[LOGO] MERRILL LYNCH       WCMA(R) REDUCING REVOLVER-LOAN AND SECURITY AGREEMENT
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WCMA REDUCING  REVOLVER(SM)  LOAN AND SECURITY  AGREEMENT NO.  885-07895  ("Loan
Agreement")  dated as of October 18, 2002,  between SEL-LEB  MARKETING,  INC., a
corporation  organized  and  existing  under  the laws of the  State of New York
having  its  principal   office  at  495  River  Street,   Paterson,   NJ  07524
("Customer"),  and MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC., a corporation
organized  and  existing  under the laws of the  State of  Delaware  having  its
principal office at 222 North LaSalle Street, Chicago, IL 60601 ("MLBFS").

Pursuant to that certain WORKING  CAPITAL  MANAGEMENT(R)  ACCOUNT  AGREEMENT NO.
885-07895 and the accompanying  Program Description (as the same may be, or have
been, amended, modified or supplemented,  the "WCMA Agreement") between Customer
and  MLBFS'  affiliate,  MERRILL  LYNCH,  PIERCE,  FENNER  & SMITH  INCORPORATED
("MLPF&S"),  Customer  opened,  or shall prior to the  Activation  Date open,  a
Working Capital  Management Account pursuant to the "WCMA Service" and the "WCMA
Program" described in the WCMA Agreement and any documents incorporated therein.
The WCMA  Agreement  is by this  reference  incorporated  as a part  hereof.  In
conjunction  therewith,  Customer  has  requested  that  MLBFS  make a  reducing
revolving credit facility available to Customer ("the Reducing Revolver") in the
amount and upon the terms  hereafter  specified,  and,  subject to the terms and
conditions  hereafter set forth, MLBFS has agreed to provide a Reducing Revolver
for Customer.

Accordingly, and in consideration of the premises and of the mutual covenants of
the parties hereto, Customer and MLBFS hereby agree as follows:

                             ARTICLE I. DEFINITIONS

1.1  SPECIFIC  TERMS.  In  addition  to terms  defined  elsewhere  in this  Loan
Agreement,  when used  herein  the  following  terms  shall  have the  following
meanings:

"Activation Date" shall mean the date upon which MLBFS shall cause the WCMA Line
of Credit to be fully  activated  under MLPF&S'  computer  system as part of the
WCMA Program.

"Bankruptcy  Event" shall mean any of the following:  (i) a proceeding under any
bankruptcy,  reorganization,  arrangement,  insolvency,  readjustment  of  debt,
liquidation, winding up or receivership law or statute shall be commenced, filed
or consented to by any Credit Party; or (ii) any such proceeding  shall be filed
against any Credit Party and shall not be  dismissed  or withdrawn  within sixty
(60)  days  after  filing;  or (iii)  any  Credit  Party  shall  make a  general
assignment  for the  benefit  of  creditors;  or (iv)  any  Credit  Party  shall
generally fail to pay or admit in writing its inability to pay its debts as they
become  due;  or (v) any  Credit  Party  shall  be  adjudicated  a  bankrupt  or
insolvent;  or (vi) any Credit  Party shall take  advantage  of any other law or
procedure  for the relief of debtors or shall take any action for the purpose of
or with a view  towards  effecting  any of the  foregoing;  or (vii) a receiver,
trustee, custodian, fiscal agent or similar official for any Credit Party or for
any  substantial  part of any of their  respective  property or assets  shall be
sought by such Credit Party or appointed.

"Business Day" shall mean any day other than Saturday,  Sunday,  federal holiday
or other day on which the New York Stock Exchange is regularly closed.

"Business Guarantor" shall mean every Guarantor that is not a natural person.

"Certificate  of  Compliance"  shall mean,  as  applicable,  that duly  executed
certificate,  substantially  the same form as Exhibit B  attached  hereto to the
extent such certificate shall be applicable,  of the president,  chief financial
officer or chief executive officer of Customer, certifying as to the matters set
forth in such certificate.

"Closing Date" shall mean the date upon which all conditions precedent to MLBFS'
obligation to make the Loan shall have been met to the satisfaction of MLBFS.

"Collateral" shall mean all Accounts, Chattel Paper, Contract Rights, Inventory,
Equipment,   Fixtures,   General  Intangibles,   Deposit  Accounts,   Documents,
Instruments,  Investment Property,  and Financial Assets of Customer,  howsoever
arising,  whether now owned or existing or  hereafter  acquired or arising,  and
wherever located;  together with all parts thereof  (including spare parts), all
accessories and accessions  thereto,  all books and records (including  computer
records)  directly related thereto,  all proceeds  thereof  (including,  without
limitation,  proceeds in the form of Accounts and insurance  proceeds),  and the
additional collateral described in Section 4.6 (b) hereof.

"Commitment Expiration Dare" shall mean November 18, 2002.

"Commitment  Fee" shall mean a fee of $7,500.00 due to MLBFS in connection  with
this Loan Agreement.

"Credit Party" and "Credit  Parties" shall mean,  individually or  collectively,
the Customer, all Guarantors and all Pledgors.

"Default"  shall mean  either an "Event of  Default"  as defined in Section  4.5
hereof,  or an event which with the giving of notice,  passage of time, or both,
would constitute such an Event of Default.
<PAGE>


"Default  Rate" shall mean an annual  interest  rate equal to the lesser of: (i)
two percentage  points over the Interest Rate; or (ii) the highest interest rate
allowed by applicable law.

"Event of Loss" shall mean the  occurrence  whereby any tangible  Collateral  is
damaged beyond repair, lost, totally destroyed or confiscated.

"Excess  Interest"  shall mean any  amount or rate of  interest  (including  the
Default Rate and, to the extent that they may be deemed to constitute  interest,
any prepayment fees, late charges and other fees and charges)  payable,  charged
or received  in  connection  with any of the Loan  Documents  which  exceeds the
maximum amount or rate of interest permitted under applicable law.

"GAAP" shall mean the generally accepted accounting  principles in effect in the
United States of America from time to time.

"General  Funding  Conditions"  shall  mean  each  of the  following  conditions
precedent to the  obligation  of MLBFS to make the Loan or any  Subsequent  WCMA
Loan hereunder:  (i) Customer shall have validly  subscribed to and continued to
maintain  the WCMA  Account  with  MLPF&S,  and the WCMA  Account  shall then be
reflected as an active  "commercial" WCMA Account (i.e., one with line of credit
capabilities)  on  MLPF&S'  WCMA  computer  system;  (ii) no Default or Event of
Default shall have occurred and be continuing or would result from the making of
the Loan or such  Subsequent  WCMA Loan by  MLBFS;  (iii)  there  shall not have
occurred  and be  continuing  any  material  adverse  change in the  business or
financial condition of any Credit Party; (iv) all representations and warranties
of all of the Credit Parties  herein or in any of the Loan Documents  shall then
be true and correct in all material respects; (v) MLBFS shall have received this
Loan Agreement and all of the other Loan  Documents,  duly executed and filed or
recorded  where  applicable,  all  of  which  shall  be in  form  and  substance
satisfactory  to MLBFS;  (vi) the  Commitment  Fee shall have been paid in full;
(vii)  MLBFS shall have  received,  as and to the extent  applicable,  copies of
invoices,  bills of sale, loan payoff letters and/or other evidence satisfactory
to it that the proceeds of the Loan will satisfy the Loan Purpose;  (viii) MLBFS
shall have  received  evidence  satisfactory  to it as to the  ownership  of the
Collateral  and the  perfection  and  priority  of  MLBFS'  liens  and  security
interests  thereon,  as well as the ownership of and the perfection and priority
of  MLBFS'  liens  and  security  interests  on any  other  collateral  for  the
Obligations  furnished  pursuant to any of the Loan Documents;  (ix) MLBFS shall
have received evidence satisfactory to it of the insurance required hereby or by
any of the Loan Documents;  and (x) any additional  conditions  specified in the
"WCMA Reducing  Revolver Loan Approval" letter executed by MLBFS with respect to
the transactions  contemplated hereby shall have been met to the satisfaction of
MLBFS.

"Guarantor"  shall mean each Person  obligated under a guaranty,  endorsement or
other undertaking by which such Person  guarantees or assumes  responsibility in
any capacity for the payment or performance of any of the Obligations.

"Individual Guarantor" shall mean each Guarantor who is a natural person.

"Interest  Due Date" shall mean the first  Business Day of each  calendar  month
during the term hereof.

"Interest  Rate"  shall mean a  variable  per annum rate equal to the sum of (i)
2.75% per annum,  and (ii) the interest rate from time to time  published in the
"Money  Rates"  section  of THE WALL  STREET  JOURNAL  as the  one-month  London
Interbank Offered Rate (the "One-Month LIBOR").  Notwithstanding anything to the
contrary, if more than one rate is so published, then the interest rate shall be
the highest of such  published  rates.  The Interest  Rate will change as of the
date of  publication  in THE WALL STREET  JOURNAL of a  One-Month  LIBOR that is
different from that  published on the preceding  Business Day. In the event that
THE WALL STREET  JOURNAL  shall,  for any  reason,  fail or cease to publish the
One-Month  LIBOR,  MLBFS will choose a reasonably  comparable index or source to
use as the basis for the Interest Rate.

"Loan" shall mean the specific  Reducing  Revolver by MLBFS to Customer pursuant
to this Agreement for the Loan Purpose and in the Loan Amount.

"Loan  Amount"  shall  mean an amount  equal to the  lesser  of: (i) 100% of the
amount  required by Customer  to satisfy or fulfill the Loan  Purpose,  (ii) the
aggregate amount which Customer shall request be advanced by MLBFS on account of
the Loan Purpose on the Closing Date, or (iii) $500,000.00.

"Loan Documents" shall mean this Loan Agreement,  any indenture, any guaranty of
any  of  the  Obligations   and  all  other  security  and  other   instruments,
assignments, certificates, certifications and agreements of any kind relating to
any of the Obligations, whether obtained, authorized,  authenticated,  executed,
sent or received  concurrently  with or  subsequent to this Loan  Agreement,  or
which  evidence  the  creation,  guaranty  or  collateralization  of  any of the
Obligations  or the granting or perfection of liens or security  interests  upon
any  Collateral  or any other  collateral  for the  Obligations,  including  any
modifications, amendments or restatements of the foregoing.

"Loan Purpose" shall mean the purpose for which the proceeds of the Loan will be
used;  to wit:  to  refinance  a portion of  Customer's  WCMA Line of Credit No.
885-07E38.

"Location of Tangible  Collateral"  shall mean the address of Customer set forth
at the  beginning of this Loan  Agreement,  together  with any other  address or
addresses  set  forth on an  exhibit  hereto  as being a  Location  of  Tangible
Collateral.

"Maximum  WCMA Line of Credit" shall mean the maximum  aggregate  line of credit
which MLBFS will extend to Customer subject to the terms and conditions  hereof,
as the same shall be reduced each month in accordance with the terms hereof.  On
the Closing Date, the Maximum WCMA Line of Credit will equal the Loan Amount.
<PAGE>


"Obligations" shall mean all liabilities,  indebtedness and other obligations of
Customer to MLBFS, howsoever created, arising or evidenced, whether now existing
or hereafter arising, whether direct or indirect, absolute or contingent, due or
to become due,  primary or secondary or joint or several,  and, without limiting
the  generality of the  foregoing,  shall include  principal,  accrued  interest
(including without limitation interest accruing after the filing of any petition
in  backruptcy),  all  advances  made by or on  behalf  of MLBFS  under the Loan
Documents,  collection and other costs and expenses  incurred by or on behalf of
MLBFS,  whether  incurred before or after  judgment,  and all present and future
liabilities, indebtedness and obligations of Customer under this Loan Agreement.

"Permitted  Liens"  shall  mean with  respect to the  Collateral:  (i) liens for
current taxes not yet due and payable, other non-consensual liens arising in the
ordinary  course of  business  for sums not due,  and,  if MLBFS'  rights to and
interest in the Collateral are not  materially and adversely  affected  thereby,
any




                                      -2-
<PAGE>


such  liens for taxes or other  non-consensual  liens  arising  in the  ordinary
course of business  being  contested in good faith by  appropriate  proceedings;
(ii) liens in favor of MLBFS;  (iii)  liens  which will be  discharged  with the
proceeds of the initial WCMA Loan; and (iv) any other liens expressly  permitted
in writing by MLBFS.

"Persons"  shall  mean  any  natural  person  and any  corporation,  partnership
(general, limited or otherwise),  limited liability company, trust, association,
joint venture,  governmental  body or agency or other entity having legal status
of any kind.

"Pledgor"  shall  mean  each  Person  who at any time  provides  collateral,  or
otherwise now or  hereinafter  agrees to grant MLBFS a security  interest in any
assets as security for Customer's Obligations.

"Subsequent WCMA Loan" shall mean each WCMA Loan other than the Loan, including,
without limitation, each WCMA Loan to pay accrued interest.

"Termination  Date" shall mean the first to occur of: (i) the last  Business Day
of the  twenty-fourth  (24th) full calendar month following the Closing Date, or
(ii) if earlier,  the date of termination of the WCMA Line of Credit pursuant to
the terms hereof.

"WCMA Account" shall mean and refer to the Working Capital Management Account of
Customer with MLPF&S  identified as WCMA Account No. 885-07895 and any successor
Working Capital Management Account of Customer with MLPF&S.

"WCMA Line of Credit"  shall mean the line of credit funded by MLBFS through the
WCMA Account.

"WCMA Loan" shall mean each advance  made by MLBFS  pursuant to the WCMA Line of
Credit, including the Loan and each Subsequent WCMA Loan.

"WCMA Loan Balance" shall mean an amount equal to the aggregate unpaid principal
balance of all WCMA Loans.

"UCC"  shall  mean the  Uniform  Commercial  Code of  Illinois  as in  effect in
Illinois from time to time.

1.2 OTHER TERMS.  Except as otherwise defined herein: (i) all terms used in this
Loan Agreement which are defined in the UCC shall have the meanings set forth in
the UCC,  and (ii)  capitalized  terms used herein which are defined in the WCMA
Agreement  (including,  without  limitation,  "Money  Accounts",  "Minimum Money
Accounts Balance",  and "WCMA Directed Reserve Program") shall have the meanings
set forth in the WCMA Agreement;  and (iii)  accounting terms not defined herein
shall have the meaning ascribed to them in GAAP.

1.3 UCC FILING. Customer hereby authorizes MLBFS to file a record or records (as
defined or otherwise  specified under the UCC),  including,  without limitation,
financing statements,  in all jurisdictions and with all filing offices as MLBFS
may determine, in its sole discretion, are necessary or advisable to perfect the
security  interest  granted  to MLBFS  herein.  Such  financing  statements  may
describe the Collateral in the same manner as described herein or may contain an
indication or  description  of collateral  that  describes  such property in any
other  manner as MLBFS may  determine,  in its sole  discretion,  is  necessary,
advisable or prudent to ensure the  perfection  of the security  interest in the
Collateral granted to the MLBFS herein.

                              ARTICLE II. THE LOAN

2.1 COMMITMENT.  Subject to the terms and conditions hereof, MLBFS hereby agrees
to make the Loan to Customer, and Customer hereby agrees to borrow the Loan from
MLBFS.  Except as otherwise  provided in Section 3.1 hereof, the entire proceeds
of the Loan will be  disbursed  by MLBFS  out of the WCMA Line of Credit  either
directly to the applicable third party or parties on account of the Loan Purpose
or to  reimburse  Customer  for  amounts  directly  expended  by it for the Loan
Purpose; all as directed by Customer in a Closing Certificate to be executed and
delivered to MLBFS prior to the date of funding.

2.2 CONDITIONS OF MLBFS' OBLIGATION.  The Closing Date and MLBFS' obligations to
activate the WCMA Line of Credit,  as hereafter set forth,  and make the Loan on
the Closing Date are subject to the prior  fulfillment  of each of the following
conditions:  (a) not less than two Business Days prior to any requested  funding
date,  MLBFS  shall  have  received  a Closing  Certificate,  duly  executed  by
Customer,  setting  forth,  among other  things,  the amount of the Loan and the
method of payment and payee(s) of the proceeds thereof;  (b) after giving effect
to the Loan,  the WCMA Loan Balance will not exceed either the Maximum WCMA Line
of Credit or the Loan Amount; (c) the Commitment  Expiration Date shall not then
have occurred;  and (d) each of the General Funding  Conditions  shall then have
been met or satisfied to the reasonable satisfaction of MLBFS.

2.3  COMMITMENT  FEE. In  consideration  of the agreement by MLBFS to extend the
Loan and any Subsequent WCMA Loans to Customer in accordance with and subject to
the terms hereof, Customer has paid or shall, on or before the Closing Date pay,
the  Commitment  Fee  to  MLBFS.  Customer  acknowledges  and  agrees  that  the
Commitment  Fee has been fully  earned by MLBFS,  and that it will not under any
circumstances be refundable.


<PAGE>


2.4 USE OF LOAN  PROCEEDS.  Unless  otherwise  agreed by MLBFS in  writing,  the
proceeds of the Loan shall be used solely for the Loan Purpose.  The Proceeds of
each Subsequent WCMA Loan initiated by Customer shall be used by Customer solely
for working capital in the ordinary  course of its business,  or, with the prior
written  consent of MLBFS,  for other lawful  business  purposes of Customer not
prohibited hereby. CUSTOMER AGREES THAT UNDER NO CIRCUMSTANCES WILL THE PROCEEDS
OF THE LOAN OR ANY  SUBSEQUENT  WCMA LOAN BE USED:  (I) FOR PERSONAL,  FAMILY OR
HOUSEHOLD PURPOSES OF ANY PERSON WHATSOEVER, OR (II) TO PURCHASE, CARRY OR TRADE
IN SECURITIES, OR REPAY DEBT INCURRED TO PURCHASE, CARRY OR TRADE IN SECURITIES,
WHETHER IN OR IN CONNECTION  WITH THE WCMA ACCOUNT,  ANOTHER ACCOUNT OF CUSTOMER
WITH  MLPF&S  OR AN  ACCOUNT  OF  CUSTOMER  AT ANY  OTHER  BROKER  OR  DEALER IN
SECURITIES,  OR (III) UNLESS OTHERWISE  CONSENTED TO IN WRITING BY MLBFS, TO PAY
ANY AMOUNT TO MERRILL LYNCH AND CO., INC. OR ANY OF ITS SUBSIDIARIES, OTHER THAN
MERRILL  LYNCH BANK USA,  MERRILL  LYNCH BANK & TRUST CO. OR ANY  SUBSIDIARY  OF
EITHER OF THEM (INCLUDING MLBFS AND MERRILL LYNCH CREDIT CORPORATION).



                                      -3-
<PAGE>


                      ARTICLE III. THE WCMA LINE OF CREDIT

3.1  ACTIVATION OF THE WCMA LINE OF CREDIT.  Subject to the terms and conditions
hereof,  on the  Closing  Date  MLBFS  will  activate  a WCMA Line of Credit for
Customer  in the Loan  Amount.  The Loan will be funded  out of the WCMA Line of
Credit  immediately  after such activation  (or, if and to the extent  otherwise
expressly  contemplated in the definition of Loan Purpose or otherwise  directed
in the Closing  Certificate and hereafter expressly agreed by MLBFS, all or part
of the Loan  may be made  available  as a WCMA  Line of  Credit  and  funded  by
Customer.)

3.2 SUBSEQUENT WCMA LOANS.  Subject to the terms and conditions  hereof,  during
the period from and after the Closing Date to the Termination Date: (a) Customer
may repay the WCMA Loan Balance in whole of in part at any time without  premium
or penalty,  and request a re-borrowing of amounts repaid on a revolving  basis,
and (b) in addition to Subsequent WCMA Loans made  automatically  to pay accrued
interest,  as hereafter provided,  MLBFS will make such Subsequent WCMA Loans as
Customer  may from  time to time  request  or be  deemed  to have  requested  in
accordance with the terms hereof.  Customer may request Subsequent WCMA Loans by
use of WCMA Checks, FTS, Visa(R) charges, wire transfers, or such other means of
access  to the WCMA Line of Credit  as may be  permitted  by MLBFS  from time to
time;  it being  understood  that so long as the WCMA Line of Credit shall be in
effect,  any charge or debit to the WCMA Account  which but for the WCMA Line of
Credit would under the terms of the WCMA Agreement result in an overdraft, shall
be deemed a request by Customer for a Subsequent WCMA Loan.

3.3 CONDITIONS OF SUBSEQUENT WCMA LOANS.  Notwithstanding  the foregoing,  MLBFS
shall not be obligated to make any Subsequent  WCMA Loan, and may without notice
refuse to honor any such request by Customer, if at the time of receipt by MLBFS
of Customer's  request:  (a) the making of such Subsequent WCMA Loan would cause
the  Maximum  WCMA Line of Credit,  as reduced  pursuant  to the  provisions  of
Section 3.6  hereof,  to be  exceeded;  or (b) the  Termination  Date shall have
occurred; or (c) an event shall have occurred and be continuing which shall have
caused any of the General Funding  Conditions to not then be met or satisfied to
the reasonable satisfaction of MLBFS. The making by MLBFS of any Subsequent WCMA
Loan (including, without limitation, the making of a Subsequent WCMA Loan to pay
accrued interest or late charges,  as hereafter provided) at a time when any one
or more of said  conditions  shall  not have  been met shall not in any event be
construed as a waiver of said  condition or  conditions  or of any Default,  and
shall not prevent MLBFS at any time  thereafter  while any  condition  shall not
have been met from  refusing to honor any request by Customer  for a  Subsequent
WCMA Loan.

3.4 WCMA NOTE.  Customer  hereby  promises to pay to the order of MLBFS,  at the
times  and in the  manner  set forth in this Loan  Agreement,  or in such  other
manner and at such place as MLBFS may  hereafter  designate in writing:  (a) the
WCMA Loan  Balance;  (b) interest at the Interest Rate on the  outstanding  WCMA
Loan Balance  (computed  for the actual number of days elapsed on the basis of a
year  consisting of 360 days),  from and including the date on which the Loan is
made until the date of payment of all WCMA Loans in full; and (c) on demand, all
other sums payable pursuant to this Loan Agreement,  including,  but not limited
to, any late charges.  Except as otherwise expressly set forth herein,  Customer
hereby waives  presentment,  demand for payment,  protest and notice of protest,
notice of dishonor,  notice of acceleration,  notice of intent to accelerate and
all other notices and  formalities  in  connection  with this WCMA Note and this
Loan Agreement.

3.5  INTEREST.  (a) An amount  equal to accrued  interest on the daily WCMA Loan
Balance  shall be  payable  by  Customer  monthly  on each  Interest  Due  Date,
commencing  with the first Interest Due Date after the Closing Date shall occur.
Unless  otherwise  hereafter  directed  in  writing  by MLBFS  on or  after  the
Termination  Date,  such  interest  will be  automatically  charged  to the WCMA
Account on the  applicable  Interest Due Date,  and, to the extent not paid with
free credit  balances or the proceeds of sales of any Money Accounts then in the
WCMA Account, as hereafter provided,  such interest will be paid by a Subsequent
WCMA Loan and added to the WCMA Loan Balance. All interest shall be computed for
the actual number of days elapsed on the basis of a year consisting of 360 days.

(b) Upon the occurrence and during the  continuance of any Default,  but without
limiting  the rights and  remedies  otherwise  available  to MLBFS  hereunder or
waiving such Default,  the interest  payable by Customer  hereunder shall at the
option of MLBFS  accrue and be payable at the Default  Rate.  The Default  Rate,
once  implemented,  shall continue to apply to the  Obligations  under this Loan
Agreement and be payable by Customer  until the date MLBFS gives written  notice
that such Default has been cured to the satisfaction of MLBFS.

(c)  Notwithstanding any provision to the contrary in any of the Loan Documents,
no  provision  of the Loan  Documents  shall  require  the payment or permit the
collection  of Excess  Interest.  If any Excess  Interest is provided for, or is
adjudicated  as being  provided for, in the Loan  Documents,  then: (i) Customer
shall not be obligated to pay any Excess Interest;  and (ii) any Excess Interest
that MLBFS may have received hereunder or under any of the Loan Documents shall,
at the option of MLBFS,  be either  applied as a credit  against the then unpaid
WCMA Loan Balance, or refunded to the payor thereof.

3.6 PERIODIC  REDUCTION OF MAXIMUM WCMA LINE OF CREDIT.  Commencing  on the last
Business Day of the first full calendar  month  following the Closing Date,  and
continuing  on the last Business Day of each  calendar  month  thereafter to and
including the last Business Day of the twenty-third  (23rd) such calendar month,
the  Maximum  WCMA  Line of  Credit  shall  be  reduced  by an  amount  equal to
one-twenty-fourth (1/24th) of the Loan Amount per month. Unless the WCMA Line of
Credit shall have been earlier  terminated  pursuant to the terms hereof, on the
last  Business Day of the  twenty-fourth  (24th)  calendar  month  following the
Closing Date, the WCMA Line of Credit shall, without further action of either of


<PAGE>


the parties hereto,  be terminated,  Customer shall pay to MLBFS the entire WCMA
Loan Balance,  if any, and all other Obligations,  and the WCMA Account,  at the
option of customer,  will either be converted to a WCMA Cash Account (subject to
any  requirements  of MLPF&S) or terminated.  No failure or delay on the part of
MLBFS in entering into the WCMA computer  system any scheduled  reduction in the
Maximum WCMA Line of Credit  pursuant to this  Section  shall have the effect of
preventing or delaying such reduction.

3.7 MANDATORY PAYMENTS.  CUSTOMER AGREES THAT IT WILL, WITHOUT DEMAND, INVOICING
OR THE REQUEST OF MLBFS,  FROM TIME TO TIME MAKE SUFFICIENT  PAYMENTS ON ACCOUNT
OF THE WCMA LOAN  BALANCE TO ASSURE THAT THE WCMA LOAN  BALANCE  WILL NOT AT ANY
TIME EXCEED THE MAXIMUM WCMA LINE OF CREDIT,  AS REDUCED EACH MONTH  PURSUANT TO
SECTION 3.6 HEREOF.



                                       -4-
<PAGE>


3.8 METHOD OF MAKING  PAYMENTS.  All  payments  required or permitted to be made
pursuant  to this Loan  Agreement  shall be made in lawful  money of the  United
States.  Unless otherwise hereafter directed by MLBFS, such payments may be made
by the delivery of checks (other than WCMA  Checks),  or by means of FTS or wire
transfer of funds  (other than funds from the WCMA Line of Credit) to MLPF&S for
credit to the WCMA  Account.  Payments  to MLBFS from funds in the WCMA  Account
shall be deemed to be made by Customer upon the same basis and schedule as funds
are made available for  investment in the Money Accounts in accordance  with the
terms of the WCMA Agreement.  The acceptance by or on behalf of MLBFS of a check
or other payment for a lesser amount than shall be due from Customer, regardless
of any endorsement or statement thereon or transmitted  therewith,  shall not be
deemed an accord and  satisfaction  or anything other than a payment on account,
and MLBFS or anyone  acting on behalf of MLBFS may  accept  such  check or other
payment without prejudice to the rights of MLBFS to recover the balance actually
due or to pursue any other remedy under this Loan  Agreement or  applicable  law
for such  balance.  All checks  accepted by or on behalf of MLBFS in  connection
with this Loan Agreement are subject to final collection.

3.9  IRREVOCABLE  INSTRUCTIONS  TO MLPF&S.  In order to  minimize  the WCMA Loan
Balance, Customer hereby irrevocably authorizes the directs MLPF&S, effective on
the Closing Date and continuing  thereafter so long as this Loan Agreement shall
be in effect:  (a) to immediately and prior to application for any other purpose
pay to MLBFS to the extent of any WCMA Loan Balance or other amounts  payable by
Customer  hereunder all available free credit  balances from time to time in the
WCMA Account; and (b) if such available free credit balances are insufficient to
pay the WCMA Loan  Balance  and such  other  amounts,  and there are in the WCMA
Account  at  any  time  any  investments  in  Money  Accounts  (other  than  any
investments  constituting  any Minimum  Money  Accounts  Balance  under the WCMA
Directed Reserve Program),  to immediately liquidate such investments and pay to
MLBFS to the  extent  of any  WCMA  Loan  Balance  and such  other  amounts  the
available proceeds from the liquidation of any such Money Accounts.

3.10 LATE  CHARGE.  Any  payment  or  deposit  required  to be made by  Customer
pursuant  to the Loan  Documents  not paid or made  within  ten (10) days of the
applicable  due date shall be subject to a late charge in an amount equal to the
lesser of: (a) 5% of the overdue amount,  or (b) the maximum amount permitted by
applicable law. Such late charge shall be payable on demand, or, without demand,
may in the sole  discretion of MLBFS be paid by a Subsequent WCMA Loan and added
to the WCMA Loan  Balance in the same  manner as  provided  herein  for  accrued
interest with respect to the WCMA Line of Credit.

3.11.  PREPAYMENT.  Customer may prepay the Loan and any Subsequent WCMA Loan at
any time in whole or in part without premium or penalty.

3.12 OPTION OF CUSTOMER TO TERMINATE. Customer will have the option to terminate
the WCMA Line of Credit at any time upon written  notice to MLBFS.  Concurrently
with any such  termination,  Customer  shall pay to MLBFS the  entire  WCMA Loan
Balance and all other Obligations.

3.13 LIMITATION OF LIABILITY. MLBFS shall not be responsible,  and shall have no
liability to Customer or any other  party,  for any delay or failure of MLBFS to
honor any  request of  Customer  for a WCMA Loan or any other act or omission of
MLBFS,  MLPF&S or any of their  affiliates  due to or resulting  from any system
failure, error or delay in posting or other clerical error, loss of power, fire,
Act of God or other cause beyond the reasonable control of MLBFS,  MLPF&S or any
of their  affiliates  unless directly arising out of the willful wrongful act or
active gross  negligence of MLBFS. In no event shall MLBFS be liable to Customer
or any other party for any incidental or consequential  damages arising from any
act or omission by MLBFS,  MLPF&S or any of their  affiliates in connection with
the WCMA Line of Credit or this Loan Agreement.

3.14 STATEMENTS.  MLPF&S will include in each monthly  statement it issues under
the WCMA  Program  information  with  respect  to WCMA  Loans  and the WCMA Loan
Balance.  Any questions that Customer may have with respect to such  information
or the Loan should be directed to MLBFS;  and any questions  with respect to any
other matter in such statements or about or affecting the WCMA Program should be
directed to MLPF&S.

                         ARTICLE IV. GENERAL PROVISIONS

4.1 REPRESENTATIONS AND WARRANTIES.

Customer represents and warrants to MLBFS that:

(a)  ORGANIZATION AND EXISTENCE.  Customer is a corporation,  duly organized and
validly existing in good standing under the laws of the State of New York and is
qualified  to do  business  and in good  standing  in each other state where the
nature of its  business  or the  property  owned by it make  such  qualification
necessary;  and, where  applicable,  each Business  Guarantor is duly organized,
validly  existing  and in good  standing  under  the  laws of the  state  of its
formation  and is qualified  to do business  and in good  standing in each other
state  where the nature of its  business or the  property  owned by it make such
qualification necessary.

(b)  EXECUTION,  DELIVERY AND  PERFORMANCE.  Each Credit Party has the requisite
power and authority to enter into and perform the Loan  Documents.  The Customer
holds all  necessary  permits,  licenses,  certificates  of occupancy  and other
governmental  authorizations  and approvals  required in order to own or operate
the Customer's business. The execution,  delivery and performance by Customer of
this Loan Agreement and by each of the other Credit Parties of such of the other
Loan  Documents  to which it is a party:  (i) have been duly  authorized  by all
requisite  action,  (ii) do not and will not violate or  conflict  with any law,
order or other governmental requirement,  or any of the agreements,  instruments
or documents which formed or govern any of the Credit Parties,  and (iii) do not
and will not breach or violate any of the  provisions of, and will not result in
a default by any of the Credit Parties under, any other agreement, instrument or
document to which it is a party or is subject.

<PAGE>


(c) NOTICES AND APPROVALS.  Except as may have been given or obtained, no notice
to or consent or approval of any  governmental  body or authority or other third
party whatsoever (including, without limitation, any other creditor) is required
in connection with the execution, delivery or performance by any Credit Party of
such of the Loan Documents to which it is a party.



                                       -5-
<PAGE>


(d) ENFORCEABILITY.  The Loan Documents to which any Credit Party is a party are
the  respective  legal,  valid and binding  obligations  of such  Credit  Party,
enforceable  against it or them,  as the case may be, in  accordance  with their
respective  terms,  except as  enforceability  may be limited by bankruptcy  and
other  similar laws  affecting  the rights of creditors  generally or by general
principles of equity.

(e)  COLLATERAL.  Except for  priorities  afforded to any Permitted  Liens:  (i)
Customer  has good and  marketable  title to the  Collateral,  (ii)  none of the
Collateral is subject to any lien,  encumbrance or security interest,  and (iii)
upon  the  filing  of  all  Uniform   Commercial   Code   financing   statements
authenticated or otherwise authorized by Customer with respect to the Collateral
in the  appropriate  jurisdiction(s)  and/or the  completion of any other action
required by applicable  law to perfect its liens and security  interests,  MLBFS
will have valid and perfected first liens and security interests upon all of the
Collateral.

(f)  FINANCIAL  STATEMENTS.  Except as expressly  set forth in Customer's or any
Business Guarantor's financial statements,  all financial statements of Customer
and each Business Guarantor  furnished to MLBFS have been prepared in conformity
with generally accepted accounting  principles,  consistently  applied, are true
and correct in all material respects, and fairly present the financial condition
of it as at such dates and the results of its  operations  for the periods  then
ended (subject, in the case of interim unaudited financial statements, to normal
year-end adjustments);  and since the most recent date covered by such financial
statements,  there has been no  material  adverse  change in any such  financial
condition  or  operation.  All  financial  statements  furnished to MLBFS of any
Guarantor  other than a Business  Guarantor are true and correct in all material
respects and fairly  represent such  Guarantor's  financial  condition as of the
date of such  financial  statements,  and  since  the most  recent  date of such
financial  statements,  there  has  been  no  material  adverse  change  in such
financial condition.

(g)  LITIGATION;   COMPLIANCE   WITH  ALL  LAWS.  No  litigation,   arbitration,
administrative  or governmental  proceedings are pending or, to the knowledge of
Customer,  threatened  against  any Credit  Party,  which  would,  if  adversely
determined,  materially and adversely affect (i) such Credit Party's interest in
the Collateral or the liens and security  interests of MLBFS  hereunder or under
any of the Loan Documents,  or (ii) the financial condition of such Credit Party
or its continued operations.  Each Credit Party is in compliance in all material
respects with all laws,  regulations,  requirements and approvals  applicable to
such Credit Party.

(h) TAX  RETURNS.  All  federal,  state  and  local  tax  returns,  reports  and
statements  required  to be filed by any  Credit  Party have been filed with the
appropriate  governmental  agencies  and all taxes due and payable by any Credit
Party have been timely paid  (except to the extent that any such failure to file
or pay will not  materially  and  adversely  affect  (i)  either  the  liens and
security  interests of MLBFS hereunder or under any of the Loan Documents,  (ii)
the financial condition of any Credit Party or (iii) its continued operations).

(i) COLLATERAL LOCATION. All of the tangible Collateral is located at a Location
of Tangible Collateral.

(j) NO DEFAULT. No "Default" or "Event of Default" (each as defined in this Loan
Agreement or any of the other Loan Documents) has occurred and is continuing.

(k) NO OUTSIDE  BROKER.  Except for  employees of MLBFS,  MLPF&S or one of their
affiliates,  Customer has not in connection with the  transactions  contemplated
hereby  directly or indirectly  engaged or dealt with, and was not introduced or
referred to MLBFS by, any broker or other loan arranger.

Each of the foregoing  representations and warranties:  (i) has been and will be
relied  upon as an  inducement  to  MLBFS to make  any  WCMA  Loan,  and (ii) is
continuing  and shall be deemed  remade by  Customer on the  Closing  Date,  and
concurrently with each request by Customer for a Subsequent WCMA Loan.

4.2 FINANCIAL AND OTHER INFORMATION.

(a) Customer  shall furnish or cause to be furnished to MLBFS during the term of
this Loan Agreement all of the following:

(i) ANNUAL FINANCIAL STATEMENTS.  Within 120 days after the close of each fiscal
year of Customer,  a copy of the annual audited financial statements of Customer
and  the  annual  audited  financial  statements  of  each  Business  Guarantor,
including,  in each case, in reasonable detail, a balance sheet and statement of
retained  earnings as at the close of such fiscal year and  statements of profit
and loss and cash flow for such fiscal year;

(ii) INTERIM FINANCIAL STATEMENTS. Within 45 days after the close of each fiscal
quarter of Customer,  a copy of the interim financial statements of Customer and
each Business  Guarantor for such fiscal quarter (including in reasonable detail
both a balance  sheet as of the close of such fiscal  period,  and  statement of
profit and loss for the applicable fiscal period);

(iii) A/R  AGINGS.  Within  15 days  after  the  close of each  fiscal  month of
Customer,  a copy of the Accounts Receivable Aging of Customer and each Business
Guarantor as of the end of such fiscal month;

(iv) INVENTORY  REPORTS.  Within 15 days after the close of each fiscal month of
Customer,  a copy of the  Inventory  Report  (as and to the  extent  applicable,
breaking  out  Inventory  by  location,  and  separately  reporting  any work in
process) of Customer  and each  Business  Guarantor as of the end of such fiscal
month; and

(v) OTHER  INFORMATION.  Such other  information  as MLBFS may from time to time
reasonably request relating to Customer, any Credit Party or the Collateral.

<PAGE>


(b) GENERAL  AGREEMENTS WITH RESPECT TO FINANCIAL  INFORMATION.  Customer agrees
that except as otherwise  specified  herein or otherwise agreed to in writing by
MLBFS: (i) all annual financial  statements required to be furnished by Customer
to  MLBFS  hereunder  will  be  prepared  by  either  the  current   independent
accountants for Customer or other independent  accountants reasonably acceptable
to MLBFS, and (ii) all other financial information required to



                                       -6-
<PAGE>


be furnished by Customer to MLBFS  hereunder will be certified as correct in all
material  respects by the party who has prepared such  information,  and, in the
case of internally prepared information with respect to Customer or any Business
Guarantor, certified as correct by their respective chief financial officer.

4.3 OTHER COVENANTS.  Customer  further  covenants and agrees during the term of
this Loan Agreement that:

(a) FINANCIAL RECORDS;  INSPECTION. Each Credit Party (other than any Individual
Guarantor)  will: (i) maintain at its principal  place of business  complete and
accurate  books and  records,  and maintain  all of its  financial  records in a
manner consistent with the financial  statements  heretofore furnished to MLBFS,
or prepared on such other basis as may be approved in writing by MLBFS; and (ii)
permit MLBFS or its duly authorized representatives,  upon reasonable notice and
at  reasonable  times,  to inspect  its  properties  (both  real and  personal),
operations, books and records.

(b) TAXES. Each Credit Party will pay when due all taxes,  assessments and other
governmental  charges,  howsoever  designated,  and all  other  liabilities  and
obligations,  except to the extent that any such failure to file or pay will not
materially and adversely affect either the liens and security interests of MLBFS
hereunder or under any of the Loan  Documents,  the  financial  condition of any
Credit Party or its continued operations.

(c) COMPLIANCE  WITH LAWS AND  AGREEMENTS.  No Credit Party will violate (i) any
law, regulation or other governmental requirement,  any judgment or order of any
court or  governmental  agency or authority;  (ii) any agreement,  instrument or
document  which is material to its  operations or to the operation or use of any
Collateral,  in each case as contemplated  by the Loan  Documents;  or (iii) any
agreement,  instrument  or  document  to  which  it is a party or by which it is
bound,  if any such  violation will  materially and adversely  affect either the
liens  and  security  interests  of MLBFS  hereunder  or  under  any of the Loan
Documents,  the  financial  condition  of any  Credit  Party,  or its  continued
operations.

(d) NO USE OF MERRILL  LYNCH NAME.  No Credit Party will  directly or indirectly
publish,  disclose or otherwise use in any advertising or promotional  material,
or press release or interview, the name, logo or any trademark of MLBFS, MLPF&S,
Merrill Lynch and Co., Incorporated or any of their affiliates.

(e)  NOTIFICATION BY CUSTOMER.  Customer shall provide MLBFS with prompt written
notification  of:  (i) any  Default;  (ii) any  material  adverse  change in the
business,  financial  condition or  operations  of any Credit  Party;  (iii) any
information  which  indicates that any financial  statements of any Credit Party
fail in any  material  respect to present  fairly the  financial  condition  and
results of  operations  purported to be presented in such  statements;  (iv) any
threatened or pending  litigation  involving any Credit Party;  (v) any casualty
loss,  attachment,  lien,  judicial  process,  encumbrance or claim affecting or
involving  $25,000 or more of any Collateral;  and (vi) any change in Customer's
outside accountants. Each notification by Customer pursuant hereto shall specify
the  event  or  information  causing  such  notification,  and,  to  the  extent
applicable,  shall specify the steps being taken to rectify or remedy such event
or information.

(f) ENTITY  ORGANIZATION.  Each Credit  Party which is an entity will (i) remain
(A) validly  existing and in good standing in the state of its  organization and
(B)  qualified to do business and in good standing in each other state where the
nature of its  business  or the  property  owned by it make  such  qualification
necessary,   and  (ii)   maintain  all   governmental   permits,   licenses  and
authorizations.  Customer  shall give MLBFS not less than 30 days prior  written
notice of any change in name (including any fictitious  name) or chief executive
office,  place of business,  or as  applicable,  the principal  residence of any
Credit Party.

(g) MERGER, CHANGE IN BUSINESS.  Except upon the prior written consent of MLBFS,
Customer  shall not cause or permit  any  Credit  Party to (i) be a party to any
merger  or  consolidation   with,  or  purchase  or  otherwise  acquire  all  or
substantially  all of the assets of, or any material stock,  partnership,  joint
venture or other equity interest in, any Person, or sell,  transfer or lease all
or any  substantial  part of its assets;  (ii) engage in any  material  business
substantially  different  from  its  business  in  effect  as  of  the  date  of
application  by  Customer  for credit from MLBFS,  or cease  operating  any such
material  business;  or (iii)  cause or  permit  any  other  Person to assume or
succeed to any material business or operations of such Credit Party.

(h) BORROWED  DEBT.  Except upon the prior  written  consent of MLBFS,  Customer
shall not directly or indirectly  hereafter incur or permit to exist any debt of
Customer  for  borrowed  money or the lease  under a capital  lease or  deferred
purchase  price of real or personal  property other than: (i) debt to MLBFS (ii)
debt existing as of the date of and reflected on the last  financial  statements
of Customer  submitted to MLBFS prior to the date hereof and not  refinanced  by
MLBFS, and (iii) debt secured by Permitted Liens.

(i) MINIMUM  TANGIBLE NET WORTH.  Customer's  "tangible  net worth" shall at all
times exceed  $8,500,000.00.  For the purposes  hereof,  the term  "tangible net
worth" shall mean Customer's net worth as shown on Customer's  regular financial
statements  prepared in a manner consistent with the terms hereof, but excluding
an  amount  equal  to:  (i)  any  assets  which  are  ordinarily  classified  as
"intangible" in accordance with generally accepted  accounting  principles,  and
(ii) any amounts now or hereafter  directly or  indirectly  owing to Customer by
officers, shareholders or affiliates of Customer.

(j) MINIMUM NET CASH FLOW. The "Net Cash Flow" of Customer as of the end of each
its fiscal years shall not be less than  $100,000.00. "Net Cash Flow" shall mean
the  excess  of (i) the sum of  Customer's  annual  net  after-tax  income,  any
non-recurring expenses, and depreciation and similar non-cash charges, over (ii)

<PAGE>


the sum of the current portion of Customer's  long term debt, any  non-recurring
income,  and any dividends  and other  distributions  to its owners;  all as set
forth on Customer's  regular annual  financial  statements  prepared in a manner
consistent with the terms hereof.

4.4 COLLATERAL

(a) PLEDGE OF COLLATERAL.  To secure payment and performance of the Obligations,
Customer hereby pledges,  assigns,  transfers and sets over to MLBFS, and grants
to MLBFS first liens and security  interests in and upon all of the  Collateral,
subject only to priorities afforded to Permitted Liens.

(b) LIENS.  Except upon the prior written  consent of MLBFS,  Customer shall not
create or permit to exist any lien,  encumbrance  or security  interest  upon or
with  respect  to any  Collateral  now owned or  hereafter  acquired  other than
Permitted Liens.



                                       -7-
<PAGE>


(c)  PERFORMANCE OF  OBLIGATIONS.  Customer shall perform all of its obligations
owing on account of or with respect to the Collateral;  it being understood that
nothing herein, and no action or inaction by MLBFS, under this Loan Agreement or
otherwise,  shall be deemed an  assumption  by MLBFS of any of  Customer's  said
obligations.

(d) SALES AND  COLLECTIONS.  Customer  shall not  sell,  transfer  or  otherwise
dispose of any Collateral, except that so long as no Event of Default shall have
occurred and be continuing, Customer may in the ordinary course of its business:
(i) sell any Inventory  normally held by Customer for sale,  (ii) use or consume
any materials and supplies normally held by Customer for use or consumption, and
(iii) collect all of its Accounts.

(e) ACCOUNT SCHEDULES. Upon the request of MLBFS, which may be made from time to
time,  Customer  shall  deliver to MLBFS,  in addition to the other  information
required  hereunder,  a schedule  identifying,  for each Account and all Chattel
Paper subject to MLBFS'  security  interests  hereunder,  each Account Debtor by
name and address and amount, invoice or contract number and date of each invoice
or contract.  Customer shall furnish to MLBFS such additional  information  with
respect to the Collateral,  and amounts  received by Customer as proceeds of any
of the Collateral, as MLBFS may from time to time reasonably request.

(f) ALTERATIONS AND MAINTENANCE. Except upon the prior written consent of MLBFS,
Customer  shall not make or permit  any  material  alterations  to any  tangible
Collateral which might materially  reduce or impair its market value or utility.
Customer  shall at all times (i) keep the tangible  Collateral in good condition
and repair,  reasonable  wear and tear  excepted,  (ii)  protect the  Collateral
against  loss,  damage  or  destruction,  and  (iii) pay or cause to be paid all
obligations arising from the repair and maintenance of such Collateral,  as well
as all obligations with respect to each Location of Tangible  Collateral  (e.g.,
all obligations under any lease, mortgage or bailment agreement), except for any
such  obligations  being  contested  by  Customer  in good faith by  appropriate
proceedings.

(g) LOCATION. Except for movements required in the ordinary course of Customer's
business, Customer shall give MLBFS 30 days' prior written notice of the placing
at or movement of any tangible  Collateral to any location other than a Location
of Tangible Collateral.  In no event shall Customer cause or permit any material
tangible  Collateral  to be removed from the United  States  without the express
prior written consent of MLBFS.  Customer will keep its books and records at its
principal  office  address  specified  in  the  first  paragraph  of  this  Loan
Agreement.  Customer  will not change the  address  where  books and records are
kept, or change its name or taxpayer  identification number. Customer will place
a legend  acceptable  to MLBFS on all chattel  paper that is  Collateral  in the
possession or control of Customer from time to time  indicating that MLBFS has a
security interest therein.

(h)  INSURANCE.  Customer  shall insure all of the tangible  Collateral  under a
policy or policies of physical damage insurance for the full  replacement  value
thereof against such perils as MLBFS shall reasonably require and also providing
that losses will be payable to MLBFS as its interests  may appear  pursuant to a
lender's or mortgagee's  long form loss payable  endorsement and containing such
other provisions as may be reasonably required by MLBFS.  Customer shall further
provide  and  maintain a policy or  policies  of  commercial  general  liability
insurance  naming  MLBFS  as an  additional  party  insured.  Customer  and each
Business Guarantor shall maintain such other insurance as may be required by law
or is  customarily  maintained  by companies in a similar  business or otherwise
reasonably  required by MLBFS.  All such  insurance  policies shall provide that
MLBFS  will  receive  not  less  than  10  days  prior  written  notice  of  any
cancellation,  and shall  otherwise be in form and amount and with an insurer or
insurers  reasonably  acceptable to MLBFS.  Customer  shall furnish MLBFS with a
copy or certificate of each such policy or policies and, prior to any expiration
or cancellation, each renewal or replacement thereof.

(i) EVENT OF LOSS.  Customer shall at its expense promptly repair all repairable
damage to any tangible  Collateral.  In the event that there is an Event of Loss
and  the  affected  Collateral  had a  value  prior  to  such  Event  of Loss of
$25,000.00  or more,  then, on or before the first to occur of (i) 90 days after
the occurrence of such Event of Loss, or (ii) 10 Business Days after the date on
which  either  Customer or MLBFS  shall  receive any  proceeds of  insurance  on
account  of  such  Event  of  Loss,  or any  underwriter  of  insurance  on such
Collateral shall advise either Customer or MLBFS that it disclaims  liability in
respect of such Event of Loss,  Customer  shall,  at Customer's  option,  either
replace the Collateral subject to such Event of Loss with comparable  Collateral
free of all liens other than  Permitted  Liens (in which event Customer shall be
entitled to utilize the  proceeds of  insurance on account of such Event of Loss
for such  purpose,  and may retain any excess  proceeds of such  insurance),  or
permanently  prepay the  Obligations by an amount equal to the actual cash value
of such Collateral as determined by either the insurance company's payment (plus
any  applicable  deductible)  or, in absence of insurance  company  payment,  as
reasonably  determined  by  MLBFS;  it being  further  understood  that any such
permanent prepayment shall cause an immediate permanent reduction in the Maximum
WCMA Line of Credit in the  amount of such  prepayment  and shall not reduce the
amount of any future  reductions  in the Maximum WCMA Line of Credit that may be
required hereunder.  Notwithstanding the foregoing, if at the time of occurrence
of such  Event  of Loss or any time  thereafter  prior  to  replacement  or line
reduction,  as  aforesaid,  an Event  of  Default  shall  have  occurred  and be
continuing hereunder, then MLBFS may at its sole option, exercisable at any time
while such Event of Default  shall be  continuing,  require  Customer  to either
replace such  Collateral or prepay the  Obligations  and reduce the Maximum WCMA
Line of Credit, as aforesaid.

(j) NOTICE OF CERTAIN EVENTS.  Customer shall give MLBFS immediate notice of any
attachment,  lien, judicial process, encumbrance or claim affecting or involving
$25,000.00 or more of the Collateral.


<PAGE>


(k)  INDEMNIFICATION.  Customer shall indemnify,  defend and save MLBFS harmless
from and against any and all claims,  liabilities,  losses,  costs and  expenses
(including, without limitation,  reasonable attorneys' fees and expenses) of any
nature whatsoever which may be asserted against or incurred by MLBFS arising out
of or in any manner occasioned by (i) the ownership, collection, possession, use
or operation of any  Collateral,  or (ii) any failure by Customer to perform any
of its obligations hereunder;  excluding,  however, from said indemnity any such
claims,  liabilities,  etc.  arising directly out of the willful wrongful act or
active gross negligence of MLBFS. This indemnity shall survive the expiration or
termination of this Loan  Agreement as to all matters  arising or accruing prior
to such expiration or termination.



                                       -8-
<PAGE>


4.5 EVENTS OF DEFAULT.

The  occurrence  of any of the  following  events shall  constitute an "Event of
Default" under this Loan Agreement:

(a) FAILURE TO PAY. (i) Customer  shall fail to deposit into the WCMA Account an
amount  sufficient  to assure  that the WCMA Loan  Balance  does not  exceed the
Maximum WCMA Line of Credit (ii) Customer  shall fail to pay to MLBFS or deposit
into the WCMA  Account when due any other amount owing or required to be paid or
deposited by Customer under the Loan Documents,  or (iii) Customer shall fail to
pay when due any other  Obligations;  and any such  failure as described in this
subparagraph  shall  continue for more than five (5) Business Days after written
notice thereof shall have been given by MLBFS to Customer.

(b) FAILURE TO PERFORM.  Any Credit Party shall  default in the  performance  or
observance  of any covenant or agreement on its part to be performed or observed
under any of the Loan Documents (not  constituting an Event of Default under any
other clause of this Section),  and such default shall  continue  unremedied for
ten (10) Business Days (i) after written notice thereof shall have been given by
MLBFS to Customer, or (ii) from Customer's receipt of any notice or knowledge of
such default from any other source.

(c) BREACH OF WARRANTY.  Any representation or warranty made by any Credit Party
contained  in any of the Loan  Documents  shall at any time  prove to have  been
incorrect in any material respect when made.

(d)  DEFAULT  UNDER  OTHER ML  AGREEMENT.  A default  or event of default by any
Credit Party shall occur under the terms of any other  agreement,  instrument or
document  with or  intended  for the  benefit  of MLBFS,  MLPF&S or any of their
affiliates,  and any required notice shall have been given and required  passage
of time shall have elapsed,  or the WCMA  Agreement  shall be terminated for any
reason.

(e) BANKRUPTCY EVENT. Any Bankruptcy Event shall occur.

(f)  MATERIAL  IMPAIRMENT.  Any event shall occur which shall  reasonably  cause
MLBFS to in good faith believe that the prospect of full payment or  performance
by the Credit  Parties of any of their  respective  liabilities  or  obligations
under any of the Loan Documents has been materially  impaired.  The existence of
such a material  impairment shall be determined in a manner  consistent with the
intent of Section 1-208 of the UCC.

(g) DEFAULT UNDER OTHER  AGREEMENTS.  Any event shall occur which results in any
default of any material  agreement  involving  any Credit Party or any agreement
evidencing any indebtedness of any Credit Party of $100,000.00 or more.

(h) COLLATERAL IMPAIRMENT. The loss, theft or destruction of any Collateral, the
occurrence of any material  deterioration or impairment of any Collateral or any
material  decline or depreciation in the value or market price thereof  (whether
actual or  reasonably  anticipated),  which causes any  Collateral,  in the sole
opinion of MLBFS,  to become  unsatisfactory  as to value or  character;  or any
levy,  attachment,  seizure  or  confiscation  of the  Collateral  which  is not
released within ten (10) Business Days.

(i) CONTESTED  OBLIGATION.  (i) Any of the Loan  Documents  shall for any reason
cease to be, or are  asserted by any Credit  Party not to be a legal,  valid and
binding  obligations of any Credit Party,  enforceable in accordance  with their
terms;  or (ii) the  validity,  perfection  or priority of MLBFS' first lien and
security  interest on any of the Collateral is contested by any Person; or (iii)
any  Credit  Party  shall or shall  attempt  to  repudiate,  revoke,  contest or
dispute,  in whole or in part,  such Credit Party's  obligations  under any Loan
Document.

(j) JUDGMENTS. A judgment shall be entered against any Credit Party in excess of
$25,000  and the  judgment  is not paid in full and  discharged,  or stayed  and
bonded to the satisfaction of MLBFS.

(k) CHANGE IN  CONTROL/CHANGE  IN  MANAGEMENT.  (i) Any direct or indirect sale,
conveyance,  assignment or other transfer of or grant of a security  interest in
any  ownership  interest  of any Credit  Party which  results,  or if any rights
related  thereto were exercised  would result,  in any change in the identity of
the individuals or entities in control of any Credit Party; or (ii) the owner(s)
of the  controlling  equity  interest of the  Customer on the date hereof  shall
cease  to own  and  control  such  Credit  Party;  or  (iii)  the  Person  (or a
replacement  who is  satisfactory  to MLBFS in its sole  discretion)  who is the
chief executive officer or holds such similar position, or any senior manager of
such Credit  Party on the date hereof shall for any reason cease to be the chief
executive officer or senior manager of such Credit Party.

(l) WITHDRAWAL, DEATH, ETC. The incapacity,  death, withdrawal,  dissolution, or
the filing of  dissolution  of: (i) any Credit  Party;  or (ii) any  controlling
shareholder, partner, or member of any Credit Party.

4.6 REMEDIES.

(a) REMEDIES UPON DEFAULT. Upon the occurrence and during the continuance of any
Event of Default,  MLBFS may at its sole option do any one or more or all of the
following,  at such time and in such  order as MLBFS may in its sole  discretion
choose:

(i) TERMINATION. MLBFS may without notice terminate its obligation to extend any
credit to or for the  benefit of  Customer  (it being  understood  that upon the
occurrence of any  Bankruptcy  Event all such  obligations  shall  automatically
terminate without any action on the part of MLBFS).


<PAGE>


(ii)  ACCELERATION.  MLBFS  may  declare  the WCMA  Loan  Balance  and all other
Obligations to be forthwith due and payable, whereupon all such amounts shall be
immediately due and payable,  without presentment,  demand for payment,  protest
and notice of protest,  notice of dishonor,  notice of  acceleration,  notice of
intent to  accelerate  or other notice or  formality  of any kind,  all of which
are hereby expressly waived; provided, however, that upon the occurrence



                                      -9-
<PAGE>


of any  Bankruptcy  Event the WCMA Loan  Balance  and  other  Obligations  shall
automatically become due and payable without any action on the part of MLBFS.

(iii) EXERCISE OTHER RIGHTS.  MLBFS may exercise any or all of the remedies of a
secured party under applicable law and in equity, including, but not limited to,
the  UCC,  and any or all of its  other  rights  and  remedies  under  the  Loan
Documents.

(iv)  POSSESSION.  MLBFS may  require  Customer to make the  Collateral  and the
records pertaining to the Collateral available to MLBFS at a place designated by
MLBFS which is reasonably  convenient to Customer, or may take possession of the
Collateral and the records  pertaining to the Collateral  without the use of any
judicial process and without any prior notice to Customer.

(v) SALE.  MLBFS may sell any or all of the Collateral at public or private sale
upon such terms and conditions as MLBFS may reasonably deem proper,  whether for
cash, on credit, or for future delivery,  in bulk or in lots. MLBFS may purchase
any Collateral at any such sale free of Customer's right of redemption,  if any,
which Customer  expressly waives to the extent not prohibited by applicable law.
The net  proceeds  of any such  public or  private  sale and all  other  amounts
actually  collected or received by MLBFS pursuant  hereto,  after  deducting all
costs and expenses incurred at any time in the collection of the Obligations and
in the protection, collection and sale of the Collateral, will be applied to the
payment of the  Obligations,  with any  remaining  proceeds  paid to Customer or
whoever  else may be entitled  thereto,  and with  Customer  and each  Guarantor
remaining  jointly and severally  liable for any amount  remaining  unpaid after
such application.

(vi) DELIVERY OF CASH, CHECKS, ETC. MLBFS may require Customer to forthwith upon
receipt,  transmit and deliver to MLBFS 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 MLBFS) which may be received by
Customer at any time in full or partial payment of any  Collateral,  and require
that  Customer not commingle any such items which may be so received by Customer
with any other of its funds or property but instead hold them separate and apart
and in trust for MLBFS until delivery is made to MLBFS.

(vii) NOTIFICATION OF ACCOUNT DEBTORS.  MLBFS may notify any Account Debtor that
its Account or Chattel  Paper has been assigned to MLBFS and direct such account
debtor to make payment directly to MLBFS of all amounts due or becoming due with
respect to such  Account or Chattel  Paper;  and MLBFS may  enforce  payment and
collect, by legal proceedings or otherwise, such Account or Chattel Paper.

(viii)  CONTROL OF  COLLATERAL.  MLBFS may otherwise  take control in any lawful
manner of any cash or non-cash items of payment or proceeds of Collateral and of
any rejected,  returned, stopped in transit or repossessed goods included in the
Collateral and endorse  Customer's name on any item of payment on or proceeds of
the Collateral.

(b) SET-OFF.  MLBFS shall have the further right upon the  occurrence and during
the continuance of an Event of Default to set-off,  appropriate and apply toward
payment of any of the  Obligations,  in such order of  application  as MLBFS may
from time to time and at any time elect, any cash, credit,  deposits,  accounts,
financial  assets,  investment  property,  securities  and any other property of
Customer  which is in  transit  to or in the  possession,  custody or control of
MLBFS,  MLPF&S or any agent,  bailee, or affiliate of MLBFS or MLPF&S.  Customer
hereby  collaterally  assigns and grants to MLBFS a continuing security interest
in  all  such  property  as  Collateral  and  as  additional  security  for  the
Obligations.  Upon the  occurrence  and  during the  continuance  of an Event of
Default,  MLBFS shall have all rights in such  property  available to collateral
assignees and secured  parties under all  applicable  laws,  including,  without
limitation, the UCC.

(c) POWER OF ATTORNEY.  Effective upon the occurrence and during the continuance
of an  Event of  Default,  Customer  hereby  irrevocably  appoints  MLBFS as its
attorney-in-fact, with full power of substitution, in its place and stead and in
its name or in the name of MLBFS, to from time to time in MLBFS' sole discretion
take any action and to execute any instrument  which MLBFS may deem necessary or
advisable to accomplish  the purposes of this Loan  Agreement and the other Loan
Documents,  including,  but not limited to, to receive,  endorse and collect all
checks,  drafts and other  instruments  for the payment of money made payable to
Customer included in the Collateral.  The powers of attorney granted to MLBFS in
this Loan Agreement are coupled with an interest and are  irrevocable  until the
Obligations  have been  indefeasibly  paid in full and fully  satisfied  and all
obligations of MLBFS under this Loan Agreement have been terminated.

(d)  REMEDIES ARE  SEVERABLE  AND  CUMULATIVE.  All rights and remedies of MLBFS
herein are  severable  and  cumulative  and in addition to all other  rights and
remedies  available in the Loan Documents,  at law or in equity,  and any one or
more  of  such  rights  and  remedies  may  be   exercised   simultaneously   or
successively.

(e) NO MARSHALLING.  MLBFS shall be under no duty or obligation to (i) preserve,
protect or marshall the  Collateral;  (ii) preserve or protect the rights of any
Credit Party or any other Person claiming an interest in the  Collateral;  (iii)
realize  upon the  Collateral  in any  particular  order or  manner,  (iv)  seek
repayment of any  Obligations  from any  particular  source;  (v) proceed or not
proceed against any Credit Party pursuant to any guaranty or security  agreement
or against  any Credit  Party  under the Loan  Documents,  with or without  also
realizing on the Collateral;  (vi) permit any substitution or exchange of all or
any part of the Collateral; or (vii) release any part of the Collateral from the
Loan  Agreement  or  any  of the  other  Loan  Documents,  whether  or not  such
substitution or release would leave MLBFS adequately secured.


<PAGE>


(f) NOTICES.  To the fullest extent permitted by applicable law, Customer hereby
irrevocably  waives and releases MLBFS of and from any and all  liabilities  and
penalties for failure of MLBFS to comply with any statutory or other requirement
imposed upon MLBFS relating to notices of sale,  holding of sale or reporting of
any sale, and Customer waives all rights of redemption or reinstatement from any
such sale.  Any notices  required  under  applicable law shall be reasonably and
properly  given to Customer if given by any of the  methods  provided  herein at
least 5 Business  Days  prior to taking  action.  MLBFS  shall have the right to
postpone  or adjourn any sale or other  disposition  of  Collateral  at any time
without  giving  notice of any such  postponed or adjourned  date.  In the event
MLBFS seeks to take possession of any or all of the Collateral by court process,
Customer further irrevocably waives to the fullest extent permitted by



                                      -10-
<PAGE>


law any bonds and any  surety  or  security  relating  thereto  required  by any
statute,  court rule or  otherwise  as an incident to such  possession,  and any
demand for possession prior to the commencement of any suit or action.

4.7 MISCELLANEOUS.

(a)  NON-WAIVER.  No  failure  or delay on the part of MLBFS in  exercising  any
right,  power or remedy pursuant to the Loan Documents shall operate as a waiver
thereof,  and no single or partial  exercise of any such right,  power or remedy
shall  preclude any other or further  exercise  thereof,  or the exercise of any
other right, power or remedy.  Neither any waiver of any provision of any of the
Loan Documents, nor any consent to any departure by Customer therefrom, shall be
effective unless the same shall be in writing and signed by MLBFS. Any waiver of
any  provision of any of the Loan  Documents and any consent to any departure by
Customer from the terms thereof shall be effective only in the specific instance
and for the  specific  purpose for which given.  Except as  otherwise  expressly
provided  herein,  no notice to or demand on Customer  shall in any case entitle
Customer  to any  other  or  further  notice  or  demand  in  similar  or  other
circumstances.

(b) DISCLOSURE.  Customer hereby  irrevocably  authorizes  MLBFS and each of its
affiliates,  including without limitation MLPF&S, to at any time (whether or not
an Event of Default shall have occurred)  obtain from and disclose to each other
any and all financial and other information  about Customer.  In connection with
said  authorization,  the parties recognize that in order to provide a WCMA Line
of Credit certain information about Customer is required to be made available on
a computer network accessible by certain affiliates of MLBFS,  including MLPF&S.
Customer further irrevocably authorizes MLBFS to contact,  investigate,  inquire
and obtain consumer  reports,  references and other information on Customer from
consumer  reporting  agencies and other  credit  reporting  services,  former or
current creditors, and other persons and sources (including, without limitation,
any  Affiliate of MLBFS) and to provide to any  references,  consumer  reporting
agencies,  credit  reporting  services,  creditors and other persons and sources
(including,  without limitation,  affiliates of MLBFS) all financial, credit and
other information obtained by MLBFS relating to the Customer.

(c) COMMUNICATIONS.  Delivery of an agreement, instrument or other document may,
at the discretion of MLBFS, be by electronic transmission. Except as required by
law or  otherwise  provided  herein or in a writing  executed by the party to be
bound, all notices demands, requests, accountings, listings, statements, advices
or other communications to be given under the Loan Documents shall be in writing
and shall be served  either  personally,  by deposit with a reputable  overnight
courier  with  charges  prepaid,  or by  deposit in the  United  States  mail by
certified mail return receipt required.  Notices may be addressed to Customer as
set forth at its address shown in the preamble hereto, or to any office to which
billing or account  statements  are sent;  to MLBFS at its address  shown in the
preamble  hereto,  or at such other address  designated in writing by MLBFS. Any
such  communication  shall be  deemed to have been  given  upon,  in the case of
personal  delivery the date of delivery,  one Business Day after deposit with an
overnight  courier,  two (2) Business Days after deposit in the United States by
certified mail (return receipt required),  or receipt of electronic transmission
(which shall be presumed to be three hours after the time of transmission unless
an error message is received by the sender), except that any notice of change of
address shall not be effective until actually received.

(d) FEES, EXPENSES AND TAXES. Customer shall pay or reimburse MLBFS for: (i) all
UCC,  real  property or other  filing,  recording,  and search fees and expenses
incurred  by  MLBFS  in  connection   with  the   verification,   perfection  or
preservation  of  MLBFS'  rights  hereunder  or in any  Collateral  or any other
collateral  for the  Obligations;  (ii) any and all stamp,  transfer,  mortgage,
intangible,  document,  filing,  recording  and other taxes and fees  payable or
determined  to be payable in  connection  with the  borrowings  hereunder or the
execution,  delivery,  filing,  and/or  recording of the Loan  Documents and any
other  instruments  or  documents  provided  for  herein or  delivered  or to be
delivered hereunder or in connection herewith; and (iii) all reasonable fees and
out-of-pocket   expenses  (including,   reasonable  attorneys'  fees  and  legal
expenses)  incurred  by MLBFS in  connection  with the  preparation,  execution,
administration, collection, enforcement, protection, waiver or amendment of this
Loan  Agreement,  the  other  Loan  Documents  and  such  other  instruments  or
documents,  and the  rights  and  remedies  of MLBFS  thereunder,  and all other
matters in  connection  therewith.  Customer  hereby  authorizes  MLBFS,  at its
option,  to either  cause any and all such fees,  expenses  and taxes to be paid
with a WCMA Loan, or invoice  Customer  therefore (in which event Customer shall
pay all such fees,  expenses and taxes  withing 5 Business Days after receipt of
such invoice).  The  obligations of Customer under this paragraph  shall survive
the  expiration or  termination  of this Loan Agreement and the discharge of the
other Obligations.

(e) RIGHT TO PERFORM OBLIGATIONS.  If Customer shall fail to do any act or thing
which  it  has  covenanted  to do  under  any  of  the  Loan  Documents  or  any
representation  or  warranty  on the  part of  Customer  contained  in the  Loan
Documents shall be breached, MLBFS may, in its sole discretion, after 5 Business
Days  written  notice is sent to Customer (or such lesser  notice,  including no
notice, as is reasonable under the circumstances), do the same or cause it to be
done or remedy any such breach,  and may expend its funds for such purpose.  Any
and all  reasonable  amounts so expended by MLBFS shall be repayable to MLBFS by
Customer upon demand,  with interest at the Interest Rate during the period from
and  including the date funds are so expended by MLBFS to the date of repayment,
and all such amounts shall be additional Obligations. The payment or performance
by MLBFS of any of Customer's  obligations  hereunder shall not relieve Customer
of said  obligations or of the  consequences  of having failed to pay or perform
the same, and shall not waive or be deemed a cure of any Default.


<PAGE>


(f) FURTHER  ASSURANCES.  Customer agrees to do such further acts and things and
to execute  and deliver to MLBFS such  additional  agreements,  instruments  and
documents as MLBFS may  reasonably  require or deem  advisable to effectuate the
purposes  of the Loan  Documents,  to  confirm  the  WCMA  Loan  Balance,  or to
establish,  perfect and maintain  MLBFS'  security  interests and liens upon the
Collateral, including, but not limited to: (i) executing financing statements or
amendments thereto when and as reasonably requested by MLBFS; and (ii) if in the
reasonable  judgment of MLBFS it is  required  by local law,  causing the owners
and/or mortgagees of the real property on which any Collateral may be located to
execute and deliver to MLBFS waivers or subordinations  reasonably  satisfactory
to MLBFS with respect to any rights in such Collateral.

(g) BINDING EFFECT. The Loan Documents shall be binding upon, and shall inure to
the benefit of MLBFS,  Customer  and their  respective  successors  and assigns.
MLBFS reserves the right, at any time while the Obligations remain  outstanding,
to sell,  assign,  syndicate or  otherwise  transfer or dispose of any or all of
MLBFS' rights and interests  under the Loan  Documents.  MLBFS also reserves the
right at any time to pool the WCMA Loan with one or more other loans  originated
by MLBFS or any other Person,  and to securitize or offer interests in such pool
on whatever terms and conditions MLBFS shall determine.



                                      -11-
<PAGE>


Customer consents to MLBFS releasing  financial and other information  regarding
Credit  Parties,  the Collateral  and the WCMA Loan in connection  with any such
sale, pooling,  securitization or other offering.  Customer shall not assign any
of its rights or delegate any of its obligations under any of the Loan Documents
without the prior written consent of MLBFS. Unless otherwise expressly agreed to
in a writing  signed  by  MLBFS,  no such  consent  shall in any  event  relieve
Customer of any of its obligations under this Loan Agreement or any of the other
Loan Documents.

(h)  INTERPRETATION;  CONSTRUCTION.  (i)  Captions  and  section  and  paragraph
headings in this Loan  Agreement are inserted  only as a matter of  convenience,
and shall not affect the interpretation  hereof;  (ii) no provision of this Loan
Agreement shall be construed  against a particular Person or in favor of another
Person  merely  because  of which  Person  (or its  representative)  drafted  or
supplied the wording for such provision;  and (iii) where the context  requires:
(a) use of the singular or plural  incorporates  the other, and (b) pronouns and
modifiers in the  masculine,  feminine or neuter gender shall be deemed to refer
to or include the other genders.

(i) GOVERNING LAW. This Loan Agreement and, unless otherwise  expressly provided
therein,  each of the Loan  Documents,  shall be governed in all respects by the
laws of the State of Illinois, not including its conflict of law provisions.

(j) SEVERABILITY OF PROVISIONS.  Whenever possible,  each provision of this Loan
Agreement and the other Loan Documents shall be interpreted in such manner as to
be effective and valid under applicable law. Any provision of the Loan Documents
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 the Loan
Documents or affecting the validity or  enforceability  of such provision in any
other jurisdiction.

(k) TERM.  This Loan  Agreement  shall become  effective on the date accepted by
MLBFS at its office in  Chicago,  Illinois,  and,  subject to the terms  hereof,
shall  continue  in effect so long  thereafter  as:  (i) the WCMA Line of Credit
shall be in effect,  (ii) there shall be any moneys  outstanding under this Loan
Agreement, or (iii) there shall be any other Obligations  outstanding.  Customer
hereby waives notice of acceptance of this Loan Agreement by MLBFS.

(l) EXHIBITS.  The exhibits to this Loan Agreement are hereby  incorporated  and
made a part hereof and are an integral part of this Loan Agreement.

(m)  COUNTERPARTS.   This  Loan  Agreement  may  be  executed  in  one  or  more
counterparts which, when taken together, constitute one and the same agreement.

(n)  JURISDICTION;  WAIVER.  CUSTOMER  ACKNOWLEDGES  THAT THIS LOAN AGREEMENT IS
BEING ACCEPTED BY MLBFS IN PARTIAL  CONSIDERATION OF MLBFS' RIGHT AND OPTION, IN
ITS SOLE  DISCRETION,  TO  ENFORCE  THE LOAN  DOCUMENTS  IN EITHER  THE STATE OF
ILLINOIS OR IN ANY OTHER  JURISDICTION  WHERE  CUSTOMER OR ANY COLLATERAL MAY BE
LOCATED.  CUSTOMER  IRREVOCABLY  SUBMITS ITSELF TO  JURISDICTION IN THE STATE OF
ILLINOIS AND VENUE IN ANY STATE OF FEDERAL  COURT IN THE COUNTY OF COOK FOR SUCH
PURPOSES,  AND CUSTOMER  WAIVES ANY AND ALL RIGHTS TO CONTEST SAID  JURISDICTION
AND VENUE  AND THE  CONVENIENCE  OF ANY SUCH  FORUM,  AND ANY AND ALL  RIGHTS TO
REMOVE SUCH  ACTION FROM STATE TO FEDERAL  COURT.  CUSTOMER  FURTHER  WAIVES ANY
RIGHTS TO COMMENCE ANY ACTION  AGAINST MLBFS IN ANY  JURISDICTION  EXCEPT IN THE
COUNTY OF COOK AND STATE OF ILLINOIS.  CUSTOMER  AGREES THAT ALL SUCH SERVICE OF
PROCESS SHALL BE MADE BY MAIL OR MESSENGER  DIRECTED TO IT IN THE SAME MANNER AS
PROVIDED FOR NOTICES TO CUSTOMER IN THIS LOAN AGREEMENT AND THAT SERVICE SO MADE
SHALL BE DEEMED TO BE COMPLETED  UPON THE EARLIER OF ACTUAL RECEIPT OR THREE (3)
DAYS AFTER THE SAME SHALL HAVE BEEN  POSTED TO  CUSTOMER  OR  CUSTOMER'S  AGENT.
NOTHING  CONTAINED HEREIN SHALL AFFECT THE RIGHT OF MLBFS TO SERVE LEGAL PROCESS
IN ANY OTHER  MANNER  PERMITTED BY LAW OR AFFECT THE RIGHT OF MLBFS TO BRING ANY
ACTION OR PROCEEDING AGAINST CUSTOMER OR ITS PROPERTY IN THE COURTS OF ANY OTHER
JURISDICTION.  CUSTOMER  WAIVES,  TO THE EXTENT  PERMITTED  BY LAW,  ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER,  BE REQUIRED
OF  MLBFS.  CUSTOMER  FURTHER  WAIVES  THE  RIGHT  TO BRING  ANY  NON-COMPULSORY
COUNTERCLAIMS.

(o) JURY WAIVER.  MLBFS AND  CUSTOMER  HEREBY EACH  EXPRESSLY  WAIVE ANY AND ALL
RIGHTS TO A TRIAL BY JURY IN ANY ACTION,  PROCEEDING OR COUNTERCLAIM  BROUGHT BY
EITHER OF THE  PARTIES  AGAINST  THE OTHER  PARTY  WITH  RESPECT  TO ANY  MATTER
RELATING  TO,  ARISING  OUT  OF OR IN ANY  WAY  CONNECTED  WITH  THE  LOAN,  THE
OBLIGATIONS,  THIS LOAN AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS AND/OR ANY OF
THE TRANSACTIONS WHICH ARE THE SUBJECT MATTER OF THIS LOAN AGREEMENT.

(p)  INTEGRATION.  THIS LOAN AGREEMENT,  TOGETHER WITH THE OTHER LOAN DOCUMENTS,
CONSTITUTES THE ENTIRE UNDERSTANDING AND REPRESENTS THE FULL AND FINAL AGREEMENT
BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT  MATTER  HEREOF,  AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR WRITTEN  AGREEMENTS OR PRIOR,  CONTEMPORANEOUS
OR  SUBSEQUENT  ORAL  AGREEMENTS  OF THE PARTIES.  THERE ARE NO  UNWRITTEN  ORAL
AGREEMENTS OF THE PARTIES. WITHOUT LIMITING THE FOREGOING, CUSTOMER ACKNOWLEDGES
THAT: (I) NO PROMISE OR COMMITMENT  HAS BEEN MADE TO IT BY MLBFS,  MLPF&S OR ANY
OF THEIR RESPECTIVE  EMPLOYEES,  AGENTS OR REPRESENTATIVES TO MAKE ANY WCMA LOAN
ON ANY TERMS OTHER THAN AS EXPRESSLY SET FORTH HEREIN, OR TO MAKE ANY OTHER LOAN
OR OTHERWISE  EXTEND ANY OTHER  CREDIT TO CUSTOMER OR ANY OTHER PARTY;  AND (II)
EXCEPT AS OTHERWISE  EXPRESSLY PROVIDED HEREIN,  THIS LOAN AGREEMENT  SUPERSEDES
AND  REPLACES  ANY AND  ALL  PROPOSALS,  LETTERS  OF  INTENT  AND  APPROVAL  AND
COMMITMENT  LETTERS FROM MLBFS TO CUSTOMER,  NONE OF WHICH SHALL BE CONSIDERED A
LOAN  DOCUMENT.  NO AMENDMENT OR  MODIFICATION  OF ANY OF THE LOAN  DOCUMENTS TO
WHICH CUSTOMER IS A PARTY SHALL BE EFFECTIVE  UNLESS IN A WRITING SIGNED BY BOTH
MLBFS AND CUSTOMER.

(q)  SURVIVAL.  All  representations,   warranties,   agreements  and  covenants
contained in the Loan  Documents  shall  survive the signing and delivery of the
Loan  Documents,  and all of the waivers  made and  indemnification  obligations
undertaken by Customer shall survive the termination,  discharge or cancellation
of the Loan Documents.
<PAGE>


(r) CUSTOMER'S  ACKNOWLEDGMENTS.  The Customer  acknowledges that the Customer:
(i) has had ample  opportunity to consult with counsel and such other parties as
deemed  advisable  prior to signing and  delivering  this Loan Agreement and the
other Loan Documents; (ii) understands the provisions of this Loan Agreement and
the other Loan Documents,  including all waivers  contained  therein;  and (iii)
signs and delivers this Loan Agreement and the other Loan  Documents  freely and
voluntarily, without duress or coercion.



                                      -12-
<PAGE>


THIS LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS ARE EXECUTED UNDER SEAL AND ARE
INTENDED TO TAKE EFFECT AS SEALED  INSTRUMENTS.

IN WITNESS WHEREOF, this Loan Agreement has been executed as of the day and year
first above written.

SEL-LAB MARKETING, INC.

By: /s/ Hal Markowitz
   -----------------------------------    --------------------------------------
           Signature (1)                               Signature (2)

        Hal Markowitz
--------------------------------------    --------------------------------------
           Printed Name                                Printed Name

        Chairman
--------------------------------------    --------------------------------------
           Title                                       Title

Accepted at Chicago, Illinois:

MERRILL LYNCH BUSINESS FINANCIAL
SERVICES INC.

By: /s/ Jennifer Corken
   ---------------------------------




                                      -13-
<PAGE>


                                   EXHIBIT A

ATTACHED  TO AND  HEREBY  MADE A PART OF WCMA  REDUCING  REVOLVER(SM)  LOAN  AND
SECURITY  AGREEMENT  NO.  885-07895  BETWEEN  MERRILL LYNCH  BUSINESS  FINANCIAL
SERVICES INC. AND SEL-LEB MARKETING, INC.
================================================================================

ADDITIONAL LOCATIONS OF TANGIBLE COLLATERAL:

N/A