<PAGE>   1
BUSINESS LOAN AGREEMENT

Borrower: Ride, Inc.
         8160 304TH AVE SE
         Preston, WA 98050

Lender:  US Bank
         East King County Corporate Banking
         10800 NE 8th Street, Suite 1000

         Bellevue, WA 98004

THIS BUSINESS LOAN AGREEMENT between RIDE, INC. ("Borrower") and U.S. BANK
("Lender") is made and executed on the following terms and conditions. Borrower
has received prior commercial loans from Lender or has applied to Lender for a
commercial loan or loans and other financial accommodations, including those
which may be described on any exhibit or schedule attached to this Agreement.
All such loans and financial accommodations, together with all future loans and
financial accommodations from Lender to Borrower, are referred to in this
Agreement individually as the "Loan" and collectively as the "Loans." Borrower
understands and agrees that: (a) in granting, renewing, or extending any Loan,
Lender is relying upon Borrower's representations, warranties and agreements, as
set forth in this Agreement; (b) the granting, renewing, or extending of any
Loan by Lender at all times shall be subject to Lender's sole judgment and
discretion; and (c) all such Loans shall be and shall remain subject to the
following terms and conditions of this Agreement.

TERM. This Agreement shall be effective as of June 30, 1997, and shall continue
thereafter until all Indebtedness of Borrower to Lender has been performed in
full and the parties terminate this Agreement in writing.

DEFINITIONS. The following words shall have the following meanings when used in
this Agreement. Terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code. All references
to dollar amounts shall mean amounts in lawful money of the United States of
America.

      Agreement. The word "Agreement" means this Business Loan Agreement, as
      this Business Loan Agreement may be amended or modified from time to time,
      together with all exhibits and schedules attached to this Business Loan
      Agreement from time to time.

      Borrower. The word "Borrower" means RIDE, INC. The word "Borrower" also
      includes, as applicable, all subsidiaries and affiliates of Borrower as
      provided below in the paragraph titled "Subsidiaries and Affiliates."

      CERCLA. The word "CERCLA" means the Comprehensive Environmental Response,
      Compensation, and Liability Act of 1980, as amended.

      Cash Flow.  The words "Cash Flow" mean net income after taxes, and 
      exclusive of extraordinary gains and income, plus depreciation and 
      amortization.


<PAGE>   2
      Collateral. The word "Collateral" means and includes without limitation
      all property and assets granted as collateral security for a Loan, whether
      real or personal property, whether granted directly or indirectly, whether
      granted now or in the future, and whether granted in the form of a
      security interest, mortgage, deed of trust, assignment, pledge, chattel
      mortgage, chattel trust, factor's lien, equipment trust, conditional sale,
      trust receipt, lien, charge, lien or title retention contract, lease or
      consignment intended as a security device, or any other security or lien
      interest whatsoever, whether created by law, contract, or otherwise.

      Debt. The word "debt" means all Borrower's liabilities excluding
      Subordinate Debt.

      ERISA. The word "ERISA" means the Employee Retirement Income Security Act
      of 1974, as amended.

      Event of Default. The words "Event of Default" mean and include without
      limitation any of the Events of Default set forth below in the section
      titled "EVENTS OF DEFAULT".

      Grantor. The word "Grantor" means and includes without limitation each and
      all of the persons or entities granting a Security Interest in any
      Collateral for the Indebtedness, including without limitation all
      Borrowers granting such a Security Interest.

      Guarantor. The word "Guarantor" means and includes without limitation each
      and all of the guarantors, sureties, and accommodation parties in
      connection with any Indebtedness.

      Indebtedness. The word "Indebtedness" means and includes without
      limitations all Loans, together with all other obligations, debts and
      liabilities of Borrower to Lender, or any one or more of them, as well as
      all claims by Lender against Borrower, or any one or more of them; whether
      now or hereafter existing, voluntary or involuntary, due or not due,
      absolute or contingent, liquidated or unliquidated; whether Borrower may
      be liable individually or jointly with others; whether Borrower may be
      obligated as a guarantor, surety, or otherwise; whether recovery upon such
      Indebtedness may be or hereafter may become barred by any statute of
      limitations; and whether such Indebtedness may be or hereafter may become
      otherwise unenforceable.

      Lender. The word "Lender" means U.S. BANK, its successors and assigns.

      Liquid Assets. The words "Liquid Assets" mean Borrower's cash on hand plus
      Borrower's readily marketable securities.

      Loan. The word "Loan" or "Loans" means and includes without limitation any
      and all commercial loans and financial accommodations from Lender to
      Borrower, whether now or hereafter existing, and however evidenced,
      including without limitation those loans and financial accommodations
      described herein or described on any exhibit or schedule attached to this
      Agreement from time to time.

      Note. The word "Note" means and includes without limitation Borrower's
      promissory note or notes, if any, evidencing Borrower's Loan obligations
      in favor of Lender, as well as any substitute, replacement or refinancing
      note or notes therefor.


<PAGE>   3
      Permitted Liens. The words "Permitted Liens" mean: (a) liens and security
      interests securing Indebtedness owed by Borrower to Lender; (b) liens for
      taxes, assessments, or similar charges either not yet due or being
      contested in good faith; (c) liens of materialmen, mechanics,
      warehousemen, or carriers, or other like liens arising in the ordinary
      course of business and securing obligations which are not yet delinquent;
      (d) purchase money liens or purchase money security interests upon or in
      any property acquired or held by Borrower in the ordinary course of
      business to secure Indebtedness outstanding on the date of this Agreement
      or permitted to be incurred under the paragraph of this Agreement titled
      "Indebtedness and Liens"; (e) liens and security interests which, as of
      the date of this Agreement, have been disclosed to and approved by the
      Lender in writing; and (f) those liens and security interests which in the
      aggregate constitute an immaterial and insignificant monetary amount with
      respect to the net value of Borrower's assets.

      Related Documents. The words "Related Documents" mean and include without
      limitation all promissory notes, credit agreements, loan agreements,
      environmental agreements, guaranties, security agreements, mortgages,
      deeds of trust, and all other instruments, agreements and documents,
      whether now or hereafter existing, executed in connection with the
      Indebtedness.

      Security Agreement. The words "Security Agreement" mean and include
      without limitation any agreements, promises, covenants, arrangements,
      understandings or other agreements, whether created by law, contract, or
      otherwise, evidencing, governing, representing, or creating a Security
      Interest.

      Security Interest. The words "Security Interest" mean and include without
      limitation any type of collateral security, whether in the form of a lien,
      charge, mortgage, deed of trust, assignment, pledge, chattel mortgage,
      chattel trust, factor's lien, equipment trust, conditional sale, trust
      receipt, lien or title retention contract, lease or consignment intended
      as a security device, or any other security or lien interest whatsoever,
      whether created by law, contract, or otherwise.

      SARA. The word "SARA" means the Superfund Amendments and Reauthorization
      Act of 1986 as now or hereafter amended.

      Subordinate Debt. The words "Subordinate Debt" mean indebtedness and
      liabilities of Borrower which have been subordinated by written agreement
      to indebtedness owed by Borrower to Lender in form and substance
      acceptable to Lender.

      Tangible Net Worth. The words "Tangible net Worth" mean Borrower's total
      assets excluding all intangible assets (i.e., goodwill, trademarks,
      patents, copyrights, organizational expenses, and similar intangible
      items, but including leaseholds and leasehold improvements) less total
      Debt.

      Working Capital. The words "Working Capital" mean Borrower's current
      assets, excluding prepaid expenses, less Borrower's current liabilities.

CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the initial
Loan Advance and each subsequent Loan Advance under this Agreement shall be
subject to the fulfillment to Lender's satisfaction of all of the conditions set
forth in this Agreement and in the Related Documents.


<PAGE>   4


      Loan Documents. Borrower shall provide to Lender in form satisfactory to
      Lender the following documents for the Loan: (a) the Note, (b) Security
      Agreements granting to Lender security interests in the Collateral, (c)
      Financing Statements perfecting Lender's Security Interests; (d) evidence
      of insurance as required below; and (e) any other documents required under
      this Agreement or by Lender or its counsel, including without limitation
      any guaranties described below.

      Borrower's Authorization. Borrower shall have provided in form and
      substance satisfactory to Lender properly certified resolutions, duly
      authorizing the execution and delivery of this Agreement, the Note and the
      Related Documents, and such other authorizations and other documents and
      instruments as Lender or its counsel, in their sole discretion, may
      require.

      Payment of Fees and Expenses. Borrower shall have paid to Lender all fees,
      charges, and other expenses which are then due and payable as specified in
      this Agreement or any Related Document.

      Representations and Warranties. The representations and warranties set
      forth in this Agreement, in the Related Documents, and in any document or
      certificate delivered to Lender under this Agreement are true and correct.

      No Event of Default. There shall not exist at the time of any advance a
      condition which would constitute an Event of Default under this Agreement.

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as
of the date of this Agreement, as of the date of each disbursement of Loan
proceeds, as of the date of any renewal, extension or modification of any Loan,
and at all times any Indebtedness exists:

      Organization. Borrower is a corporation which is duly organized, validly
      existing, and in good standing under the laws of the State of Washington
      and is validly existing and in good standing in all states in which
      Borrower is doing business. Borrower has the full power and authority to
      own its properties and to transact the businesses in which it is presently
      engaged or presently proposes to engage. Borrower also is duly qualified
      as a foreign corporation and is in good standing in all states in which
      the failure to so qualify would have a material adverse effect on its
      businesses or financial condition.

      Authorization. The execution, delivery, and performance of this Agreement
      and all Related Documents by Borrower, to the extent to be executed,
      delivered or performed by Borrower, have been duly authorized by all
      necessary action by Borrower; do not require the consent or approval of
      any other person, regulatory authority or governmental body; and do not
      conflict with, result in a violation of, or constitute a default under (a)
      any provision of its articles of incorporation or organization, or bylaws,
      or any agreement or other instrument binding upon Borrower or (b) any law,
      governmental regulation, court decree, or order applicable to Borrower.

      Financial information. Each financial statement of Borrower supplied to
      Lender truly and completely disclosed Borrower's financial condition as of
      the date of the statement, and there has been no material adverse change
      in Borrower's financial condition subsequent to the date of the most
      recent financial statement supplied to Lender. Borrower has no material
      contingent obligations except as disclosed in such financial statements.


<PAGE>   5
      Legal Effect. This Agreement constitutes, and any instrument or agreement
      required hereunder to be given by Borrower when delivered will constitute,
      legal, valid and binding obligations of Borrower enforceable against
      Borrower in accordance with their respective terms.

     Properties. Except as contemplated by this Agreement or as previously
     disclosed in Borrower's financial statements or in writing to Lender and as
     accepted by Lender, and except for property tax liens for taxes not
     presently due and payable, Borrower owns and has good title to all of
     Borrowers properties free and clear of all Security Interests, and has not
     executed any security documents or financing statements relating to such
     properties. All of Borrower's properties are titled in Borrower's legal
     name, and Borrower has not used, or filed a financing statement under, any
     other name for at least five (5) years.

      Hazardous Substances. The terms "hazardous waste," "hazardous substance,"
      "disposal," "release," and "threatened release," as used in this
      Agreement, shall have the same meanings as set forth in the "CERCLA,"
      "SARA," the Hazardous Materials Transportation Act, 49 U.S.C. Section
      1801, et seq., the Resource Conservation and Recovery Act, 42 U.S.C.
      Section 6901, et seq., or other applicable state or Federal laws, rules,
      or regulations adopted pursuant to any of the foregoing. Except as
      disclosed to and acknowledged by Lender in writing, Borrower represents
      and warrants that: (a) During the period of Borrower's ownership of the
      properties, there has been no use, generation, manufacture, storage,
      treatment, disposal, release or threatened release of any hazardous waste
      or substance by any person on, under, about or from any of the properties.
      (b) Borrower has no knowledge of, or reason to believe that there has
      been; (i) any use, generation, manufacture, storage, treatment, disposal,
      release, or threatened release of any hazardous waste or substance on,
      under, about or from the properties by any prior owners or occupants of
      any of the properties, or (ii) any actual or threatened litigation or
      claims of any kind by any person relating to such matters. (c) Neither
      Borrower nor any tenant, contractor, agent or other authorized user of any
      of the properties shall use, generate, manufacture, store, treat, dispose
      of, or release any hazardous waste or substance on, under, about or from
      any of the properties; and any such activity shall be conducted in
      compliance with all applicable federal, state, and local laws,
      regulations, and ordinances, including without limitation those laws,
      regulations and ordinances described above. Borrower authorizes Lender and
      its agents to enter upon the properties to make such inspections and tests
      as Lender may deem appropriate to determine compliance of the properties
      with this section of the Agreement. Any inspections or tests made by
      Lender shall be at Borrower's expense and for Lender's purposes only and
      shall not be construed to create any responsibility or liability on the
      part of Lender to Borrower or to any other person. The representations and
      warranties contained herein are based on Borrower's due diligence in
      investigating the properties for hazardous waste and hazardous substances.
      Borrower hereby (a) releases and waives any future claims against Lender
      for indemnity or contribution in the event Borrower becomes liable for
      cleanup or other costs under any such laws, and (b) agrees to indemnify
      and hold harmless Lender against any and all claims, losses, liabilities,
      damages, penalties, and expenses which Lender may directly or indirectly
      sustain or suffer resulting from a breachof this section of the Agreement
      or as a consequence of any use, generation, manufacture, storage,
      disposal, release or threatened release occurring prior to Borrower's
      ownership or interest in the properties, whether or not the same was or
      should have been known to Borrower. The provisions of this section of the
      Agreement, including the obligation to 



<PAGE>   6
      indemnify, shall survive the payment of the Indebtedness and the
      termination or expiration of this Agreement and shall not be affected by
      Lender's acquisition of any interest in any of the properties, whether by
      foreclosure or otherwise.

      Litigation and Claims. No litigation, claim, investigation, administrative
      proceeding or similar action (including those for unpaid taxes) against
      Borrower is pending or threatened, and no other event has occurred which
      may materially adversely affect Borrower's financial condition or
      properties, other than litigation, claims, or other events, if any, that
      have been disclosed to and acknowledged by Lender in writing.

      Taxes. To the best of Borrower's knowledge, all tax returns and reports of
      Borrower that are or were required to be filed, have been filed, and all
      taxes, assessments and other governmental charges have been paid in full,
      except those presently being or to be contested by Borrower in good faith
      in the ordinary course of business and for which adequate reserves have
      been provided.

      Lien Priority. Unless otherwise previously disclosed to Lender in writing,
      Borrower has not entered into or granted any Security Agreements, or
      permitted the filing or attachment of any Security Interests on or
      affecting any of the Collateral directly or indirectly securing repayment
      of Borrower's Loan and Note, that would be prior or that may in any way be
      superior to Lender's Security Interests and rights in and to such
      Collateral.

      Binding Effect. This Agreement, the Note, all Security Agreements directly
      or indirectly securing repayment of Borrower's Loan and Note and all of
      the Related Documents are binding upon Borrower as well as upon Borrower's
      successors, representatives and assigns, and are legally enforceable in
      accordance with their respective terms.

      Commercial Purposes. Borrower intends to use the Loan proceeds solely for
      business or commercial related purposes.

      Employee Benefit Plans. Each employee benefit plan as to which Borrower
      may have any liability complies in all material respects with all
      applicable requirements of law and regulations, and (i) no Reportable
      Event nor Prohibited Transaction (as defined in ERISA) has occurred with
      respect to any such plan, (ii) Borrower has not withdrawn from any such
      plan or initiated steps to do so, (iii) no steps have been taken to
      terminate any such plan, and (iv) there are no unfunded liabilities other
      than those previously disclosed to Lender in writing.

      Location of Borrower's Offices and Records. Borrower's place of business,
      or Borrower's Chief executive office, if Borrower has more than one place
      of business, is located at 8160 304TH AVENUE SE, PRESTON, WA 98050. Unless
      Borrower has designated otherwise in writing this location is also the
      office or offices where Borrower keeps its records concerning the
      Collateral.



<PAGE>   7
      Information. All information heretofore or contemporaneously herewith
      furnished by Borrower to Lender for the purposes of or in connection with
      this Agreement or any transaction contemplated hereby is, and all
      information hereafter furnished by or on behalf of Borrower to Lender will
      be, true and accurate in every material respect on the date as of which
      such information is dated or certified; and none of such information is or
      will be incomplete by omitting to state any material fact necessary to
      make such information not misleading.

      Survival of Representations and Warranties. Borrower understands and
      agrees that Lender, without independent investigation, is relying upon the
      above representations and warranties in extending Loan Advances to
      Borrower. Borrower further agrees that the foregoing representations and
      warranties shall be continuing in nature and shall remain in full force
      and effect until such time as Borrower's Indebtedness shall be paid in
      full, or until this Agreement shall be terminated in the manner provided
      above, whichever is the last to occur.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, while
this Agreement is in effect, Borrower will:

      Litigation. Promptly inform Lender in writing of (a) all material adverse
      changes in Borrower's financial condition, and (b) all existing and all
      threatened litigation, claims, investigations, administrative proceedings
      or similar actions affecting Borrower or any Guarantor which could
      materially affect the financial condition of Borrower or the financial
      condition of any Guarantor.

      Financial Records. Maintain its books and records in accordance with
      generally accepted accounting principles, applied on a consistent basis,
      and permit Lender to examine and audit Borrowers books and records at all
      reasonable times.

      Financial Statements. Furnish Lender with, as soon as available, but in no
      event later than one hundred twenty (120) days after the end of each
      fiscal year, Borrower's balance sheet and income statement for the year
      ended, audited by a certified public accountant satisfactory to Lender,
      and, as soon as available, but in no event later than forty five (45) days
      after the end of each fiscal quarter, Borrower's balance sheet and profit
      and loss statement for the period ended, prepared and certified as correct
      to the best knowledge and belief by Borrower's chief financial officer or
      other officer or person acceptable to Lender. All financial reports
      required to be provided under this Agreement shall be prepared in
      accordance with generally accepted accounting principles, applied on a
      consistent basis, and certified by Borrower as being true and correct.

      Additional Information. Furnish such additional information and
      statements, lists of assets and liabilities, agings of receivables and
      payables, inventory schedules, budgets, forecasts, tax returns, and other
      reports with respect to Borrower's financial condition and business
      operations as Lender may request from time to time.

      Financial Covenants and Ratios. Comply with the following covenants and
      ratios:

           Net Worth Ratio.  Maintain a ratio of Total Liabilities to Tangible
           Net Worth of less than 1.00 to 1.00.

           Working Capital. Maintain Working Capital in excess of
           $14,000,000.00.


<PAGE>   8
      The following provisions shall apply for purposes of determining
      compliance with the foregoing financial covenants and ratios: BORROWER
      UNDERSTANDS AND AGREES THAT MODIFIED QUICK RATIO WILL BE MONITORED MONTHLY
      AND ALL OTHER COVENANTS AND RATIOS WILL BE MONITORED QUARTERLY. Except as
      provided above, all computations made to determine compliance with the
      requirements contained in this paragraph shall be made in accordance with
      generally accepted accounting principles, applied on a consistent basis,
      and certified by Borrower as being true and correct.

      Insurance. Maintain fire and other risk insurance, public liability
      insurance, as Lender may require with respect to Borrower's properties and
      operations, in form, amounts, coverages and with insurance companies
      reasonably acceptable to Lender. Borrower, upon request of Lender, will
      deliver to Lender from time to time the policies or certificates of
      insurance in form satisfactory to Lender, including stipulations that
      coverages will not be canceled or diminished without at least ten (10)
      days prior written notice to Lender. Each insurance policy also shall
      include an endorsement providing that coverage in favor of Lender will not
      be impaired in any way by any act, omission or default of Borrower or any
      other person. In connection with all policies covering assets in which
      Lender holds or is offered a security interest for the Loans, Borrower
      will provide Lender with such loss payable or other endorsements as Lender
      may require.

      Insurance Reports. Furnish to Lender, upon request of Lender, reports on
      each existing insurance policy showing such information as Lender may
      reasonably request, including without limitation the following: (a) the
      name of the insurer, (b) the risks insured; (c) the amount of the policy,
      (d) the properties insured; (e) the then current property values on the
      basis of which insurance has been obtained, and the manner of determining
      those values; and (f) the expiration date of the policy. In addition, upon
      request of Lender (however not more often than annually), Borrower will
      have an independent appraiser satisfactory to Lender determine, as
      applicable, the actual cash value or replacement cost of any Collateral.
      The cost of such appraisal shall be paid by Borrower.

      Guaranties. Prior to disbursement of any Loan proceeds, furnish executed
      guaranties of the Loans in favor of Lender, executed by the guarantors
      named below, on Lender's forms, and in the amounts and under the
      conditions spelled out in those guaranties.

<TABLE>
<CAPTION>
                      Guarantors                               Amounts
                      ----------                               -------
<S>                                                           <C>
                 RIDE MANUFACTURING, INC.                     Unlimited
                 RIDE INTERNATIONAL, INC.                     Unlimited
                 PRESTON BINDING COMPANY                      Unlimited

                 SMP CLOTHING, INC.                           Unlimited
                 RIDE SNOWBOARD COMPANY                       Unlimited
</TABLE>

      Other Agreements. Comply with all terms and conditions of all other
      agreements, whether now or hereafter existing, between Borrower and any
      other party and notify Lender immediately in writing of any default in
      connection with any other such agreements.


<PAGE>   9
      Loan Proceeds. Use all Loan proceeds solely for Borrower's business
      operations, unless specifically consented to the contrary by Lender in
      writing.

      Taxes, Charges and Liens. Pay and discharge when due all of its
      Indebtedness and obligations, including without limitation all
      assessments, taxes, governmental charges, levies and liens, of every kind
      and nature, imposed upon Borrower or its properties, income, or profits,
      prior to the date on which penalties would attach, and all lawful claims
      that, if unpaid, might become a lien or charge upon any of Borrower's
      properties, income, or profit. Provided however, Borrower will not be
      required to pay and discharge any such assessment, tax, charge, levy, lien
      or claim so long as (a) the legality of the same shall be contested in
      good faith by appropriate proceedings, and (b) Borrower shall have
      established on its books adequate reserves with respect to such contested
      assessment, tax, charge, levy, lien, or claim in accordance with generally
      accepted accounting practices. Borrower, upon demand of Lender, will
      furnish to Lender evidence of payment of the assessments, taxes, charges,
      levies, liens and claims and will authorize the appropriate governmental
      official to deliver to Lender at any time a written statement of any
      assessments, taxes, charges, levies, liens and claims against Borrower's
      properties, income, or profits.

      Performance. Perform and comply with all terms, conditions, and provisions
      set forth in this Agreement and in the Related Documents in a timely
      manner, and promptly notify Lender if Borrower learns of the occurrence of
      any event which constitutes an Event of Default under this Agreement or
      under any of the Related Documents.

      Operations. Maintain executive and management personnel with substantially
      the same qualifications and experience as the present executive and
      management personnel; provide written notice to Lender of any change in
      executive and management personnel; conduct its business affairs in a
      reasonable and prudent manner and in compliance with all applicable
      federal, state and municipal laws, ordinances, rules and regulations
      respecting its properties, charters, businesses and operations, including
      without limitations, compliance with the Americans With Disabilities Act
      and with all minimum funding standards and other requirements of ERISA and
      other laws applicable to Borrower's employee benefit plans.

      Inspection. Permit employees or agents of Lender at any reasonable time to
      inspect any and all Collateral for the Loan or Loans and Borrower's other
      properties and to examine or audit Borrower's books, accounts, and records
      and to make copies and memoranda of Borrower's books, accounts, and
      records. If Borrower now or at any time hereafter maintains any records
      (including without limitation computer generated records and computer
      software programs for the generation of such records) in the possession of
      a third party, Borrower, upon request of Lender, shall notify such party
      to permit Lender free access to such records at all reasonable times and
      to provide Lender with copies of any records it may request, all at
      Borrower's expense.


<PAGE>   10
      Compliance Certificate. Unless waived in writing by Lender, provide Lender
      MODIFIED QUICK RATIO REQUIRES MONTHLY COMPLIANCE CERTIFICATES, ALL OTHER
      COVENANTS REQUIRE QUARTERLY COMPLIANCE CERTIFICATES with a certificate
      executed by Borrower's chief financial officer, or other officer or person
      acceptable to Lender, certifying that the representations and warranties
      set forth in this Agreement are true and correct as of the date of the
      certificate and further certifying that, as of the date of the
      certificate, no Event of Default exists under this Agreement.

      Environmental Compliance and Reports. Borrower shall comply in all
      respects with all environmental protection federal, state and local laws,
      statutes, regulations and ordinances; not cause or permit to exist, as a
      result of an intentional or unintentional action or omission on its part
      or on the part of any third party, on property owned and/or occupied by
      Borrower, any environmental activity where damage may result to the
      environment unless such environmental activity is pursuant to and in
      compliance with the conditions of a permit issued by the appropriate
      federal, state or local governmental authorities; shall furnish to Lender
      promptly and in any event within thirty (30) days after receipt thereof a
      copy of any notice, summons, lien, citation, directive, letter or other
      communication from any governmental agency or instrumentality concerning
      any intentional or unintentional action or omission on Borrower's part in
      connection with any environmental activity whether or not there is damage
      to the environment and/or other natural resources.

      Additional Assurances. Make, execute and deliver to Lender such promissory
      notes, mortgages, deeds of trust, security agreements, financing
      statements, instruments, documents and other agreements as Lender or its
      attorneys may reasonably request to evidence and secure the Loans and to
      perfect all Security Interests.

RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law,
rule, regulation or guideline, or in the interpretation or application of any
thereof by any court or administrative or governmental authority (including any
request or policy not having the force of law) shall impose, modify or make
applicable any taxes (except U.S. federal, state or local income or franchise
taxes imposed on Lender), reserve requirements , capital adequacy requirements
or other obligations which would (a) increase the cost to Lender for extending
or maintaining the credit facilities to which this Agreement relates, (b) reduce
the amounts payable to Lender under this Agreement or the Related Documents, or
(c) reduce the rate of return on Lender's capital as a consequence of Lender's
obligations with respect to the credit facilities to which this Agreement
relates, then Borrower agrees to pay Lender such additional amounts as will
compensate Lender therefor, within five (5) days after Lender's written demand
for such payment, which demand shall be accomplished by an explanation of such
imposition or charge and a calculation in reasonable detail of the additional
amounts payable by Borrower, which explanation and calculations shall be
conclusive in the absence of manifest error.

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall not, without the prior written consent of
Lender:


<PAGE>   11
      Capital Expenditures. Make or contract to make capital expenditures,
      including leasehold improvements, in any fiscal year in excess of
      $800,000.00 or incur liability for rentals of property (including both
      real and personal property) in an amount which, together with capital
      expenditures, shall in any fiscal year exceed such sum.

      Indebtedness and Liens. (a) Except for trade debt incurred in the normal
      course of business and Indebtedness to Lender contemplated by this
      Agreement, create, incur or assume Indebtedness for borrowed money,
      including capital leases, (b) except as allowed as a Permitted Lien, sell,
      transfer, mortgage, assign, pledge, lease, grant a security interest in,
      or encumber any of Borrower's assets, or (c) sell with recourse any of the
      Borrower's accounts, except to Lender.

      Continuity of Operations. (a) Engage in any business activities
      substantially different than those in which Borrower is presently engaged,
      (b) cease operations, liquidate, merge, transfer, acquire or consolidate
      with any other entity, change ownership, change its name, dissolve or
      transfer or sell Collateral out of the ordinary course of business, (c)
      pay any dividends on Borrower's stock (other than dividends payable in its
      stock)provided, however that notwithstanding the foregoing, but only so
      long as no Event of Default has occurred and is continuing or would result
      from the payment of dividends, if Borrower is a "Subchapter S Corporation"
      (as defined in the Internal Revenue Code of 1986, as amended), Borrower
      may pay cash dividends on its stock to its shareholders from time to time
      in amounts necessary to enable the shareholders to pay income taxes and
      make estimated income tax payments to satisfy their liabilities under
      federal and state law which arise solely from their status as Shareholders
      of a Subchapter S Corporation because of their ownership of shares of
      stock of Borrower, or (d) purchase or retire any of Borrower's outstanding
      shares or alter or amend Borrower's capital structure.

      Loans, Acquisitions and Guaranties. (a) loan, invest in or advance money
or assets, (b) purchase, create or acquire any interest in any other enterprise
or entity, or (c) incur any obligation as surety or guarantor other than in the
ordinary course of business.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if:
(a) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the Related Documents or any other agreement that Borrower or any
Guarantor has with Lender; (b) Borrower or any Guarantor becomes insolvent,
files a petition in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (c) there occurs a material adverse change in Borrower's financial
condition, in the financial condition of any Guarantor, or in the value of any
Collateral securing any Loan; (d) any Guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such Guarantor's guaranty of the Loan or any
other loan with Lender; or (e) Lender in good faith deems itself insecure, even
though no Event of Default shall have occurred.

STATUTE OF FRAUDS DISCLOSURE. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY,
EXTEND CREDIT, OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT
ENFORCEABLE UNDER WASHINGTON LAW.


<PAGE>   12
OUT OF DEBT PERIOD. BORROWER AGREES TO REDUCE THE PRINCIPAL BALANCE ON THE LINE
OF CREDIT FACILITY TO $0.00 FOR A MINIMUM OF 30 CONSECUTIVE DAYS DURING THE TERM
OF THE LINE OF CREDIT.
(THIS DOES NOT APPLY TO OPEN L/C'S.)

TANGIBLE NET WORTH. BORROWER AGREES TO MAINTAIN A MINIMUM TANGIBLE NET WORTH OF
NOT LESS THAN $21,000,000.00 AT EACH QUARTER END AND $23,000,000.00 AT FISCAL
YEAR END.

QUICK RATIO. BORROWER AGREES TO MAINTAIN A RATION OF LIQUID ASSETS TO CURRENT
LIABILITIES IN EXCESS OF 1.25 TO 1.00 DEFINED AS: (CASH AND EQUIVALENTS PLUS
TRADE ACCOUNTS RECEIVABLE PLUS INVENTORY) DIVIDED BY (CURRENT LIABILITIES PLUS
ALL OPEN LETTERS OF CREDIT AND BANKERS ACCEPTANCES). FOR THE JUNE THROUGH
OCTOBER, 1997 MEASUREMENT PERIODS, WE WILL ALLOW THE COMPANY TO INCLUDE THEIR
1996 FEDERAL INCOME TAX REFUND RECEIVABLE IN THE NUMERATION OF THIS FORMULA.

RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory security
interest in, and hereby assigns, conveys, delivers, pledges, and transfers to
Lender all Borrower's right, title and interest in and to, Borrower's accounts
with Lender (whether checking, savings, or some other account), including
without limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the Indebtedness against
any and all such accounts, and, at Lender's option, to administratively freeze
all such accounts to allow Lender to protect Lender's charge and setoff rights
provided on this paragraph.

EVENTS OF DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

      Default on Indebtedness. Failure of Borrower to make any payment when due
      on the Loans.

      Other Defaults. Failure of Borrower or any Grantor to comply with or to
      perform when due any other term, obligation, covenant or condition
      contained in this Agreement or in any of the Related Documents, or failure
      of Borrower to comply with or to perform any other term, obligation,
      covenant or condition contained in any other agreement between Lender and
      Borrower.

      Default In Favor of Third Parties. Should Borrower or any Grantor default
      under any loan, extension of credit, security agreement, purchase or sales
      agreement, or any other agreement, in favor of any other creditor or
      person that may materially affect any of Borrower's property or Borrower's
      or any Grantor's ability to repay the Loans or perform their respective
      obligations under this Agreement or any of the Related Documents.

      False Statements. Any warranty, representation or statement made or
      furnished to Lender by or on behalf of Borrower or any Grantor under this
      Agreement or the Related Documents is false or misleading in any material
      respect at the time made or furnished, or becomes false or misleading at
      any time thereafter.

      Defective Collateralization. This Agreement or any of the Related
      Documents ceases to be in full force and effect (including failure of any
      Security Agreement to create a valid and perfected Security Interest) at
      any time and for any reason.

      Insolvency. The dissolution or termination of Borrower's existence as a


<PAGE>   13
      going business, the insolvency of Borrower, the appointment of a receiver
      for any part of Borrower's property, any assignment for the benefit of
      creditors, any type of creditor workout, or the commencement of any
      proceeding under any bankruptcy or insolvency laws by or against Borrower.

      Creditor or Forfeiture Proceedings. Commencement of foreclosure or
      forfeiture proceedings, whether by judicial proceeding, self-help,
      repossession or any other method, by any creditor of Borrower, any
      creditor of any Grantor against any collateral securing the Indebtedness,
      or by any governmental agency. This includes a garnishment, attachment, or
      levy on or of any of Borrower's deposit accounts with Lender.

      Events Affecting Guarantor. Any of the preceding events occurs with
      respect to any Guarantor of any of the Indebtedness or any Guarantor dies
      or becomes incompetent, or revokes or disputes the validity of, or
      liability under, any Guaranty of the Indebtedness.

      Change in Ownership. The acquisition by any one person of a majority of
      Borrower's outstanding Common Stock.

      Adverse Change. A material adverse change occurs in Borrower's financial
      condition, or Lender believes the prospect of payment or performance of
      the Indebtedness is impaired.

       Insecurity.  Lender, in good faith, deems itself insecure.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where
otherwise provided in this Agreement or the Related Documents, all commitments
and obligations of Lender under this Agreement or the Related Documents or any
other agreement immediately will terminate (including any obligation to make
Loan Advances or disbursements), and, at Lender's option, all Indebtedness
immediately will become due and payable, all without notice of any kind to
Borrower, except that in the case of an Event of Default of the type described
in the "Insolvency" subsection above, such acceleration shall be automatic and
not optional. In addition, Lender shall have all the rights and remedies
provided in the Related Documents or available at law, in equity, or otherwise.
Except as may be prohibited by applicable law, all of Lenders rights and
remedies shall be cumulative and may be exercised singularly or concurrently.
Election by Lender to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an
obligation of Borrower or of any Grantor shall not affect Lender's right to
declare a default and to exercise is rights and remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:

      Amendments. This Agreement, together with any Related Documents,
      constitutes the entire understanding and agreement of the parties as to
      the matters set forth in this Agreement. No alteration of or amendment to
      this Agreement shall be effective unless given in writing and signed by
      the party or parties sought to be charged or bound by the alteration or
      amendment.

      Applicable Law. This Agreement has been delivered to Lender and accepted
      by Lender in the State of Washington. If there is a lawsuit, Borrower
      agrees upon Lender's request to submit to the jurisdiction of the courts
      of King County, the State of Washington. Subject to the provisions on
      arbitration, this Agreement shall be governed by and construed in
      accordance with the laws of the State of Washington.


<PAGE>   14
      Arbitration. Lender and Borrower agree that all disputes, claims and
      controversies between them, whether individual, joint or class in nature,
      arising from this Agreement or otherwise, including without limitation
      contract and tort disputes, shall be arbitrated pursuant to the Rules of
      the American Arbitration Association, upon request of either party. No act
      to take or dispose of any Collateral shall constitute a waiver of this
      arbitration agreement or be prohibited by this arbitration agreement. This
      includes, without limitation, obtaining injunctive relief or a temporary
      restraining order; invoking a power of sale under any deed of trust or
      mortgage; obtaining a writ of attachment or imposition of a receiver; or
      exercising any rights relating to personal property, including taking or
      disposing of such property with or without judicial process pursuant to
      Article 9 of the Uniform Commercial Code. Any disputes, claims, or
      controversies concerning the lawfulness or reasonableness of any act, or
      exercise of any right, concerning any Collateral, including any claim to
      rescind, reform, or otherwise modify any agreement relating to the
      Collateral, shall also be arbitrated, provided however that no arbitrator
      shall have the right or the power to enjoin or restrain any act of any
      party. Judgment upon any award rendered by any arbitrator may be entered
      in any court having jurisdiction. Nothing in this Agreement shall preclude
      any party from seeking equitable relief from a court of competent
      jurisdiction. The statute of limitations, estoppel, waiver, laches, and
      similar doctrines which would otherwise be applicable in an action brought
      by a party shall be applicable in any arbitration proceeding, and the
      commencement of an arbitration proceeding shall be deemed the commencement
      of an action for these purposes. The Federal Arbitration Act shall apply
      to the construction, interpretation, and enforcement of this arbitration
      provision.

      Caption Headings. Caption headings in this Agreement are for convenience
      purposes only and are not to be used to interpret or define the provisions
      of this Agreement.

      Multiple Parties; Corporate Authority. All obligations of Borrower under
      this Agreement shall be joint and several, and all references to Borrower
      shall mean each and every Borrower. This means that each of the persons
      signing below is responsible for all obligations in this Agreement.

      Consent to Loan Participation. Borrower agrees and consents to Lender's
      sale or transfer, whether now or later, of one or more participation
      interests in the Loans to one or more purchasers, whether related or
      unrelated to Lender. Lender may provide, without any limitation
      whatsoever, to any one or more purchasers, or potential purchasers, any
      information or knowledge Lender may have about Borrower or about any other
      matter relating to the Loan, and Borrower hereby waives any rights to
      privacy it may have with respect to such matters. Borrower additionally
      waives any and all notices of sale of participation interests, as well as
      all notices of any repurchase of such participation interests. Borrower
      also agrees that the purchasers of any such participation interest will be
      considered as the absolute owners of such interests in the Loans and will
      have all the rights granted under the participation agreement or
      agreements governing the sale of such participation interests. Borrower
      further waives all rights of offset or counterclaim that it may have now
      or later against Lender or against any purchaser of such a participation
      interest and unconditionally agrees that either Lender or such purchaser
      may enforce Borrower's obligation under the Loans irrespective of the
      failure or insolvency of any holder of any interest in the Loans. Borrower
      further agrees that the purchaser of any such participation interests may
      enforce its interests irrespective of any personal claims or defenses that


<PAGE>   15
      Borrower may have against Lender.

      Costs and Expenses. Borrower agrees to pay upon demand all of Lender's
      expenses, including without limitation attorneys' fees, incurred in
      connection with the enforcement, modification and collection of this
      Agreement or in connection with the Loans made pursuant to this Agreement.
      Lender may pay someone else to help collect the Loans and to enforce this
      Agreement, and Borrower will pay that amount. This includes, subject to
      any limits under applicable law, Lender's attorneys' fees and Lender's
      legal expenses, whether or not there is a lawsuit, including attorneys'
      fees for bankruptcy proceedings (including efforts to modify or vacate any
      automatic stay or injunction), appeals, and any anticipated post-judgment
      collection services. Borrower also will pay any court costs, in addition
      to all other sums provided by law.

      Notices. All notices required to be given under this Agreement shall be
      given in writing, may be sent by telefacsimilie, and shall be effective
      when actually delivered or when deposited with a nationally recognized
      overnight courier or deposited in the United States mail, first class,
      postage prepaid, addressed to the party to whom the notice is to be given
      at the address shown above. Any party may change its address for notices
      under this Agreement by giving formal written notice to the other parties,
      specifying that the purpose of the notice is to change the party's
      address. To the extent permitted by applicable law, if there is more than
      one Borrower, notice to any Borrower will constitute notice to all
      Borrowers. For notice purposes, Borrower will keep Lender informed at all
      times of Borrower's current address(es).

      Severability. If a court of competent jurisdiction finds any provision of
      this Agreement to be invalid or unenforceable as to any person or
      circumstance, such finding shall not render that provision invalid or
      unenforceable as to any other persons or circumstances. If feasible, any
      such offending provision shall be deemed to be modified to be within the
      limits of enforceability or validity; however, if the offending provision
      cannot be so modified, it shall be stricken and all other provisions of
      this Agreement in all other respects shall remain valid and enforceable.

      Subsidiaries and Affiliates of Borrower. To the extent the context of any
      provisions of this Agreement makes it appropriate, including without
      limitation any representation, warranty or covenant, the word "Borrower"
      as used herein shall include all subsidiaries and affiliates of Borrower.
      Notwithstanding the foregoing however, under no circumstances shall this
      Agreement be construed to require Lender to make any Loan or other
      financial accommodation to any subsidiary or affiliate of Borrower.

      Successors and Assigns. All covenants and agreements contained by or on
      behalf of Borrower shall bind its successors and assigns and shall inure
      to the benefit of Lender, its successors and assigns. Borrower shall not,
      however, have the right to assign its rights under this Agreement or any
      interest therein, without the prior written consent of Lender.

      Survival. All warranties, representations, and covenants made by Borrower
      in this Agreement or in any certificate or other instrument delivered by
      Borrower to Lender under this Agreement shall be considered to have been
      relied upon by Lender and will survive the making of the Loan and delivery
      to Lender of the Related Documents, regardless of any investigation made
      by Lender or on Lender's behalf.

      Waiver. Lender shall not be deemed to have waived any rights under this
      Agreement unless such waiver is given in writing and signed by Lender. No


<PAGE>   16
      delay or omission on the part of Lender in exercising any right shall
      operate as a waiver of such right or any other right. A waiver by Lender
      of a provision of this Agreement shall not prejudice or constitute a
      waiver of Lender's right otherwise to demand strict compliance with that
      provision or any other provision of this Agreement. No prior waiver by
      Lender, nor any course of dealing between Lender and Borrower, or between
      Lender and any Grantor, shall constitute a waiver of any of Lender's
      rights or of any obligations of Borrower or of any Grantor as to any
      future transactions. Whenever the consent of Lender is required under this
      Agreement, the granting of such consent by Lender in any instance shall
      not constitute continuing consent in subsequent instances where such
      consent is required, and in all cases such consent may be granted or
      withheld in the sole discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF
JUNE 30, 1997.


BORROWER:

RIDE, INC.

/S/  G. Scott Stewart, Senior Vice President and Chief Financial Officer
------------------------------------------------------------------------
Authorized Officer


LENDER:

U.S. BANK

By: /S/  Tony W. Chalfant, Vice President
    -------------------------------------
Authorized Officer