EXHIBIT 10.9

                 SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT

         This Second Amendment to Loan and Security Agreement is made effective
as of the 13th day of January, 1999 by and between

         BankBoston Retail Finance Inc. as Agent for the Lenders
         party to a certain Loan and Security Agreement dated as of
         April 28, 1998, as amended and in effect;

         the Lenders party thereto; and

         Sunglass Hut Trading Corporation (hereinafter, in such capacity, the
         "Lead Borrower"), a Florida corporation with its principal executive
         offices at 255 Alhambra Circle, Coral Gables, Florida 33134, as agent
         for

                  Said Sunglass Hut Trading Corporation; and Watch Station,
                  Inc., each a Florida corporation with their principal
                  executive offices at 255 Alhambra Circle, Coral Gables,
                  Florida 33134 (individually, a "US Borrower" and collectively,
                  the "US Borrowers");

         Sunglass Hut of Canada Ltd., an Ontario corporation with its principal
         executive offices at 205 Mathenson Blvd., East #11, Mississauga,
         Ontario, Canada L4Z 3EZ (the "CAN Borrower");

         Sunglass Hut International, Inc., a Florida corporation with its
         principal executive offices at 255 Alhambra Circle, Coral Gables,
         Florida 33134 (the "Parent"); and

         Shadescom, Inc., a Florida corporation with its principal executive
         offices at 255 Alhambra Circle, Coral Gables, Florida 33134 ("Shades")

in consideration of the mutual covenants herein contained and
benefits to be derived herefrom.

                              W I T N E S S E T H:

         WHEREAS, the Agent, the Lenders, the Parent and the Borrowers entered
in a certain Loan and Security Agreement dated as of April 28, 1998 (as amended
and in effect, the "Agreement"); and

         WHEREAS, the Parent has acquired the assets of Gallagher & Forsythe,
LLC pursuant to a certain Asset Purchase Agreement dated as of January 13, 1999,
and in connection therewith, among other things, has formed Shades, a new
Subsidiary, to hold such assets; and



<PAGE>



         WHEREAS, pursuant to the terms and conditions of the Agreement, among
other things, in connection with the formation of any new Subsidiary, such
Subsidiary is required to guaranty the Liabilities of the US Borrowers and the
CAN Borrower and grant to the Agent, for the ratable benefit of the Lenders, a
security interest in all of such Subsidiary's assets; and

         WHEREAS, in connection with the formation of Shades, the Agent, the
Lenders, the Parent and the Borrowers desire to modify certain of the provisions
of the Agreement as set forth herein.

         NOW, THEREFORE, it is hereby agreed among the Agent, the Lenders, the
Parent and the Borrowers as follows:

         1.       CAPITALIZED TERMS.  All capitalized terms used herein
                  and not otherwise defined shall have the same meaning
                  herein as in the Agreement.

         2.       ACQUISITION OF ASSETS OF GALLAGHER & FORSYTHE, LLC. The
                  Agent hereby consents to the acquisition by the Parent
                  of the assets of Gallagher & Forsythe, LLC, a
                  Massachusetts limited liability company, pursuant to
                  that certain Asset Purchase Agreement by and among the
                  Parent, Gallagher & Forsythe, LLC and the Members of
                  Gallagher & Forsythe, LLC dated as of January 13, 1999,
                  (the "Acquisition Agreement") and the Agent
                  acknowledges that no Event of Default will arise under
                  the Loan Agreement.  The foregoing acknowledgment by
                  the Agent relates only to the transaction described in
                  the Acquisition Agreement and shall not be deemed to
                  constitute a waiver of any rights of the Agent and the
                  Lenders with respect to any other transaction.

         3.       AMENDMENTS TO EXHIBITS. The Exhibits to the Agreement are
                  hereby amended as follows:

                  (1)      EXHIBIT 4-2 is hereby amended by adding
                           "Shadescom, Inc." as an Active Domestic Entity

                  (2)      EXHIBIT 4-3 is hereby amended by adding the following
                           tradenames thereto:

                                    shades.com
                                    SwissArmyDepot.com
                                    Swiss Army Depot
                                    Shades & Blades
                                    Shades of the Web
                                    Sunglasses, Shavers & More
                                    Superhighway Sunglass
                                    Shades of Cape Cod
                                    Gallagher & Forsythe

                  (3)      EXHIBIT 4-5 is hereby amended by adding the following
                           location thereto:

                                    714 Main Street, Yarmouthport, Massachusetts
                                    02675

                                       2
<PAGE>

                  (4)      EXHIBIT 4-7 is hereby amended by adding the following
                           thereto:

                           AMOUNT           DATE                DESCRIPTION
                           ------           ----                -----------
                           $1,248,341.00    January 13, 1999    Convertible Note

         4.       FULL FORCE AND EFFECT. Except as provided herein, all terms
                  and conditions of the Agreement and the other Loan Documents
                  remain in full force and effect.

         5.       CONDITIONS TO EFFECTIVENESS. This Second Amendment to Loan and
                  Security Agreement shall not be effective until each of the
                  following conditions precedent have been fulfilled to the
                  satisfaction of the Agent:

                  (1)      This Second Amendment to Loan and Security
                           Agreement shall have been duly executed and
                           delivered by the Borrowers, the Parent, Shades,
                           the Agent and such percentage of the Lenders as is
                           required to consent hereto under the terms of the
                           Agency Agreement.  The Agent shall have received a
                           fully executed copy hereof and of each other
                           document required hereunder.  Further, Shades and
                           the Borrower shall have provided the Agent with
                           the additional loan documents set forth in
                           Schedule 1 annexed hereto and incorporated herein
                           by reference, and the Borrower shall have provided
                           such additional instruments and documents to the
                           Agent as the Agent and its counsel may have
                           reasonably requested.

                  (2)      All action on the part of the Borrowers and the
                           Parent necessary for the valid execution, delivery
                           and performance by the Borrowers and the Parent of
                           this Second Amendment to Loan and Security
                           Agreement shall have been duly and effectively
                           taken.  The Agent shall have received from Shades,
                           a true copy of its resolutions adopted by its
                           board of directors authorizing the transactions
                           described herein, certified by its secretary as of
                           a recent date to be true and complete.

                  (3)      The Borrower shall have paid to the Agent all fees
                           and expenses then due and owing pursuant to the Loan
                           and Security Agreement, as modified hereby,
                           including, without limitation, reasonable attorneys'
                           fees incurred by the Agent and each of the Lenders.

                  (4)      No Suspension Event shall have occurred and be
                           continuing.

         6.       MISCELLANEOUS.

                           (a) This Second Amendment to Loan and Security
                  Agreement may be executed in several counterparts and by each
                  party on a separate counterpart, each of which when so
                  executed and delivered shall be an original, and all of which
                  together shall constitute one instrument.

                                       3
<PAGE>

                           (b) This Second Amendment to Loan and Security
                  Agreement expresses the entire understanding of the parties
                  with respect to the transactions contemplated hereby. No prior
                  negotiations or discussions shall limit, modify, or otherwise
                  affect the provisions hereof.

                           (c) Any determination that any provision of this
                  Second Amendment to Loan and Security Agreement or any
                  application hereof is invalid, illegal or unenforceable in any
                  respect and in any instance shall not effect the validity,
                  legality, or enforceability of such provision in any other
                  instance, or the validity, legality or enforceability of any
                  other provisions of this Second Amendment to Loan and Security
                  Agreement.

                           (d) The Borrowers shall pay on demand all costs and
                  expenses of the Agent and each of the Lenders, including,
                  without limitation, reasonable attorneys' fees in connection
                  with the preparation, negotiation, execution and delivery of
                  this Second Amendment to Loan and Security Agreement.

                           (e) The Borrowers and the Parent each warrant and
                  represent that the Borrowers and the Parent each have
                  consulted with independent legal counsel of their selection in
                  connection with this Second Amendment to Loan and Security
                  Agreement and are not relying on any representations or
                  warranties of the Agent or any Lender or their respective
                  counsel in entering into this Second Amendment.

         IN WITNESS WHEREOF, the parties have hereunto caused this Second
Amendment to Loan and Security Agreement to be executed and their seals to be
hereto affixed as of the date first above written.

                                 "AGENT"

                                 BANKBOSTON RETAIL FINANCE INC.

                                 By:__________________________

                                 Name:________________________

                                 Title:_______________________

                                 "LENDERS"

                                 BANKBOSTON RETAIL FINANCE INC.

                                 By:__________________________

                                 Name:________________________

                                 Title:_______________________

                                 LASALLE BUSINESS CREDIT, INC.

                                 By:__________________________

                                 Name:________________________

                                 Title:_______________________

                                       4
<PAGE>

                                 FOOTHILL CAPITAL CORPORATION

                                 By:__________________________

                                 Name:________________________

                                 Title:_______________________


                                 "LEAD BORROWER"

                                 SUNGLASS HUT TRADING
                                 CORPORATION

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             

                                 "BORROWERS"

                                 SUNGLASS HUT TRADING
                                 CORPORATION

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             

                                 WATCH STATION, INC.

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             

                                       5
<PAGE>

                                 SUNGLASS HUT OF CANADA LTD.

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             


                                 "PARENT"

                                 SUNGLASS HUT INTERNATIONAL,
                                 INC.

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             

                                 "SHADES"

                                 SHADESCOM, INC.

                                 By:__________________________

                                 Name: LARRY G. PETERSEN      

                                 Title: TREASURER             

                                       6
<PAGE>
                                   Schedule 1

         1.       Certificate of Legal Existence for Shades from Florida
         Secretary of State

         2.       Certificates of Foreign Qualification for Shades from:
                  a.       Massachusetts Secretary of State

         3.       Officers' Certificate for Shades with copies of:
                  a.       Certificate of Incorporation
                  b.       By-Laws
                  c.       Resolutions

         4.       Guaranty by Shades of each of:
                  a.       Sunglass Hut Trading Corporation
                  b.       Watch Station, Inc.
                  c.       Sunglass Hut of Canada Ltd.

         5.       Financing Statements from Shades

                  a.       Secretary of State of Massachusetts
                  b.       Clerk, Town of Yarmouth
                  c.       Secretary of State of Florida

         6.       First Amendment to Stock Pledge from Sunglass Hut
         Corporation of all of stock of Shades

                  a.       Stock Certificate
                  b.       Stock Power with medallion guaranty

         7.       Asset Purchase Agreement with all schedules

         8.       UCC Searches

                  a.       Gallagher & Forsythe, LLC
                           i.       Secretary of State of Massachusetts

                           ii.

                  b.       Shadescom, Inc.

                           i.       Secretary of State of Florida

         9.       Release by Adler

                                       7

<PAGE>

                    FIRST AMENDMENT TO STOCK PLEDGE AGREEMENT

         This FIRST AMENDMENT TO STOCK PLEDGE AGREEMENT (the "AGREEMENT") is
made as of the 13th day of January, 1999, by Sunglass Hut Corporation (the
"COMPANY") and BankBoston Retail Finance Inc., N.A. (the "AGENT") as Agent for
the benefit of the Lenders from time to time party to that certain Loan and
Security Agreement dated as of April 28, 1998 (as such may be amended hereafter,
the "CREDIT AGREEMENT"), among the Agent, such Lenders and Sunglass Hut Trading
Corporation, Watch Station, Inc., and Sunglass Hut of Canada Ltd. (collectively,
the "Borrowers"), in consideration of the mutual covenants contained herein and
the benefits to be derived herefrom.

                              W I T N E S S E T H:

         WHEREAS, the Borrowers, the Agent and the Lenders entered into a
certain loan arrangement (the "Loan Arrangement") dated as of April 28, 1998 (as
amended and in effect, the "Loan Arrangement"); and

         WHEREAS, in connection with the Loan Arrangement, the Company executed
and delivered to the Agent, among other things, a certain Stock Pledge Agreement
dated April 28, 1998 (the "Pledge Agreement") pursuant to which the Company
granted to the Agent, for the ratable benefit of the Lenders, a security
interest in certain Stock Collateral (as defined in the Pledge Agreement) as
security for the Secured Liabilities (as defined in the Pledge Agreement) and
the Guaranty (as defined in the Pledge Agreement); and

         WHEREAS, the Company has created an additional Subsidiary, and pursuant
to the terms and conditions of the Pledge Agreement, the Company is required to
amend the Pledge Agreement to include therein the stock of any additional
Subsidiary of the Company acquired or created after the execution and delivery
of the Pledge Agreement to the Agent; and

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the hereby acknowledges and agrees
as follows:

         1.       Unless otherwise defined herein, all capitalized terms used
                  herein shall have the meaning provided for in the Pledge
                  Agreement.

         2.       Annex A to the Pledge Agreement is hereby superseded by the
                  Annex A attached hereto and incorporated herein by reference.

         3.       The Company acknowledges, confirms and agrees that, except as
                  modified hereby, the Pledge Agreement remains in full force
                  and effect. The Company hereby ratifies, confirms and
                  reaffirms the terms and conditions of, and all warranties and
                  representations made in the Pledge Agreement.

         4.       The Company acknowledges, confirms and agrees that any and all
                  Stock Collateral pledged pursuant to the Pledge Agreement, as
                  modified hereby, shall continue to secure the prompt, punctual
                  and faithful payment and performance of all Obligations and
                  the Guaranty.

<PAGE>

         5.       This Agreement and all other documents, instruments, and
                  agreements executed in connection herewith incorporate all
                  discussions and negotiations between the Company and the
                  Agent, either express or implied, concerning the matters
                  included herein and in such other documents, instruments, and
                  agreements, any statute, custom, or usage to the contrary
                  notwithstanding.

         This Agreement may be executed in multiple counterparts and shall take
effect as a sealed instrument as of the date first written above.

                                     SUNGLASS HUT CORPORATION

                                     By:___________________________

                                     Name__________________________

                                     Title:________________________

Accepted and Agreed as of the 13th day of January, 1999.

BANKBOSTON RETAIL FINANCE INC.
AS AGENT

By:___________________________

Name:                                                 

Title:                                                   

                                       -2-


<PAGE>

                   Amended and Restated as of January 13, 1999
                                     ANNEX A
              to Stock Pledge Agreement dated as of April 28, 1998
<TABLE>
<CAPTION>
                                                                                      NUMBER OF                               
                                                 CLASS          NUMBER OF             ISSUED AND               PAR OR
                              RECORD               OF          AUTHORIZED            OUTSTANDING             LIQUIDATION
       ISSUER                  OWNER             SHARES          SHARES                 SHARES                  VALUE
       ------                 ------             ------        ----------            ------------            -----------
<S>                        <C>                   <C>              <C>                   <C>                     <C>

    Sunglass Hut           Sunglass Hut                                                                                       
      Trading               Corporation                                                                                       
    Corporation                                  Common            500                   226                    $1.00

       Watch               Sunglass Hut                                                                                       
      Station,              Corporation                                                                                       
        Inc.                                     Common           1,000                 1,000                   $0.01

    Sunglass Hut           Sunglass Hut                                                                                       
       Realty               Corporation                                                                                       
    Corporation                                  Common            500                   100                    $1.00

    Sunglass Hut           Sunglass Hut                                                                                       
    of Florida,             Corporation                                                                                       
        Inc.                                     Common           1,000                 1,000                   $0.01

    Sunglass Hut           Sunglass Hut                                                                                       
     Holding of             Corporation                                                                                       
    France, Inc.                                 Common           1000                   200                    $.01

    Sunglass Hut           Sunglass Hut                                                                                       
    of Northern             Corporation                                                                                       
    France, Inc.                                 Common           1000                   200                    $.01

    Sunglass Hut           Sunglass Hut                                                                                       
    of Southern             Corporation                                                                                       
    France, Inc.                                 Common           1000                   200                    $.01

     Shadescom,            Sunglass Hut          Common           1000                   1000                   $.01
        Inc.                Corporation

</TABLE>

                                       -3-

<PAGE>

--------------------------------------------------------------------------------
GUARANTY                                  BANKBOSTON RETAIL FINANCE INC., AGENT
--------------------------------------------------------------------------------

                                                                January 13, 1999

         FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF
WHICH ARE ACKNOWLEDGED, the undersigned unconditionally guaranties to BankBoston
Retail Finance Inc. (in such capacity, herein the "AGENT"), a Delaware
corporation with offices at 40 Broad Street, Boston, Massachusetts 02109, as
Agent for a syndicate of Lenders (the "LENDERS") party to the Loan Agreement
(defined below), and the Lenders, in accordance with the terms hereof and
without any prior written notice, the payment and performance of the Liabilities
(defined below) of each of Sunglass Hut Trading Corporation, Sunglass Hut of
Canada Ltd., and Watch Station, Inc. (singly, a "BORROWER", and collectively,
the "BORROWERS").

         DEFINITIONS.  As used herein, the following terms have the following
meanings:

         "COSTS   OF COLLECTION" includes, without limitation, all attorneys'
                  reasonable fees and reasonable out-of-pocket expenses incurred
                  by the Agent's and any Lender's attorneys, and all reasonable
                  costs incurred by the Agent or any Lender in the
                  administration of the Liabilities, including, without
                  limitation, reasonable costs and expenses associated with
                  travel on behalf of the Agent or any Lender (limited, however,
                  prior to the occurrence of a Suspension Event (as defined in
                  the Loan Agreement), to those in connection with the
                  monitoring of the Borrowers and any collateral which secures
                  any Liabilities) and continuing due diligence in connection
                  therewith), which costs and expenses are directly or
                  indirectly related to or in respect of the Agent's and any
                  Lender's: administration and management of the Liabilities;
                  negotiation, documentation, and amendment of any instrument
                  which relates to any Liability; or efforts to preserve,
                  protect, collect, or enforce any right in any collateral which
                  secures the Liabilities, the Liabilities, and/or the Agent's
                  Rights and Remedies and/or any of the Agent's rights and
                  remedies against or 


<PAGE>

                  in respect of any guarantor or other person liable in respect
                  of the Liabilities (whether or not suit is instituted in
                  connection with such efforts). The Costs of Collection are
                  Liabilities, and at the Agent's option may bear interest at
                  the highest post-default rate which the Agent may charge the
                  Borrowers hereunder as if such had been lent, advanced, and
                  credited by the Agent to, or for the benefit of, the
                  Borrowers.

         "LIABILITIES" (in the singular, "LIABILITY"): Includes, without
                  limitation, all and each of the following, whether now
                  existing or hereafter arising from each Borrower singly/or the
                  Borrowers collectively:

                           (a) Any and all direct and indirect liabilities,
                  debts, and obligations of any Borrower to the Agent or any
                  Lender, each of every kind, nature, and description.

                           (b) Each obligation to repay any loan, advance,
                  indebtedness, note, obligation, overdraft, or amount now or
                  hereafter owing by any Borrower to the Agent or any Lender
                  (including all future advances whether or not made pursuant to
                  a commitment by the Agent or any Lender), whether or not any
                  of such are liquidated, unliquidated, primary, secondary,
                  secured, unsecured, direct, indirect, absolute, contingent, or
                  of any other type, nature, or description, or by reason of any
                  cause of action which the Agent or any Lender may hold against
                  any of the Borrowers.

                           (c) All notes and other obligations of any of the
                  Borrowers now or hereafter assigned to or held by the Agent or
                  any Lender, each of every kind, nature, and description.

                           (d) All interest, fees, and charges and other amounts
                  which may be charged by the Agent or any Lender to any of the
                  Borrowers and/or which may be due from any of the Borrowers to
                  the Agent or any Lender from time to time.

                           (e) All costs and expenses incurred or paid by the
                  Agent or any Lender in respect of any agreement between any of
                  the Borrowers and Agent or any the Lender or instrument
                  furnished by any of the Borrowers to the Agent or any Lender
                  (including, without limitation, Costs of Collection,
                  attorneys' reasonable fees, and all court and litigation costs
                  and expenses).

                           (f) Any and all covenants of any of the Borrowers to
                  or with the Agent or any Lender and any and all obligations of
                  any of the Borrowers to act or to refrain from acting in
                  accordance with any agreement between any of the Borrowers and
                  the Agent or any 


                                       2
<PAGE>

                  Lender or instrument furnished by any of the Borrowers to the
                  Agent or any Lender.

         "LOAN    AGREEMENT" means that certain Loan and Security Agreement
                  dated April 28, 1998 by and among the Borrowers, the Agent and
                  the Lenders as amended from time to time.

         INDEMNIFICATION. FOR SAID GOOD AND VALUABLE CONSIDERATION, the
undersigned shall also indemnify, defend, and hold the Agent and each Lender,
and each agent, employee, officer, or representative of the Agent and each
Lender (each, an "INDEMNIFIED PERSON"), harmless of and from any claim (other
than any claim as to which a final determination is made in a judicial
proceeding (in which the Indemnified Person has had an opportunity to be heard),
which determination includes a specific finding that the Indemnified Person had
acted in a grossly negligent manner or in actual bad faith) brought or
threatened against the Indemnified Person by: any of the Borrowers; the
undersigned; any other guarantor or endorser of the Liabilities or any other
person (as well as from attorneys' reasonable fees and reasonable expenses in
connection therewith) on account of the relationship of any Indemnified Person
with any of the Borrowers, the undersigned, or any other guarantor or endorser
of the Liabilities (each of which may be defended, compromised, settled, or
pursued by the Agent with counsel of the Agent's selection, but at the expense
of the undersigned).

         INTEREST. The undersigned will pay on demand interest on all amounts
due to the Agent (for the ratable benefit of the Agent and the Lenders) under
this Guaranty, or arising under any documents, instruments, or agreements
relating to any collateral securing this Guaranty, from the time the Agent first
demands payment of this Guaranty at a rate (determined based upon a 365 day year
and actual days elapsed) equal to the lesser from time to time of (a) the
aggregate of the Base Rate from time to time announced by BankBoston, N.A. (or,
if said bank ceases to announce such a rate, the functional equivalent rate or
index selected in good faith by the Lender) plus Four Percent (4.0 %) per annum
or (b) the highest rate of interest which under the circumstances may be charged
under applicable law.

         OBLIGATIONS NOT AFFECTED. The obligations of the undersigned hereunder
shall not be affected by: any fraudulent, illegal, or improper act by any of the
Borrowers, the undersigned, or any person liable or obligated to the Agent or
any Lender for or on the Liabilities; any release, discharge, or invalidation,
by operation of law or otherwise, of the Liabilities; or the 


                                       3
<PAGE>

legal incapacity of any of the Borrowers, the undersigned, or any other person
liable or obligated to the Agent or any Lender for or on the Liabilities.
Interest and Costs of Collection shall continue to accrue and shall continue to
be deemed Liabilities guarantied hereby notwithstanding any stay to the
enforcement thereof against any of the Borrowers or the disallowance of any
claim therefor against any of the Borrowers.

         INCORPORATION OF ALL DISCUSSIONS.  The within instrument incorporates
all discussions and negotiations between the undersigned and the Agent and
each Lender concerning the guaranty and indemnification provided by the
undersigned hereby.  No such discussions or negotiations shall limit, modify,
or otherwise affect the provisions hereof. No provision hereof may be altered,
amended, waived, cancelled or modified, except by a written instrument executed,
sealed, and acknowledged by a duly authorized officer of the Agent.

         GENERAL WAIVERS. The undersigned WAIVES: presentment, demand, notice,
and protest with respect to the Liabilities and this Guaranty; any delay on the
part of the Agent or any Lender; any right to require the Agent or any Lender to
pursue or to proceed against any of the Borrowers or any collateral which might
have been granted to secure the Liabilities or to secure the obligations of the
undersigned hereunder; any benefit of, and any right to participate in, any
collateral which may secure the Liabilities; any claim which the undersigned may
have or to which the undersigned may become entitled to the extent that such
claim might otherwise cause any transfer to the Agent by or on behalf of any of
the Borrowers to be avoided as having been, or in the nature of, a preference;
and notice of acceptance of this Guaranty.

         WAIVER OF SUBROGATION. The undersigned shall not undertake any of the
following:

                  (a) Exercise of any right against any of the Borrowers, by way
         of subrogation, reimbursement, indemnity, contribution, or the like
         unless and until all Liabilities have been irrevocably paid and
         satisfied in full.

                  (b) The filing of any proof of any claim in competition with
         the Agent in respect of any payment hereunder in any bankruptcy or
         insolvency proceedings of any nature.

                  (c) The claiming of any set-off or counterclaim against any of
         the Borrowers in respect of any liability of the undersigned to any of
         the Borrowers.

         SUBORDINATION.  The payment of any amounts due with respect to any


                                       4
<PAGE>

indebtedness of any of the Borrowers now or hereafter held by the undersigned
for borrowed money is hereby subordinated to the prior payment in full of the
Liabilities. The undersigned will not demand, sue for, or otherwise attempt to
collect any such indebtedness. Any amounts which are collected, enforced and
received by the undersigned shall be held by the undersigned as trustee for the
Agent and shall be paid over to the Agent on account of the Liabilities without
affecting in any manner the liability of the undersigned under this Guaranty.

         AGENT'S LENDER'S BOOKS AND RECORDS. The books and records of the Agent
showing the account between the Agent and the Borrowers shall be admissible in
any action or proceeding and constitute prima facie evidence and proof of the
items contained therein.

         GUARANTOR'S OBLIGATIONS PRIMARY. The obligations of the undersigned
hereunder are primary, with no recourse necessary by the Agent against any of
the Borrowers or any collateral given to secure the Liabilities or to secure the
obligations of the undersigned hereunder or against any other person liable for
or on the Liabilities prior to proceeding against the undersigned hereunder.

         CHANGES IN LIABILITIES. The undersigned assents to any indulgence or
waiver which the Agent or any Lender might grant or give any of the Borrowers
and/or any other person liable or obligated for or on the Liabilities. The
undersigned authorizes the Agent and each Lender to alter, amend, cancel, waive,
or modify any term or condition of the Liabilities and of the obligations of any
other person liable or obligated for or on the Liabilities, without notice to,
or consent from, the undersigned. The undersigned authorizes the Agent to
complete this Guaranty and any instrument or other document which evidences or
relates to the Liabilities, to the extent that this Guaranty or such instrument
or other document, upon delivery to the Agent, is incomplete in any respect. No
compromise, settlement, or release by the Agent or any Lender of the Liabilities
or of the obligations of any such other person (whether or not jointly liable
with the undersigned) and no release of any collateral securing the Liabilities
or securing the obligations of any such other person shall affect the
obligations of the undersigned hereunder. No action by the Agent or any Lender
which has been assented to herein shall affect the obligations of the
undersigned hereunder.

         FINANCIAL INFORMATION. The undersigned, from time to time at the
request of the Agent, will provide the Agent with such information concerning
the 


                                       5
<PAGE>

financial condition of the undersigned as the Agent reasonably may request
(including but not limited to financial statements in such form as reasonably
may be requested by the Agent and copies of the federal and state income tax
returns).

         COLLATERAL. Upon demand by the Agent after any change in the condition
or affairs (financial or otherwise) of any of the Borrowers or of the
undersigned deemed by the Agent to be adverse and material, the undersigned
shall secure the payment and performance of the obligations of the undersigned
hereunder by delivering, assigning, or transferring to the Agent or granting the
Agent a security interest in collateral of a value and character reasonably
satisfactory to the Agent. The undersigned shall do all such things and execute
all such documents as the Agent may consider necessary or desirable to give full
effect to this Guaranty and to perfect and preserve the rights and powers of the
Agent hereunder.

         COSTS OF ENFORCEMENT. The undersigned will pay on demand, without
limitation, all attorneys' reasonable fees, out-of-pocket expenses incurred by
the Agent's attorneys and all costs incurred by the Agent, including, without
limitation, costs and expenses associated with travel on behalf of the Agent,
which costs and expenses are directly or indirectly related to or in respect of
the Lender's administration, negotiation, documentation, and amendment of this
guaranty and in the Agent's efforts to collect and/or to enforce any of the
obligations of the undersigned hereunder and/or to enforce any of the Agent's
rights, remedies, or powers against or in respect of the undersigned (whether or
not suit is instituted by or against the Agent).

         The undersigned shall also pay on demand all costs and expenses
(including attorneys' reasonable fees) incurred, following the occurrence of any
event of default under any instrument or document which evidences or governs the
Liabilities, by each Lender in connection with the enforcement, attempted
enforcement, or preservation of any rights and remedies under this, or any such
instrument or document, as well as any such costs and expenses in connection
with any "workout", forbearance, or restructuring of any credit facility between
any of the Borrowers, on the one hand, and the Agent and the Lenders on the
other.

         BINDING EFFECT. This instrument shall inure to the benefit of the Agent
and each Lender and their respective successors and assigns; shall be binding
upon the heirs, successors, representatives, and assigns of the undersigned; and
shall apply to all Liabilities of the Borrowers and any successor to any of the
Borrowers, including any successor by operation of law.

                                       6
<PAGE>

         AGENT'S RIGHTS AND REMEDIES. The rights, remedies, powers, privileges,
and discretions of the Agent hereunder (herein, the "AGENT'S RIGHTS AND
REMEDIES") shall be cumulative and not exclusive of any rights or remedies which
it would otherwise have. No delay or omission by the Agent in exercising or
enforcing any of the Agent's Rights and Remedies shall operate as, or constitute
a waiver thereof. No waiver by the Agent of any of the Agent's Rights and
Remedies or of any default or remedies under any other agreement with the
undersigned, or of any default under any agreement with any of the Borrowers, or
any other person liable or obligated for or on the Liabilities, shall operate as
a waiver of any other of the Agent's Rights and Remedies or of any default or
remedy hereunder or thereunder. No exercise of any of the Agent's Rights and
Remedies and no other agreement or transaction of whatever nature entered into
between the Agent and: the undersigned; and any of the Borrowers; and/or any
such other person at any time shall preclude any other exercise of the Agent's
Rights and Remedies. No waiver by the Agent of any of the Agent's Rights and
Remedies on any one occasion shall be deemed a waiver on any subsequent
occasion, nor shall it be deemed a continuing waiver. All of the Agent's Rights
and Remedies, and all of the Agent's rights, remedies, powers, privileges, and
discretions under any other agreement or transaction with the undersigned, any
of the Borrowers, or any such other person, shall be cumulative and not
alternative or exclusive, and may be exercised by the Agent at such time or
times and in such order of preference as the Agent in its sole discretion may
determine.

         COPIES AND FACSIMILES. This instrument and all documents which have
been or may be hereinafter furnished by the undersigned to the Agent or any
Lender may be reproduced by the Agent and any Lender by any photographic,
microfilm, xerographic, digital imaging, or other process. Any such reproduction
shall be admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original is in existence and
whether or not such reproduction was made in the regular course of business).
Any facsimile which bears proof of transmission shall be binding on the party
which or on whose behalf such transmission was initiated and likewise so
admissible in evidence as if the original of such facsimile had been delivered
to the party which or on whose behalf such transmission was received.

         CHOICE OF LAWS.  This instrument shall be governed, construed, and
interpreted in accordance with the laws of The Commonwealth of Massachusetts.

         CONSENT TO JURISDICTION. (a) The undersigned agrees that any legal
action, proceeding, case, or controversy against the undersigned with respect 


                                       7
<PAGE>

to this Guaranty or otherwise, may be brought in the Superior Court of Suffolk
County Massachusetts or in the United States District Court, District of
Massachusetts, sitting in Boston, Massachusetts, as the Agent may elect in the
Agent's sole discretion. By execution and delivery of this Guaranty, the
undersigned accepts, submits, and consents generally and unconditionally, to the
jurisdiction of the aforesaid courts.

                  (b) The undersigned WAIVES personal service of any and all
process and irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by certified mail, postage prepaid, to the undersigned at the last
address of the undersigned of which the Agent then has written notice, such
service to become effective five (5) business days after such mailing.

                  (c) The undersigned WAIVES, any objection based on FORUM NON
CONVENIENS and any objection to venue of any action or proceeding instituted
hereunder and consents to the granting of such legal or equitable remedy as is
deemed appropriate by the court in which the Agent initiates the subject action.

                  (d) Nothing herein shall affect the right of the Agent to
bring legal actions or proceedings in any other competent jurisdiction.

                  (e) The undersigned agrees that any action commenced by the
undersigned asserting any claim or counterclaim arising under or in connection
with this Guaranty or the Agent's relationship with any of the Borrowers shall
be brought in the Superior Court of Suffolk County Massachusetts or in the
United States District Court, District of Massachusetts, sitting in Boston,
Massachusetts, and that such Courts shall have exclusive jurisdiction with
respect to any such action.

         BROAD SCOPE OF GUARANTY. It is the intention of the undersigned that
the provisions of the within Guaranty and indemnification be liberally construed
to the end that the Agent and each Lender may be put in as good a position as if
each of the Borrowers had promptly, punctually, and faithfully performed all
Liabilities and that the undersigned had promptly, punctually, and faithfully
performed hereunder.

         SEVERABILITY. Any determination that any provision herein is invalid,
illegal, or unenforceable in any respect in any instance shall not affect the
validity, legality, or enforceability of such provision in any other instance
and shall not affect the validity, legality, or enforceability of any other
provision contained herein.

         RIGHT OF SET-OFF. Any and all deposits or other sums at any time
credited by or due to the undersigned from the Agent or any Lender or from any


                                       8
<PAGE>

participant with any Lender in the Liabilities (a "PARTICIPANT") and any cash,
securities, instruments or other property of the undersigned in the possession
of the Agent or any Lender or any Participant, whether for safekeeping or
otherwise (regardless of the reason the Agent, the Lender or the Participant had
received the same) shall at all times constitute security for all Liabilities
and for any and all obligations of the undersigned to the Agent, each Lender and
any Participant, and may be applied or set off against the Liabilities and
against the obligations of the undersigned to the Agent, each Lender and any
Participant including, without limitation, those arising hereunder, at any time,
whether or not such are then due and whether or not other collateral is then
available to the Agent, any Lender or any Participant.

         TERMINATION. The obligations of the undersigned hereunder shall remain
in full force and effect as to all Liabilities, without regard to any reduction
of the Liabilities (other than on account of payments made pursuant to the
within Guaranty) until the earlier of (a) ten (10) days following the actual
receipt by the Agent at its main office (presently BankBoston Retail Finance
Inc., 40 Broad Street, 02109) of written notice signed by the undersigned of the
termination thereof or (b) the delivery of written notice of termination dated
and signed by a duly authorized officer of the Agent, which notice of
termination includes specific reference to this provision. No termination hereof
shall affect any Liability in existence or outstanding ten (10) days following
the date of such actual receipt or delivery (including, without limitation,
those which are contingent or not then due and those which arise out of any
check, draft, item, or paper which was made, executed, or drawn prior to the
expiration of such ten (10) days, even if received by the Agent thereafter) nor
any which arises out of any continuing commitment of the Agent to provide loans,
advances, and financial accommodations to the Borrowers, nor any obligation of
the undersigned hereunder, including, without limitation, any which by its terms
includes any of the Liabilities of a contingent nature (including, without
limitation, the indemnification provided for herein). This Guaranty shall
continue to be effective or, if previously terminated, shall be automatically
reinstated, without any further action, if at any time any payment made or value
received with respect to a Liability is rescinded or must otherwise be returned
by the Agent upon the insolvency, bankruptcy or reorganization of the
undersigned, or otherwise, all as though such payment had not been made or value
received.

         MISCELLANEOUS. The undersigned represents and certifies that, prior to
the execution of this Guaranty, the undersigned had carefully read and reviewed
all of the provisions of this Guaranty and had been afforded an 


                                       9
<PAGE>

opportunity to consult with counsel independently selected by the undersigned.
The undersigned further represents and certifies that the undersigned has freely
and willingly executed this Guaranty with full appreciation of the legal effect
of this Guaranty. The undersigned recognizes that the titles to the paragraphs
of the within Guaranty are for ease of reference; are not part of this Guaranty;
and do not alter or affect the substantive provisions hereof. The undersigned
acknowledges that the Liabilities and the obligations of the undersigned
pursuant to this Guaranty constitute "Designated Senior Indebtedness" for
purposes of, and as defined in, the Indenture dated as of June 26, 1996 between
Sunglass Hut International, Inc. (the "Parent") and The Bank of New York, as
Trustee relating to the Parent's 5 1/4% Convertible Subordinated Notes due 2003,
as amended an in effect.

         WAIVER OF JURY TRIAL. The undersigned makes the following waiver
knowingly, voluntarily, and intentionally, and understands that the Agent and
each Lender, in the establishment and maintenance of the Agent's and the
Lender's relationship with each of the Borrowers and the undersigned, is relying
thereon. THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ANY PRESENT OR FUTURE RIGHT
OF THE UNDERSIGNED, EACH OF THE BORROWERS OR ANY ENDORSER OR ANY OTHER GUARANTOR
OF ANY OF THE BORROWERS OR ANY OTHER SIMILAR PERSON, TO A TRIAL BY JURY OF ANY
CASE OR CONTROVERSY IN WHICH THE AGENT AND/OR ANY LENDER IS OR BECOMES A PARTY
(WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST THE AGENT OR
AGAINST ANY LENDER OR IN WHICH THE AGENT OR ANY LENDER IS JOINED AS A PARTY
LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF, OR IS IN RESPECT OF, ANY
RELATIONSHIP AMONGST OR BETWEEN THE UNDERSIGNED, ANY OF THE BORROWERS, ANY SUCH
PERSON, AND THE AGENT AND ANY LENDER.

         It is intended that this Guaranty take effect as a sealed instrument.

                                              SHADESCOM,INC.

                                              By:___________________________

                                              Name: ________________________

                                              Title: _______________________

                                       10

<PAGE>

--------------------------------------------------------------------------------

                               SECURITY AGREEMENT

--------------------------------------------------------------------------------

                         BANKBOSTON RETAIL FINANCE INC.
                                    AGENT FOR
                          THE LENDERS REFERENCED HEREIN

--------------------------------------------------------------------------------

                                 SHADESCOM, INC.
                                    GUARANTOR

--------------------------------------------------------------------------------

                             As of January 13, 1999


<PAGE>

                                TABLE OF CONTENTS

ARTICLE 1 - DEFINITIONS:.................................................. 1 ..

ARTICLE 2 - GRANT OF SECURITY INTEREST:................................... 7 ..

         2-1.     Grant of Security Interest.............................. 7 ..
         2-2.     Extent and Duration of Security Interest................ 8 ..

ARTICLE 3 - GENERAL REPRESENTATIONS, COVENANTS AND WARRANTIES:............ 8 ..

ARTICLE 4 - USE AND COLLECTION OF COLLATERAL:............................. 8 ..

         4-1.     Use of Inventory Collateral............................. 8 ..
         4-2.     Inventory Quality....................................... 9 ..
         4-3.     Adjustments and Allowances.............................. 9 ..
         4-4.     Validity of Accounts.................................... 9 ..
         4-5.     Notification to Account Debtors......................... 9 ..
         4-6.     Proceeds and Collection of Accounts Held in Trust....... 9 ..

ARTICLE 5 - LENDER AS GUARANTOR'S ATTORNEY-IN-FACT:...................... 10 ..

         5-1.     Appointment as Attorney-In-Fact........................ 10 ..
         5-2.     No Obligation to Act................................... 11 ..

ARTICLE 6 - RIGHTS AND REMEDIES UPON DEFAULT:............................ 11 ..

         6-1.     Rights of Enforcement.................................. 11 ..
         6-2.     Sale of Collateral..................................... 12 ..
         6-3.     Occupation of Business Location........................ 13 ..
         6-4.     Grant of Nonexclusive License.......................... 13 ..
         6-5.     Assembly of Collateral................................. 13 ..
         6-6.     Rights and Remedies.................................... 13 ..

ARTICLE 7 - NOTICES:..................................................... 14 ..

         7-1.     Notice Addresses....................................... 14 ..
         7-2.     Notice Given........................................... 15 ..

ARTICLE 8 - GENERAL:..................................................... 15 ..

         8-1.     Protection of Collateral............................... 15 ..
         8-2.     Successors and Assigns................................. 16 ..
         8-3.     Severability........................................... 16 ..
         8-4.     Amendments.  Course of Dealing......................... 16 ..
         8-5.     Application of Proceeds................................ 17 ..
         8-6.     Costs and Expenses of Agent and Of Lenders............. 17 ..
         8-7.     Copies and Facsimiles.................................. 17 ..
         8-8.     Massachusetts Law...................................... 18 ..


                                    .. ii ..
<PAGE>

         8-9.     Consent to Jurisdiction................................ 18 ..
         8-10.    Indemnification........................................ 18 ..
         8-11.    Rules of Construction.................................. 19 ..
         8-12.    Intent................................................. 20 ..
         8-13.    Right of Set-Off....................................... 20 ..
         8-14.    Waivers. .............................................. 20 ..



                                    .. iii ..


<PAGE>
--------------------------------------------------------------------------------

SECURITY AGREEMENT                                BANKBOSTON RETAIL FINANCE INC.

--------------------------------------------------------------------------------

                                                          As of January 13, 1999

         THIS AGREEMENT is made between

                   BankBoston Retail Finance Inc. (in such capacity, herein the
         "AGENT"), a Delaware corporation with offices at 40 Broad Street,
         Boston, Massachusetts 02109, as agent for the ratable benefit of the
         "LENDERS", who are party to the Loan Agreement (defined herein)

                  and

                  Shadescom, Inc. (hereinafter, the "GUARANTOR"), a Florida
         corporation with its principal executive offices at 255 Alhambra
         Circle, Coral Gables, Florida 33134

in consideration of the mutual covenants contained herein and benefits to be
derived herefrom,

                                   WITNESSETH:

ARTICLE 1 - DEFINITIONS:

         As herein used, the following terms have the following meanings or are
defined in the section of this Agreement so indicated:

         "ACCOUNTS" and "ACCOUNTS RECEIVABLE" include, without limitation,
                  "accounts" as defined in the UCC, and also all: accounts,
                  accounts receivable, credit card receivables, notes, drafts,
                  acceptances, and other forms of obligations and receivables
                  and rights to payment for credit extended and for goods sold
                  or leased, or services rendered, whether or not yet earned by
                  performance; all "contract rights" as formerly defined in the
                  UCC; all Inventory which gave rise thereto, and all rights
                  associated with such Inventory, including the right of
                  stoppage in transit; all reclaimed, returned, rejected or
                  repossessed Inventory (if any) the sale of which gave rise to
                  any Account.

         "ACCOUNT DEBTOR": Has the meaning given that term in the UCC.

         "AGENT'S RIGHTS AND REMEDIES": Is defined in Section 6-6.

         "BORROWER" OR "BORROWERS": Collectively, the US Borrowers and the CAN
                  Borrower.

         "CAN BORROWER": Sunglass Hut of Canada Ltd.



                                     ..1..
<PAGE>

         "CAPITAL LEASE": Any lease which may be capitalized in accordance with
                  GAAP.

         "CHATTEL PAPER": Has the meaning given that term in the UCC.

         "COLLATERAL": Is defined in Section 2-1.

         "COSTS   OF COLLECTION": Includes, without limitation, all attorneys'
                  reasonable fees and reasonable out-of-pocket expenses incurred
                  by the Agent's and any Lender's attorneys, and all reasonable
                  costs incurred by the Agent or any Lender in the
                  administration of the Liabilities and/or the Loan Documents,
                  including, without limitation, reasonable costs and expenses
                  associated with travel on behalf of the Agent or any Lender
                  (limited, however, prior to the occurrence of a Suspension
                  Event to those in connection with the monitoring of the
                  Borrowers and or the Guarantor or any other guarantor and the
                  Collateral and continuing due diligence in connection
                  therewith), which costs and expenses are directly or
                  indirectly related to or in respect of the Agent's and any
                  Lender's: administration and management of the Liabilities;
                  negotiation, documentation, and amendment of any Loan
                  Document; or efforts to preserve, protect, collect, or enforce
                  the Collateral, the Liabilities, and/or the Agent's Rights and
                  Remedies and/or any of the Agent's rights and remedies against
                  or in respect of the Guarantor or any other guarantor, or any
                  other person liable in respect of the Liabilities (whether or
                  not suit is instituted in connection with such efforts). The
                  Costs of Collection are Liabilities, and at the Agent's option
                  may bear interest at the highest post-default rate which the
                  Agent may charge the Guarantor under the Loan Agreement as if
                  such had been lent, advanced, and credited by the Agent to, or
                  for the benefit of, the Borrowers or the Guarantor.

         "DEPOSIT ACCOUNT": Has the meaning given that term in the UCC.

         "DOCUMENTS": Has the meaning given that term in the UCC.

         "DOCUMENTS OF TITLE": Has the meaning given that term in the UCC.

         "ENCUMBRANCE": Each of the following:

                           (a) Any security interest, mortgage, pledge,
                  hypothecation, lien, attachment, or charge of any kind
                  (including any agreement to give any of the foregoing); the
                  interest of a lessor under a capital lease; conditional sale
                  or other title retention agreement; sale of accounts
                  receivable or chattel paper; or other arrangement pursuant to
                  which any Person is entitled to any preference or priority
                  with respect to the property or assets of another Person or
                  the income or profits of such other Person or which
                  constitutes an interest in property to secure an obligation;
                  each of the foregoing whether consensual or non-consensual and
                  whether arising by way of agreement, operation of law, legal
                  process or otherwise.

                           (b) The filing of any financing statement under the
                  UCC or comparable law of any jurisdiction.

         "EQUIPMENT": "Equipment" as defined in the UCC, and also all motor
                  vehicles, rolling stock, machinery, office equipment, plant
                  equipment, 


                                     ..2..
<PAGE>

                  tools, dies, molds, store fixtures, furniture, and
                  other goods, property, and assets which are used and/or were
                  purchased for use in the operation or furtherance of the
                  Guarantor's business, and any and all accessions or additions
                  thereto, and substitutions therefor.

         "EVENTS  OF DEFAULT": Has the meaning given that term in the Loan
                  Agreement.

         "FIXTURES": Has the meaning given that term in the UCC.

         "GENERAL INTANGIBLES": Includes, without limitation, "general
                  intangibles" as defined in the UCC; and also all: rights to
                  payment for credit extended; deposits; amounts due to the
                  Guarantor; credit memoranda in favor of the Guarantor;
                  warranty claims; tax refunds and abatements; insurance refunds
                  and premium rebates; all means and vehicles of investment or
                  hedging, including, without limitation, options, warrants, and
                  futures contracts; records; customer lists; telephone numbers;
                  goodwill; causes of action; judgments; payments under any
                  settlement or other agreement; literary rights; rights to
                  performance; royalties; license and/or franchise fees; rights
                  of admission; licenses; franchises; license agreements,
                  including all rights of the Guarantor to enforce same;
                  permits, certificates of convenience and necessity, and
                  similar rights granted by any governmental authority; patents,
                  patent applications, patents pending, and other intellectual
                  property; internet addresses and domain names; developmental
                  ideas and concepts; proprietary processes; blueprints,
                  drawings, designs, diagrams, plans, reports, and charts;
                  catalogs; manuals; technical data; computer software programs
                  (including the source and object codes therefor), computer
                  records, computer software, rights of access to computer
                  record service bureaus, service bureau computer contracts, and
                  computer data; tapes, disks, semi-conductors chips and
                  printouts; trade secrets rights, copyrights, mask work rights
                  and interests, and derivative works and interests; user,
                  technical reference, and other manuals and materials; trade
                  names, trademarks, service marks, and all goodwill relating
                  thereto; applications for registration of the foregoing; and
                  all other general intangible property of the Guarantor in the
                  nature of intellectual property; proposals; cost estimates,
                  and reproductions on paper, or otherwise, of any and all
                  concepts or ideas, and any matter related to, or connected
                  with, the design, development, manufacture, sale, marketing,
                  leasing, or use of any or all property produced, sold, or
                  leased, by the Guarantor or credit extended or services
                  performed, by the Guarantor, whether intended for an
                  individual customer or the general business of the Guarantor,
                  or used or useful in connection with research by the
                  Guarantor.

         "GUARANTOR": Is defined in the Preamble.

         "GOODS": Has the meaning given that term in the UCC.

         "GUARANTY": The Guarantor's Guaranty of the Liabilities of the
                  Borrowers to the Agent and the Lenders of even date, as the
                  same may be amended or restated from time to time hereafter
                  and any other instrument or undertaking by the Guarantor to
                  answer for or be obligated on account of any liabilities,
                  obligations, or indebtedness of the Borrowers to the Agent and
                  the Lenders.

         "INDEBTEDNESS": All indebtedness and obligations of or assumed by any
                  Person on account of or in respect to any of the following:

                           (a) In respect of money borrowed (including any
                  indebtedness which is non-recourse to the credit of such
                  Person but which is secured by an Encumbrance on any asset of
                  such Person) whether or not evidenced by a promissory note,
                  bond, debenture or other 


                                     ..3..
<PAGE>

                  written obligation to pay money.

                           (b) In connection with any letter of credit or
                  acceptance transaction (including, without limitation, the
                  face amount of all letters of credit and acceptances issued
                  for the account of such Person or reimbursement on account of
                  which such Person would be obligated).

                           (c) In connection with the sale or discount, with
                  recourse, of accounts receivable or chattel paper of such
                  Person.

                           (d) On account of deposits or advances.
                           (e) As lessee under Capital Leases.

                  "INDEBTEDNESS" also includes:

                                    (x) Indebtedness of others secured by an
                           Encumbrance on any asset of such Person, whether or
                           not such Indebtedness is assumed by such Person.

                                    (y) Any guaranty, endorsement, suretyship or
                           other undertaking pursuant to which that Person may
                           be liable on account of any obligation of any third
                           party.

                                    (z) The Indebtedness of a partnership or
                           joint venture in which such Person is a general
                           partner or joint venturer.

         "INSTRUMENTS": Has the meaning given that term in the UCC.

         "INVENTORY": Includes, without limitation, "inventory" as defined in
                  the UCC and also all: packaging, advertising, and shipping
                  materials related to any of the foregoing, and all names or
                  marks affixed or to be affixed thereto for identifying or
                  selling the same; Goods held for sale or lease or furnished or
                  to be furnished under a contract or contracts of sale or
                  service by the Guarantor, or used or consumed or to be used or
                  consumed in the Guarantor's business; Goods of said
                  description in transit: returned, repossessed and rejected
                  Goods of said description; and all documents (whether or not
                  negotiable) which represent any of the foregoing.

         "INVESTMENT PROPERTY": Has the meaning given that term in the UCC.

         "LEASEHOLD INTEREST": Any interest of the Guarantor as lessee under any
                  lease.

         "LENDERS": Defined in the Preamble to the within Agreement.

         "LIABILITIES" (in the singular, "LIABILITY"): Has the meaning given
                  that term in each of the Loan Agreement and the Guaranty.

         "LOAN    AGREEMENT": The Loan and Security Agreement dated as of April
                  28, 1998 between the Borrowers, the Agent and the Lenders, as
                  the same may be amended or restated hereafter. Except as
                  otherwise defined herein, terms used herein which are defined
                  in the Loan Agreement are used as so defined.

         "PERMITTED ENCUMBRANCES": Has the meaning given that term in the Loan
                  Agreement.

                                     ..4..
<PAGE>

         "PERSON": Any natural person, and any corporation, limited liability
                  company, trust, partnership, joint venture, or other
                  enterprise or entity.

         "PROCEEDS": Includes, without limitation, "Proceeds" as defined in the
                  UCC (defined below), and each type of property described in
                  Section 2-1 hereof.

         "RECEIVABLES COLLATERAL": That portion of the Collateral which consists
                  of the Guarantor's Accounts, Accounts Receivable, contract
                  rights, General Intangibles, Chattel Paper, Instruments,
                  Documents of Title, Documents, Investment Property, letters of
                  credit for the benefit of the Guarantor, and bankers'
                  acceptances held by the Guarantor, and any rights to payment.

         "REQUIREMENT OF LAW": As to any Person:

                           (a)(i) All statutes, rules, regulations, orders, or
                  other requirements having the force of law and (ii) all court
                  orders and injunctions, arbitrator's decisions, and/or similar
                  rulings, in each instance ((i) and (ii)) of or by any federal,
                  state, municipal, and other governmental authority, or court,
                  tribunal, panel, or other body which has or claims
                  jurisdiction over such Person, or any property of such Person,
                  or of any other Person for whose conduct such Person would be
                  responsible.

                           (b) That Person's charter, certificate of
                  incorporation, articles of organization, and/or other
                  organizational documents, as applicable.

                           (c) That Person's by-laws and/or other instruments
                  which deal with corporate or similar governance, as
                  applicable.

         "UCC":   The Uniform Commercial Code as presently in effect in
                  Massachusetts (Mass. Gen. Laws, Ch. 106), as amended from time
                  to time hereafter.

         "US BORROWERS": Sunglass Hut Trading Corporation and Watch
                  Station, Inc.

ARTICLE 2 - GRANT OF SECURITY INTEREST:

         2-1. GRANT OF SECURITY INTEREST. To secure the Guarantor's prompt,
punctual, and faithful performance of all and each of the Liabilities, the
Guarantor hereby grants to the Agent, for the ratable benefit of the Lenders, a
continuing security interest in and to, and assigns to the Agent, as collateral
security, the following, and each item thereof, whether now owned or now due, or
in which the Guarantor has an interest, or hereafter acquired, arising, or to
become due, or in which the Guarantor obtains an interest, and all products,
Proceeds, substitutions, and accessions of or to any of the following (all of
which, together with any other property in which the Lender may in the future be
granted a security interest, is referred to herein as the "COLLATERAL"):

                  (a)      All Accounts and accounts receivable.
                  (b)      All Inventory.
                  (c)      All General Intangibles.
                  (d)      All Equipment.
                  (e)      All Goods.
                  (f)      All Fixtures.
                  (g)      All Chattel Paper.

                                     ..5..
<PAGE>

                  (h)      All books, records, and information relating to the
                           Collateral and/or to the operation of the Guarantor's
                           business, and all rights of access to such books,
                           records, and information, and all property in which
                           such books,

                  (i)      records, and information are stored, recorded, and 
                           maintained. All Investment Property, Instruments, 
                           Documents, Deposit Accounts, policies and 
                           certificates of insurance, deposits, impressed 
                           accounts, compensating balances, money, cash, or 
                           other property.

                  (j)      All insurance proceeds, refunds, and premium rebates,
                           including, without limitation, proceeds of fire and
                           credit insurance, whether any of such proceeds,
                           refunds, and premium rebates arise out of any of the
                           foregoing (2-1(a) through 2-1(i)) or otherwise.

                  (k)      All liens, guaranties, rights, remedies, and
                           privileges pertaining to any of the foregoing (2-1(a)
                           through 2-1(i)), including the right of stoppage in
                           transit.

                  (l)      All Leasehold Interests.

         2-2. EXTENT AND DURATION OF SECURITY INTEREST. The security interest
created and granted herein is in addition to, and supplemental of, any security
interest previously granted by the Guarantor to the Lender and shall continue in
full force and effect applicable to all Liabilities until all Liabilities have
been paid and/or satisfied in full (other than contingent Liabilities which have
not then ripened into a claim) and the Guaranty has been duly terminated, at
which time the security interest granted herein shall be terminated in writing
by a duly authorized officer of the Agent.

ARTICLE 3 - GENERAL REPRESENTATIONS, COVENANTS AND WARRANTIES:

         To induce each Lender to provide financial accommodations to and for
the account of the Borrowers, the Guarantor acknowledges and agrees that
pursuant to the terms and conditions of the Loan Agreement, the Guarantor is and
shall hereinafter be deemed an Obligor thereunder.

ARTICLE 4 - USE AND COLLECTION OF COLLATERAL:

         4-1.     USE OF INVENTORY COLLATERAL.

                  (a) The Guarantor shall not engage in any sale of the
Inventory other than for fair consideration in the conduct of the Guarantor's
business in the ordinary course and shall not (i) engage in sales or other
dispositions to creditors; or (ii) sales or other dispositions in bulk, except
in a manner consistent with past and existing practices of the Guarantor and in
the ordinary course of business (unless either (x) the value of the Guarantor's
remaining Inventory will be materially and adversely affected thereby, or (y) an
Event of Default exists and is continuing, in which events the foregoing will be
prohibited under all circumstances).

                  (b) No sale of Inventory shall be on consignment, approval, or
under any other circumstances such that, such Inventory may be returned to the
Guarantor without the consent of the Agent.

         4-2. INVENTORY QUALITY. All Inventory now owned or hereafter acquired
by the Guarantor is and will be of good and merchantable quality and free from
defects (other than defects within customary trade tolerances).

         4-3. ADJUSTMENTS AND ALLOWANCES. The Guarantor may grant such
allowances or other adjustments to the Guarantor's Account Debtors (exclusive of
extending the time for payment of any Account or Account Receivable, which shall
not be done without first obtaining the Agent's prior written consent in 


                                     ..6..
<PAGE>

each instance) as the Guarantor may reasonably deem to accord with sound
business practice, PROVIDED, HOWEVER, the authority granted the Guarantor
pursuant to this Section 4-3 may be limited or terminated by the Agent at any
time after the occurrence and during the continuance of an Event of Default, in
the Agent's discretion.

         4-4. VALIDITY OF ACCOUNTS.

                  (a) The amount of each Account shown on the books, records,
and invoices of the Guarantor represented as owing by each Account Debtor is and
will be the correct amount actually owing by such Account Debtor and shall have
been fully earned by performance by the Guarantor.

                  (b) The Guarantor has no knowledge of any material impairment
of the validity or collectibility of any of the Accounts and shall notify the
Agent of any such fact immediately after the Guarantor become aware of any such
material impairment.

                  (c) The Guarantor shall not post any bond to secure the
Guarantor' performance under any agreement to which any Borrower is a party nor
cause any surety, guarantor, or other third party obligee to become liable to
perform any obligation of any Borrower (other than to the Agent ) in the event
of such Borrower's failure so to perform.

         4-5. NOTIFICATION TO ACCOUNT DEBTORS. The Agent shall have the right at
any time, after the occurrence and during the continuance of an Event of
Default, to notify any of the Guarantor' Account Debtors to make payment
directly to the Agent and to collect all amounts due on account of the
Collateral.

         4-6. PROCEEDS AND COLLECTION OF ACCOUNTS HELD IN TRUST. (a) Except as
provided for in the Loan Agreement, all Receivables Collateral and all proceeds
and collections of the Collateral shall be held in trust by the Guarantor for
the Agent and shall not be commingled with any of the Guarantor's other funds or
deposited in any bank account of the Guarantor.

                  (b) The Guarantor shall at all times deliver to the Agent in
accordance with the provisions of the Loan Agreement, as and when received by
the Guarantor and in the same form as so received, all checks, drafts, and other
items which represent the Collateral and any proceeds and collections of the
Collateral, each of which checks, drafts, and other items shall be endorsed to
the Agent or as the Agent may otherwise specify from time to time and which
shall be accompanied by remittance reports in form satisfactory to the Agent all
as provided for in the Loan Agreement. In addition, the Guarantor shall cause
any wire or other electronic transfer of funds which constitutes Collateral or
proceeds as provided for in the Loan Agreement. The Agent may apply the proceeds
thereof to the Liabilities as provided for in the Loan Agreement.

                  (c) The Guarantor shall cause all checks, drafts, and other
items which represent the Receivables Collateral and any proceeds and
collections of the Collateral to be delivered directly to a lock box, blocked
account, or similar recipient over which the Agent has sole access and control
as provided for in the Loan Agreement. The Agent shall apply the proceeds and
collections so delivered to the Liabilities as provided for in the Loan
Agreement.

ARTICLE 5 - LENDER AS GUARANTOR'S ATTORNEY-IN-FACT:

         5-1. APPOINTMENT AS ATTORNEY-IN-FACT. The Guarantor hereby irrevocably
constitutes and appoints the Agent as the Guarantor's true and lawful attorney,
with full power of substitution, exercisable after the occurrence and during the
continuance of an Event of Default, to convert the Collateral into cash at the
sole risk, cost, and expense of the Guarantor, but for the sole benefit of the
Agent. The rights and powers granted the Agent by the within appointment include
but are not limited to the right and power to:

                  (a) Prosecute, defend, compromise, or release any action
relating to the Collateral.

                                     ..7..
<PAGE>

                  (b) Sign change of address forms to change the address to
which the Guarantor's mail is to be sent to such address as the Agent shall
designate; receive and open the Guarantor's mail; remove any Receivables
Collateral and Proceeds of Collateral therefrom and turn over the balance of
such mail either to the Guarantor or to any trustee in bankruptcy, receiver,
assignee for the benefit of creditors of the Guarantor, or other legal
representative of the Guarantor whom the Agent determines to be the appropriate
person to whom to so turn over such mail.

                  (c) Endorse the name of the Guarantor in favor of the Agent
upon any and all checks, drafts, notes, acceptances, or other items or
instruments; sign and endorse the name of the Guarantor on, and receive as
secured party, any of the Collateral, any invoices, schedules of Collateral,
freight or express receipts, or bills of lading, storage receipts, warehouse
receipts, or other documents of title respectively relating to the Collateral.

                  (d) Sign the name of the Guarantor on any notice to the
Guarantor's Account Debtors or verification of the Receivables Collateral; sign
the Guarantor's name on any Proof of Claim in Bankruptcy against Account
Debtors, and on notices of lien, claims of mechanic's liens, or assignments or
releases of mechanic's liens securing the Accounts.

                  (e) Take all such action as may be necessary to obtain the
payment of any letter of credit and/or banker's acceptance of which any
Guarantor is a beneficiary.

                  (f) Repair, manufacture, assemble, complete, package, deliver,
alter or supply goods, if any, necessary to fulfill in whole or in part the
purchase order of any customer of the Guarantor.

                  (g) Use, license or transfer any or all General Intangibles of
the Guarantor.

         5-2. NO OBLIGATION TO ACT. The Agent shall not be obligated to do any
of the acts or to exercise any of the powers authorized by Section 5-1 herein,
but if the Lender elects to do any such act or to exercise any of such powers,
it shall not be accountable for more than it actually receives as a result of
such exercise of power, and shall not be responsible to the Guarantor for any
act or omission to act except for any act or omission to act as to which there
is a final determination made in a judicial proceeding (in which proceeding the
Agent has had an opportunity to be heard) which determination includes a
specific finding that the subject act or omission to act had been grossly
negligent or in actual bad faith.

ARTICLE 6 - RIGHTS AND REMEDIES UPON DEFAULT:

         In addition to all of the rights, remedies, powers, privileges, and
discretions which the Agent is provided prior to the occurrence of an Event of
Default, the Agent shall have the following rights and remedies upon the
occurrence, and during the continuance, of any Event of Default. No stay which
otherwise might be imposed pursuant to Section 362 of the Bankruptcy Code or
otherwise shall stay, limit, prevent, hinder, delay, restrict, or otherwise
prevent the Agent's exercise of any of such rights and remedies.

         6-1. RIGHTS OF ENFORCEMENT. The Agent shall have all of the rights and
remedies of a secured party upon default under the UCC, in addition to which the
Agent shall have all and each of the following rights and remedies:

                  (a) To collect the Receivables Collateral with or without the
taking of possession of any of the Collateral.

                  (b) To take possession of all or any portion of the
Collateral.

                  (c) To sell, lease, or otherwise dispose of any or all of the
Collateral, in its then condition or following such preparation or processing as
the Agent deems advisable and with or without the taking of possession of any of
the Collateral.

                  (d) To conduct one or more going out of business sales which
include the sale or other disposition of the Collateral.

                  (e) To apply the Receivables Collateral or the Proceeds of the
Collateral towards (but not necessarily in complete satisfaction of) 


                                     ..8..
<PAGE>

the Liabilities.

                  (f) To exercise all or any of the rights, remedies, powers,
privileges, and discretions under all or any of the Loan Documents.

         6-2. SALE OF COLLATERAL.

                  (a) Any sale or other disposition of the Collateral may be at
public or private sale upon such terms and in such manner as the Agent deems
advisable, having due regard to compliance with any statute or regulation which
might affect, limit, or apply to the Agent's disposition of the Collateral.

                  (b) The Agent, in the exercise of the Agent's rights and
remedies upon default, may conduct one or more going out of business sales, in
the Agent's own right or by one or more agents and contractors. Such sale(s) may
be conducted upon any premises owned, leased, or occupied by the Guarantor. The
Agent and any such agent or contractor, in conjunction with any such sale, may
augment the Inventory with other goods (all of which other goods shall remain
the sole property of the Agent or such agent or contractor). Any amounts
realized from the sale of such goods which constitute augmentations to the
Inventory (net of an allocable share of the costs and expenses incurred in their
disposition) shall be the sole property of the Agent or such agent or contractor
and neither the Guarantor nor any Person claiming under or in right of the
Guarantor shall have any interest therein.

                  (c) Unless the Collateral is perishable or threatens to
decline speedily in value, or is of a type customarily sold on a recognized
market (in which event the Agent shall provide the Guarantor with such notice as
may be practicable under the circumstances), the Agent shall give the Guarantor
at least seven (7) days prior written notice of the date, time, and place of any
proposed public sale, and of the date after which any private sale or other
disposition of the Collateral may be made. The Guarantor agrees that such
written notice shall satisfy all requirements for notice to the Guarantor which
are imposed under the UCC or other applicable law with respect to the exercise
of the Agent's rights and remedies upon default.

                  (d) The Agent and any Lender may purchase the Collateral, or
any portion of it at any sale held under this Article.

                  (e) The Agent shall apply the proceeds of any exercise of the
Agent's Rights and Remedies under this Article 6 towards the Liabilities in such
manner, and with such frequency, as the Agent determines.

         6-3. OCCUPATION OF BUSINESS LOCATION. In connection with the Agent's
exercise of the Agent's rights under this Article 6, the Agent may enter upon,
occupy, and use any premises owned or occupied by the Guarantor, and may exclude
the Guarantor from such premises or portion thereof as may have been so entered
upon, occupied, or used by the Agent. The Agent shall not be required to remove
any of the Collateral from any such premises upon the Agent's taking possession
thereof, and may render any Collateral unusable to the Guarantor. In no event
shall the Agent be liable to the Guarantor for use or occupancy by the Agent of
any premises pursuant to this Article 6, nor for any charge (such as wages for
the Guarantor's employees and utilities) incurred in connection with the Agent's
exercise of the Agent's Rights and Remedies.

         6-4. GRANT OF NONEXCLUSIVE LICENSE. The Guarantor hereby grants to the
Agent a royalty free nonexclusive irrevocable license to use, apply, and affix
any trademark, trade name, logo, or the like in which the Guarantor now or
hereafter has rights, such license being solely with respect to the Agent's
exercise of the rights under this Article 6, including, without limitation, in
connection with any completion of the manufacture of Inventory or sale or other
disposition of Inventory.

         6-5. ASSEMBLY OF COLLATERAL. The Agent may require the Guarantor to
assemble the Collateral and make it available to the Agent at the Guarantor's
sole risk and expense at a place or places which are reasonably convenient to
both the Agent and Guarantor.

                                     ..9..
<PAGE>

         6-6. RIGHTS AND REMEDIES. The rights, remedies, powers, privileges, and
discretions of the Agent hereunder (herein, the " AGENT'S RIGHTS AND REMEDIES")
shall be cumulative and not exclusive of any rights or remedies which it would
otherwise have. No delay or omission by the Agent in exercising or enforcing any
of the Agent's Rights and Remedies shall operate as, or constitute, a waiver
thereof. No waiver by the Agent of any Event of Default or of any default under
any other agreement shall operate as a waiver of any other default hereunder or
under any other agreement. No single or partial exercise of any of the Agent's
Rights or Remedies, and no express or implied agreement or transaction of
whatever nature entered into between the Agent and any person, at any time,
shall preclude the other or further exercise of the Agent 's Rights and
Remedies. No waiver by the Agent of any of the Agent's Rights and Remedies on
any one occasion shall be deemed a waiver on any subsequent occasion, nor shall
it be deemed a continuing waiver. All of the Agent's Rights and Remedies and all
of the Agent's rights, remedies, powers, privileges, and discretions under any
other agreement or transaction between the Agent and the Guarantor are
cumulative, and not alternative or exclusive, and may be exercised by the Agent
at such time or times and in such order of preference as the Agent in its sole
discretion may determine. The Agent's Rights and Remedies may be exercised
without resort or regard to any other source of satisfaction of the Liabilities.

ARTICLE 7 - NOTICES:

         7-1. NOTICE ADDRESSES. All notices, demands, and other communications
made in respect of this Agreement shall be made to the following addresses, each
of which may be changed upon seven (7) days written notice to all others given
by certified mail, return receipt requested:

If to the Agent:

                                    BankBoston Retail Finance Inc.
                                    40 Broad Street
                                    Boston, Massachusetts 02109
                                    Attention        :  Joseph V. Balsamo
                                                        Vice President
                                    Fax              :  617 434-4339

         WITH A COPY TO:

                                    Riemer & Braunstein
                                    Three Center Plaza
                                    Boston, Massachusetts  02108

                                    Attention        : David S. Berman, Esquire
                                    Fax              : 617 723-6831


                                     ..10..
<PAGE>

If to the Guarantor:

                                    Shadescom, Inc.
                                    255 Alhambra Circle
                                    Coral Gables, Florida 33134

                                    Attention        : Mr. Larry G. Petersen
                                    Fax              : (305) 461-6389

         WITH A COPY TO:

                                    Greenberg Traurig, P.A.
                                    1221 Brickell Avenue, 21st Floor
                                    Miami, Florida 33131
                                    Attention        : Bruce Macdonough, Esquire
                                    Fax:             : (305) 579-0717

         7-2.     NOTICE GIVEN.

                  (a) Except as otherwise specifically provided herein, notices
shall be deemed made and correspondence received, as follows (all times being
local to the place of delivery or receipt):

                           (i) By mail: the sooner of when actually received or
         Three (3) days following deposit in the United States mail, postage
         prepaid.

                           (ii) By recognized overnight express delivery: the
         Business Day following the day when sent.

                           (iii) By Hand: If delivered on a Business Day after
         9:00 AM and no later than Three (3) hours prior to the close of
         customary business hours of the recipient, when delivered. Otherwise,
         at the opening of the then next Business Day.

                           (iv) By Facsimile transmission (which must include a
         header on which the party sending such transmission is indicated): If
         sent on a Business Day after 9:00 AM and no later than Three (3) hours
         prior to the close of customary business hours of the recipient, one
         (1) hour after being sent. Otherwise, at the opening of the then next
         Business Day.

                  (b) Rejection or refusal to accept delivery and inability to
deliver because of a changed address or Facsimile Number for which no due notice
was given shall each be deemed receipt of the notice sent.

ARTICLE 8 - GENERAL:

         8-1. PROTECTION OF COLLATERAL. The Agent has no duty as to the
collection or protection of the Collateral beyond the safe custody of such of
the Collateral as may come into the possession of the Agent and shall have no
duty as to the preservation of rights against prior parties or any other rights
pertaining thereto.

         8-2. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Guarantor and the Guarantor's representatives, successors, and assigns and shall
enure to the benefit of the Agent and each Lender and the respective successors
and assigns of each. In the event that the Agent or any Lender assigns or
transfers its rights under this Agreement, the assignee shall thereupon succeed
to and become vested with all rights, powers, privileges, and duties of such
assignor hereunder and such assignor shall thereupon be discharged and relieved
from its duties and obligations hereunder.

                                     ..11..
<PAGE>

         8-3. SEVERABILITY. Any determination that any provision of this
Agreement or any application thereof is invalid, illegal, or unenforceable in
any respect in any instance shall not affect the validity, legality, or
enforceability of such provision in any other instance, or the validity,
legality, or enforceability of any other provision of this Agreement.

         8-4. AMENDMENTS. COURSE OF DEALING.

                  (a) This Agreement constitutes a "Loan Document" as defined in
the Loan Agreement. This Agreement and the other Loan Documents incorporate all
discussions and negotiations between the Guarantor and the Agent and each
Lender, either express or implied, concerning the matters included herein and in
such other instruments, any custom, usage, or course of dealings to the contrary
notwithstanding. No such discussions, negotiations, custom, usage, or course of
dealings shall limit, modify, or otherwise affect the provisions thereof. No
failure by the Agent or any Lender to give notice to the Guarantor of such
Guarantor's having failed to observe and comply with any warranty or covenant
included in this Agreement shall constitute a waiver of such warranty or
covenant or the amendment of this Agreement.

                  (b) The Guarantor may undertake any action otherwise
prohibited hereby, and may omit to take any action otherwise required hereby,
upon and with the express prior written consent of the Agent. No consent,
modification, amendment, or waiver of any provision of this Agreement shall be
effective unless executed in writing by or on behalf of the party to be charged
with such modification, amendment, or waiver (and if such party is the Agent,
then by a duly authorized officer thereof). Any modification, amendment, or
waiver provided by the Agent shall be in reliance upon all representations and
warranties theretofore made to the Agent by or on behalf of the Guarantor and
consequently may be rescinded in the event that any of such representations or
warranties was not true and complete in all material respects when given.

         8-5. APPLICATION OF PROCEEDS. The proceeds of any collection, sale, or
disposition of the Collateral, or of any other payments received hereunder,
shall be applied towards the Liabilities in such order and manner as the Agent
determines in its sole discretion. The Guarantor shall remain liable for any
deficiency remaining following such application.

         8-6. COSTS AND EXPENSES OF AGENT AND OF LENDERS. (a) The Guarantor
shall pay on demand all Costs of Collection and all reasonable expenses of the
Agent in connection with the preparation, execution, and delivery of this
Agreement, whether now existing or hereafter arising, and all other reasonable
expenses which may be incurred by the Agent in preparing or amending this
Agreement and all other agreements, instruments, and documents related thereto,
or otherwise incurred with respect to the Liabilities, and all costs and
expenses of the Agent which relate to the credit facility contemplated hereby.

                  (b) The Guarantor shall pay on demand all costs and expenses
(including attorneys' reasonable fees) incurred, following the occurrence of any
Event of Default, by each Lender in connection with the enforcement, attempted
enforcement, or preservation of any rights and remedies under this, or any other
Loan Document, as well as any such costs and expenses in connection with any
"workout", forbearance, or restructuring of the credit facility contemplated
hereby.

                  (c) The undertaking on the part of the Guarantor in this
Section 8-6 shall survive payment of the Liabilities and/or any termination,
release, or discharge executed by the Agent in favor of the Guarantor, other
than a termination, release, or discharge which makes specific reference to this
Section 8-6.

         8-7. COPIES AND FACSIMILES. This Agreement and all documents which
relate hereto, which have been or may be hereinafter furnished the Agent or any
Lender may be reproduced by that Person 


                                     ..12..
<PAGE>

or by the Agent by any photographic, microfilm, xerographic, digital imaging, or
other process, and that Person may destroy any document so reproduced. Any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course of
business). Any facsimile which bears proof of transmission shall be binding on
the party which or on whose behalf such transmission was initiated and likewise
shall be so admissible in evidence as if the original of such facsimile had been
delivered to the party which or on whose behalf such transmission was received.

         8-8. MASSACHUSETTS LAW. This Agreement and all rights and obligations
hereunder, including matters of construction, validity, and performance, shall
be governed by the laws of The Commonwealth of Massachusetts.

         8-9. CONSENT TO JURISDICTION.

                  (a) The Guarantor agrees that any legal action, proceeding,
case, or controversy against the Guarantor with respect to any this Agreement or
any other Loan Documents to which the Guarantor is a party may be brought in the
Superior Court of Suffolk County Massachusetts or in the United States District
Court, District of Massachusetts, sitting in Boston, Massachusetts, as the Agent
may elect in the Agent's sole discretion. By execution and delivery of this
Agreement, the Guarantor, for itself and in respect of its property, accepts,
submits, and consents generally and unconditionally, to the jurisdiction of the
aforesaid courts.

                  (b) To the extent permitted by applicable law, the Guarantor
WAIVES personal service of any and all process upon it, and irrevocably consents
to the service of process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by certified mail, postage
prepaid, to the Guarantor at the address for notices as specified herein, such
service to become effective five (5) Business Days after such mailing.

                  (c) The Guarantor WAIVES any objection based on FORUM NON
CONVENIENS and any objection to venue of any action or proceeding instituted
under this Agreement or any other Loan Documents and consents to the granting of
such legal or equitable remedy as is deemed appropriate by the Court.

                  (d) Nothing herein shall affect the right of the Agent to
bring legal actions or proceedings in any other competent jurisdiction.

                  (e) The Guarantor agrees that any action commenced by the
Guarantor asserting any claim or counterclaim arising under or in connection
with this Agreement or any other Loan Document shall be brought solely in the
Superior Court of Suffolk County Massachusetts or in the United States District
Court, District of Massachusetts, sitting in Boston, Massachusetts, and that
such Courts shall have exclusive jurisdiction with respect to any such action.

         8-10. INDEMNIFICATION. The Guarantor shall indemnify, defend, and hold
the Agent and each Lender and any employee, officer, or agent of any of the
foregoing (each, an "INDEMNIFIED PERSON") harmless of and from any claim brought
or threatened against any Indemnified Person by any Obligor, the Guarantor, or
any other Person (as well as from attorneys' reasonable fees and expenses in
connection therewith) on account of the relationship of any such Obligor or the
Guarantor with the Agent or any Lender (each of claims which may be defended,
compromised, settled, or pursued by the Indemnified Person with counsel of the
Lender's selection, but at the expense of the Guarantor) other than any claim as
to which a final determination is made in a judicial proceeding (in which the
Agent and any other Indemnified Person has had an opportunity to be heard),
which determination includes a specific finding that the Indemnified Person
seeking indemnification had acted in a grossly negligent manner or in actual bad
faith. The within indemnification shall survive payment of the Liabilities
and/or any termination, release, or discharge executed by the Agent in favor of
the Guarantor, other than a termination, release, or discharge which makes
specific reference to this Section 8-10.

         8-11. RULES OF CONSTRUCTION. The following rules of construction shall
be applied in the interpretation, construction, and enforcement of this
Agreement:

                                     ..13..
<PAGE>

                  (a) Words in the singular include the plural and words in the
plural include the singular.

                  (b) Headings (indicated by being UNDERLINED) and the Table of
Contents are solely for convenience of reference and do not constitute a part of
the instrument in which included and do not affect such instrument's meaning,
construction, or effect.

                  (c) The words "includes" and "including" are not limiting.

                  (d) Text which follows the words "including, without
limitation" (or similar words) is illustrative and not limitational.

                  (e) Text which is UNDERLINED, shown in ITALICS, shown in BOLD,
shown IN ALL CAPITAL LETTERS, or in any combination of the foregoing, shall be
deemed to be conspicuous.

                  (f) The words "may not" are prohibitive and not permissive.

                  (g) The word "or" is not exclusive.

                  (h) Terms which are defined in one section of an instrument
are used with such definition throughout the instrument in which so defined.

                  (i) The symbol "$" refers to United States Dollars.

                  (j) References to "herein", "hereof", and "within" are to this
entire Loan Agreement and not merely to the provision in which such reference is
included.

                  (k) References to "this Agreement" or to any other Loan
Document is to the subject instrument as amended to the date on which
application of such reference is being made.

                  (l) Except as otherwise specifically provided, all references
to time are to Boston time.

         8-12. INTENT. It is intended that:

                  (a) This Agreement take effect as a sealed instrument.

                  (b) The scope of the security interests created by this
Agreement be broadly construed in favor of the Agent.

                  (c) The security interests created by this Agreement secure
all Liabilities, whether now existing or hereafter arising.

                  (d) All reasonable costs and expenses incurred by the Agent
and, to the extent provide in Section 8-6 each Lender in connection with such
Person's relationship(s) with the Obligors shall be borne by the Guarantor.

         8-13. RIGHT OF SET-OFF. Any and all deposits or other sums at any time
credited by or due to the Guarantor from the Agent or any Lender and any cash,
securities, instruments or other property of the Guarantor in the possession of
the Agent or any Lender, whether for safekeeping or otherwise (regardless of the
reason such Person had received the same) shall at all times constitute security
for all Liabilities and for any and all obligations of the Guarantor to the
Agent and each Lender and may be applied or set off against the Liabilities and
against such obligations at any time, whether or not such are then due and
whether or not other collateral is then available to the Agent.

         8-14.    WAIVERS.

                  (a) The Guarantor makes each of the waivers included in
Section 8-14(b), below, knowingly, voluntarily, and intentionally, and
understands that the Agent and each Lender, in providing loans and other
financial accommodations to or for the account of the Borrowers, is relying on
such waivers.

                  (b) THE GUARANTOR WAIVES THE FOLLOWING:

                                     ..14..
<PAGE>

                           (i) Except as otherwise specifically required hereby,
         notice of non-payment, demand, presentment, protest and all forms of
         demand and notice, both with respect to the Liabilities and the
         Collateral.

                           (ii) Except as otherwise specifically required
         hereby, the right to notice and/or hearing prior to the Agent's
         exercising of the Agent's rights upon default.

                           (iii) THE RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR
         CONTROVERSY IN WHICH THE AGENT OR ANY LENDER IS OR BECOMES A PARTY
         (WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST THE AGENT
         OR ANY LENDER OR IN WHICH THE AGENT OR ANY LENDER IS JOINED AS A PARTY
         LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF OR IS IN RESPECT OF,
         ANY RELATIONSHIP AMONGST OR BETWEEN THE GUARANTOR OR ANY OTHER PERSON
         AND THE AGENT OR ANY LENDER (AND THE AGENT AND EACH LENDER LIKEWISE
         WAIVES THE RIGHT TO A JURY IN ANY TRIAL OF ANY SUCH CASE OR
         CONTROVERSY).

                           (iv) The benefits or availability of any stay,
         limitation, hindrance, delay, or restriction (including, without
         limitation, any automatic stay which otherwise might be imposed
         pursuant to Section 362 of the Bankruptcy Code) with respect to any
         action which the Agent may or may become entitled to take hereunder.

                           (v) Any claim to consequential, special, or punitive
         damages.

         IN WITNESS WHEREOF, the parties have placed their hands and seals.

                                           SHADESCOM, INC.
                                           ("GUARANTOR")

                                           By___________________________________
                                           Print  Name: LARRY G. PETERSEN  
                                           Title: TREASURER 

                                     ..15..
<PAGE>
                                           BANKBOSTON RETAIL FINANCE INC.
                                           ("AGENT")

                                           By___________________________________
                                           Print Name:__________________________
                                           Title:_______________________________

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