AMENDMENT NO. 4 TO

                 LOAN AND SECURITY AGREEMENT

          This Amendment No. 4 to Loan and Security
Agreement (this "Amendment") is made as of the 2nd day of
July, 1998 by and among each of the undersigned and amends
that certain Loan and Security Agreement, dated as of
November 27, 1996 (as amended by Amendment No. 1 dated as of
February 28, 1997, Amendment No. 2 dated as of June 27,
1997, Amendment No. 3 dated as of November 1, 1997 and by
this Amendment, the "Loan Agreement"), among the financial
institutions listed on the signature pages thereof as
lenders (such financial institutions, together with their
respective successors and assigns, are referred to
hereinafter each individually as a "Lender" and collectively
as the "Lenders"), BankAmerica Business Credit, Inc., a
Delaware corporation, as agent for the Lenders (in its
capacity as agent, the "Agent"), NationsBank of Texas, N.A.,
as the L/C Issuer and as co-syndication agent for the
Lenders, Credit Agricole Indosuez, as co-agent for the
Lenders, Consolidated Freightways Corporation of Delaware, a
Delaware corporation, (the "Borrower"), Consolidated
Freightways Corporation (the "Parent"), Leland James Service
Corporation ("Leland") and Redwood Systems, Inc.
("Redwood").  Capitalized terms used herein without
definition have the meanings assigned thereto in the Loan
Agreement.

                          RECITALS

     A.  The Borrower has requested that certain provisions
of the Loan Agreement be amended as more fully described
below.

     B.  On the terms and subject to the conditions set
forth in this Amendment, the parties to the Loan Agreement
have agreed to amendments to the Loan Agreement, including,
without limitation, (i) a reduction of the Total Facility
from $225,000,000 to $150,000,000, (ii) a reduction of the
interest rate payable on Revolving Loans, (iii) a reduction
of the Letter of Credit Fee, (iii) a reduction of the Unused
Line Fee, (iv) elimination of the early termination fee, (v)
release of all Revenue Equipment from the Agent's Liens,
(vi) modifications to the requirement of weekly delivery of
Borrowing Base Certificates, (vii) modifications to various
financial covenants, and (viii) various modifications
relating to or corresponding to the foregoing, all as set
forth more fully below.

                          AGREEMENT

     In consideration of the foregoing, and for good and
valuable consideration, the receipt of which is hereby
acknowledged, the undersigned hereby agree as follows:

                          ARTICLE 1
          AMENDMENTS TO LOAN AND SECURITY AGREEMENT

     1.1    Amendments to Section 1.1 - Definitions.  Each
of the following definitions set forth in Section 1.1 of the
Loan Agreement is hereby amended and restated to read in its
entirety as follows:

          "`Availability' means at any time the lesser of:

              (a) the Total Facility or

              (b) the Net Amount of Eligible Accounts
     multiplied by the Account Advance Rate;

     Less, in the case of each of (a) and (b) above, the sum
     of (without duplication of amounts which have become
     ineligible):

                (A) the Aggregate Revolver Outstandings;

                (B) following the occurrence and during
     the continuance of any Event of Default, reserves for
     accrued interest on the Obligations;

                (C) the Environmental Compliance Reserve;

                (D) ACH Settlement Risk Reserve; and

                (E) all other reserves which the Agent
     deems necessary or desirable in the exercise of its
     reasonable credit judgment to maintain with respect to
     the Borrower's account, including, without limitation,
     reserves for any amounts which the Agent or any Lender
     may be obligated to pay in the future for the account
     of the Borrower."

          "`Borrowing Base Certificate' means the
     certificate by a Responsible Officer of the Borrower,
     substantially in the form of Exhibit A (or another form
     acceptable to the Agent) which (a) is required to be
     delivered pursuant to Section 6.7 (it being understood
     and agreed that if such certificate is required to be
     delivered on a weekly basis, information included
     therein with respect to the Accounts will be updated
     weekly, and that other information included therein
     with respect to Accounts of the type described in
     Accounts Dilution Rate will be updated as of the end of
     each month), (b) sets forth the calculation of the
     Availability, including a calculation of each component
     thereof, and is dated, as of the close of business on
     the last Business Day of the month (or the last
     Business Day of the week, if applicable) covered by the
     certificate, and (c) if required to be delivered weekly
     pursuant to Section 6.7, is to be delivered prior to
     the end of the third Business Day of the following
     week; all in such detail as shall be reasonably
     satisfactory to the Agent.  All calculations of
     Availability in connection with the preparation of any
     Borrowing Base Certificate shall originally be made by
     the Borrower and certified to the Agent; provided, that
     the Agent shall have the right to review and adjust, in
     the exercise of its reasonable credit judgment, any
     such calculation (1) to reflect its reasonable estimate
     of declines in value of any of the Collateral described
     therein, and (2) to the extent that such calculation is
     not in accordance with this Agreement."

          "`Commitment' means, at any time with respect to a
     Lender, the principal amount set forth beside such
     Lender's name under the heading "Commitment" on the
     signature pages of Amendment No. 4 to this Agreement
     dated as of July 2, 1998 or on the signature page of
     the Assignment and Acceptance pursuant to which such
     Lender became a Lender hereunder in accordance with the
     provisions of Section 13.3, as such Commitment may be
     adjusted from time to time in accordance with the
     provisions of Section 13.3 or Section 2.1(b) and
     "Commitments" means, collectively, the aggregate amount
     of the commitments of all of the Lenders."

          "`Excluded Property' means Real Estate (and any
     fixtures and intangible property (such as permits,
     maintenance contracts, blueprints and designs) which
     are in each case directly and specifically related to
     the particular parcel of Real Estate if covered by a
     mortgage of such Real Estate), the Revenue Equipment
     and stock of Subsidiaries of the Borrower existing as
     of the Closing Date other than the 65% of the stock of
     Canadian Freightways Limited pledged to the Agent for
     the benefit of the Lenders pursuant to the Stock Pledge
     Agreement."

          "`Triggering Event' means the occurrence of any
     one of the following events:  (a) an Event of Default,
     (b) Availability is $25,000,000 or less, (c) the
     average daily Dollar amount of Revolving Loans
     outstanding for the immediately preceding thirty (30)
     day period exceeds $20,000,000, or (d) the aggregate
     Dollar amount of Revolving Loans outstanding on any
     date exceeds $25,000,000."

    1.2    Deletion of Definitions.  Each of the following
definitions set forth in Section 1.1 of the Loan Agreement
is hereby deleted:

          "Applicable Margin"
          "Appraised Value of Revenue Equipment"
          "Eligible Revenue Equipment"
          "Eligible Revenue Equipment Value"
          "Fixed Charge Coverage Ratio"
          "Maximum Revolver Equipment Advance"
          "Revenue Equipment Advance Rate"

    1.3    Amendment to Section 2.1 - Credit Facility.
Section 2.1 of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "2.1   Credit Facility.  Subject to all of the
     terms and conditions of this Agreement, the Lenders
     severally agree to make available a total credit
     facility of up to $150,000,000 (the "Total Facility")
     for the Borrower's use from time to time during the
     term of this Agreement.  The Total Facility shall be
     comprised of a revolving line of credit consisting of
     revolving loans and letters of credit, as described in
     Sections 2.2 and 2.3."

     1.4    Amendment to Section 3.1(a) - Interest Rate on
Revolving Loans.  The fourth sentence of Section 3.1(a) of
the Loan Agreement is hereby amended and restated to read in
its entirety as follows:

          "Except as otherwise provided herein, the
     outstanding Obligations shall bear interest as follows:
     (i) for all Base Rate Revolving Loans and other
     Obligations (other than LIBOR Revolving Loans) at a
     fluctuating per annum rate equal to the Base Rate minus
     one-quarter of one percent (0.25%), and (ii) for all
     LIBOR Revolving Loans at a per annum rate equal to the
     LIBOR Rate plus seven-eighths of one percent (0.875%)."

    1.5    Amendment to Section 3.5 - Unused Line Fee.
The first sentence of Section 3.5 of the Loan Agreement is
hereby amended and restated to read in its entirety as
follows:

          "3.5 Unused Line Fee.  Until the Obligations have
     been paid in full and the Agreement terminated, the
     Borrower agrees to pay, on the first day of each month
     and on the Termination Date, to the Agent, for the
     ratable account of the Lenders, an unused line fee (the
     "Unused Line Fee") equal to one-quarter of one percent
     (0.25%) per annum on the average daily amount by which
     the Total Facility exceeded the sum of the average
     daily outstanding amount of Revolving Loans and the
     undrawn face amount of all outstanding Letters of
     Credit, during the immediately preceding month or
     shorter period if calculated on the Termination Date."

    1.6    Amendment to Section 3.6 - Letter of Credit
Fee.  The first sentence of Section 3.6 of the Loan
Agreement is hereby amended and restated to read in its
entirety as follows:

          "3.6 Letter of Credit Fee.  The Borrower agrees to
     pay to the Agent, for the ratable account of the
     Lenders, for each Letter of Credit, a fee (the "Letter
     of Credit Fee") equal to seven-eighths of one percent
     (0.875%) per annum of the undrawn face amount of each
     Letter of Credit issued for the Borrower's account at
     the Borrower's request, plus all out-of-pocket costs,
     fees and expenses incurred by the Agent in connection
     with the application for, issuance of, or amendment to
     any Letter of Credit."

     1.7    Amendment to Section 4.2 - Termination of
Facility.  Section 4.2 of the Loan Agreement is hereby
amended and restated to read in its entirety as follows:

         "4.2   Termination of Facility.  The Borrower may
     terminate this Agreement upon at least thirty (30)
     Business Days' notice to the Agent and the Lenders,
     upon (a) the payment in full of all outstanding
     Revolving Loans, together with accrued interest
     thereon, and the cancellation of all outstanding
     Letters of Credit, (b) the payment in full in cash of
     all other Obligations together with accrued interest
     thereon, and (c) with respect to any LIBOR Revolving
     Loans prepaid in connection with such termination prior
     to the expiration date of the Interest Period
     applicable thereto, the payment of the amounts
     described in Section 5.5."

     1.8    Amendment to Section 6.2(b) - Perfection and
Protection of Security Interests - Revenue Equipment.
Section 6.2(b) of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "(b) Intentionally Omitted."

     1.9    Amendment to Section 6.5 - Appraisals.
Section 6.5 of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "6.5 Intentionally Omitted."

     1.10 Amendment to Section 6.7 - Collateral Reporting.
Section 6.7 of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "6.7 Collateral Reporting.  The Borrower shall
     provide the Agent with the following documents at the
     following times in form satisfactory to the Agent:

              (a)    if the daily average Availability for
     the preceding month is $25,000,000 or less or if a
     Default or Event of Default arising under Section 9.21,
     Section 9.22 or Section 9.23 has occurred and is
     continuing, on a weekly basis, a Borrowing Base
     Certificate and, at the same time, such supporting
     documentation as the Agent may request;

              (b)    on a monthly basis, as of the end of
     each month, and received by the end of the 20th day of
     the following month, a Borrowing Base Certificate and,
     at the same time, such supporting documentation as the
     Agent may request;

              (c)    on a monthly basis, as of the end of
     each month, and received by the Agent no later than the
     20th day of the following month, an aging of the
     Borrower's Accounts, together with a reconciliation to
     the Borrower's general ledger, and the Borrower's
     computation of ineligible Accounts and reserves against
     Availability, certified as accurate and correct by a
     Responsible Officer of the Borrower;

              (d)    on a monthly basis, as of the end of
     each month, and received by the Agent no later than the
     20th day of the following month, an aging or open item
     listing of all Borrower's accounts payable to the
     fifteen Account Debtors with the highest amount of
     Accounts owed to the Borrower; provided that such
     accounts payable information shall not be required with
     respect to the Account Debtors to which the Borrower is
     indebted in an amount not in excess of $50,000;

              (e)    such other reports as to the
     Collateral of the Borrower as the Agent shall
     reasonably request from time to time; and

              (f)    with the delivery of each of the
     foregoing, a certificate of an officer of the Borrower
     certifying as to the accuracy and completeness of the
     foregoing.

          If any of the Borrower's records or reports of the
     Collateral are prepared by an accounting service or
     other agent, the Borrower hereby authorizes such
     service or agent to deliver such records, reports, and
     related documents to the Agent, for distribution to the
     Lenders.  Any report required to be delivered pursuant
     to this Section 6.7 on a day that is not a Business Day
     may be delivered on the next Business Day after such
     report was due."

     1.11 Amendment to Section 6.10 - Equipment.  Section
6.10 of the Loan Agreement is hereby amended and restated to
read in its entirety as follows:

          "6.10  Equipment.

              (a)    The Borrower represents and warrants
     to the Agent and the Lenders and agrees with the Agent
     and the Lenders that all of the Equipment owned by the
     Borrower is and will be used or held for use in the
     Borrower's business, and is and will be fit for such
     purposes.  The Borrower shall keep and maintain its
     Equipment in good operating condition and repair
     (ordinary wear and tear excepted) and shall make all
     necessary replacements thereof.

              (b)    The Borrower shall promptly inform
     the Agent of any material additions to or deletions
     from the Equipment (other than Excluded Property).  The
     Borrower will not, without the Agent's prior written
     consent, alter or remove any identifying manufacturers
     serial number, vehicle identification number or similar
     symbol or number on any of the Borrower's Equipment
     consisting of Collateral.

              (c)    The Borrower shall not, without the
     Agent's prior written consent, sell, lease as a lessor,
     or otherwise dispose of any of the Borrower's Equipment
     (other than Excluded Revenue Equipment); provided,
     however, that the Borrower may dispose of Included
     Revenue Equipment as permitted by Section 6.10(d), and
     may dispose of obsolete or unusable Equipment other
     than Included Revenue Equipment which is obsolete or
     unusable and has a book value no greater than
     $2,000,000 in the aggregate in any Fiscal Year, or
     $6,000,000 in the aggregate during the term of this
     Agreement, without the Agent's consent.

              (d)    The Borrower shall not, without the
     Agent's prior written consent, sell, lease as a lessor
     or otherwise dispose of any Included Revenue Equipment;
     provided, however, that so long as no Event of Default
     has occurred and is continuing, the Borrower may
     dispose of Included Revenue Equipment having an orderly
     liquidation value no greater than $4,000,000 in the
     aggregate in any month and no greater than $16,000,000
     in the aggregate in any Fiscal Year, if such
     dispositions are made in the ordinary course of the
     Borrower's business and consistent with the Borrower's
     past practice."

     1.12 Amendment to Section 9.21- Capital Expenditures.
Section 9.21 of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "9.21  Capital Expenditures.  None of the Loan
     Parties shall make or incur any Capital Expenditure if,
     after giving effect thereto, the aggregate amount of
     all Capital Expenditures (net of proceeds from sales of
     fixed assets) by the Loan Parties on a consolidated
     basis would exceed $30,000,000 for Fiscal Year 1997 or
     $100,000,000 for each Fiscal Year thereafter until the
     Stated Termination Date; provided, however, that up to
     $15,000,000 of unused permitted Capital Expenditures in
     a given Fiscal Year may be carried over to the
     following Fiscal Year."

     1.13 Amendment to Section 9.22 - Adjusted Net Earnings.
Section 9.22 of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

          "9.22  Adjusted Net Earnings.  The Parent, the
     Borrower and their Subsidiaries on a consolidated basis
     will not permit the Adjusted Net Earnings for the
     fiscal period specified below, measured at the end of
     each fiscal quarter on a Fiscal Year to date basis for
     1997 and on a rolling four quarter basis thereafter, to
     be less than the amount set forth below opposite such
     fiscal quarter:

                Period                   Amount

              March 1997               $5,000,000

               June 1997               $15,000,000

            September 1997             $27,000,000

             December 1997             $40,000,000

              March 1998               $43,000,000

               June 1998               $50,000,000

            September 1998             $52,000,000

             December 1998             $55,000,000

              March 1999               $54,000,000

               June 1999               $56,000,000

            September 1999             $58,000,000

           December 1999 and           $60,000,000
              thereafter

     1.14 Amendment to Section 9.23 - Adjusted Tangible Net
Worth.  Section 9.23 of the Loan Agreement is hereby amended
and restated to read in its entirety as follows:

          "9.23  Adjusted Tangible Net Worth.  The Parent,
     the Borrower and their Subsidiaries on a consolidated
     basis will not permit Adjusted Tangible Net Worth
     calculated without regard to the increase, not to
     exceed $10,000,000 (after giving effect to income
     taxes), in the worker's compensation accrual reserve
     over and above the level of such reserve reflected in
     the Latest Projections dated September 9, 1996 and
     delivered to the Agent, to be less than the following
     amounts:

                Period                   Amount

             December 1996            $210,000,000

          March 1997 through          $195,000,000
             December 1997

              March 1998              $190,000,000

           June 1998 through          $220,000,000
            September 1998

           December 1998 and          $225,000,000
              thereafter

     1.15 Amendment to Section 9.24 - Fixed Charge Coverage
Ratio.  Section 9.24 of the Loan Agreement is hereby amended
and restated to read in its entirety as follows:

          "9.24  Intentionally Omitted."

     1.16 Amendment to Section 13.2(h) - Amendments and
Waivers.  Section 13.2(h) of the Loan Agreement (which
relates to definitions which cannot be amended without the
consent of each Lender) is hereby amended and restated to
delete references to definitions which have been deleted,
and shall read in its entirety as follows:

          "(h) increase the "Account Advance Rate," "Maximum
     Revolver Amount," "Total Facility" or "Unused Letter of
     Credit Facility"."

     1.17 Amendment of Borrowing Base Certificate.  Exhibit
A of the Loan Agreement is hereby amended and restated and
shall read in its entirety as Exhibit A attached hereto.

                          ARTICLE 2
               REPRESENTATIONS AND WARRANTIES

     Each Loan Party warrants and represents to the Agent
and the Lenders that:

     2.1    Representations and Warranties True and
Correct.  The representations and warranties contained in
the Agreement and the other Loan Documents are correct in
all material respects on and as of the date hereof except to
the extent the Agent and the Lenders have been notified by
the Borrower that any representation or warranty is not
correct and the Majority Lenders have explicitly waived in
writing compliance with such representation or warranty; and
except with respect to Schedules 8.3, 8.5, 8.9, 8.15, 8.17,
8.18, 8.29 and 8.32 to the Loan Agreement to the extent that
the Borrower has submitted to the Agent, the L/C Issuer and
each Lender an update thereto.

     2.2    No Default or Event of Default.  No event has
occurred and is continuing which constitutes a Default or an
Event of Default.

                          ARTICLE 3
              CONSENT TO RELEASE OF COLLATERAL

    3.1    Consent to Release of Revenue Equipment
Collateral.  By its signature below, each Lender consents to
the release of all Collateral which consists of Revenue
Equipment and authorizes and directs the Agent to release
such Collateral and take all actions necessary in connection
therewith and reasonably incidental thereto.

                          ARTICLE 4
                        MISCELLANEOUS

     4.1    Effective Date.  This Amendment shall be
effective as of the date when the Agent has received a duly
executed counterpart of this Amendment from each of the
parties to the Loan Agreement; provided that the changes to
the pricing terms contained in Sections 1.3, 1.4, 1.5 and
1.6 of this Amendment shall be effective on July 1, 1998.

     4.2    Governing Law.  This Amendment shall be
interpreted and the rights and liabilities of the parties
hereto determined in accordance with the internal laws (as
opposed to the conflict of laws provisions) of the State of
California.

     4.3    Counterparts.  This Amendment may be executed
in any number of counterparts, and by the Agent, the L/C
Issuer, each Lender, the Borrower, Parent, Leland and
Redwood in separate counterparts, each of which shall be an
original, but all of which shall together constitute one and
the same agreement.

          IN WITNESS WHEREOF, the parties have entered into
this Amendment on the date first above written.

                                "BORROWER"

                                Consolidated Freightways
                                Corporation of Delaware, a
                                Delaware corporation


                                By: /s/David F. Morrison
                                Name: David F. Morrison
                                Title: Executive Vice President
                                and CFO



                                "PARENT"

                                Consolidated Freightways
                                Corporation, a Delaware
                                corporation


                                By: /s/David F. Morrison
                                Name: David F. Morrison
                                Title: Executive Vice President
                                and CFO



                                "LELAND"

                                Leland James Service
                                Corporation, a Delaware
                                corporation


                                By: /s/David F. Morrison
                                Name: David F. Morrison
                                Title: Executive Vice President
                                and CFO



                                "REDWOOD"

                                Redwood Systems, Inc., a Delaware
                                corporation


                                By: /s/David F. Morrison
                                Name: David F. Morrison
                                Title: Executive Vice President
                                and CFO



                                "AGENT"

                                BankAmerica Business Credit,
                                Inc., as the Agent


                                By: /s/Gary P. Riley
                                Name: Gary P. Riley
                                Title: Vice President



                                "LENDERS"

Commitment:  $63,333,333.34     BankAmerica Business Credit,
                                Inc., as a Lender


                                By: /s/Gary P. Riley
                                Name: Gary P. Riley
                                Title: Vice President



Commitment:  $23,333,333.33     NationsBank of Texas, N.A., as a
                                Lender


                                By: /s/Stacy Wills
                                Name: Stacy Wills
                                Title: Assistant Vice President



Commitment:  $13,333,333.33     Credit Agricole Indosuez, as a
                                Lender


                                By: /s/Marcy Lyons
                                Name: Marcy Lyons
                                Title: First Vice President



Commitment:  $23,333,333.33     Transamerica Business Credit
                                Corporation, as a Lender


                                By: /s/Robert L Heinz
                                Name: Robert L. Heinz
                                Title: Senior Vice President



Commitment:  $16,666,666.67     Congress Financial Corporation
                                (Western), as a Lender


                                By: /s/Gregg Corey
                                Name: Gregg Corey
                                Title: Vice President



Commitment:  $10,000,000.00     PNC Bank, National Association,
                                as a Lender


                                By:/s/ Michael Shover
                                Name: Michael Shover
                                Title: Bank Officer



                                "L/C ISSUER"

                                NationsBank of Texas, N.A., as
                                L/C Issuer


                                By: /s/Stacy Wills
                                Name: Stacy Wills
                                Title:  Assistant Vice President