafter  created notes,  loan  agreements,  security  agreements,  guarantees,
subordination  agreements,   waivers,  certificates,   mortgages,   assignments,
indemnities,  agreements,  instruments or other  documents (and any  amendments,
substitutions,  restatements,  extensions and renewals to the  foregoing)  which
create, evidence, secure or otherwise relate to the TCFC Debt.

         "TCFC  Obligors"  shall mean the Persons  identified  on Schedule II to
this Agreement and any other Person now or hereafter  becoming an obligor on the
TCFC Debt.

         "Tracker Debt" shall mean debts, claims, obligations and liabilities of
the Parent to Tracker, whether primary,  secondary,  direct, contingent,  fixed,
owed by a  Parent  to a third  party  and  acquired  by  Tracker  or  otherwise,
heretofore,  now  and/or  from time to time  hereafter  owing,  due or  payable,
including, without limitation, all amounts owed or to become due pursuant to the
Tracker  Loan  Documents  and  all  renewals,   extensions,   replacements   and
modifications thereof.

         "Tracker  Loan  Documents"  shall mean shall mean all now  existing  or
hereafter  created notes,  loan  agreements,  security  agreements,  guarantees,
subordination  agreements,   waivers,  certificates,   mortgages,   assignments,
indemnities,  agreements,  instruments or other  documents (and any  amendments,
substitutions,  restatements,  extensions and renewals to the  foregoing)  which
create, evidence, secure or otherwise relate to the Tracker Debt.

         "Travis Obligors" shall mean collectively, the TCFC Obligors and the GE
Obligors.

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         "UCC" shall mean the Uniform  Commercial Code as enacted and amended in
the State of Illinois.

         SECTION 1.2. OTHER TERMS. Accounting terms used in this Agreement which
are not specifically  defined shall have the meanings  customarily given them in
accordance with generally accepted accounting  principles in effect from time to
time.  Terms used in this Agreement which are defined in the UCC, shall,  unless
the context indicates otherwise or are otherwise defined in this Agreement, have
the meanings provided for by the UCC.


                             ARTICLE TWO. COLLATERAL

         SECTION 2.1. SECURITY INTERESTS.  To secure payment of the Obligations,
Debtor hereby irrevocably pledges, assigns, transfers,  conveys and sets over to
the Agent and  hereby  grants to the  Agent a  security  interest  in and to the
Collateral,  howsoever  arising,  wherever  located  and  whether  now  owned or
existing or hereafter existing or acquired.

         SECTION 2.2. PERFECTION  AUTHORIZATION AND FILING REQUIREMENTS.  Debtor
shall perform any and all acts requested by the Agent to establish, maintain and
continue the Agent's  security  interest and liens in the Collateral,  including
but not limited to, executing or  authenticating  financing  statements and such
other  instruments and documents when and as reasonably  requested by the Agent.
Debtor  hereby  authorizes  Agent  through any of Agent's  employees,  agents or
attorneys  to  file  any  and  all  financing  statements,   including,  without
limitation,  any  continuations,  transfers or  amendments  thereof  required to
perfect  Agent's  security  interest and liens in the  Collateral  under the UCC
without authentication or execution by Debtor.

         SECTION 2.3 PARENT INCOME TAX CLAIM/REFUND.  As additional security for
the payment and performance of the  Obligations,  Debtor shall (A)  collaterally
assign  the  Parent  Income  Tax  Claim/Refund  to  Agent  in  form  and  manner
satisfactory  to  Agent  (the  "Collateral   Assignment  of  Parent  Income  Tax
Claim/Refund "); and (B) perform any and all acts requested by Agent to have the
Internal  Revenue  Service and any other Person required by Agent to acknowledge
such assignment and pledge of the Parent Income Tax Claim/Refund to Agent.


                  ARTICLE THREE. REPRESENTATIONS AND WARRANTIES

         SECTION 3.1. DEBTOR. Debtor represents and warrants to the Agent that:

                  (A) Organization,  Etc. It is duly organized, validly existing
and in good standing  under the laws of the State of Texas and is duly qualified
and in good standing or has applied for  qualification as a foreign  corporation
authorized to do business in each jurisdiction  where,  because of the nature of
its activities or properties, such qualification is required.

                  (B) Authorization:  No Conflict. The execution and delivery of
the  Documents  are all  within  the  corporate  powers  of it,  have  been duly
authorized by all necessary action,  have, or by the time of their execution and
delivery shall have, received all necessary  governmental or regulatory approval
(if any shall be required),  and do not and will not contravene or conflict with
any provision of (i) law,  rule,  regulation or ordinance,  (ii) the articles of
incorporation or by-laws of it; or (iii) any agreement binding upon it or any of
their properties, as the case may be.

                  (C) Validity and Binding Nature.  The Documents executed by it
are the legal, valid and binding  obligations of it, enforceable  against it, in
accordance with their respective terms,  except as enforceability may be limited
by  bankruptcy,  insolvency,  reorganization  and other  similar laws of general
application  affecting  the rights and remedies of  creditors  and except as the
availability  of specific  performance  or  injunctive  relief is subject to the
discretion of the court before which any proceeding therefor may be brought.

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                  (D) Parent Income Tax  Claim/Refund.  Any of the Parent Income
Tax  Claim/Refund is a legitimate claim under the Internal Revenue Code based on
the Travis  Obligors'  net  income or losses as of the end of any  fiscal  year,
including,  but not limited to, prior to December 31, 2002 and has been reviewed
by Debtor's  independent  certified public accountants and has not been disputed
by any Person,  including,  but not limited to, the Internal Revenue Service and
Debtor's independent certified public accountants.


                             ARTICLE FOUR. COVENANTS

         SECTION 4.1.  Debtor.  Until all the  Liabilities are paid in full, the
Debtor covenants and agrees that:

                  (A)  Books,  Records  and  Inspections.  It will (i)  maintain
complete and accurate  books and records  with respect to the  Collateral;  (ii)
permit reasonable access by the Agent to the books and records of it.

                  (B)  Good  Title.  It  shall at all  times  maintain  good and
marketable title to the Collateral.

                  (C)  Parent  Income  Tax   Claim/Refund.   Debtor  shall  give
immediate written notice to Agent of any communication (whether oral or written)
or notice relating to and any payment of all or any portion of the Parent Income
Tax  Claim/Refund  contemporaneously  with receipt by any Travis  Obligor or any
agent of any Travis Obligor of any such communication, notice or payment. Debtor
agrees that if any Parent Income Tax Claim/Refund,  or any portion of any Parent
Income  Tax  Claim/Refund,  is paid to  Debtor at any time or from time to time,
Debtor  will  receive  and hold the same in trust  for  Agent  and  Debtor  will
forthwith  upon  receipt of such Parent  Income Tax  Claim/Refund  deliver  such
Parent  Income  Tax  Claim/Refund  to Agent  in the  identical  form of  payment
received by the Debtor.

                         ARTICLE FIVE. EVENTS OF DEFAULT

         SECTION 5.1. EVENTS OF DEFAULT. Each of the following acts, occurrences
or omissions shall  constitute an event of default under this Agreement  (herein
referred  to as an "Event of  Default"),  whatever  the reason for such Event of
Default  and  whether it shall be  voluntary  or  involuntary  or be effected by
operation of law or pursuant to any judgment or order of any court or any order,
rule or regulation of any governmental or nongovernmental body or tribunal:

                  (A) Any default or event of default,  howsoever such terms are
defined, shall occur under any of the Documents; or

                  (B) default,  and continuance thereof for 5 days after written
notice  thereof to Debtor by the Agent,  in the  payment of any amount  owing by
Debtor  to the  Agent  pursuant  to the  this  Agreement  or any of the  Related
Documents; or

                  (C) Any representation or warranty made by Debtor contained in
the this  Agreement or any of the Related  Documents  shall at any time prove to
have been incorrect in any material respect when made; or

                  (D) Debtor shall default in the  performance  or observance of
any term,  covenant,  condition  or  agreement  on its part to be  performed  or
observed under this Agreement or any of the Related  Documents (not constituting
an  Event  of  Default  under  any  other  clause  of this  Section  5.1 of this
Agreement) and such default shall  continue  unremedied for 5 days after written
notice thereof shall have been given by the Agent to Debtor; or

                  (E)  Either:  (i)  any of the  Travis  Obligors  shall  become
insolvent or generally fail to pay, or admit in writing their  inability to pay,
their  debts  as  they  become  due,  or  a  proceeding  under  any  bankruptcy,
reorganization,  arrangement  of  debt,  insolvency,  readjustment  of  debt  or
receivership  law or statute is filed by or  against  any Travis  Obligor or any
Travis  Obligor  makes an  assignment  for the benefit of  creditors;  provided,
however,  that no Event of Default  shall exist  pursuant to this  Subsection E,
Clause (i) due to an involuntary  bankruptcy case,  proceeding or petition filed
against any Travis Obligor unless such involuntary case,  proceeding or petition


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shall not have been dismissed or withdrawn within 60 days after the date of such
involuntary  filing;  or (ii)  corporate  or other  action shall be taken by any
Travis Obligor for the purpose of effectuating any of the foregoing; or

                  (F) If notice is given that the  Collateral or any part of the
Collateral,  is  subject  to  levy,  attachment,  seizure,  or  confiscation  or
uninsured loss; provided,  however,  that the deductible amount on any insurance
policy  currently  in  effect  on the  Collateral  shall  not be  considered  an
uninsured loss pursuant to this Subsection; or

                  (G) any Travis Obligor shall be dissolved, whether voluntarily
or  involuntarily  and such Travis Obligor has not taken all actions required to
become reinstated.


                              ARTICLE SIX. REMEDIES

         SECTION 6.1. REMEDIES UPON DEFAULT. Upon the occurrence and continuance
of any Event of Default,  and the expiration of any applicable cure period,  and
in every such event:

                  (A) notwithstanding  anything in the Documents,  each Creditor
may, in its sole and arbitrary discretion, declare the principal of and interest
on their respective Obligations, and all other amounts owed under the Documents,
to be forthwith due and payable without  presentment,  demand,  protest or other
notice of any kind, all of which are hereby expressly waived; and

                  (B) Agent may, in its sole and arbitrary  discretion,  without
presentment,  demand,  protest  or other  notice of any  kind,  all of which are
hereby  expressly  waived,  exercise all of the remedies of a secured  party and
mortgage holder under  applicable law,  including,  but not limited to, the UCC,
and all of its rights and remedies under the Documents; and

                  (C) Agent may require Debtor to make the records pertaining to
the Collateral  available to the Agent at a place  designated by the Agent which
is reasonably  convenient or may take repossession of the records  pertaining to
the  Collateral  without the use of any  judicial  process and without any prior
notice thereof to Debtor; and

                  (D) Except as  otherwise  provided  by law,  Agent may, at its
option, and in its sole and arbitrary discretion,  sell the Collateral at public
or private  sale upon such terms and  conditions  as Agent may  reasonably  deem
proper,  and Agent may purchase the  Collateral at any such sale,  and apply the
net proceeds,  after deducting all costs,  expenses and attorneys' fees incurred
at any time in the collection of the  indebtedness of Debtor to the Agent and in
the protection and sale of the Collateral,  to the payment of said indebtedness,
returning  the  remaining  proceeds,  if any, to Debtor,  with Debtor  remaining
liable for any amount remaining unpaid after such application; and

                  (E) Debtor  shall,  upon the  request of the Agent,  forthwith
upon receipt,  transmit and deliver to the Agent in the form received, all cash,
checks,  drafts  and  other  instruments  for the  payment  of  money  (properly
endorsed,  where  required,  so that such items may be collected by Agent) which
may be  received  by  Debtor  at any  time  in full or  partial  payment  of any
Collateral.  Debtor shall not  commingle any such items which may be so received
by Debtor with any other of its funds or property  but shall hold them  separate
and apart  from  their own funds or  property  and in trust for the Agent  until
delivery is made to Agent.

         SECTION  6.2.  ATTORNEY-IN-FACT.  Upon the  occurrence  and  during the
continuation  of an Event  of  Default,  Debtor  hereby  appoints  Agent as such
Person's attorney-in-fact,  with full authority in such Person's place and stead
and in such Person's  name or  otherwise,  from time to time in Agent's sole and
arbitrary  discretion,  to take any action and to execute any  instrument  which
Agent  may deem  necessary  or  advisable  to  accomplish  the  purpose  of this
Agreement.

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         SECTION 6.3.  REMEDIES ARE SEVERABLE  AND  CUMULATIVE.  All  provisions
contained  herein  pertaining  to any  remedy  of the  Agent  shall  be and  are
severable  and  cumulative  and in  addition  to all other  rights and  remedies
available  in the  Documents,  at law and in  equity,  any  one or  more  may be
exercised simultaneously or successively.  Any notification required pursuant to
this Article or under  applicable  law shall be reasonably and properly given to
Debtor at the  address  and by any of the  methods of giving  such notice as set
forth in  Section  7.3 of this  Agreement,  at least 10 days  before  taking any
action.


                          ARTICLE SEVEN. MISCELLANEOUS

         SECTION 7.1. NO WAIVER;  MODIFICATIONS IN WRITING.  No failure or delay
on the part of Agent in exercising  any right,  power or remedy  pursuant to the
Related  Documents  shall operate as a waiver  thereof,  nor shall any single or
partial  exercise  of any such  right,  power or  remedy  preclude  any other or
further exercise thereof,  or the exercise of any other right,  power or remedy.
No amendment,  modification,  supplement, termination or waiver of any provision
of the Related  Documents,  nor any consent by Agent to any  departure by Debtor
therefrom,  shall be effective unless the same shall be in writing and signed by
Agent.  Any waiver of any provision of the Documents and any consent by Agent to
any departure by Debtor from the terms of any provision of the Related Documents
shall be effective  only in the specific  instance and for the specific  purpose
for which  given.  No notice  to or demand on Debtor in any case  shall  entitle
Debtor  to  any  other  or  further   notice  or  demand  in  similar  or  other
circumstances.

         SECTION  7.2.   SET-OFF.   Agent  shall  have  the  right  to  set-off,
appropriate and apply toward payment of any of the Liabilities, in such order of
application  as Agent  may from  time to time and at any time  elect,  any cash,
credit, deposits, accounts, securities and any other property of Debtor which is
in transit to or in the  possession,  custody or control of Agent, or any agent,
bailee, or Affiliate of Agent. Debtor hereby grants to Agent a security interest
in all such property.

         SECTION 7.3. NOTICES, ETC. All notices, demands, instructions and other
communications  required  or  permitted  to be given to or made  upon any  party
hereto shall be in writing personally  delivered or sent by overnight courier or
by  facsimile  machine,  and shall be deemed  to be given for  purposes  of this
Agreement on the day that such writing is delivered or sent by facsimile machine
or one (1) days after such notice is sent by  overnight  courier to the intended
recipient  thereof in accordance with the provisions of this Section 7.3. Unless
otherwise  specified  in a  notice  sent or  delivered  in  accordance  with the
foregoing  provisions of this Section 7.3 of this Agreement,  notices,  demands,
instructions and other  communications in writing shall be given to or made upon
the respective parties hereto at their respective  addresses  indicated for such
party below:

         If to the Debtor:                Travis Boats & Motors, Inc.
                                          12116 Jekel Circle
                                          Suite 102
                                          Austin, Texas 78727
                                          Attention:  Mark T. Walton
                                          Phone:  (___) __________
                                          Fax No.:  (___) ________

         With copies to:                  Jenkens & Gilchrist
                                          22001 American Center
                                          6000 Congress Avenue
                                          Austin, Texas 78701
                                          Attention:  J. Rowland Cook, Esq.
                                          Phone:  (512) __________
                                          Fax No:  (512) 404-3520

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         If to the Agent:                 Transamerica Commercial Finance
                                           Corporation
                                          5595 Trillium Boulevard
                                          Hoffman Estates, Illinois 60192
                                          Attn:  Michelle Rice
                                          Phone:  (847) 747-7589
                                          Fax No.:  (847) 747-7436

         With a copy to:                  Steven Bright, Esq.
                                          Levenfeld Pearlstein
                                          211 Waukegan Road
                                          Suite 300
                                          Northfield, Illinois 60093
                                          Phone:  (847) 441-7676
                                          Fax:  (847) 441-9976

         SECTION  7.4.  COSTS,  EXPENSES  AND  TAXES.  Debtor  agrees to pay all
out-of-pocket fees and expenses of Agent and the Creditors  (including,  but not
limited to, UCC Filing and Search Fees and fees and expenses of outside  counsel
to Agent and the Creditors and paralegals) in connection  with the  preparation,
administration  and enforcement of this Agreement,  any of the Related Documents
and the Obligations.  In addition,  Debtor shall pay any and all stamp, transfer
and other  taxes  payable or  determined  to be payable in  connection  with the
execution  and delivery of the  Documents  and agrees to hold the Agent and each
Creditor  harmless from and against any and all  liabilities  with respect to or
resulting from any delay in paying or omission to pay such taxes. If any suit or
proceeding arising from any of the foregoing is brought against Agent and/or any
Creditor, Debtor, to the extent and in the manner directed by Agent, will resist
and defend such suit or proceeding or cause the same to be resisted and defended
by counsel  approved by Agent. If Debtor shall fail to do any act or thing which
it has covenanted to do under this Agreement or any  representation  or warranty
on the part of Debtor contained in this Agreement shall be breached,  Agent may,
in its sole and arbitrary  discretion,  after 10 days written  notice is sent to
Debtor,  do the same or cause it to be done or remedy any such  breach,  and may
expend its funds for such  purpose;  and any and all  amounts so expended by the
Agent shall be  repayable  to the Agent by Debtor  immediately  upon the Agent's
demand therefor,  with interest at a rate equal to the highest interest rate set
forth in the  Documents  in effect  from time to time during the period from and
including the date funds are so expended by Agent to the date of repayment,  and
any  such  amounts  due  and  owing  Agent  shall  be  deemed  to be part of the
Obligations  secured  hereunder.  The  obligations  of Debtor under this Section
shall survive the  termination  of this Agreement and the discharge of the other
obligations of Debtor under the Documents.

         SECTION 7.5.  COMPUTATIONS.  Where the character or amount of any asset
or liability or item of income or expense is required to be  determined,  or any
consolidation  or other  accounting  computation is required to be made, for the
purpose of this  Agreement,  such  determination  or calculation  shall,  to the
extent applicable and except as otherwise  specified in this Agreement,  be made
in accordance with generally accepted  accounting  principles applied on a basis
consistent with those at the time in effect.

         SECTION 7.6. FURTHER ASSURANCES.  Debtor agrees to do such further acts
and things  and to execute  and  deliver to Agent such  additional  assignments,
agreements, powers, documents and instruments as Agent may reasonably require or
deem advisable to carry into effect the purposes of the Related Documents, or to
confirm unto Agent its rights, powers and remedies under the Related Documents.

         SECTION 7.7. COUNTERPARTS. This Agreement may be executed in any number
of  counterparts,  each of  which  counterparts,  once  they  are  executed  and
delivered,  shall be deemed  to be an  original  and all of which  counterparts,
taken together, shall constitute but one and the same agreement.

         SECTION 7.8.  BINDING  EFFECTS;  ASSIGNMENT.  This  Agreement  shall be
binding upon,  and inure to the benefit of, Agent,  Debtor and their  respective
successors,  assigns,  representatives and heirs. Debtor shall not assign any of
its rights nor delegate any of its obligations under Documents without the prior
written  consent  of Agent and no such  consent  by Agent  shall,  in any event,
relieve Debtor of any of its obligations under the Documents.

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         SECTION  7.9.  HEADINGS.  Captions  contained  in  this  Agreement  are
inserted only as a matter of convenience  and in no way define,  limit or extend
the scope or intent of this  Agreement or any  provision of this  Agreement  and
shall not affect the construction of this Agreement.

         SECTION  7.10.  ENTIRE  AGREEMENT.  This  Agreement,  together with the
Related Documents, contains the entire agreement between the parties hereto with
respect  to  the  transactions  contemplated  herein  and  supersede  all  prior
representations,  agreements,  covenants  and  understandings,  whether  oral or
written, related to the subject matter of the Agreement.  Except as specifically
set forth in this Agreement,  Agent makes no covenants to Debtor, including, but
not limited to, any commitments to provide any financing to Debtor.  The parties
acknowledge  and agree  that the Agent is acting as agent for the  Creditors  in
accordance  with the terms and  provisions  of,  and  subject  to the powers and
authorities  granted  to  the  Agent  by the  Creditors  in,  the  Intercreditor
Agreement.

         SECTION 7.11.  GOVERNING  LAW. This  Agreement  shall be deemed to be a
contract made under the laws of the State of Illinois and for all purposes shall
be construed in accordance with the laws of the State of Illinois.

         SECTION  7.12.  SEVERABILITY  OF  PROVISIONS.  Any  provision  of  this
Agreement which is prohibited or unenforceable in any jurisdiction  shall, as to
such  jurisdiction,  be  ineffective  only to the extent of such  prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or  affecting  the  validity or  enforceability  of such  provision in any other
jurisdiction.

         SECTION  7.13.  CONFLICT.  In the event of any  conflict  between  this
Agreement and any of the other Documents,  (A) as between Debtor on the one hand
and Agent and/or  Creditors on the other hand,  the terms and provisions of this
Agreement  shall govern and control and (B) as among the Agent and the Creditors
or among the  Creditors,  the  terms  and  provisions  of this  Agreement  shall
control,  unless  solely with respect to this clause (B),  100% of the Creditors
agree in writing that another agreement, document or instrument shall control.

         SECTION  7.14.  JURISDICTION;  WAIVER.  DEBTOR  ACKNOWLEDGES  THAT THIS
AGREEMENT IS BEING SIGNED BY THE AGENT IN PARTIAL CONSIDERATION OF AGENT'S RIGHT
TO ENFORCE IN THE  JURISDICTION  STATED  BELOW THE TERMS AND  PROVISION  OF THIS
AGREEMENT AND THE DOCUMENTS.  DEBTOR  CONSENTS TO  JURISDICTION  IN THE STATE OF
ILLINOIS  AND VENUE IN ANY FEDERAL OR STATE COURT IN THE COUNTY OF COOK FOR SUCH
PURPOSES  AND WAIVES ANY AND ALL RIGHTS TO CONTEST SAID  JURISDICTION  AND VENUE
AND ANY OBJECTION THAT SAID COUNTY IS NOT  CONVENIENT.  DEBTOR WAIVES ANY RIGHTS
TO COMMENCE ANY ACTION  AGAINST AGENT IN ANY  JURISDICTION  EXCEPT THE AFORESAID
COUNTY  AND STATE.  AGENT AND DEBTOR  HEREBY  EACH  EXPRESSLY  WAIVE ANY AND ALL
RIGHTS TO A TRIAL BY JURY IN ANY ACTION,  PROCEEDING OR COUNTERCLAIM  BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY WITH RESPECT TO ANY MATTER WHATSOEVER
RELATING  TO,  ARISING  OUT OF OR IN ANY  WAY  CONNECTED  WITH  THE  LOANS,  THE
DOCUMENTS AND/OR THE TRANSACTIONS WHICH ARE THE SUBJECT OF THE DOCUMENTS.


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<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly  executed  and  delivered  at Chicago,  Illinois as of the date first above
written.


         DEBTOR:                                TRAVIS BOATS & MOTORS, INC.
         ------


                                                By:___________________________
                                                Title:________________________


         AGENT:                                 TRANSAMERICA COMMERCIAL FINANCE
                                                 COPORATION



                                                By:___________________________
                                                Title:________________________







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