<PAGE>

                        CREDIT AND SECURITY AGREEMENT

     THIS AGREEMENT is made as of December 19, 1995, by and between FBS
BUSINESS FINANCE CORPORATION, a Delaware corporation (the "LENDER"), and
CRYENCO, INC., a Colorado corporation and CRYENCO SCIENCES, INC., a Delaware
corporation (collectively and/or individually the "BORROWER").

     In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:

                 ARTICLE I   DEFINITIONS AND ACCOUNTING TERMS

     1.1  DEFINITIONS.  In addition to terms defined elsewhere in this
Agreement or any Supplement, Exhibit or Schedule hereto, the following terms
shall have the following respective meanings (and such meanings shall be
equally applicable to both the singular and plural forms of the terms
defined, as the context may require):

     "ACCOUNT DEBTOR":  Any Person who is or who may become obligated to the
Borrower under, with respect to, or on account of an Account Receivable,
General Intangible or other Collateral.

     "ACCOUNT RECEIVABLE":  Any account of the Borrower and any other right
of the Borrower to payment for goods sold or leased or for services rendered,
whether or not evidenced by an instrument or chattel paper and whether or not
yet earned by performance.

     "ACCOUNTS RECEIVABLE AVAILABILITY":  The term "Accounts Receivable
Availability" shall have the meaning given such term in SUPPLEMENT A.

     "ADVERSE EVENT":  The occurrence of any event that could have a material
adverse effect on the business, operations, property, assets or condition
(financial or otherwise) of the Borrower on a consolidated basis or on the
ability of the Borrower or any other Obligor to perform its obligations under
the Loan Documents.

     "AFFILIATE"  means any Person which directly or indirectly through one
or more intermediaries controls, or is controlled by, or is under common
control with, the Lender including, without limitation, FBNA.  The term
"control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of stock, by contract or otherwise.

     "AGREEMENT":  This Credit and Security Agreement, as it may be amended,
modified, supplemented, restated or replaced from time to time.

     "APPLICATION":  An application by the Borrower, in a form and containing
terms and provisions acceptable to the Lender, for the issuance by the
Lender, or any Affiliate, of a Letter of Credit.

     "ATTORNEYS' FEES":  The value of the services (and costs, charges and
expenses related thereto) of the attorneys employed by the Lender (including,
without limitation, attorneys and



<PAGE>

paralegals who are employees of the Lender or any Affiliate) from time to
time (a) in connection with the negotiation, preparation, execution delivery,
administration and enforcement of the Loan Documents, (b) to prepare
documentation related to the Loans and other Obligations, (c) to represent
the Lender in any litigation, contest, dispute, suit or proceeding or to
commence, defend or intervene in any litigation contest, dispute, suit or
proceeding or to file a petition, complaint, answer, motion or other
pleading, or to take any other action in or with respect to, any litigation,
contest, dispute, suit or proceeding (whether instituted by the Lender, the
Borrower or any other Person and whether in bankruptcy or otherwise) in any
way or respect relating to the Collateral, any Third Party Collateral, the
Loan Documents, or the Borrower's or any other Obligor's affairs, (d) to
protect, collect, lease, sell, take possession of, or liquidate any of the
Collateral or any Third Party Collateral, (e) to attempt to enforce any
security interest in any of the Collateral or any Third Party Collateral or
to give any advice with respect to such enforcement, and (f) to enforce any
of the Lender's rights to collect any of the Obligations.

     "BORROWING BASE":  The term "Borrowing Base" shall have the meaning
given such term in SUPPLEMENT A.

     "BORROWING BASE CERTIFICATE":  The term "Borrowing Base Certificate"
shall have the meaning given such term in SECTION 2.5(c).

     "BUSINESS DAY":  Any day (other than a Saturday, Sunday or legal holiday
in the State of Minnesota) on which national banks are permitted to be open
in Minneapolis, Minnesota.

     "CAPITAL EXPENDITURE":  Any amount debited to the fixed asset account on
the consolidated balance sheet of the Borrower in respect of (a) the
acquisition (including, without limitation, acquisition by entry into a
Capitalized Lease), construction, improvement, replacement or betterment of
land, buildings, machinery, equipment or of any other fixed assets or
leaseholds, and (b) to the extent related to and not included in CLAUSE (a),
materials, contract labor and direct labor (excluding expenditures properly
chargeable to repairs or maintenance in accordance with GAAP).

     "CAPITALIZED LEASE":  Any lease which is or should be capitalized on the
books of the lessee in accordance with GAAP.

     "CLOSING DATE":  The date on which all of the conditions precedent to
the initial Loans are satisfied.

     "CODE":  The Internal Revenue Code of 1986, as amended, or any successor
statute, together with the regulations thereunder.

     "COLLATERAL":  The term "Collateral" shall have the meaning given such
term in SECTION 3.1.

     "COLLATERAL ACCOUNT":  The term "Collateral Account" shall have the
meaning given such term in SECTION 3.2(b).

                                       2

<PAGE>

     "CONSOLIDATED":  When applied to any financial or accounting term, the
term "consolidated" shall refer to figures prepared on a consolidated basis
including Cryenco and CSI.

     "CONTROLLED DISBURSEMENT ACCOUNT":  The term "Controlled Disbursement
Account" shall have the meaning given such term in SECTION 2.3(c)

     "COSTS": Costs and revenues in excess of billings, determined under the
percentage of completion method of accounting for contract revenues.

     "CREDIT":  The facility established under this Agreement pursuant to
which the Lender will make Revolving Loans and the Term Loan to the Borrower
or issue, or cause any Affiliate to issue, Letters of Credit for the account
of the Borrower.

     "CRYENCO":  Cryenco, Inc., a Colorado corporation.

     "CSI":  Cryenco Sciences, Inc., a Delaware corporation.

     "DEFAULT RATE":  With respect to a Loan, the rate of interest which is
applicable to such Loan after any amount thereof is not paid when due, as
determined pursuant to SUPPLEMENT A.

     "DISBURSEMENT ACCOUNT":  The term "Disbursement Account" shall have the
meaning given such term in SECTION 2.3(b).

     "EBITDA":  For any period of determination, the consolidated net income
of the Borrower before provision for income taxes, interest expense
(including, without limitation, implicit interest expense on Capitalized
Leases), depreciation, amortization and other non-cash expenses or charges,
all as determined in accordance with GAAP, excluding therefrom (to the extent
included): (a) non-operating gains (including, without limitation,
extraordinary or nonrecurring gains, gains from discontinuance of operations
and gains arising from the sale of assets other than Inventory) during the
applicable period; and (b) similar non-operating losses during such period.

     "ELIGIBLE ACCOUNT RECEIVABLE":  An Account Receivable owing to the
Borrower which meets the following requirements:

          (a)  it is genuine and in all respects what it purports to be;

          (b)  it arises from either (i) the performance of services by the
     Borrower, which services have been fully performed and, if applicable,
     acknowledged and/or accepted by the Account Debtor with respect thereto; or
     (ii) the sale or lease of goods by the Borrower and (A) such goods comply
     with such Account Debtor's specifications (if any) and have been shipped
     to, or delivered to and accepted by, such Account Debtor, (B) the Borrower
     has possession of, or has delivered to the Lender, at the Lender's request,
     shipping and delivery receipts evidencing such shipment, delivery and
     acceptance, and (C) such goods have not been returned to the Borrower;

                                       3

<PAGE>

          (c)  it (i) is evidenced by an invoice rendered to the Account Debtor
     with respect thereto which (A) is dated not earlier than the date of
     shipment or performance and (B) has payment terms not unacceptable to the
     Lender; and (ii) meets the Eligible Account Receivable requirements set
     forth in SUPPLEMENT A;

          (d)  it is not subject to any assignment, claim or Lien other than (i)
     a Lien in favor of the Lender and (ii) Liens consented to by the Lender in
     writing;

          (e)  it is a valid, legally enforceable and unconditional obligation
     of the Account Debtor with respect thereto and is not subject to setoff,
     counterclaim, credit or allowance (except any credit or allowance which has
     been deducted in computing the net amount of the applicable invoice as
     shown in the original schedule or Borrowing Base Certificate furnished to
     the Lender identifying or including such Account Receivable) or adjustment
     by the Account Debtor with respect thereto, or to any claim by such Account
     Debtor denying liability thereunder in whole or in part, and such Account
     Debtor has not refused to accept any of the goods or services which are the
     subject of such Account Receivable or offered or attempted to return any of
     such goods;

          (f)  there are no proceedings or actions which are then threatened or
     pending against the Account Debtor with respect thereto or to which such
     Account Debtor is a party which might result in any material adverse change
     in such Account Debtor's financial condition or in its ability to pay any
     Account Receivable in full when due;

          (g)  it does not arise out of a contract or order which, by its terms,
     forbids, restricts or makes void or unenforceable the assignment by the
     Borrower to the Lender of such Account Receivable;

          (h)  the Account Debtor with respect thereto is not a Subsidiary,
     Related Party or Obligor, or a director, officer, employee or agent of the
     Borrower, a Subsidiary, Related Party or Obligor;

          (i)  the Account Debtor with respect thereto is a resident or citizen
     of and is located within the United States of America unless the sale of
     goods giving rise to such Account Receivable is on letter of credit,
     banker's acceptance or other credit support terms satisfactory to the
     Lender;

          (j)  it does not arise from a "sale on approval," "sale or return" or
     "consignment," nor is it subject to any other repurchase or return
     agreement;

          (k)  it is not an Account Receivable with respect to which possession
     and/or control of the goods sold giving rise thereto is held, maintained or
     retained by the Borrower, any Subsidiary, Related Party or Obligor (or by
     any agent or custodian of the Borrower, any Subsidiary, Related Party or
     Obligor) for the account of or subject to further and/or future direction
     from the Account Debtor with respect thereto;

                                      4

<PAGE>

          (l)  it does not, in any way, fail to meet or violate any warranty,
     representation or covenant contained in the Loan Documents relating
     directly or indirectly to the Borrower's Accounts Receivable;

          (m)  the Account Debtor with respect thereto is not located in the
     States of Indiana, New Jersey or Minnesota, PROVIDED, HOWEVER, that such
     restriction shall not apply if (i) the Borrower has filed and has effective
     a Notice of Business Activities Report with the appropriate office or
     agency of the States of Indiana, New Jersey or Minnesota, as applicable,
     for the then current year or (ii) the Borrower is exempt from the filing of
     such report;

          (n)  it arises in the ordinary course of the Borrower's business;

          (o)  if the Account Debtor with respect thereto is the United States
     of America or any department, agency or instrumentality thereof, the
     Borrower has assigned its right to payment of such Account Receivable to
     the Lender pursuant to the Assignment of Claims Act of 1940 as amended;

          (p)  if the Lender, in its sole and absolute discretion, has
     established a credit limit for the Account Debtor with respect thereto, the
     aggregate dollar amount of Accounts Receivable due from such Account
     Debtor, including such Account Receivable, does not exceed such credit
     limit; and

          (q)  if it is evidenced by chattel paper or instruments, (i) the
     Lender shall have specifically agreed to include such Account Receivable as
     an Eligible Account Receivable, (ii) only payments then due and payable
     under such chattel paper or instrument shall be included as an Eligible
     Account Receivable and (iii) the originals of such chattel paper or
     instruments have been assigned and delivered to the Lender in a manner
     satisfactory to the Lender.

An Account Receivable which is at any time an Eligible Account Receivable but
which subsequently fails to meet any of the foregoing requirements shall
forthwith cease to be an Eligible Account Receivable.  Further, with respect
to any Account Receivable, if the Lender at any time or times hereafter
determines, in its sole and absolute discretion, that the prospect of payment
or performance by the Account Debtor with respect thereto is or will be
impaired for any reason whatsoever, notwithstanding anything to the contrary
contained above, such Account Receivable shall forthwith cease to be an
Eligible Account Receivable.

     "ELIGIBLE EQUIPMENT":  Equipment which meets the following requirements:

          (a)  it is in good and workable condition, ordinary wear and tear
     excepted;

          (b)  no portion of the purchase price thereof remains unpaid, as
     established by documentation satisfactory to the Lender;

                                       5

<PAGE>

          (c)  it is not subject to any prior assignment, claim or Lien other
     than (i) a Lien in favor of the Lender and (ii) Liens consented to by the
     Lender in writing;

          (d)  it complies with the Borrower's specifications and has been
     delivered to and accepted by the Borrower;

          (e)  there exists no dispute with respect thereto between the Borrower
     and the manufacturer or supplier thereof, including, without limitation,
     warranty or other claims;

          (f)  it does not, in any way, fail to meet or violate any warranty,
     representation or covenant contained in the Loan Documents relating
     directly or indirectly to the Borrower's Equipment;

          (g)  the Lender has determined in its sole and absolute discretion
     that it is not unacceptable due to age, type, condition or quality; and

          (h)  it satisfies the Eligible Equipment requirements, if any, set
     forth in SUPPLEMENT A.

Equipment which at any time is Eligible Equipment but which subsequently
fails to meet any of the foregoing requirements shall forthwith cease to be
Eligible Equipment.

     "ELIGIBLE INVENTORY":  Inventory of the Borrower which meets the
requirements set forth in clauses (a) through (i) below:

          (a)  it is owned by the Borrower and is not subject to any prior
     assignment, claim or Lien other than (i) a Lien in favor of the Lender and
     (ii) Liens consented to by the Lender in writing;

          (b)  if held for sale or lease or furnishing under contracts of
     service, it is (except as the Lender may otherwise consent in writing) new
     and unused;

          (c)  except as the Lender may otherwise consent, it is not stored with
     a bailee, warehouseman or similar party; if so stored with the Lender's
     consent, such bailee, warehouseman or similar party has issued and
     delivered to the Lender, in form and substance acceptable to the Lender,
     such documents and agreements as the Lender may require, including, without
     limitation, warehouse receipts therefor in the Lender's name;

          (d)  the Lender has determined, in its sole and absolute discretion,
     that it is not unacceptable due to age, type, category, quality and/or
     quantity;

          (e)  it is not held by the Borrower on "consignment" and is not
     subject to any other repurchase or return agreement;

                                       6

<PAGE>

          (f)  it complies with all standards imposed by any governmental agency
     having regulatory authority over such goods and/or their use, manufacture
     or sale;

          (g)  it does not, in any way, fail to meet or violate any warranty,
     representation or covenant contained in the Loan Documents relating
     directly or indirectly to the Borrower's Inventory;

          (h)  it satisfies the Eligible Inventory requirements, if any, set
     forth in SUPPLEMENT A;

          (i)  it is either the raw materials or finished goods components of
     Inventory.

Inventory of the Borrower which is at any time Eligible Inventory but which
subsequently fails to meet any of the foregoing requirements applicable to
Inventory shall forthwith cease to be Eligible Inventory.

     "ENVIRONMENTAL LAWS":  The Resource Conservation and Recovery Act of
1987, the Comprehensive Environmental Response, Compensation and Liability
Act, any so-called "Superfund" or "Superlien" law, the Toxic Substances
Control Act, and any other federal, state or local statue, law, ordinance,
code, rule, regulation, order or decree regulating, relating to, or imposing
liability or standards of conduct concerning any Hazardous Materials or other
hazardous, toxic or dangerous waste, substance or constituent, or other
substance, whether solid, liquid or gas, as now or at any time hereafter in
effect.

     "ENVIRONMENTAL LIEN":  A Lien in favor of any governmental entity for
(a) any liability under any Environmental Law, or (b) damages arising from or
costs incurred by such governmental entity in response to a spillage,
disposal, or release into the environment of any Hazardous Material or other
hazardous, toxic or dangerous waste, substance or constituent, or other
substance.

     "EQUIPMENT":  All equipment of the Borrower of every description,
including, without limitation, fixtures, furniture, vehicles and trade
fixtures, together with any and all accessions, parts and equipment attached
thereto or used in connection therewith, and any substitutions therefor and
replacements thereof.

     "EQUIPMENT AVAILABILITY":  The term "Equipment Availability" shall have
the meaning given such term in SUPPLEMENT A.

     "EQUIPMENT AVAILABILITY SUBLIMIT":  The term "Equipment Availability
Sublimit" shall have the meaning given such term in SUPPLEMENT A.

     "ERISA":  The Employee Retirement Income Security Act of 1974, as
amended, or any successor statute, together with the regulations thereunder.

     "ERISA AFFILIATE":  Any trade or business (whether or not incorporated)
that is a member of a group of which the Borrower is a member and which is
treated as a single employer under Section 414 of the Code.


                                       7

<PAGE>

     "EVENT OF DEFAULT":  The term "Event of Default" shall have the meaning
given such term in SECTION 7.1.

     "FBNA":  First Bank National Association, a national banking association
having its offices at First Bank Place, 601 Second Avenue South, Minneapolis,
Minnesota  55402-4302.

     "FEDERAL RESERVE BOARD":  The Board of Governors of the Federal Reserve
System or any successor thereto.

     "GAAP":  Generally accepted accounting principles promulgated by the
Financial Accounting Standards Board, as applied in the preparation of the
audited financial statement of the Borrower referred to in SECTION 4.6.

     "GENERAL INTANGIBLES":  All of the Borrower's intangible personal property
including things in action, causes of action and all other personal property of
the Borrower of every kind and nature (other than goods, accounts, chattel
paper, documents, instruments and money) including, without limitation,
corporate or other business records, inventions, designs, patents, patent
applications, trademarks, trademark applications, trade names, trade secrets,
goodwill, copyrights, registrations, licenses, franchises, customer lists, tax
refund claims, claims against carriers and shippers, guarantee claims, security
interests, security deposits or other security held by or granted to the
Borrower to secure payment by an Account Debtor of any of the Accounts
Receivable, any other rights to payment, including, without limitation, rights
to reimbursement or indemnification, and any other rights of whatsoever nature.

     "HAZARDOUS MATERIALS":  Any hazardous substance or pollutant or contaminant
defined as such in (or for the purposes of) any Environmental Law including,
without limitation, petroleum, including crude oil or any fraction thereof which
is liquid at standard conditions of temperature or pressure (60 degrees
Fahrenheit and 14.7 pounds per square inch absolute), any radioactive material,
including any source, special nuclear or by-product material as defined at 42
U.S.C. section 2011 ET. SEQ., as amended or hereafter amended, and asbestos in
any form or condition.

     "INDEBTEDNESS":  Without duplication, all obligations, contingent or
otherwise, which in accordance with GAAP should be classified upon the obligor's
balance sheet as liabilities, but in any event including the following (whether
or not they should be classified as liabilities upon such balance sheet):  (a)
any obligation secured by any mortgage, pledge, security interest, lien, charge
or other encumbrance existing on property owned or acquired subject thereto,
whether or not such obligation shall have been assumed and whether or not such
obligation is the obligation of the owner or another party; (b) any obligation
on account of deposits or advances; (c) any obligation for the deferred purchase
price of any property or services, except accounts payable arising in the
ordinary course of business; (d) any obligation as lessee under any Capitalized
Lease; (e) any guaranty, endorsement or other contingent obligation in respect
to Indebtedness of others; and (f) any undertaking or agreement to reimburse or
indemnify issuers of letters of credit.  For all purposes of this Agreement, the
Indebtedness of any Person shall include the Indebtedness of any partnership or
joint venture in which such Person is a general partner or a joint venturer.


                                      8

<PAGE>

     "INDEMNIFIED LIABILITIES":  The term "Indemnified Liabilities" shall have
the meaning given such term in SECTION 10.2.

     "INDEMNITEES":  The term "Indemnitees" shall have the meaning given such
term in SECTION 10.2.

     "INVENTORY":  Any and all of the Borrower's goods, including, without
limitation, goods in transit, wheresoever located which are or may at any time
be leased by the Borrower to a lessee, held for sale or lease, furnished under
any contract of service or held as raw materials, work in process, or supplies
or materials used or consumed in the Borrower's business, or which are held for
use in connection with the manufacture, packing, shipping, advertising, selling
or finishing of such goods, and all goods, the sale or other disposition of
which has given rise to an Account Receivable, which are returned to and/or
repossessed and/or stopped in transit by the Borrower or the Lender, or at any
time hereafter in the possession or under the control of the Borrower or the
Lender, or any agent or bailee of either thereof, and all documents of title or
other documents representing the same.

     "INVENTORY AVAILABILITY":  The term "Inventory Availability" shall have the
meaning given such term in SUPPLEMENT A.

     "INVESTMENT":  The acquisition, purchase, making or holding of any stock or
other security, any loan, advance, contribution to capital, extension of credit
(except for trade and customer accounts receivable for inventory sold or
services rendered in the ordinary course of business and payable in accordance
with customary trade terms), any acquisitions of real and personal property
(other than real and personal property acquired in the ordinary course of
business) and any purchase or commitment or option to purchase stock or other
debt or equity securities of, or any interest in, another Person or any integral
part of any business or the assets comprising such business or part thereof.

     "L/C DRAFT":  A draft drawn on the Lender, or any Affiliate, pursuant to a
Letter of Credit.

     "LETTER OF CREDIT":  A letter of credit issued by the Lender, or any
Affiliate, on the Application of the Borrower.

     "LETTER OF CREDIT OBLIGATIONS":  An amount equal to the aggregate of the
original face amounts of all Letters of Credit MINUS the sum of (a) the amount
of any reduction(s) in the original face amount of any Letter of Credit which
did not result from a draw made under such Letter of Credit, (b) the amount of
any payments made by the Lender, or any Affiliate, with respect to a Letter of
Credit or L/C Draft for which the Borrower has reimbursed the Lender, or such
Affiliate, and (c) the undrawn portion of any issued, but expired, Letter of
Credit PLUS the amount of any increase(s) in the original face amount of any
Letter of Credit. For purposes of determining the outstanding Letter of Credit
Obligations at any time, the Lender's, or any Affiliate's, acceptance of an L/C
Draft shall constitute a draw on the applicable Letter of Credit at the time of
such acceptance.


                                      9

<PAGE>

     "LETTER OF CREDIT SUBLIMIT":  The term "Letter of Credit Sublimit" shall
have the meaning given such term in SUPPLEMENT A.

     "LIEN":  Any security interest, mortgage, pledge, lien, hypothecation,
judgment lien or similar legal process, charge, encumbrance, title retention
agreement or analogous instrument or device (including, without limitation, the
interest of lessors under Capitalized Leases and the interest of a vendor under
any conditional sale or other title retention agreement).

     "LOAN":  Any Revolving Loan made by the Lender to the Borrower pursuant to
SECTION 2.1.1, the Term Loan made by the Lender to the Borrower pursuant to
SECTION 2.1.2 and any other loan or advance made by the Lender to the Borrower
under or pursuant to this Agreement.

     "LOAN ACCOUNT":  The term "Loan Account" shall have the meaning given such
term in SECTION 2.3(A).

     "LOAN DOCUMENTS":  This Agreement, any Note and each other instrument,
document, guaranty, mortgage, deed of trust, chattel mortgage, pledge, power of
attorney, consent, assignment, contract, notice, security agreement, lease,
financing statement, subordination agreement, trust account agreement, or other
agreement executed and delivered by the Borrower or any guarantor or party
granting security interests in connection with this Agreement, the Loans or the
Collateral.

     "NET WORTH":  At any determination date, the total of all assets appearing
on a consolidated balance sheet of the Borrower at such date, prepared in
accordance with GAAP, after deducting all proper reserves (including reserves
for depreciation, obsolescence and amortization) MINUS all liabilities which in
accordance with GAAP would be included on the liability side of a consolidated
balance sheet.

     "NOTE":  Any promissory note of the Borrower evidencing any loan or advance
(including but not limited to the Loans) made by the Lender to the Borrower
pursuant to this Agreement.

     "OBLIGATIONS":  All of the liabilities, obligations and indebtedness of the
Borrower to the Lender, or any Affiliate, of any kind or nature, however
created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing or due or to become due, and including,
without limitation, (a) the Borrower's obligations under the Loan Documents,
including obligations of performance, (b) the Borrower's obligations with
respect to any Letter of Credit or any Application, and (c) interest, charges,
expenses, Attorneys' Fees and other sums chargeable to the Borrower by the
Lender under the Loan Documents.  "Obligations" shall also include the effects
of any and all amendments, extensions, renewals, refundings or refinancings of
any of the foregoing.

     "OBLIGOR":  The Borrower and each other Person who is or shall become
primarily or secondarily liable on any of the Obligations or who grants to the
Lender a Lien on any property of such Person as security for any of the
Obligations.


                                     10

<PAGE>

     "OCCUPATIONAL SAFETY AND HEALTH LAW":  The Occupational Safety and Health
Act of 1970 and any other federal, state or local statute, law, ordinance, code,
rule, regulation, order or decree regulating, relating to or imposing liability
or standards of conduct concerning employee health and/or safety.

     "OVER ADVANCE":  The term "Over Advance" shall have the meaning given such
term in SECTION 2.8.

     "OVERDRAFT LOAN":  The term "Overdraft Loan" shall have the meaning given
such term in SECTION 2.7.

     "PARTICIPANT":  Any Person, now or at any time or times hereafter,
participating with the Lender in the Loans made to the Borrower hereunder.

     "PBGC":  The Pension Benefit Guaranty Corporation, established pursuant to
Subtitle A of Title IV of ERISA, or any successor thereto or to the functions
thereof.

     "PERSON":  Any natural person, corporation, partnership, joint venture,
firm, association, trust, unincorporated organization, government or
governmental agency or political subdivision thereof, or any other entity,
whether acting in an individual, fiduciary or other capacity.

     "PLAN":  An employee benefit plan or other plan, maintained for employees
of the Borrower or of any ERISA Affiliate, and subject to Title IV of ERISA or
Section 412 of the Code.

     "REFERENCE RATE":  The rate of interest from time to time publicly
announced by FBNA as its "reference rate."  The Lender may lend to its customers
at rates that are at, above or below the Reference Rate.  For purposes of
determining any interest rate which is based on the Reference Rate, such
interest rate shall change on the effective date of any change in the Reference
Rate.

     "RELATED PARTY":  Any Person (other than a Subsidiary):  (a) which directly
or indirectly, through one of more intermediaries, controls, is controlled by or
is under common control with, the Borrower, (b) which beneficially owns or holds
5% or more of the equity interest of the Borrower, or (c) 5% or more of the
equity interest of which is beneficially owned or held by the Borrower or a
Subsidiary.  The term "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.

     "REPORTABLE EVENT":  A reportable event, as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC, by regulation, has waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event; PROVIDED, HOWEVER, that a failure to meet the
minimum funding standard of Section 412 of the Code and Section 302 of ERISA
shall be a reportable event regardless of the issuance of any such waivers in
accordance with Section 412(d) of the Code.


                                     11

<PAGE>

     "REVOLVING CREDIT AMOUNT":  The term "Revolving Credit Amount" shall have
the meaning given such term in SUPPLEMENT A.

     "REVOLVING LOAN":  The term "Revolving Loan" shall have the meaning given
such term in SECTION 2.1.1.

     "REVOLVING LOAN AVAILABILITY":  The lesser of (a) the Revolving Credit
Amount MINUS the Letter of Credit Obligations and (b) the Borrowing Base MINUS
the Letter of Credit Obligations.

     "SUBORDINATED DEBT":  That portion of any liabilities, obligations or
Indebtedness of the Borrower which contains terms satisfactory to the Lender and
is subordinated, in a manner satisfactory to the Lender, as to right and time of
payment of principal and interest thereon, to any and all of the Obligations.

     "SUBSIDIARY":  Any Person of which or in which the Borrower and its other
Subsidiaries own directly or indirectly 50% or more of:  (a) the combined voting
power of all classes of stock having general voting power under ordinary
circumstances to elect a majority of the board of directors of such Person, if
it is a corporation, (b) the capital interest or profits interest of such
Person, if it is a partnership, joint venture or similar entity, or (c) the
beneficial interest of such Person, if it is a trust, association or other
unincorporated organization.

     "SUPPLEMENTAL DOCUMENTATION":  The term "Supplemental Documentation" shall
have the meaning given such term in SECTION 3.5.

     "TAXES":  With respect to any Person means taxes, assessments or other
governmental charges or levies imposed upon such Person, its income or any of
its properties, franchises or assets.

     "TERM LOAN":  The term "Term Loan" shall have the meaning given such term
in SECTION 2.1.2.

     "TERM LOAN AVAILABILITY":  The term "Term Loan Availability" shall have the
meaning given such term is SUPPLEMENT A.

     "TERMINATION DATE":  The term "Termination Date" shall have the meaning
given such term in SUPPLEMENT A.

     "THIRD PARTY COLLATERAL":  Any property of any Person other than the
Borrower which secures payment or performance of any Obligations.

     "UCC":  The Uniform Commercial Code as in effect in the State of Minnesota
and any successor statute, together with any regulations thereunder, in each
case as in effect from time to time.  References to sections of the UCC shall be
construed to also refer to any successor sections.


                                     12

<PAGE>

     "UNMATURED EVENT OF DEFAULT":  Any event which, with the giving of notice
to the Borrower or lapse of time, or both, would constitute an Event of Default.

     "UNUSED REVOLVING CREDIT AMOUNT":  The Revolving Credit Amount MINUS the
sum of (a) the outstanding principal balance of the Revolving Loans PLUS (b) the
Letter of Credit Obligations.

     1.2  ACCOUNTING TERMS AND CALCULATIONS.  Except as may be expressly
provided to the contrary herein, all accounting terms used herein or in any
certificate or other document made or delivered pursuant hereto shall be
interpreted and all accounting determination hereunder (including, without
limitation, determination of compliance with financial ratios and restrictions
in ARTICLES V and VI) shall be made in accordance with GAAP consistently
applied, using a first in first out method of Inventory valuation. Any reference
to "consolidated" financial terms shall be deemed to refer to those financial
terms as applied to the Borrower in accordance with GAAP.

     1.3  OTHER DEFINITIONAL PROVISIONS.  Unless otherwise defined herein, all
terms defined in this Agreement shall have such defined meanings when used in
any other Loan Document.  Terms used in this Agreement which are defined in any
Supplement, Exhibit or Schedule hereto shall, unless the context otherwise
indicates, have the meanings given them in such Supplement, Exhibit or Schedule.
Other terms used in this Agreement shall, unless the context otherwise
indicates, have the meanings given such terms in the Minnesota Uniform
Commercial Code to the extent the same are used or defined therein.  The words
"hereof," "herein," and "hereunder" and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement.  Reference to "this Agreement" shall
include the provisions of SUPPLEMENT A.  References to Sections, Exhibits,
Schedules and like references are to this Agreement unless otherwise expressly
provided. Section captions used in this Agreement are for convenience only, and
shall not affect the construction of this Agreement.

             ARTICLE II  REVOLVING LOANS; TERM LOAN; OTHER MATTERS

     2.1  LOANS.

          2.1.1     REVOLVING LOANS.

               (a)  Subject to the terms and conditions of the Loan Documents,
     and in reliance upon the warranties of the Borrower set forth herein and in
     the other Loan Documents, the Lender agrees to make such loans or advances
     (individually, a "REVOLVING LOAN" and collectively, the "REVOLVING LOANS")
     to the Borrower as the Borrower may from time to time request, up to but
     not in excess of the Revolving Loan Availability. Revolving Loans made by
     the Lender may be repaid and, subject to the terms and conditions hereof,
     reborrowed to the Termination Date unless the Credit extended under this
     Agreement is otherwise terminated as provided in this Agreement.

               (b)  In the event the aggregate outstanding principal balance
     of the Revolving Loans exceeds the Revolving Loan Availability, the
     Borrower shall, unless the Lender


                                     13

<PAGE>

     shall otherwise consent, immediately and without notice of any kind, make
     such payments or take such other action as shall be necessary to eliminate
     such excess.

          2.1.2     TERM LOAN.

               (a)  Subject to the terms and conditions of the Loan Documents,
     and in reliance upon the warranties of the Borrower set forth herein and in
     the other Loan Documents, the Lender agrees to make such loans or advances
     (individually and collectively, the "TERM LOAN") to the Borrower as the
     Borrower may from time to time through August 31, 1996 request, up to but
     not in excess of the Term Loan Availability.

               (b)  Unless otherwise required to be sooner paid pursuant to this
     Agreement, the principal of the Term Loan shall mature and be payable in
     consecutive equal monthly installments of one forty-eighth (1/48) of the
     outstanding principal amount of the Term Loan on September 1, 1996, payable
     on the fifteenth (15th) day of each month, commencing September 15, 1996,
     and a final installment in the outstanding principal balance of the Term
     Loan on the Termination Date.

               (c)  At any time after September 1, 1996, the Borrower may, upon
     three Business Days' notice to the Lender, prepay the principal of the Term
     Loan in whole or in part without premium except as set forth on
     SUPPLEMENT A.  Any partial prepayment of principal of the Term Loan shall
     be in a minimum amount of the lesser of (i) the outstanding principal
     balance of the Term Loan and (ii) $50,000 or an integral multiple thereof,
     and shall be applied to the unpaid installments of the Term Loan in the
     inverse order of their maturities.  Any principal of the Term Loan which
     is repaid may not be reborrowed.

               (d)  Any payment of the Term Loan may be made with the proceeds
     of a Revolving Loan only if, immediately before and after giving effect to
     such payment, no Event of Default or Unmatured Event of Default then exists
     or would result therefrom.

          2.1.3     ALL LOANS PAYABLE ON TERMINATION DATE.  All Loans and other
     Obligations hereunder shall be paid by the Borrower on the Termination
     Date, unless payable sooner pursuant to the provisions of this Agreement,
     but may, at the Borrower's election be repaid in whole or in part at any
     time prior to such date without premium or penalty except as set forth on
     SUPPLEMENT A.  Recourse to Collateral, Third Party collateral or other
     security is not required at any time.

     2.2  LETTERS OF CREDIT.

               (a)  In addition to Loans made pursuant to SECTION 2.1, the
     Lender, or any Affiliate, may, upon receipt of duly executed Applications
     and such other documents, instruments and/or agreements as the Lender, or
     such Affiliate, may require, issue Letters of Credit on such terms as are
     satisfactory to the Lender; PROVIDED, HOWEVER, that no Letter of Credit
     will be issued if, before or after taking such Letter of Credit into
     account, the Letter of Credit Obligations exceeds the least of (i) the


                                     14

<PAGE>

     Letter of Credit Sublimit, (ii) the Revolving Credit Amount MINUS the
     outstanding principal balance of the Revolving Loans and (iii) the
     Borrowing Base MINUS the outstanding principal balance of the Revolving
     Loans.

               (b)  The Borrower agrees to pay the Lender, or any Affiliate, on
     demand, the Lender's, or such Affiliate's, standard administrative
     operating fees and charges in effect from time to time for issuing and
     administering any Letters of Credit.  The Borrower further agrees to pay
     the Lender, or any Affiliate, a commission on the undrawn amount of each
     Letter of Credit and on each L/C Draft accepted by the Lender, or such
     Affiliate, as the Borrower and the Lender, or such Affiliate, shall agree.
     Such commissions shall be paid at such frequency as the Lender, or such
     Affiliate, shall determine.

               (c)  The Borrower agrees to reimburse the Lender, or any
     Affiliate, on demand for each payment made by the Lender, or such
     Affiliate, under or pursuant to any Letter of Credit or L/C Draft.  The
     Borrower further agrees to pay to the Lender, or any Affiliate, on demand,
     interest at the Default Rate, on any amount paid by the Lender, or such
     Affiliate, under or pursuant to any Letter of Credit or L/C Draft from the
     date of payment until the date of reimbursement to the Lender, or such
     Affiliate.

               (d)  Notwithstanding anything to the contrary herein or in any
     Application of the Borrower, upon the occurrence of an Event of Default or
     on the Termination Date, an amount equal to the aggregate amount of the
     outstanding Letter of Credit Obligations shall, at the Lender's option and
     without further notice to the Borrower, be deemed (as between the Lender
     and the Borrower) to have been paid or disbursed by the Lender under the
     Letters of Credit and L/C Drafts accepted by the Lender, or any Affiliate,
     notwithstanding that such amounts may not in fact have been so paid or
     disbursed, and a Loan to the Borrower, in the amount of such Letter of
     Credit Obligations, to have been made and accepted, which Loan shall be
     immediately due and payable.  In lieu of the foregoing, at the election of
     the Lender, the Borrower shall, upon the Lender's demand, deliver to the
     Lender or any Affiliate cash or other Collateral of a type satisfactory to
     the Lender or such Affiliate having a value, as determined by the Lender,
     or such Affiliate equal to the aggregate Letter of Credit Obligations.  Any
     such Collateral and/or any amounts received by the Lender, or any
     Affiliate, in payment of the Loan made pursuant to this PARAGRAPH (d) shall
     be held by the Lender or such Affiliate in the Collateral Account or a
     separate account appropriately designated as a cash collateral account in
     relation to this Agreement and the Letters of Credit and retained by the
     Lender, or such Affiliate, as collateral security for the Obligations in
     respect of this Agreement and each of the Letters of Credit and L/C
     Drafts. Such amounts shall not be used by the Lender or such Affiliate to
     pay any amounts drawn or paid under or pursuant to any Letter of Credit
     or L/C Draft but may be applied to reimburse the Lender, or any Affiliate,
     for drawings or payments under or pursuant to Letters of Credit or L/C
     Drafts which the Lender, or such Affiliate, has paid or, if no such
     reimbursement is required, to payment of such other Obligations as the
     Lender shall determine.  Following payment in full of all Obligations,
     any amounts remaining in any cash collateral account established pursuant
     to this PARAGRAPH (d) which are not (as determined by the Lender) to be
     applied to reimburse the Lender, or


                                     15

<PAGE>

     any Affiliate, for amounts actually paid by the Lender, or such Affiliate,
     in respect of a Letter of Credit or L/C Draft shall be returned to the
     Borrower (after deduction of the Lender's, or such Affiliate's expenses).

     2.3  LOAN ACCOUNT; DISBURSEMENT ACCOUNT; CONTROLLED DISBURSEMENT ACCOUNT.

               (a)  Loan Account.  The Lender shall establish or cause to be
     established on its books in the Borrower's name one or more accounts (each,
     a "LOAN ACCOUNT") to evidence Loans made to the Borrower.  Any amounts
     advanced as Loans which are credited to the Disbursement Account, together
     with any other amounts advanced to the Borrower as a Loan pursuant to this
     Agreement, will be debited to the applicable Loan Account and result in an
     increase in the principal balance outstanding in such Loan Account in the
     amount thereof.

               (b)  Disbursement Account.  Unless otherwise provided in this
     Agreement, the Lender will credit or cause to be credited to a commercial
     account (the "DISBURSEMENT ACCOUNT") maintained by the Borrower at Colorado
     National Bank, 918 Seventeenth Street, Denver, Colorado  80202 the amount
     of any sums advanced as Loans.

               (c)  Controlled Disbursement Account.  The Borrower may maintain
     a commercial account (the "Controlled Disbursement Account") into which
     deposits from the Disbursement Account may be made by the Lender and from
     which the Borrower may draw checks for corporate purposes.

     2.4  INTEREST; FEES.

               (a)  INTEREST.  The outstanding principal balance of each Loan to
     the Borrower hereunder shall bear interest at the rate(s) applicable to
     such Loan indicated in SUPPLEMENT A; PROVIDED, HOWEVER, that no provision
     of this Agreement or any Note shall require the payment or permit the
     collection of interest in excess of the rate permitted by applicable law.
     Interest as aforesaid shall be charged for the actual number of days
     elapsed over a year consisting of 360 days on the actual daily balance of
     such Loan. Interest on the unpaid principal of any Loan shall accrue from
     the date such Loan is made to the date such Loan is paid.  Interest shall
     be paid by the Borrower on the last day of each month, commencing on the
     first such day to occur after the date hereof, and on maturity.  After
     maturity of any Loan, whether by acceleration or otherwise, interest shall
     be payable on demand.

               (b)  INTEREST AFTER DEFAULT.  If any Loan or any amount thereof
     is not paid in full within five (5) days after the date such Loan or amount
     is due, whether by acceleration or otherwise, then the Lender may elect
     that the entire unpaid principal balance of such Loan shall bear interest
     at the Default Rate applicable to such Loan.

               (c)  NON-USE FEE.  The Borrower shall pay to the Lender a non-use
     fee for the period from the date hereof to the date the Credit terminates
     in the amount


                                     16

<PAGE>

     indicated in SUPPLEMENT A.  The non-use fee shall be charged for the actual
     number of days elapsed over a year consisting of 360 days on the actual
     daily balance of the Revolving Loans.  The non-use fee shall be paid by
     the Borrower first (1st) day of the month following the close of each
     quarter, beginning with the quarter ending March 31, 1996, and on the date
     the Credit terminates for the period then ended.

               (d)  CREDIT TERMINATION FEE.  Upon termination or cancellation of
     the Credit by the Borrower, the Borrower shall pay to the Lender a
     termination fee in the amount indicated in SUPPLEMENT A.

     2.5  REQUESTS FOR REVOLVING LOANS; BORROWING BASE CERTIFICATES; OTHER
INFORMATION.

               (a)  Revolving Loans shall be requested by telephone, except for
     Overdraft Loans.  Any such telephonic notice shall be promptly confirmed by
     the Borrower in writing.  The Borrower's failure to confirm any such
     telephonic notice or otherwise comply with the provisions of this
     SECTION 2.5(A) shall not in any manner affect the obligation of the
     Borrower to repay such Revolving Loan in accordance with the terms of
     this Agreement.

               (b)  In the event that the Borrower shall at any time, or from
     time to time, (i) make a request for a Revolving Loan, or (ii) be deemed to
     have requested an Overdraft Loan, the Borrower agrees to forthwith provide
     the Lender with such information, at such frequency and in such format, as
     is required by the Lender, such information to be current as of the time of
     such request.

               (c)  The Borrower further agrees to provide to the Lender a
     current borrowing base certificate ("BORROWING BASE CERTIFICATE") at the
     end of each week and at such other times as the Lender may request.  Such
     Borrowing Base Certificate shall be in substantially the form of EXHIBIT A,
     executed and certified as accurate by such person or persons as the
     Borrower designates in writing to the Lender pursuant to duly adopted
     resolutions of the Borrower's Board of Directors authorizing such action.

               (d)  The Borrower shall provide the Lender with documentation
     satisfactory to the Lender indicating the names of those employees of the
     Borrower authorized by the Borrower to sign Borrowing Base Certificates,
     among other things, and/or to make a telephone request for a Revolving
     Loan, and/or to authorize disbursement of the proceeds of a Loan by wire
     transfer or otherwise, and the Lender shall be entitled to rely upon such
     documentation until notified in writing by the Borrower of any change(s) in
     the names of persons so authorized.  The Lender shall be entitled to act on
     the instructions of anyone identifying himself as one of the persons
     authorized to request Revolving Loans or disbursements of Loan proceeds by
     telephone and the Borrower shall be bound thereby in the same manner as if
     the person were actually so authorized.  The Borrower agrees to indemnify
     and hold the Lender harmless from any and all claims, damages, liabilities,
     losses, costs and expenses (including Attorneys' Fees) which may arise or
     be created by the acceptance of instructions for making or paying Loans or
     wire transfers by telephone.


                                     17


<PAGE>

     2.6  NOTES.  Except to the extent a Loan may, in the Lender's sole and
absolute discretion, be evidenced by a Note, all Loans and payments hereunder
shall be recorded on the Lender's books, which shall be rebuttable presumptive
evidence of the amount of such Loans outstanding at any time hereunder.  The
Lender will account monthly as to all Loans and payments hereunder and each
monthly accounting will be fully binding on the Borrower unless, within 15 days
following the Borrower's receipt thereof, the Borrower shall provide the Lender
with a specific listing of exceptions. Notwithstanding any term or condition of
this Agreement to the contrary, the failure of the Lender to record the date and
amount of any Loan shall not limit or otherwise affect the obligation of the
Borrower to repay any such Loan.

     2.7  OVERDRAFT LOANS.  The Lender, in its sole and absolute discretion and
subject to the terms hereof, may make a Loan to the Borrower in an amount equal
to the amount of any overdraft which may from time to time exist with respect to
the Disbursement Account or any other bank account which the Borrower may now or
hereafter have with FBNA or any other Affiliate. The existence of such overdraft
shall be deemed to be a request by the Borrower for such Loan. The Borrower
acknowledges that the Lender is under no duty or obligation to make any Loan to
the Borrower to cover any overdraft.  The Borrower further agrees that an
overdraft shall constitute a separate Loan under this Agreement (an "OVERDRAFT
LOAN"), which shall bear, from the date on which the overdraft occurred until
paid, interest in an amount equal to the greater of 130% of the highest rate of
interest then charged for Loans (other than Overdraft Loans) made hereunder, or
$50.00 per day.  If the Lender, in its sole and absolute discretion, decides not
to make a Loan to cover part or all of any overdraft, the Lender ma return any
check(s) which created such overdraft.

     2.8  OVER ADVANCES.  The Lender, in its sole and absolute discretion, may
make Loans to the Borrower, either at the Borrower's request or to pay amounts
due to the Lender under this Agreement or any other Loan Document, in excess of
the Loan Availability or permit the total Loans to at any time exceed the Loan
Availability (such excess Obligations are hereinafter referred to as "OVER
ADVANCES") and no such event or occurrence shall cause or constitute a waiver by
the Lender of its right to refuse to make any further Loan or issue, or cause to
be issued, any Letters of Credit at any time that an Over Advance exists or
would result therefrom. During any period in which an Over Advance exists, the
amount of the Over Advances shall bear interest at a rate equal to 130% of the
highest rate of interest then charged for Loans (other than Overdraft Loans)
made hereunder.

     2.9  ALL LOANS ONE OBLIGATION.  All Loans under this Agreement shall
constitute one Loan, and all Indebtedness and other Obligations shall constitute
one general obligation secured by the Lien granted by the Borrower hereunder on
all of the Collateral and by all other Liens heretofore, now or at any time or
times hereafter granted by the Borrower or any other Obligor to secure the
Obligations.  The Borrower agrees that all of the rights of the Lender set forth
in the Loan Documents shall, unless otherwise agreed to in writing, apply to any
modification of or supplement to the Loan Documents.

     2.10 MAKING OF PAYMENTS; APPLICATION OF COLLECTIONS; CHARGING OF ACCOUNTS.

                                    18



<PAGE>

               (a)  All payments hereunder (including payments with respect to
     any Notes) shall be made without set-off or counterclaim and shall be made
     to the Lender in immediately available funds (or as the Lender may
     otherwise consent) prior to 12:30 p.m., Minneapolis time, on the date due
     at its office at First Bank Place, 601 Second Avenue South, Minneapolis,
     Minnesota 55402-4302, or at such other place as may be designated by the
     Lender to the Borrower in writing.  Any payments received after such time
     shall be deemed received on the next Business Day.  Whenever any payment to
     be made hereunder or under any Note shall be stated to be due on a date
     other than a Business Day such payment may be made on the next succeeding
     Business Day and such extension of time shall be included in the
     computation of payment of interest or any fees.

               (b)  The Borrower authorizes the Lender to, and the Lender will,
     subject to the provisions of this SECTION 2.10(b), apply the whole or any
     part of any amounts received by the Lender, or any Affiliate (whether
     deposited in the Collateral Account or otherwise received by the Lender, or
     any Affiliate) from the collection of items of payment and proceeds of any
     Collateral or Third Party Collateral against the principal and/or interest
     of any Loans made hereunder and/or any other Obligations, whether or not
     then due, in such order of application as the Lender may determine, unless
     such payments or proceeds are, in the Lender's sole and absolute
     discretion, released to the Borrower; PROVIDED, HOWEVER, that no checks,
     drafts or other instruments received by the Lender, or any Affiliate, shall
     constitute final payment to the Lender unless and until such item of
     payment has actually been collected.  All items or amounts which are
     delivered to the Lender, by or on behalf of the Borrower or any Obligor or
     any Account Debtor on account of partial or full payment or otherwise as
     proceeds of any of the Collateral or Third Party Collateral (including any
     items or amounts which may have been deposited to the Collateral Account)
     may from time to time, in the Lender's sole and absolute discretion, be
     released to the Borrower or may be applied by the Lender towards such of
     the Obligations, whether or not then due, in such order of application as
     the Lender may determine.  Notwithstanding anything to the contrary herein,
     (i) all cash, checks, instruments and other items of payment, solely for
     purposes of determining the occurrence of an Event of Default hereunder,
     shall be deemed received upon actual receipt by the Lender unless the same
     is subsequently dishonored for any reason whatsoever, (ii) for purposes of
     determining whether, under SECTIONS 2.1 and 2.2, there is availability for
     Loans or Letters of Credit, all cash, checks, instruments and other items
     of payment shall be applied against the Obligations on the same Business
     Day as receipt thereof by the Lender in Minneapolis, Minnesota or the same
     Business Day as the initiation by the Lender of an ACH transaction from a
     Collateral Account, and (iii) solely for purposes of interest calculation
     hereunder, all cash, checks, instruments and other items of payment shall
     be deemed to have been applied against the Obligations on the first
     Business Day following receipt thereof by the Lender in Minneapolis,
     Minnesota or the first Business Day following the initiation by the Lender
     of an ACH transaction from a Collateral Account.

               (c)  The Borrower hereby authorizes the Lender and the Lender
     may, in its sole and absolute discretion, charge to the Borrower, at any
     time, all or any

                                    19



<PAGE>

     portion of any of the Obligations (and interest, if any, thereon)
     including, without limitation, any Attorneys' Fees and other costs and
     expenses of the Lender for which the Borrower is liable pursuant to the
     terms of the Loan Documents, by charging the Disbursement Account or any
     other bank account of the Borrower with FBNA or by advancing the amount
     thereof to the Borrower as a Loan; PROVIDED, HOWEVER, that the
     provisions of this SECTION 2.10(c) shall not affect the Borrower's
     obligation to pay when due all amounts payable by the Borrower under any
     of the Loan Documents whether or not there are sufficient funds therefor
     in the Disbursement Account or any such other bank account of the
     Borrower with FBNA, or sufficient Loan Availability.

     2.11 LENDER'S ELECTION NOT TO ENFORCE.  Notwithstanding any term or
condition of this Agreement to the contrary, the Lender, in its sole and
absolute discretion, at any time and from time to time may suspend or refrain
from enforcing any or all of the restrictions imposed in this SECTION 2 but no
such suspension or failure to enforce shall impair the Lender's right and power
under this Agreement to refrain from making a Loan or issuing, or causing to be
issued, a Letter of Credit requested by the Borrower if all conditions precedent
to the Lender's obligation to make such Loan or issue, or cause to be issued,
such Letter of Credit have not been satisfied.

                           ARTICLE III  COLLATERAL

     3.1  GRANT OF SECURITY INTEREST.  As security for the payment of all Loans
now or hereafter made by the Lender to the Borrower hereunder or under any Note,
and as security for the payment or other satisfaction of all other Obligations,
the Borrower hereby grants to the Lender, and its Affiliates, a security
interest in and to the following property of the Borrower, whether now owned or
existing, or hereafter acquired or coming into existence, wherever now or
hereafter located (all such property is hereinafter referred to collectively as
the "COLLATERAL"):

               (a)  Accounts Receivable (whether or not Eligible Accounts
     Receivable), including all other rights and interests (including all liens
     and security interests) that the Borrower may at any time have by law or
     agreement against any Account Debtor or other obligor obligated to make any
     such payment or against any of the property of such Account Debtor or other
     obligor;

               (b)  Equipment (whether or not Eligible Equipment);

               (c)  Inventory (whether or not Eligible Inventory);

               (d)  General Intangibles;

               (e)  documents;

               (f)  all chattel paper and instruments evidencing, arising out of
     or relating to any obligation to the Borrower for goods sold or leased or
     services rendered or otherwise arising out of or relating to any property
     described in CLAUSES (a) through (e) above;

                                    20



<PAGE>

               (g)  goods, instruments, documents or chattel paper that are in
     the possession or control of, or in transit to, the Lender or any Affiliate
     or any agent or bailee for the Lender or any Affiliate for any reason and
     all interest on, dividends and distributions and other rights in connection
     with such property, and any and all balances, credits, deposits (general or
     special, time or demand, provisional or final), accounts or monies of or in
     the name of the Borrower now or hereafter with the Lender, or any
     Affiliate, and any and all property of every kind or description of or in
     the name of the Borrower now or hereafter, for any reason or purpose
     whatsoever, in the possession or control of, in transit to or standing to
     the Borrower's credit on the books of, the Lender, any Affiliate, or any
     agent or bailee for the Lender or any Affiliate or any Participant;

               (h)  all interest of the Borrower in any goods the sale or lease
     of which shall have given or shall give rise to, and in all guaranties and
     other property securing the payment of or performance under, any Accounts
     Receivable, General Intangibles or any chattel paper or instruments
     referred to in CLAUSE (f) above;

               (i)  any and all other property of the Borrower of any kind or
     description, including, without limitation, real estate of the Borrower,
     subject to a separate mortgage, pledge or security interest in favor of the
     Lender or in which the Lender now or hereafter has or acquires a security
     interest securing any Obligations, pursuant to any written agreement or
     instrument other than this Agreement;

               (j)  all replacements, substitutions, additions or accessions to
     or for any of the foregoing;

               (k)  to the extent related to the property described in CLAUSES
     (a) through (j) above, all books, correspondence, credit files, records,
     invoices and other papers and documents, including, without limitation, to
     the extent so related, all tapes, cards, computer runs, computer programs
     and other papers and documents in the possession or control of the Borrower
     or any computer bureau from time to time acting for the Borrower, and, to
     the extent so related, all rights in, to and under all policies of
     insurance, including claims of rights to payments thereunder and proceeds
     therefrom, including any credit insurance; and

               (l)  all proceeds (including, without limitation, any Accounts
     Receivable or other proceeds arising from the sale or other disposition of
     any Collateral, any returns of any Equipment or Inventory sold by the
     Borrower and the proceeds of any insurance covering any of the Collateral)
     of any of the foregoing.

     3.2  ACCOUNTS RECEIVABLE.

               (a)  The Borrower shall notify the Lender immediately of all
     disputes and claims by any Account Debtor and settle or adjust them at no
     expense to the Lender. If the Lender directs, no discount or credit
     allowance shall be granted thereafter by the Borrower to any Account
     Debtor.  All Account Debtor payments and all net amounts received by the
     Lender in settlement, adjustment or liquidation of any

                                    21



<PAGE>

     Account Receivable may be applied by the Lender to the Obligations or
     credited to the Disbursement Account (subject to collection), as the
     Lender may deem appropriate, as more fully described in SECTION 2.10.
     If requested by the Lender, the Borrower will make proper entries in its
     books, disclosing the assignment of Accounts Receivable to the Lender.

               (b)  Unless otherwise consented to by the Lender, the Borrower
     will, forthwith upon receipt by the Borrower of all checks, drafts, cash
     and other remittances in payment or as proceeds of, or on account of, any
     of the Accounts Receivable or other Collateral, deposit the same in a
     special bank account (the "COLLATERAL ACCOUNT") with FBNA or such other
     bank or financial institution as the Lender shall consent, over which the
     Lender alone has power of withdrawal, and will designate with each such
     deposit the particular Accounts Receivable or other item of Collateral upon
     which the remittance was made.  The Borrower acknowledges that the
     maintenance of the Collateral Account is solely for the convenience of the
     Lender in facilitating its own operations and the Borrower does not and
     shall not have any right, title or interest in the Collateral Account or in
     the amounts at any time appearing to the credit thereof.  Said proceeds
     shall be deposited in precisely the form received except for the Borrower's
     endorsement where necessary to permit collection of items, which
     endorsement the Borrower agrees to make.  Pending such deposit, the
     Borrower agrees not to commingle any such checks, drafts, cash and other
     remittances with any of its funds or property, but will hold them separate
     and apart therefrom and upon an express trust for the Lender until deposit
     thereof if made in the Collateral Account.  Upon the full and final
     liquidation of all Obligations, the Lender will pay over to the Borrower
     any excess amounts received by the Lender as payment or proceeds of
     Collateral, whether received by the Lender as a deposit in the Collateral
     Account or received by the Lender as a direct payment on any of the sums
     due hereunder.

               (c)  If any Accounts Receivable, chattel paper or General
     Intangible arises out of contracts with the United States or any
     department, agency, or instrumentality thereof, the Borrower will, unless
     the Lender shall otherwise agree, immediately notify the Lender in writing
     and execute any instruments and take any steps required by the Lender in
     order that all monies due and to become due under such contracts shall be
     assigned to the Lender and notice thereof given to the government under the
     Federal Assignment of Claims Act of 1940, as amended.

               (d)  If any Accounts Receivable is evidenced by chattel paper or
     instruments, the Borrower will, unless the Lender shall otherwise agree,
     deliver the originals of same to the Lender, appropriately endorsed to the
     Lender's order and, regardless of the form of such endorsement, the
     Borrower hereby expressly waives presentment, demand, notice of dishonor,
     protest and notice of protest and all other notices with respect thereto.

     3.3  INVENTORY.

               (a)  Unless the Lender shall otherwise agree, if the Borrower
     sells Inventory for cash, all full and partial payments therefor shall
     immediately be delivered

                                    22



<PAGE>

     by the Borrower to the Lender in their original form for deposit in the
     Collateral Account or other application to reduction of the
     Obligations.  All such cash shall be held by the Borrower in trust for
     the Lender and shall be remitted to the Lender at the end of the day
     received or at such other time as the Lender may designate.

               (b)  The Lender shall not be liable or responsible in any way for
     the safekeeping of any Inventory delivered to it, to any bailee appointed
     by or for it, to any warehouseman, or under any other circumstances.  The
     Lender shall not be responsible for collection of any proceeds or for
     losses in collected proceeds held by the Borrower in trust for the Lender.
     Any and all risk of loss for any or all of the foregoing shall be upon the
     Borrower except for such loss as shall result from the Lender's gross
     negligence or willful misconduct.

               (c)  If requested by the Lender, the Borrower shall, upon
     acquiring an interest in any Inventory, deliver to the Lender schedules of
     such Inventory, together with supplier's invoices, warranties, production,
     cost and other records as the Lender may request. If requested by the
     Lender, the Borrower shall deliver to the Lender schedules of the sale of
     any Inventory immediately upon its sale.  Any material change in the value
     or condition of any Inventory and any errors discovered in schedules
     delivered to the Lender shall be reported to the Lender immediately.

               (d)  The Borrower shall (i) notify the Lender immediately if the
     Borrower obtains possession (by return, repossession or otherwise) of any
     Inventory which has been sold and shall inform the Lender of the identity
     of the returned or repossessed Inventory, the applicable Account Debtor and
     the amount of the applicable Account Receivable; (ii) receive such
     Inventory in trust; and (iii) resell such Inventory for the Lender unless
     instructed to deliver it to the Lender.

     3.4  EQUIPMENT.

               (a)  In the event any Equipment is sold, transferred or otherwise
     disposed of, unless the Lender shall agree otherwise, the Borrower shall
     deliver all of the proceeds of any such sale, transfer or disposition to
     the Lender, which proceeds shall be deposited in the Collateral Account or
     otherwise applied to the repayment of the Obligations.

               (b)  The Borrower will, upon request of the Lender, submit to the
     Lender a current listing of all of the Borrower's Equipment which listing
     shall indicate the type, model, serial number and location of such
     Equipment.

     3.5  SUPPLEMENTAL DOCUMENTATION.  At the Lender's request, the Borrower
shall execute and/or deliver to the Lender, at any time or times hereafter, such
agreements, documents, financing statements, warehouse receipts, bills of
lading, notices of assignment of Accounts Receivable, schedules of Accounts
Receivable assigned, and other written matter necessary or requested by the
Lender to perfect and maintain perfected the security interest in the Collateral
granted hereunder (all the above hereinafter referred to as "SUPPLEMENTAL
DOCUMENTATION"), in form and substance acceptable to the Lender, and pay all
taxes, fees and

                                    23



<PAGE>

other costs and expenses associated with any recording or filing
of the same.  The Borrower hereby irrevocably makes, constitutes and appoints
the Lender (and all Persons designated by the Lender for that purpose) as the
Borrower's true and lawful attorney (and agent-in-fact) to sign the name of the
Borrower on any of the Supplemental Documentation and to deliver any of the
Supplemental Documentation to such Persons as the Lender in its sole and
absolute discretion, may elect.  The Borrower agrees that a  carbon,
photographic, photostatic, and other reproduction of this Agreement or of a
financing statement is sufficient as a financing statement.

     3.6  POWER OF ATTORNEY.  The Borrower irrevocably designates, makes,
constitutes, and appoints the Lender (and all Persons designated by the Lender)
as the Borrower's true and lawful attorney (and agent-in-fact) and the Lender,
or the Lender's agent, may, without notice to the Borrower:

               (a)  at such time or times hereafter as the Lender or said agent,
     in its sole and absolute discretion, may determine, in the Borrower's or
     the Lender's name, (i) receive, open and dispose of all mail received at
     the lockbox address of the Borrower; (ii) notify and/or require the
     Borrower to notify, any Account Debtor or other Person obligated under or
     in respect of any Collateral, of the fact of the Lender's Lien thereon and
     of the collateral assignment thereof to the Lender; (iii) direct and/or
     require the Borrower to direct, any Account Debtor or other Person
     obligated under or in respect of any Collateral, to make payment directly
     to the Lender of any amounts due or to become due thereunder or with
     respect thereto; (iv) endorse the Borrower's name on any checks, notes,
     drafts or any other items of payment relating to and/or proceeds of the
     Collateral which come into the possession of the Lender or under the
     Lender's control and apply such payment or proceeds to the Obligations; and
     (v) endorse the Borrower's name on any chattel paper, document, instrument,
     invoice, freight bill, bill of lading or similar document or agreement in
     the Lender's possession relating to Accounts Receivable, Inventory
     Equipment or any other Collateral; and

               (b)  at such time or times after the occurrence of an Event of
     Default, as the Lender or said agent, in its sole and absolute discretion,
     may determine, in the Borrower's or the Lender's name: (i) receive, open
     and dispose of all mail received at the street address or any post office
     box address of the Borrower; (ii) demand, collect, surrender, release or
     exchange all or any part of any Collateral or any amounts due thereunder or
     with respect thereto; (iii) settle, adjust, compromise, extend or renew for
     any period (whether or not longer than the initial period) any and all sums
     which are now or may hereafter become due or owing upon or with respect to
     any of the Collateral; (iv) enforce, by suit or otherwise, payment or
     performance of any of the Collateral; (v) settle, adjust or compromise any
     legal proceedings brought to collect any sums due or owing upon or with
     respect to any of the Collateral; (vi) exercise all of the Borrower's
     rights and remedies with respect to the collection of any amounts due upon
     or with respect to any of the Collateral;  (vii) if permitted by applicable
     law, sell or assign the Collateral upon such terms, for such amounts and at
     such time or times as the Lender may deem advisable; (viii) discharge and
     release the Collateral; (ix) prepare, file and sign the Borrower's name on
     any proof of claim in bankruptcy or similar document against any Account
     Debtor; (x) prepare, file and sign the Borrower's

                                    24



<PAGE>

     name on any notice of lien, assignment or satisfaction of lien or
     similar document in connection with the Accounts Receivable and/or other
     Collateral; and (xi) do all acts and things necessary, in the Lender's
     sole and absolute discretion, to obtain repayment of the Obligations and
     to fulfill the Borrower's other obligations under this Agreement.

               (c)  at such time or times after the assertion by the Lender that
     an Event of Default has occurred and is continuing (whether or not an Event
     of Default has in fact occurred), as the Lender or said agent, in its
     reasonable discretion, may determine, in the Borrower's or the Lender's
     name, notify the post office authorities to change the address for delivery
     of the Borrower's mail to an address designated by the Lender.

Under no circumstances shall the Lender be under any duty to act in regard to
any of the foregoing matters.  The costs relating to any of the foregoing
matters, including Attorneys' Fees and out-of-pocket expenses shall be borne
solely by the Borrower whether the same are incurred by the Lender or the
Borrower.

Neither the Lender nor any of its directors, officers, employees or agents will
be liable for any acts of commission or omission nor for any error in judgment
or mistake of fact or law, unless the same shall have resulted from gross
negligence or willful misconduct.  This power, being coupled with an interest,
is irrevocable until either (i) all Obligations under this Agreement are paid in
full, or (ii) this Agreement is terminated, whichever shall last occur.

                  ARTICLE IV  REPRESENTATIONS AND WARRANTIES

     To induce the Lender to enter into this Agreement and to make Loans to the
Borrower hereunder, the Borrower makes the following representations and
warranties, all of which shall be true and correct as of the date the initial
Loans are made and survive the execution of this Agreement and the making of the
initial Loans:

     4.1  ORGANIZATION. Each of Cryenco and CSI is a corporation duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its respective incorporation. Each of Cryenco and CSI is in good
standing and is duly qualified to do business in each state where, because of
the nature of its respective activities or properties, such qualification is
required.  On the date hereof, each of Cryenco and CSI conducts business in its
own name exclusively and has no trade names, styles or doing business forms
except as disclosed on SCHEDULE 4.1.  Cryenco's taxpayer identification number
is I.D. No.  84-0767496. CSI's taxpayer identification number is
I.D. No. 52-1471630.

     4.2  AUTHORIZATION.  The Borrower is duly authorized to execute and deliver
the Loan Documents and any Supplemental Documentation contemplated by this
Agreement, and is and will continue to be duly authorized to borrow monies
hereunder and to perform its obligations under the Loan Documents and any
Supplemental Documentation contemplated by this Agreement and the borrowings
hereunder do not and will not require any consent or approval of any
governmental agency or authority.


                                     25



<PAGE>

     4.3  NO CONFLICTS.  The execution, delivery and performance by the Borrower
of the Loan Documents and any Supplemental Documentation contemplated by this
Agreement, do not and will not conflict with (a) any provision of law, (b) the
charter or by-laws of the Borrower, (c) any agreement binding upon the Borrower,
or (d) any court or administrative order or decree applicable to the Borrower,
and do not and will not require, or result in, the creation or imposition of any
Lien on any asset of the Borrower except as provided herein.

     4.4  VALIDITY AND BINDING EFFECT.  The Loan Documents and any Supplemental
Documentation contemplated by this Agreement, when duly executed and delivered
will be, legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their respective terms, except as
enforceability may be limited by bankruptcy, insolvency or other similar laws of
general application affecting the enforcement of creditors' rights or by general
principles of equity limiting the availability of equitable remedies.

     4.5  NO DEFAULT.  The Borrower is not in default under any agreement or
instrument to which the Borrower is a party or by which any of its properties or
assets is bound or affected, which default (a) might materially and adversely
affect the Lender's Lien on or rights with respect to any Collateral or Third
Party Collateral or (b) constitutes an Adverse Event.  No Event of Default or
Unmatured Event of Default has occurred and is continuing.

     4.6  FINANCIAL STATEMENTS.  The Borrower's audited consolidated financial
statement as at August 31, 1995 and the Borrower's unaudited consolidated and
consolidating financial statements as at August 31, 1995 and October 31, 1995,
copies of which have been furnished to the Lender, have been prepared in
conformity with GAAP (except that unaudited statements do not include footnotes
required by GAAP) promulgated by the Financial Accounting Standards Board and
applied on a basis consistent with that of the preceding fiscal year and period
and present fairly the financial condition of the Borrower as at such dates and
the results of their operations for the periods then ended, subject (in the case
of the interim financial statement) to year-end audit adjustments. Since October
31, 1995, no Adverse Event has occurred.

     4.7  INSURANCE.  SCHEDULE 4.7 sets forth a summary of the property and
casualty insurance program carried by the Borrower on the date hereof, including
the insurer's(s') name(s), policy number(s), expiration date(s), amount(s) of
coverage, type(s) of coverage, the annual premium(s), Best's policyholder's and
financial size ratings of the insurers, exclusions, deductibles and self-insured
retention, and describes in detail any retrospective rating plan, fronting
arrangement or any other self-insurance or risk assumption agreed to by the
Borrower or imposed upon the Borrower by any such insurer.  This summary also
includes any self-insurance program that is in effect.

     4.8  LITIGATION; CONTINGENT LIABILITIES.

               (a)  Except for those referred to in SCHEDULE 4.8, no claims
     litigation, arbitration proceedings or governmental proceedings are pending
     or threatened against or are affecting the Borrower.


                                      26

<PAGE>

               (b)  Other than any liability incident to the claims, litigation
     or proceedings disclosed in SCHEDULE 4.8, the Borrower has no contingent
     liabilities which are material to the Borrower.

     4.9  LIENS.  None of the Collateral or other property or assets of the
Borrower is subject to any Lien (including, without limitation, Liens pursuant
to Capitalized Leases under which the Borrower is a lessee) except:  (a)  Liens
in favor of the Lender; (b) Liens for current Taxes not delinquent or Taxes
being contested in good faith and by appropriate proceedings and as to which
such reserves or other appropriate provisions as may be required by GAAP are
being maintained; (c) carriers', warehousemen's, mechanics', materialmen's and
other like statutory Liens arising in the ordinary course of business securing
obligations which are not overdue or which are being contested in good faith and
by appropriate proceedings and as to which such reserves or other appropriate
provisions as may be required by GAAP are being maintained; and (d) Liens listed
on SCHEDULE 4.9.

     4.10 SUBSIDIARIES.  The Borrower has no Subsidiaries except as listed on
SCHEDULE 4.10.  The Borrower and the Subsidiaries own the percentage of the
Subsidiaries as set forth on SCHEDULE 4.10.

     4.11 PARTNERSHIPS.  The Borrower is not a partner or joint venturer in any
partnership or joint venture other than the partnerships and joint ventures
listed on SCHEDULE 4.11.

     4.12 BUSINESS LOCATIONS.  On the date hereof the office where the Borrower
keeps the Borrower's books and records concerning the Borrower's Accounts
Receivable and other Collateral, and the Borrower's chief place of business and
chief executive office, is located at the address of the Borrower set forth on
the signature pages of this Agreement, and all of the Borrower's other places of
business are listed on SCHEDULE 4.12.  On the date hereof, the names of any
landlords and/or mortgagees of any of such locations are identified in SCHEDULE
4.12.

     4.13 COLLATERAL LOCATIONS.  On the date hereof the Borrower's Inventory,
Equipment and, if applicable, fixtures (except any part thereof which prior to
the execution of this Agreement the Borrower shall have advised the Lender in
writing consists of Collateral normally used in more than one state) is located
at the addresses set forth in SCHEDULE 4.13.  The legal descriptions of any real
property on which any fixtures are located and the name(s) of the record owner
of such real property is set forth in SCHEDULE 4.13.

     4.14 ELIGIBILITY OF COLLATERAL.  (a) All of the Accounts Receivable are and
will continue to be bona fide existing obligations created by the sale of goods,
the rendering of services, or the furnishing of other good and sufficient
consideration to Accounts Debtors in the regular course of business and all
shipping or delivery receipts and other documents furnished or to be furnished
to the Lender in connection therewith are and will be genuine; (b) Each Account
Receivable, item of Inventory or item of Equipment which the Borrower shall,
expressly or by implication, request the Lender to classify as an Eligible
Account Receivable, as Eligible Inventory or as Eligible Equipment,
respectively, will, as of the time when such


                                      27

<PAGE>

request is made, conform in all respects to the requirements of such
classification set forth in the respective definitions of "Eligible Account
Receivable," "Eligible Inventory" and "Eligible Equipment" set forth herein;
(c) with respect to each schedule of Inventory delivered to the Lender
pursuant to SECTION 3.3: (i) the descriptions, origins, size, qualities,
quantities, weights, and markings of all goods stated thereon, or on any
attachment thereto, are true and correct in all material respects; (ii) all
goods stated thereon have been produced by the Borrower in compliance with
all requirements of the Fair Labor Standards Act; and (iii) none of the goods
stated thereon are defective, of second quality, used, or goods returned
after shipment, except where described as such; and (iv) all Inventory not
included on such schedule has been previously scheduled.

     4.15 CONTROL OF COLLATERAL; LEASE OF PROPERTY.  The Borrower is not now
conducting, or permitting or suffering to be conducted, any activities pursuant
to or in conjunction with which any of the Collateral is now, or will be (while
any Obligations exist or this Agreement is in effect), in the possession or
control of, any Obligor (other than the Borrower) or Related Party. Except as
listed on SCHEDULE 4.15, none of the machinery, equipment or real property used
by the Borrower is subject to a lease (excluding only Capitalized Leases
included on SCHEDULE 6.11) under which the Borrower is the lessee.

     4.16 PATENTS, TRADEMARKS, ETC.  The Borrower possesses or has the right to
use all of the patents, trademarks, trade names, service marks and copyrights,
and applications therefor, and all technology, know-how, processes, methods and
designs used in or necessary for the conduct of its business, without known
conflict with the rights of others.  All such licenses, patents, trademarks,
trade names, service marks and copyrights, and applications therefor existing on
the date hereof are listed on SCHEDULE 4.16.

     4.17 SOLVENCY.  The Borrower now has capital sufficient to carry on its
respective business and transactions and all business and transactions in which
it is about to engage and is now solvent and able to pay its respective debts as
they mature.

     4.18 CONTRACTS; LABOR MATTERS.  Except as disclosed on SCHEDULE 4.18:  (a)
the Borrower is not a party to any contract or agreement, or subject to any
charge, corporate restriction, judgment, decree or order, the performance of
which constitutes an Adverse Event; (b) no labor contract to which the Borrower
is subject is scheduled to expire during the original term of this Agreement;
and (c) on the date of this Agreement (i) the Borrower is not a party to any
labor dispute and (ii) there are no strikes or walkouts relating to any labor
contracts to which the Borrower is subject.

     4.19 ERISA.  Each Plan complies with all material applicable requirements
of ERISA and the Code and with all material applicable rulings and regulations
issued under the provisions of ERISA and the Code setting forth those
requirements.  No Reportable Event, other than a Reportable Event for which the
reporting requirements have been waived by regulations of the PBGC, has occurred
and is continuing with respect to any Plan.  All of the minimum funding
standards applicable to such Plans have been satisfied and there exists no event
or condition which would permit the institution of proceedings to terminate any
Plan under Section 4042 of ERISA.  The Current value of the Plans' benefits
guaranteed under Title IV of ERISA does not exceed the current value of the
Plans' assets allocable to such


                                      28

<PAGE>

benefits.  Except as listed on SCHEDULE 4.8, the Borrower has no contingent
liability with respect to any "employee welfare benefit plans," as such term
is defined in Section 3(1) of ERISA, which covers retired or terminated
employees and their beneficiaries.

     4.20 REGULATION U.  The Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (as
defined in Regulation U of the Federal Reserve Board), and no part of the
proceeds of any Loan will be used to purchase or carry margin stock or for any
other purpose which would violate any of the margin requirements of the Federal
Reserve Board.

     4.21 COMPLIANCE.  The Borrower is in material compliance with all statutes
and governmental rules and regulations applicable to them.  All Inventory of the
Borrower has been produced in compliance with all requirements of the Fair Labor
Standards Act.

     4.22 TAXES.  The Borrower has filed all  federal, state and local tax
returns required to be filed and has paid, or made adequate provisions for the
payment of, all Taxes due and payable pursuant to such returns and pursuant to
any assessments made against it or any of its property (other than Taxes the
amount or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in accordance with
GAAP have been provided on the books of the Borrower). No tax Liens have been
filed and no material claims are being asserted with respect to any such Taxes.
The charges, accruals and reserves on the books of the Borrower in respect of
Taxes are adequate.  The federal income tax liability of the Borrower has been
audited by the Internal Revenue Service and has been finally determined and
satisfied (or the time for audit has expired) for all tax years up to and
including the tax year ended August 31, 1993.  The Borrower is not aware of any
proposed assessment against the Borrower for additional Taxes (or any basis for
any such assessment) which might be material to the Borrower.

     4.23 INVESTMENT COMPANY ACT.  The Borrower is not an "investment company"
or a company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.

     4.24 PUBLIC UTILITY HOLDING COMPANY ACT.  The Borrower is not a "holding
company" or a "subsidiary company" of a "holding company" or an "affiliate" of a
"holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended.

     4.25 ENVIRONMENTAL AND SAFETY AND HEALTH MATTERS.  Except as disclosed on
SCHEDULE 4.25:  (a) the operations of the Borrower complies in all respects with
(i) all applicable Environmental Laws, and (ii) all applicable Occupational
Safety and Health Laws; (b) none of the operations of the Borrower are subject
to any judicial or administrative proceeding alleging the violation of any
Environmental Law or Occupational Safety and Health Law; (c) none of the
operations of the Borrower is the subject of federal or state investigation
evaluating whether any remedial action is needed to respond to (i) a spillage,
disposal or release into the environment of any Hazardous Material or other
hazardous, toxic or dangerous waste, substance or constituent, or other
substance, or (ii) any unsafe or unhealthful condition at any premises of the
Borrower; (d) neither the Borrower has filed any notice under any Environmental
Law or Occupation Safety and Health Law indicating or


                                      29

<PAGE>

reporting (i) any past or present spillage, disposal or release into the
environment of, or treatment, storage or disposal of, any Hazardous Material
or other hazardous, toxic or dangerous waste, substance or constituent, or
other substance or (ii) any unsafe or unhealthful condition at any premises
of the Borrower; and (e) the Borrower has no known contingent liability in
connection with (i) any spillage, disposal or release into the environment
of, or otherwise with respect to, any Hazardous Material or other hazardous,
toxic or dangerous waste, substance or constituent, or other substance, or
(ii) any unsafe or unhealthful condition at any premises of the Borrower.

                      ARTICLE V  AFFIRMATIVE COVENANTS

     From the date of this Agreement and thereafter until all Obligations of CSI
and Cryenco hereunder are paid in full, the Borrower agrees that unless the
Lender shall otherwise consent in writing, it will:

     5.1  FINANCIAL STATEMENTS AND OTHER REPORTS.

          5.1.1     FINANCIAL REPORTS.  Furnish to the Lender in form
satisfactory to the Lender:

               (a)  ANNUAL AUDIT REPORT.  As soon as available and in any event
     within 90 days after the end of each fiscal year of the Borrower, CSI's 10K
     report as filed with the Securities and Exchange Commission (or any
     successor thereto) or any national securities exchange, and the annual
     audit report of the Borrower prepared on a consolidated basis in conformity
     with GAAP, consisting of at least statements of income, cash flow and
     stockholders' equity, and a consolidated balance sheet as at the end of
     such year, setting forth in each case in comparative form corresponding
     figures from the previous annual audit, certified, without qualification,
     by Ernst & Young, L.L.P. or by another independent certified public
     accountants of recognized standing selected by the Borrower and acceptable
     to the Lender, together with any management letters, management reports or
     other supplementary comments or reports to the Borrower or its board of
     directors furnished by such accountants.

               (b)  ACCOUNTANT'S CERTIFICATE.  Together with the audited
     financial statements required under SECTION 5.1.1(a), a certificate from
     the accounting firm performing such audit (i) acknowledging its
     understanding that the Lender and any Participant is relying on such audit
     report and (ii) stating that it has reviewed this Agreement and that in
     performing its examination, nothing came to its attention that caused it to
     believe that any Event of Default or Unmatured Event of Default exists, or,
     if such Unmatured Event of Default or Event of Default exists, describing
     its nature.

               (c)  QUARTERLY FINANCIAL STATEMENT.  As soon as available and in
     any event within forty-five (45) days after the end of each of the first
     three fiscal quarters of each fiscal year, a copy of CSI's unaudited 10Q
     report as filed with the Securities and Exchange Commission (or any
     successor thereto) or any national securities exchange prepared in the same
     manner as the audit report referred to in SECTION 5.1.1(a), signed by the
     Borrower's chief financial officer and consisting of at least


                                      30

<PAGE>

     consolidated statements of income, cash flow and stockholders' equity for
     the Borrower for such quarter and for the period from the beginning of such
     fiscal year to the end of such quarter, a consolidated balance sheet of the
     Borrower as at the end of such quarter.

               (d)  MONTHLY FINANCIAL STATEMENT.  As soon as available and in
     any event within 20 days after the end of each month of each fiscal year of
     the Borrower, a copy of the unaudited consolidated and consolidating
     financial statement of the Borrower prepared in the same manner as the
     audit report referred to in SECTION 5.1.1(a) (except that the unaudited
     financial statements need not be prepared in accordance with GAAP to the
     extent that footnotes are required under GAAP), signed by the Borrower's
     chief financial officer and consisting of at least statements of income,
     cash flow and stockholders' equity for the Borrower for such month and for
     the period from the beginning of such fiscal year to the end of such month,
     and balance sheets of the Borrower as at the end of such month.

               (e)  PROJECTIONS.  As soon as available and in any event not
     later than 30 days prior to the last day of each fiscal year of the
     Borrower, a projected financial statement of the Borrower prepared in the
     same manner as the audit report referred to in SECTION 5.1.1(a), signed by
     the Borrower's chief financial officer and presenting fairly the Borrower's
     best good faith projections of the financial position and results of
     operations of the Borrower for each month of the following fiscal year.

               (f)  OFFICER'S CERTIFICATE.  Together with the financial
     statements furnished by the Borrower under SECTION 5.1.1(a), (c) and (d), a
     certificate of the Borrower's chief financial officer, dated the date of
     such annual audit report or such monthly financial statement, as the case
     may be, to the effect that no Event of Default or Unmatured Event of
     Default has occurred and is continuing, or, if there is any such event,
     describing it and the steps, if any, being taken to cure it, and containing
     a computation of, and showing compliance with, each of the financial ratios
     and restrictions contained in ARTICLES V and VI and SUPPLEMENT A.

               (g)  GAAP CHANGES.  In the event that a material change occurs,
     in the Lender's judgment, in GAAP, either the Lender and the Borrower shall
     amend, in writing, the covenants in this Agreement, SUPPLEMENT A, and the
     other Loan Documents which are calculated on the basis of GAAP to reflect
     such change, or, if the Lender and the Borrower fail to agree on and enter
     into such an amendment, the Lender shall have the right to deem such change
     in GAAP to be an Event of Default.

          5.1.2     AGINGS; INELIGIBLE ACCOUNTS RECEIVABLE CERTIFICATION. Within
15 days after the end of each month, (a) a detailed aging of all Accounts
Receivable by invoice, including, without limitation, a reconciliation to the
aging report delivered to the Lender for the preceding month, (b) a
certification of ineligible Accounts Receivable and (c) an aging of all accounts
payable as of the end of the preceding month, each in form and content
acceptable to the Lender.


                                      31

<PAGE>

          5.1.3     INVENTORY CERTIFICATION.  Within 15 days after the end of
each month, an Inventory certification report as of the end of the preceding
month for all Inventory locations showing the amount of each component of the
Borrower's Inventory and the amount of each component of the Borrower's Costs,
and the amount of work in process, and a copy of the Borrower's job status
report as of the end of the preceding month, showing the amount of each
component of the Borrower's work in process, all in form and content acceptable
to the Lender.

          5.1.4     SALES AND COLLECTION REPORTS.  If requested by the Lender,
not later than 4:00 p.m., Minneapolis time on each Business Day, a report of the
Borrower's sales and collections for the preceding Business Day, in form and
content acceptable to the Lender.

          5.1.5     OTHER REPORTS.

               (a)  SEC AND OTHER REPORTS.  Promptly upon the making or filing
     thereof, copies of all financial statements, reports and proxy statements
     mailed to the CSI's shareholders, and copies of all registration
     statements, periodic reports and other documents filed with the Securities
     and Exchange Commission (or any successor thereto) or any national
     securities exchange.

               (b)  REPORT OF CHANGE IN SUBSIDIARIES OR PARTNERSHIPS. Promptly
     from time to time, a written report of any new Subsidiaries of the Borrower
     and of any change in the list of partnerships and joint ventures set forth
     on SCHEDULE 4.11.

               (c)  PATENTS, ETC.  Promptly from time to time, a written report
     of any change to the list of patents, trademarks, copyrights and other
     information set forth in SCHEDULE 4.16.

               (d)  OTHER REPORTS.  The information required to be provided
     pursuant to  other provisions of this Agreement, and such other reports
     from time to time requested by the Lender.


     5.2  NOTICES.  Notify the Lender in writing of any of the following
immediately upon learning of the occurrence thereof, describing the same and, if
applicable, the steps being taken by the Person(s) affected with respect
thereto:

               (a)  DEFAULT.  The occurrence of (i) any Event of Default or
     Unmatured Event of Default, and (ii) to the extent not included in CLAUSE
     (i) above, the default by the Borrower or any other Obligor under any note,
     indenture, loan agreement, mortgage, lease, deed or other material similar
     agreement to which the Borrower or any other Obligor, as appropriate, is a
     party or by which it is bound.

               (b)  LITIGATION.  The institution of any litigation, arbitration
     proceeding or governmental proceeding affecting the Borrower, any other
     Obligor, any Collateral or any Third Party Collateral and involving more
     than $50,000, whether or not considered to be covered by insurance.


                                      32

<PAGE>

               (c)  JUDGMENT.  The entry of any judgment or decree against the
     Borrower or any other Obligor, if the amount of such judgment exceeds
     $50,000.

               (d)  ERISA.  With respect to any Plan, the occurrence of a
     Reportable Event (other than a Reportable Event for which the reporting
     requirements have been waived by PBGC regulations) or any "prohibited
     transaction" (as defined in Section 4975 of the Code), a notice specifying
     the nature thereof and what action the Borrower proposes to take with
     respect thereto, and, when received, copies of any notice from PBGC of
     intention to terminate or have a trustee appointed for any Plan; or the
     incurrence of any material increase in the contingent liability of the
     Borrower or any other Obligor with respect to any "employee welfare benefit
     plan" as defined in Section 3(1) of ERISA which covers retired employees
     and their beneficiaries.

               (e)  CHANGE IN COLLATERAL LOCATIONS.  If any of the Borrower's
     Inventory or Equipment is placed in locations other than those identified
     in this Agreement or in SCHEDULE 4.13.

               (f)  CHANGE IN PLACE(S) OF BUSINESS.  Any proposed opening,
     closing or other change in the list of offices and other places of business
     of the Borrower set forth in SCHEDULE 4.12, and any opening, closing or
     other change in the offices and other places of business of each other
     Obligor.

               (g)  CHANGE OF NAME.  Any change in the name of the Borrower or
     any other Obligor, and any change in the list of trade names and trade
     styles set forth in SCHEDULE 4.1.

               (h)  ENVIRONMENTAL AND SAFETY AND HEALTH MATTERS. Receipt of any
     notice that the operations of the Borrower or any other Obligor are not in
     full compliance with requirements of any applicable Environmental Law or
     any Occupational Safety and Health Law; receipt of notice that the Borrower
     or any other Obligor is subject to federal, state or local investigation
     evaluating whether any remedial action is needed to respond to (i) any
     spillage, disposal or release into the environment of any Hazardous
     Material or other hazardous, toxic or dangerous waste, substance or
     constituent, or other substance, or (ii) any unsafe or unhealthful
     condition at any premises of the Borrower or any other Obligor; or receipt
     of notice that any properties or assets of the Borrower or any other
     Obligor are subject to an Environmental Lien.

               (i)  ADVERSE EVENT.  The occurrence of an Adverse Event.

               (j)  DEFAULT BY OTHERS.  Any material default by any Account
     Debtor or other Person obligated to the Borrower or any other Obligor,
     under any contract, chattel paper, note or other evidence of amounts
     payable or due or to become due to the Borrower or such Obligor if the
     amount payable under such contract, chattel paper, note or other evidence
     of amounts payable or due or to become due is material.


                                      33

<PAGE>

               (k)  MOVEABLE COLLATERAL.  If any of the Collateral or Third
     Party Collateral shall  consist of goods of a type normally used in more
     than one state, whether or not actually so used, any use of any such goods
     in any state other than a state in which the Borrower shall have previously
     advised the Lender such goods will be used. The Borrower agrees that such
     goods will not, unless the Lender shall otherwise consent in writing, be
     used outside the continental United States or in Louisiana.

               (l)  CHANGE IN MANAGEMENT OR LINE(S) OF BUSINESS.  Any
     substantial change in the senior management of the Borrower, or any change
     in the Borrower's line(s) of business.

               (m)  OTHER EVENTS.  The occurrence of such other events as the
     Lender may from time to time specify.

     5.3  EXISTENCE. Maintain and preserve its existence as a corporation, and
all rights, privileges, licenses, patents, patent rights, copyrights,
trademarks, trade names, franchises and other authority to the extent material
and necessary for the conduct of its respective business in the ordinary course
as conducted from time to time.

     5.4  NATURE OF BUSINESS.  Engage in substantially the same fields of
business as it is engaged in on the date hereof.

     5.5  BOOKS, RECORDS AND ACCESS.  Maintain complete and accurate books and
records (including, without limitation, records relating to Accounts Receivable,
Inventory, Equipment and other Collateral), in which full and correct entries in
conformity with GAAP shall be made of all dealings and transactions in relation
to its respective business and activities.  Cause its books and records as at
the end of any calendar month to be posted and closed not more than 15 days
after the last business day of such month.  Permit access by the Lender and its
agents or employees to the books and records of the Borrower at the Borrower's
place or places of business at intervals to be determined by the Lender and
without hindrance or delay, and permit the Lender or its agents and employees to
inspect the Borrower's Inventory and Equipment, and to inspect, audit, check and
make copies and/or extracts from the books, records, journals, orders, receipts,
correspondence and other data relating to Inventory, Accounts Receivable,
chattel paper, General Intangibles, Equipment and any other Collateral or Third
Party Collateral, or to any other transactions between the parties hereto.  Any
and all such inspections and/or audits shall be at the Borrower's expense,
including, without limitation, the pre-closing audit undertaken by the Lender,
PROVIDED, HOWEVER, that as long as the Borrower is in full compliance with the
terms and provisions of this Agreement, the Borrower will not be charged for
more than three such inspections and/or audits per year (excluding the pre-
closing audit) or for more than $3,000 per such inspection and/or audit actually
occurring hereafter (excluding the pre-closing audit).

     5.6  INSURANCE. Maintain insurance to such extent and against such hazards
and liabilities as is commonly maintained by companies similarly situated or as
the Lender may reasonably request from time to time. Keep the Collateral
properly housed and insured for its full insurable value against loss or damage
by fire, theft, explosion, sprinklers, collision (in the


                                      34

<PAGE>

case of motor vehicles) and such other risks as are customarily insured
against by persons engaged in business similar to that of the Borrower, with
such companies, in such amounts and under policies in such form as shall be
satisfactory to the Lender. Certificates of such policies of insurance have
been delivered to the Lender prior to the date hereof together with evidence
of payment of all premiums therefor.  The Borrower hereby directs all
insurers under such policies of insurance to pay all proceeds payable
thereunder directly to the Lender.  The Borrower irrevocably makes,
constitutes and appoints the Lender and any Person whom the Lender may from
time to time designate (and all officers, employees or agents designated by
the Lender or such Person) as the Borrower's true and lawful attorney (and
agent-in-fact) for the purpose of making, settling and adjusting claims under
such policies of insurance, endorsing the name of the Borrower on any check,
draft, instrument or other item of payment for the proceeds of such policies
of insurance and for making all determinations and decisions with respect to
such policies of insurance.  In the event the Borrower at any time or times
hereafter shall fail to obtain or maintain any of the policies of insurance
required herein or to pay any premium in whole or in part relating thereto,
the Lender, without waiving or releasing any obligations or default by the
Borrower hereunder, may at any time or times thereafter (but shall be under
no obligation to do so) obtain and maintain such policies of insurance and
pay such premiums and take any other action with respect thereto which the
Lender deems advisable.  All sums so disbursed by the Lender, including
reasonable Attorneys' Fees, court costs, expenses and other charges relating
thereto, shall be payable on demand by the Borrower to the Lender.

     5.7  INSURANCE SURVEY.  Provide to the Lender at least annually within 90
days of the end of the Borrower's fiscal year, a certificate signed by its chief
financial officer that attests to and summarizes the property and casualty
insurance program carried by the Borrower.  This summary shall include the
insurer's(s') name, policy number(s), expiration date(s), amount(s) of coverage,
type(s) of coverage, the annual premium(s), Best's policyholder's and financial
size ratings of the insurers, exclusions, deductibles and self-insured retention
and shall describe in detail any retrospective rating plan, fronting arrangement
or any other self-insurance or risk assumption agreed to by the Borrower or
imposed upon the Borrower by any such insurer, as well as any self-insurance
program that is in effect.  The Borrower shall (a) notify the Lender in writing
at least 30 days prior to any cancellation or material change of any such
insurance by the Borrower and (b) within five business days after receipt of any
notice (whether formal or informal) thereof, of any cancellation or change in
any of its insurance by any of its insurers or any material change in the cost
thereof or which reduces the policyholder's or financial size ratings of the
insurance carriers of the Borrower, as established by BEST'S INSURANCE REPORTS.
In the event of the Borrower's decision to change insurers, and not more
frequently than annually in the absence of any such change, the Lender shall
have the right to request the Borrower to have a risk management survey
completed by a recognized independent risk management consultant acceptable to
it and the Lender which will identify, quantify and assess any catastrophic
uninsured, underinsured or self-insured exposures faced by the Borrower.  The
cost of such survey shall be borne solely by the Borrower.  A copy of the
results of each such a survey shall be promptly delivered by the Borrower to the
Lender.

     5.8  REPAIR.  Maintain, preserve and keep its properties in good repair,
working order and condition, and from time to time make all necessary and proper
repairs, renewals,


                                      35

<PAGE>

replacements, additions, betterments and improvements thereto so that at all
times the efficiency thereof shall be fully preserved and maintained.

     5.9  TAXES.  Pay when due, all of its Taxes, unless and only to the extent
that the Borrower is contesting such Taxes in good faith and by appropriate
proceedings and the Borrower has set aside on its books such reserves or other
appropriate provisions therefor as may be required by GAAP.

     5.10 COMPLIANCE.  Comply with all statutes and governmental rules and
regulations applicable to it, including, without limitation, the Fair Labor
Standards Act.

     5.11 COLLATERAL MONITORING.  Permit the Lender to (a) use the Borrower's
stationery and sign the name of the Borrower to request verification of Accounts
Receivable or other Collateral from Account Debtors, and (b) use the information
recorded on or contained in any data processing equipment and computer hardware
and software to which the Borrower has access relating to Accounts Receivable,
Inventory, Equipment and/or other Collateral.

                        ARTICLE VI  NEGATIVE COVENANTS

     From the date of this Agreement and thereafter until all Obligations of the
Borrower hereunder are paid in full, the Borrower agrees that, unless the Lender
shall otherwise consent in writing, it will not do any of the following:

     6.1  MERGER.  Merge or consolidate or enter into any analogous
reorganization or transaction with any Person.

     6.2  SALE OF ASSETS.  Sell, transfer, convey, lease, assign or otherwise
dispose (with or without recourse) of any of its assets (including, without
limitation, any Accounts Receivable, instruments or chattel paper) except for
sales and leases of Inventory in the ordinary course of business.

     6.3  PURCHASE OF ASSETS.  Purchase or lease or otherwise acquire all or
substantially all the assets of any Person.

     6.4  ERISA.  Permit any condition to exist in connection with any Plan
which might constitute grounds for the PBGC to institute proceedings to have
such Plan terminated or a trustee appointed to administer such Plan; permit any
Plan to terminate under any circumstances which would cause the lien provided
for in Section 4068 of ERISA to attach to any property, revenue or asset of the
Borrower; or permit the underfunded amount of Plan benefits guaranteed under
Title IV of ERISA to exceed $10,000.

     6.5  CHANGES IN COLLATERAL OR BUSINESS LOCATIONS.  Change (a) the location
of its chief executive office or chief place of business; (b) its name; or (c)
the locations where it stores or maintains Inventory or Equipment without, in
each case, at least 30 days' prior written notice to the Lender.


                                      36

<PAGE>

     6.6  SUBSIDIARIES, PARTNERSHIPS AND JOINT VENTURES.  Either: (a) form or
acquire any corporation which would thereby become a Subsidiary; or (b) form or
enter into any partnership as a limited or general partner or into any joint
venture.

     6.7  OTHER AGREEMENTS.  Enter into any agreement, bond, note or other
instrument with or for the benefit of any Person other than the Lender which
would (a) prohibit the Borrower from granting, or otherwise limit the ability of
the Borrower to grant, to the Lender any Lien on any assets or properties of the
Borrower, or (b) be violated or breached by the Borrower's performance of its
obligations under the Loan Documents.

     6.8  RESTRICTED PAYMENTS.  Purchase or redeem or otherwise acquire for
value any shares of the Borrower's stock, or declare or pay any dividends
thereon (other than stock dividends, dividends payable to the Borrower and
dividends payable with respect to the preferred stock of CSI which is issued
and outstanding as of the date of this Agreement), or make any distribution to
stockholders as such (other than the Borrower) or set aside any funds for any
such purpose, or prepay, purchase or redeem any subordinated Indebtedness of
the Borrower; or make any payment to Charterhouse Group International, Inc. in
respect of management fees unless and only to the extent that the amount of the
Borrowing Base exceeds the amount of the Obligations by at least $500,000
immediately after the payment and PROVIDING FURTHER, that prior to and after the
making of any such payment to Charterhouse Group International, Inc., there has
not occurred an Event of Default or an Unmatured Event of Default under this
Agreement.

     6.9  CHANGE IN MANAGEMENT.  Permit a change in the title or duties of any
of the following officers, directors and/or employees of the Borrower: Alfred
Schechter, Chairman and Chief Executive Officer, Dale Brubaker, President and
Chief Operating Officer, Don Harwell, Vice President and Vice Chairman and James
Raabe, Vice President and Chief Financial Officer.

     6.10 INVESTMENTS.  Acquire for value, make, have or hold any Investments,
except: (a) advances to employees of the Borrower for travel or other ordinary
business expenses, provided that the aggregate amount outstanding at any one
time shall not exceed $5,000 for any single employee and $25,000 in the
aggregate  for  all employees;  (b) advances to subcontractors and suppliers in
maximum aggregate amounts reasonably acceptable to the Lender; (c) extensions of
credit in the nature of Accounts Receivable or notes receivable arising from the
sale of goods and services in the ordinary course of business; (d) shares of
stock, obligations or other securities received in settlement of claims arising
in the ordinary course of business; (e) Investments (other than Investments in
the nature of loans or advances) outstanding on the date hereof in subsidiaries
by the Borrower; (f) other Investments outstanding on the date hereof and listed
on SCHEDULE 6.10; (g) at any time except after the occurrence and during the
continuance of any Event of Default or any Unmatured Event of Default under this
Agreement, Investments in ALT USA, a joint venture between CSI and Jack B.
Kelley, Inc. not exceeding $1,200,000 during the Borrower's 1996 fiscal year,
and for any fiscal year thereafter, Investments in ALT USA which do not exceed
in the aggregate the amount by which the consolidated EBITDA of the Borrower
during the most recent four consecutive fiscal quarters exceeds the sum of their
consolidated unfinanced capital expenditures, cash taxes, interest payments,
dividends and mandatory debt retirement


                                     37

<PAGE>

payments during the same four consecutive fiscal quarters, by at least 25%;
and (h) other Investments consented to by the Lender in writing.

     6.11 INDEBTEDNESS.  Incur, create, issue, assume or suffer to exist any
Indebtedness, including, without limitation, Indebtedness as lessee under any
Capitalized Lease, except: (a) Indebtedness under the terms of this Agreement;
(b) Subordinated Debt existing as of the date of this Agreement; (c)
Indebtedness hereafter incurred in connection with Liens permitted under
SECTION 6.12(d); (d) other Indebtedness outstanding on the date hereof and
listed on SCHEDULE 6.11; and (e) other Indebtedness approved in writing by
the Lender.

     6.12 LIENS.  Create, incur, assume or suffer to exist any Lien with respect
to any property, revenues or assets now owned or hereafter arising or acquired,
except: (a) Liens for current Taxes not delinquent or Taxes being contested in
good faith and by appropriate proceedings and as to which such reserves or other
appropriate provisions as may be required by GAAP are being maintained; (b)
carriers', warehousemen's, mechanics', materialmen's, repairmen's, and other
like statutory Liens arising in the ordinary course of business securing
obligations which are not overdue or which are being contested in good faith and
by appropriate proceedings and as to which such reserves or other appropriate
provisions as may be required by GAAP are being maintained; (c) pledges or
deposits in connection with workers' compensation, unemployment insurance and
other social security legislation; (d) Liens in connection with Capital
Expenditures attaching only to the property being acquired if the Indebtedness
secured thereby does not exceed 100% of the fair market value of such property
at the time of acquisition thereof; (e) Liens in favor of the Lender; (f) Liens
referred to in SECTION 4.9; and (g) Liens consented to by the Lender in writing.

     6.13 CONTINGENT LIABILITIES.  Either: (a) endorse, guarantee, contingently
agree to purchase or to provide funds for the payment of, or otherwise become
contingently liable upon, any obligation of any other Person (including without
limitation, ALT USA), except by the endorsement of negotiable instruments for
deposit or collection (or similar transactions) in the ordinary course of
business, or (b) agree to maintain the net worth or working capital of, or
provide funds to satisfy any other financial test applicable to, any other
Person.

     6.14 CHANGE IN ACCOUNTS RECEIVABLE.  After the occurrence of an Event of
Default or receipt of notice from the Lender that the Lender intends to commence
direct collection of Accounts Receivable, permit or agree to any extension,
compromise or settlement or make any change or modification of any kind or
nature with respect to any Account Receivable, including any of the terms
relating thereto.

     6.15 UNCONDITIONAL PURCHASE OBLIGATIONS.  Enter into or be a party to any
contract for the purchase of materials, supplies or other property or services,
if such contract requires that payment be made by it regardless of whether or
not delivery is ever made of such materials, supplies or other property or
services.

     6.16 USE OF PROCEEDS.  Use or permit any proceeds of the Loans to be used,
either directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of "purchasing or carrying any margin stock" within the meaning of
Regulation U of the Federal Reserve


                                     38

<PAGE>

Board, as amended from time to time, and furnish to the Lender upon request,
a statement in conformity with the requirements of Federal Reserve Form U-1
referred to in Regulation U of the Federal Reserve Board.

     6.17 TRANSACTIONS WITH RELATED PARTIES.  Enter into or be a party to any
transaction or arrangement, including, without limitation, the purchase, sale,
lease or exchange of property or the rendering of any service, with any Related
Party, except in the ordinary course of and pursuant to the reasonable
requirements of the Borrower's business and upon fair and reasonable terms no
less favorable to the Borrower than would be obtained in a comparable
arm's-length transaction with a Person not a Related Party.

                 ARTICLE VII  EVENTS OF DEFAULT AND REMEDIES

     7.1  EVENTS OF DEFAULT.  The occurrence of any one or more of the following
events shall constitute an Event of Default:

               (a)  NON PAYMENT.  The Borrower shall fail to pay, when due or
     declared due, any of the Obligations;

               (b)  NON-PAYMENT OF OTHER INDEBTEDNESS.  The Borrower or any
     other Obligor shall fail to pay, when due, whether by acceleration or
     otherwise (subject to any applicable grace period), any Indebtedness of, or
     guaranteed by, the Borrower or such other Obligor;

               (c)  ACCELERATION OF OTHER INDEBTEDNESS.  Any event or condition
     shall occur which results in the acceleration of the maturity of any
     Indebtedness of, or guaranteed by, the Borrower or any other Obligor or
     enables the holder or holders of such other Indebtedness or any trustee or
     agent for such holders (any required notice of default having been given
     and any applicable grace period having expired) to accelerate the maturity
     of such other Indebtedness;

               (d)  OTHER OBLIGATIONS.  The Borrower or any other Obligor shall
     fail to pay, when due, whether by acceleration or otherwise, or perform or
     observe (subject to any applicable grace period or waiver of such default)
     (i) any obligation or agreement of the Borrower or such other Obligor to or
     with the Lender (other than any obligation or agreement of the Borrower
     hereunder and under any Notes) or (ii) any material obligation or agreement
     of the Borrower or such other Obligor to or with any other Person (other
     than (A) any such material obligation or agreement constituting or related
     to Indebtedness, (B) accounts payable arising in the ordinary course of
     business, and (C) any material obligation or agreement of any Subsidiary to
     the Borrower or to any other Subsidiary), except only to the extent that
     the occurrence of any such failure is being contested by the Borrower or
     such other Obligor, as the case may be, in good faith and by appropriate
     proceedings and the Borrower or such other Obligor, as applicable, shall
     have set aside on its books such reserves or other appropriate provisions
     therefor as may be required by GAAP;


                                     39

<PAGE>

               (e)  INSOLVENCY.  The Borrower, any other Obligor or any
     Subsidiary becomes insolvent, or generally fails to pay, or admits in
     writing its inability to pay, its debts as they mature, or applies for,
     consents to, or acquiesces in, the appointment of a trustee, receiver or
     other custodian for the Borrower, such other Obligor or such Subsidiary, or
     for a substantial part of the property of the Borrower, such other Obligor
     or such Subsidiary, or makes a general assignment for the benefit of
     creditors; or, in the absence of such application, consent or acquiescence,
     a trustee, receiver or other custodian is appointed for the Borrower, any
     other Obligor or any Subsidiary or for a substantial part of the property
     of the Borrower, any other Obligor or any Subsidiary and is not discharged
     or dismissed within 30 days; or any bankruptcy, reorganization, debt
     arrangement or other proceeding under any bankruptcy or insolvency law, or
     any dissolution or liquidation proceeding, is instituted by or against the
     Borrower, any other Obligor or any Subsidiary; or any warrant of attachment
     or similar legal process is issued against any substantial part of the
     property of the Borrower, any other Obligor or any Subsidiary;

               (f)  ERISA.  The institution by the Borrower or any ERISA
     Affiliate of steps to terminate any Plan if, in order to effectuate such
     termination, the Borrower or any ERISA Affiliate would be required to make
     a contribution to such Plan or would incur a liability or obligation to
     such Plan, in excess of $10,000; or the institution by the PBGC of steps to
     terminate any  Plan;

               (g)  NON-COMPLIANCE WITH THIS AGREEMENT.

                    (i)  The Borrower shall fail to comply with any of the
          Borrower's agreements set  forth in SECTION 9 of SUPPLEMENT A; or

                    (ii) The Borrower shall fail to comply with any of the
          Borrower's agreements set forth in this Agreement (and not
          constituting an Event of Default under any of the other subsections of
          this SECTION 7.1, including, without limitation, SECTION 7.1(g)(i)),
          and such failure to comply shall continue for ten days;

               (h)  NON-COMPLIANCE WITH LOAN DOCUMENTS.  Failure by the Borrower
     or any other Obligor to comply with any of its respective agreements set
     forth in any Loan Documents other than this Agreement (and not constituting
     an Event of Default under any of the other subsections of this
     SECTION 7.1), and such failure to comply shall continue after the grace
     period (if any) set forth therein;

               (i)  WARRANTY.  Any warranty made by the Borrower or any other
     Obligor in any of the Loan Documents is untrue or misleading in any
     material respect when made or deemed made; or any schedule, statement,
     report, notice, certificate or other writing furnished by the Borrower or
     any other Obligor to the Lender is untrue or misleading in any material
     respect on the date as of which the facts set forth therein are stated or
     certified; or any certification made or deemed made by the Borrower or any
     other Obligor to the Lender is untrue or misleading in any material respect
     on or as of the date made or deemed made;


                                     40

<PAGE>

               (j)  LITIGATION. There shall be entered against any one of the
     Borrower or any other Obligor one or more judgments or decrees in excess of
     $100,000 in the aggregate at any one time outstanding, excluding those
     judgments or decrees (i) that shall have been outstanding less than 30
     calendar days from the entry thereof or (ii) for and to the extent which
     the Borrower or such Obligor, as applicable, is insured and with respect to
     which the insurer has assumed responsibility in writing or for and to the
     extent which the Borrower or such Obligor, as applicable, is otherwise
     indemnified if the terms of such indemnification are satisfactory to the
     Lender;

               (k)  DEATH OF OBLIGOR.  Intentionally omitted;

               (l)  VALIDITY. If the validity or enforceability of any of the
     Loan Documents shall be challenged by the Borrower, any other Obligor or
     any other Person, or shall fail to remain in full force and effect;

               (m)  CONDUCT OF BUSINESS.  If the Borrower or any other Obligor
     is enjoined, restrained or in any way prevented by court order, which has
     not been dissolved or stayed within five Business Days, from conducting all
     or any material part of its business affairs;

               (n)  ADVERSE EVENT.  The Lender shall have determined in good
     faith (which determination shall be conclusive) that (i) an Adverse Event
     has occurred or (ii) the Lender's interest in any material Collateral or
     Third Party Collateral has been adversely affected or impaired, or the
     value thereof to the Lender has been diminished to a material extent, or
     (iii) the prospect of payment or performance of any obligation or agreement
     of the Borrower or any other Obligor under any of the Loan Documents is
     materially impaired, and the condition giving rise to such determination
     does not constitute an Event of Default under any of the other subsections
     of this SECTION 7.1; and

               (o)  CHANGE IN BOARD OF DIRECTORS OR OWNERSHIP OF CRYENCO. If
     less than six of the following eight Persons shall be directors of CSI:
     Alfred Schechter, Dale Brubaker, Russell Haines, William Phelan, Don
     Harwell, Burton Ahrens, Jerome Katz or Ajit Hutheesing; if the number of
     the board of directors of CSI is increased to more than eight and the
     number of the foregoing Persons who are directors of CSI shall cease to
     represent at least two-thirds of the board of directors of CSI;  or if CSI
     shall cease to own 100% of the stock of Cryenco.

     7.2  EFFECT OF EVENT OF DEFAULT; REMEDIES.


               (a)  In the event that one or more Events of Default described in
     Section 7.1(E) shall occur, then the Credit extended under this Agreement
     shall terminate and all Obligations hereunder and under any Notes shall be
     immediately due and payable without demand, notice or declaration of any
     kind whatsoever.


                                     41

<PAGE>

               (b)  In the event an Event of Default other than one described in
     Section 7.1(e) shall occur, then the Lender may declare all Obligations
     hereunder and under any Notes immediately due and payable without demand or
     notice of any kind whatsoever, whereupon the Credit extended under this
     Agreement shall terminate and all Obligations hereunder and under any Notes
     shall be immediately due and payable.  The Lender shall promptly advise the
     Borrower of any such declaration, but failure to do so shall not impair the
     effect of such declaration.

               (c)  In the event of the occurrence of any Event of Default the
     Lender may exercise any one or more or all of the following remedies, all
     of which are cumulative and non-exclusive:

                    (i)  any remedy contained in the Loan Documents or any
          Supplemental Documentation;

                    (ii) any rights and remedies available to the Lender under
          the Uniform Commercial Code as enacted in Minnesota as of the date of
          this Agreement, and any other applicable law;

                    (iii)     without notice, demand or legal process of any
          kind, the Lender may take possession of any or all of the Collateral
          (in addition to Collateral which it might already have in its
          possession), wherever it might be found, and for that purpose may
          pursue the same wherever it may be found, and may enter into any
          premises where any of the Collateral may be or is supposed to be, and
          search for, take possession of, remove, keep and store any of the
          Collateral until the same shall be sold or otherwise disposed of, and
          the Lender shall have the right to store the same in any of the
          Borrower's premises without cost to the Lender;

                    (iv) at the Lender's request, the Borrower will, at the
          Borrower's expense, assemble the Collateral and make it available to
          the Lender at a place or places to be designated by the Lender which
          is reasonably convenient to the Lender and the Borrower; and

                    (v)  the Lender at its option, and pursuant to notification
          given to the Borrower as provided for below, may sell any Collateral
          actually or constructively in its possession at public or private sale
          and apply the proceeds thereof as provided below.

     7.3  SETOFF.  In addition to and not in limitation of all rights of offset
that the Lender or any other holder of a Note may have under applicable law, the
Lender or such other holder of a Note shall, upon the occurrence of any Event of
Default, or any Unmatured Event of Default described in SECTION 7.1(e) hereof,
have the right to appropriate and apply to the payment of the Obligations any
and all balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter with the Lender, or any Affiliate, or other holder.

               ARTICLE VIII  COLLATERAL AND THE LENDER'S RIGHTS


                                     42

<PAGE>

     8.1  NOTICE OF DISPOSITION OF COLLATERAL.  Any notification of intended
disposition of any of the Collateral required by law shall be deemed reasonably
and properly given if given at least ten calendar days before such disposition.

     8.2  APPLICATION OF PROCEEDS OF COLLATERAL.  Any proceeds of any
disposition by the Lender of any of the Collateral may be applied by the Lender
to the payment of expenses in connection with the taking possession of, storing,
preparing for sale, and disposition of Collateral, including Attorneys' Fees and
legal expenses, and any balance of such proceeds may be applied by the Lender
toward the payment of such of the Obligations, and in such order of application,
as the Lender may from time to time elect.

     8.3  CARE OF COLLATERAL.  The Lender shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its
possession if it takes such action for that purpose as the Borrower requests in
writing, but failure of the Lender to comply with such request shall not, of
itself, be deemed a failure to exercise reasonable care, and no failure of the
Lender to preserve or protect any rights with respect to such Collateral against
prior parties, or to do any act with respect to the preservation of such
Collateral not so requested by the Borrower, shall be deemed a failure to
exercise reasonable care in the custody or preservation of such Collateral.

     8.4  PERFORMANCE OF BORROWER'S OBLIGATIONS.  The Lender shall have the
right, but shall not be obligated, to discharge any claims against or Liens, and
any Taxes at any time levied or placed upon, any or all Collateral including,
without limitation, those arising under statute or in favor of landlords, taxing
authorities, government, public and/or private warehousemen, common and/or
private carriers, processors, finishers, draymen, coopers, dryers, mechanics,
artisans, laborers, attorneys, courts, or others.  The Lender may also pay for
maintenance and preservation of Collateral. The Lender may, but is not obligated
to, perform or fulfill any of the Borrower's responsibilities under this
Agreement which the Borrower has failed to perform or fulfill.

     8.5  LENDER'S RIGHTS.  None of the following shall affect the obligations
of the Borrower to the Lender under this Agreement or the Lender's rights with
respect to the remaining Collateral or any Third Party Collateral (any or all of
which actions may be taken by the Lender at any time, whether before or after an
Event of Default, at its sole and absolute discretion and without notice to the
Borrower):

               (a)  acceptance or retention by the Lender of other property or
     interests in property as security for the Obligations, or acceptance or
     retention of any obligor(s), in addition to the Borrower, with respect to
     any of the Obligations;

               (b)  release of its security interest in, or surrender or release
     of, or the substitution or exchange of or for, all or any part of the
     Collateral or any Third Party Collateral or any other property securing any
     of the Obligations (including, without limitation, any property of any
     Obligor other than the Borrower), or any extension or renewal for one or
     more periods (whether or not longer than the original period), or


                                     43

<PAGE>

     release, compromise, alteration or exchange, of any obligations of any
     guarantor or other Obligor with respect to any Collateral or any such
     property;

               (c)  extension or renewal for one or more periods (whether or not
     longer than the original period), or release, compromise, alteration or
     exchange of any of the Obligations, or release or compromise of any
     obligation of any Obligor with respect to any of the Obligations; or

               (d)  failure by the Lender to resort to other security or pursue
     any Person liable for any of the Obligations before resorting to the
     Collateral.

                      ARTICLE IX   CONDITIONS PRECEDENT

     9.1  CONDITIONS PRECEDENT TO INITIAL LOANS.  The obligation of the Lender
to make the initial Loans shall be subject to the satisfaction of the following
conditions precedent, in addition to the applicable conditions precedent set
forth in SECTION 9.2:

          9.1.1     NO CHANGE IN CONDITION.  No change in the condition or
operations, financial or otherwise, of the Borrower or any other Obligor, shall
have occurred which change, in the sole credit judgment of the Lender, may
constitute an Adverse Event or have a material adverse effect on any Collateral
or Third Party Collateral or the Lender's interest therein.

          9.1.2     ACCOUNTING METHODS.  The Borrower shall not have made any
material, as determined by the Lender, change in its accounting methods or
principles.

          9.1.3     SURVEY.  The Lender shall have completed its updated survey
of the business, operations and assets of the Borrower and each other Obligor,
and such survey shall provide the Lender with results and information which, in
the Lender's determination, are satisfactory to the Lender.

          9.1.4     NO MATERIAL TRANSACTION.  Neither the Borrower nor any other
Obligor shall have entered into any material, as determined by the Lender,
commitment or transaction, including, without limitation, transactions for
borrowings and capital expenditures, which are not in the ordinary course of
their respective businesses.

          9.1.5     LITIGATION. No litigation shall be outstanding or have been
instituted or threatened which the Lender determines to be material against the
Borrower or any other Obligor.

          9.1.6     FILING OF DOCUMENTS.  All financing statements, mortgages
and other documents relating to the Collateral and Third Party Collateral shall
have been filed or recorded, as appropriate.

          9.1.7     DELIVERY OF DOCUMENTS.  The Borrower shall have delivered to
the Lender with each of the following, each duly executed and dated the date of
the initial Loans or such earlier date as shall be acceptable to the Lender:


                                     44

<PAGE>

               (a)  RESOLUTIONS. A copy, duly certified by the secretary or an
     assistant secretary of the Borrower, of (i) the resolutions of the Board of
     Directors of the Borrower authorizing (1) the borrowings by the Borrower
     hereunder, (2) the execution, delivery and performance by the Borrower of
     the Loan Documents to which the Borrower is a party or by which it is bound
     and (3) certain officers or employees of the Borrower to request borrowings
     by telephone and to execute Borrowing Base Certificates; (ii) all documents
     evidencing other necessary corporate action; and (iii) all approvals or
     consents, if any, with respect to the Loan Documents;

               (b)  INCUMBENCY CERTIFICATE.  A certificate of the secretary or
     an assistant secretary of the Borrower, certifying the names of the
     officers of the Borrower authorized to sign the Loan Documents to which it
     is a party and any Supplemental Documentation, together with the true
     signatures of such officers;

               (c)  OTHER AGREEMENTS.  Duly executed copies of each of the Loan
     Documents not specifically identified herein which the Lender determines to
     be necessary or desirable, each in form and content satisfactory to the
     Lender;

               (d)  OPINION.  A legal opinion of Shack & Siegel, counsel to the
     Borrower, substantially in the form set forth as EXHIBIT B;

               (e)  BORROWER'S CERTIFICATE.  The certificate of the President of
     the Borrower certifying, to the best of his/her knowledge after diligent
     inquiry, to the fulfillment of all conditions precedent to closing and
     funding the secured financing transaction contemplated by this Agreement
     and to the truth and accuracy, as of such date, of the representations and
     warranties of the Borrower contained in the Loan Documents to which the
     Borrower is a party;

               (f)  INSURANCE. Evidence satisfactory to the Lender of the
     existence of insurance on the Collateral and Third Party Collateral in
     amounts and with insurers acceptable to the Lender, together with evidence
     establishing that the Lender is named as a loss payee on all related
     insurance policies; and if required by the Lender, additional insured on
     all related insurance policies and an endorsement or an independent
     instrument from each issuer of an insurance policy substantially in the
     form set forth as EXHIBIT C;

               (g)  BYLAWS. A copy, duly certified by the secretary or an
     assistant secretary of the Borrower, of the Borrower's Bylaws;

               (h)  ARTICLES OF INCORPORATION.  A copy, duly certified by the
     secretary or an assistant secretary of the Borrower, of the Borrower's
     Articles of Incorporation;

               (i)  GOOD STANDING CERTIFICATES.  Certificates of good standing
     as to the Borrower issued by the Secretary of State of the state in which
     the Borrower is organized, and each other state in which the failure of the
     Borrower to be in good


                                     45

<PAGE>

     standing would constitute an Adverse Event or have a material adverse
     effect on the Lender's rights in any Collateral or Third Party Collateral;

               (j)  DISBURSEMENT LETTER.  Written authorization and instructions
     from the Borrower, in form satisfactory to the Lender, for disbursement of
     the proceeds of the initial Loans;

               (k)  PAYOFF LETTERS.  Evidence satisfactory to the Lender that
     all obligations of the Borrower to Chemical Bank[ AND CIT] have been paid
     in full and that Chemical Bank[ AND CIT] have terminated, or agreed to
     terminate, all of their Liens on the property of the Borrower and all
     public record filings evidencing such Liens;

               (l)  LANDLORDS AND WAREHOUSEMEN WAIVERS.  If required by the
     Lender, (i) from each lessor or landlord identified on SCHEDULE 4.12 or
     SCHEDULE 4.13, a landlord waiver and (ii) from each operator of a public
     warehouse where Inventory is stored, a letter from such operator, in each
     case in form acceptable to the Lender;

               (m)  SUBORDINATION AGREEMENTS.  A subordination agreement from
     Charterhouse Group International, Inc.[ AND A SUBORDINATION AGREEMENT FROM
     THE CIT GROUP/EQUITY INVESTMENTS, INC., BOTH] in form acceptable to the
     Lender; and

               (n)  OTHER. Such other documents, instruments or agreements as
     the Lender shall determine to be necessary or desirable.

          9.1.8     SECURITY INTEREST.  The Lien in the Collateral and Third
Party Collateral granted to the Lender to secure the Obligations shall be
senior, perfected Liens except as otherwise agreed by the Lender.

          9.1.9     RESTRICTED ACCESS LOCKBOX; COLLATERAL ACCOUNT AND
DISBURSEMENT ACCOUNT AGREEMENTS.  The Borrower shall have entered into a
Restricted Access Lockbox; Collateral Account and Disbursement Account
Agreement, substantially in the form of EXHIBIT D, with the Lender and FBNA.

          9.1.10    EFFECT OF LAW.  No law or regulation affecting the Lender's
entering into the secured financing transaction contemplated by this Agreement
shall impose upon the Lender any material obligation, fee, liability, loss,
cost, expense or damage.

          9.1.11    EXHIBITS; SCHEDULES.  All Exhibits and Schedules to the Loan
Documents shall have been completed in form and substance satisfactory to the
Lender and shall contain no facts or information which the Lender, in its sole
judgment, determines to be unacceptable.

     9.2  CONDITIONS PRECEDENT TO ALL LOANS.  The obligation of the Lender to
make any Loan or issue, or cause to be issued, any Letter of Credit (including
the initial Loans) shall be subject to the satisfaction of the following
conditions precedent:


                                     46

<PAGE>

          (a)  REPRESENTATIONS AND WARRANTIES.  All of the representations and
     warranties of the Borrower and each other Obligor set forth in the Loan
     Documents to which the Borrower or such other Obligor, as applicable, is a
     party shall be true and correct.

          (b)  EVENT OF DEFAULT.  Immediately before and after making such Loan
     or issuing, or causing to be issued such Letter of Credit, no Event of
     Default or Unmatured Event of Default shall exist or be continuing.

                             ARTICLE X  INDEMNITY

     10.1 ENVIRONMENTAL AND SAFETY AND HEALTH INDEMNITY.  The Borrower hereby
indemnifies the Lender and agrees to hold the Lender harmless from and against
any and all losses, liabilities, damages, injuries, costs, expenses and claims
of any and every kind whatsoever (including, without limitation, court costs and
Attorneys' Fees) which at any time or from time to time may be paid, incurred or
suffered by, or asserted against, the Lender for, with respect to, or as a
direct or indirect result of the violation by the Borrower, of any Environmental
Law or Occupational Safety and Health Law; or with respect to, or as a direct or
indirect result of (a) the presence on or under, or the escape, seepage,
leakage, spillage, disposal, discharge, emission or release from, properties
utilized by the Borrower in the conduct of its business into or upon any land,
the atmosphere, or any watercourse, body of water or wetland, of any Hazardous
Material or other hazardous, toxic or dangerous waste, substance or constituent,
or other substance (including, without limitation, any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising under the
Environmental Laws) or (b) the existence of any unsafe or unhealthful condition
on or at any premises utilized by the Borrower in the conduct of its business.
The provisions of and undertakings and indemnification set out in this
SECTION 10.1 shall survive satisfaction and payment of the Obligations and
termination of this Agreement.

     10.2 GENERAL INDEMNITY.  In addition to the payment of expenses pursuant to
SECTION 12.3, whether or not the transactions contemplated hereby shall be
consummated, the Borrower agrees to indemnify, pay and hold the Lender and any
holder of any Notes, and the officers, directors, employees, agents, and
affiliates of the Lender and such holders (collectively called the
"INDEMNITEES") harmless from and against, any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs, expenses and disbursements of any kind or nature whatsoever (including,
without limitation, the reasonable fees and disbursements of counsel for any of
such Indemnitees in connection with any investigative, administrative or
judicial proceeding commenced or threatened, whether or not any of such
Indemnitees shall be designated a party thereto), that may be imposed on,
incurred by, or asserted against the Indemnitees, in any manner relating to or
arising out of the Loan Documents, the statements contained in any commitment
letters delivered by the Lender, the Lender's agreement to make the Loans or to
issue Letters of Credit hereunder, or the use or intended use of any Letters of
Credit, or the use or intended use of the proceeds of any of the Loans (the
"INDEMNIFIED LIABILITIES"); PROVIDED, HOWEVER, that the Borrower shall have no
obligation to an Indemnitee hereunder with respect to indemnified liabilities
arising from the gross negligence or willful misconduct of an Indemnitee.  To
the extent that the


                                     47

<PAGE>

undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Borrower shall contribute the maximum portion that it is
permitted to pay and satisfy under applicable law, to the payment and
satisfaction of all indemnified liabilities incurred by the Indemnitees or
any of them.  The provisions of the undertakings and indemnification set out
in this SECTION 10.2 shall survive satisfaction and payment of the
Obligations and termination of this Agreement.

     10.3 CAPITAL ADEQUACY.  If the Lender shall reasonably determine  that the
application or adoption of any law, rule, regulation, directive, interpretation,
treaty or guideline regarding capital adequacy, or any change therein  or in the
interpretation or administration thereof, whether or not having the force or law
(including, without limitation, application of changes to Regulation H and
Regulation Y of the Federal Reserve Board issued by the Federal Reserve Board on
January 19, 1989 and regulations of the Comptroller of the Currency, Department
of the Treasury, 12 CFR Part 3, Appendix A, issued by the Comptroller of the
Currency on January 27, 1989) increases the amount of capital required or
expected to be maintained by the Lender or any Person controlling the Lender,
and such increase is based upon the existence of the Lender's obligations
hereunder and other commitments of this type, then from time to time, within 10
days after demand from the Lender, the Borrower shall pay to the Lender such
amount or amounts as will compensate the Lender or such controlling Person, as
the case may be, for such increased capital requirement.  The determination of
any amount to be paid by the Borrower under this SECTION 10 shall take into
consideration the policies of the Lender or  any Person controlling the Lender
with respect to capital adequacy and shall be based upon any  reasonable
averaging, attribution and allocation methods.  A certificate of the Lender
setting forth the amount or amounts as shall be necessary to compensate the
Lender as specified in this SECTION 10.3 shall be delivered to the Borrower and
shall be conclusive in the absence of manifest error.

                       ARTICLE XI  ADDITIONAL PROVISIONS

     Additional provisions are set forth in SUPPLEMENT A.

                             ARTICLE XII  GENERAL

     12.1 BORROWER'S WAIVER.  Except as otherwise provided for in this
Agreement, the Borrower waives (a) presentment, demand and protest and notice of
presentment, protest, default, non-payment, maturity, release, compromise,
settlement, one or more extensions or renewals of any or all commercial paper,
accounts, documents, instruments, chattel paper and guaranties at any time held
by the Lender on which the Borrower may in any way be liable and hereby ratifies
and confirms whatever the Lender may do in this regard; (b) all rights to notice
and a hearing prior to the Lender's taking possession or control of, or the
Lender's relevy, attachment or levy on or of, the Collateral or any bond or
security which might be required by any court prior to allowing the Lender to
exercise any of the Lender's remedies; and (c) the benefit of all valuation,
appraisement and exemption laws.  The Borrower acknowledges that it has been
advised by counsel of its choice with respect to this Agreement and the
transactions evidenced by this Agreement.


                                     48


<PAGE>


     12.2 EXPENSES; ATTORNEYS' FEES.  The Borrower agrees, whether or not any
Loan is made hereunder, to pay the Lender upon demand for all expenses and
Attorneys' Fees, including, without limitation, those incurred by the Lender in
connection with (a) the preparation, negotiation and execution of the Loan
Documents, (b) the preparation of any and all amendments to the Loan Documents
and all other instruments or documents provided for therein or delivered or to
be delivered thereunder or in connection therewith, (c) the collection or
enforcement of the Borrower's or any other Obligor's obligations under any of
the Loan Documents and (d) the collection or enforcement of any of the Lender's
rights in or to any Collateral or Third Party Collateral.  The Borrower also
agrees (y) to indemnify and hold the Lender harmless from any loss or expense
which may arise or be created by the acceptance of telephonic or other
instructions for making Loans and (z) to pay, and save the Lender harmless from
all liability for, any stamp or other taxes which may be payable with respect to
the execution or delivery of this Agreement or the issuance of any Note or of
any other instruments or documents provided for herein  or to be delivered
hereunder or in connection herewith.  The Borrower's foregoing obligations shall
survive any termination of this Agreement.

     12.3 LENDER FEES AND CHARGES.  The Borrower agrees to pay the Lender, or
any Affiliate, on demand, the customary fees and charges of the Lender, or such
Affiliate, for maintenance of accounts with the Lender, or such Affiliate, or
for providing other services to the Borrower.  The Lender may, in its sole and
absolute discretion, provide for such payment by charging the Disbursement
Account or any other account of the Borrower with FBNA or advancing the amount
thereof to the Borrower as a Loan.

     12.4 NO WAIVER BY LENDER; AMENDMENTS.  No failure or delay on the part of
the Lender in the exercise of any power or right, and no course of dealing
between the Borrower and the Lender shall operate as a waiver of such power or
right, nor shall any single or partial exercise of any power or right preclude
other or further exercise thereof or the exercise of any other power or right.
The remedies provided for herein are cumulative and not exclusive of any
remedies which may be available to the Lender at law or in equity.  No notice to
or demand on the Borrower not required hereunder shall in any event entitle the
Borrower to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the right of the Lender to any other or
further action in any circumstances without notice or demand.  No amendment,
modification or waiver of, or consent with respect to, any provision of this
Agreement shall in any event be effective unless the same shall be in writing
and signed and delivered by the Lender. Any waiver of any provision of this
Agreement, and any consent to any departure by the Borrower from the terms of
any provision of this Agreement, shall b effective only in the specific instance
and for the specific purpose for which given.

     12.5 NOTICE.  Except as otherwise expressly provided herein, any notice
hereunder to the Borrower or the Lender shall be in writing (including
telegraphic, telex, or telecopy communication) and shall be given to the
Borrower or the Lender at its address, telex number or fax number set forth on
the signature pages hereof or at such other address, telex number or telecopier
number as the Borrower or the Lender may, by written notice, designate as its
address, telex number or fax number for purposes of notice hereunder.  All such
notices shall be deemed to be given when transmitted by telex and the
appropriate answer back is received, transmitted by fax, delivered to the
telegraph office, delivered by courier, personally


                                      49

<PAGE>

delivered or, in the case of notice by mail, three days following deposit in
the United States mails, properly addressed as herein provided, with proper
postage prepaid.

     12.6 PARTICIPATIONS; INFORMATION.  The Borrower hereby consents to the
Lender's grant of participations in or sale, assignment, transfer or other
disposition, at any time and from time to time hereafter, of the Loan Documents,
or of any portion of any thereof, including without limitation lender's rights,
titles, interests, remedies, powers and/or duties.  The Lender may furnish any
information concerning the Borrower in the possession of the Lender from time to
time to assignees of the rights and/or obligations of the Lender hereunder and
to participants in any Loan (including prospective assignees and participants)
and may furnish information in response to credit inquiries consistent with
general banking practice.

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

     12.8 SUCCESSORS. This Agreement shall be binding upon the Borrower and the
Lender and their respective successors and assigns, and shall inure to the
benefit of the Borrower and the Lender and the successors and assigns of the
Lender.  The Borrower shall not assign its rights or duties hereunder without
the consent of the Lender.

     12.9 ENTIRE AGREEMENT.  This Agreement and the other Loan Documents embody
the entire agreement and understanding between the Borrower and the Lender with
respect to the subject matter hereof and thereof.  This Agreement supersedes all
prior agreements and understandings relating to the subject matter hereof.

     12.10     COUNTERPARTS.  This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and either of the parties hereto may execute this Agreement by
signing any such counterpart.

     12.11     CONSTRUCTION.  The Borrower acknowledges that this Agreement
shall not be binding upon the Lender or become effective until and unless
accepted by the Lender, in writing. If so accepted by the Lender, THE LOAN
DOCUMENTS AND ANY SUPPLEMENTAL DOCUMENTATION SHALL, UNLESS OTHERWISE EXPRESSLY
PROVIDED THEREIN, BE DEEMED TO HAVE BEEN NEGOTIATED AND ENTERED INTO IN, AND
SHALL BE GOVERNED AND CONTROLLED BY THE LAWS OF, THE STATE OF MINNESOTA AS TO
INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, CHOICE OF LAW, AND
IN ALL OTHER RESPECTS, INCLUDING, BUT NOT LIMITED TO, THE LEGALITY OF THE
INTEREST RATE AND OTHER CHARGES, BUT EXCLUDING PERFECTION OF SECURITY INTERESTS
AND LIENS WHICH SHALL BE GOVERNED AND CONTROLLED BY THE LAWS OF THE RELEVANT
JURISDICTION.

     12.12     CONSENT TO JURISDICTION.  To induce the Lender to accept this
Agreement, the Borrower, irrevocably, agrees that, subject to the Lender's sole
and absolute election, ALL ACTIONS OR PROCEEDINGS IN ANY WAY, MANNER OR RESPECT,
ARISING OUT OF OR FROM OR RELATED TO THE LOAN DOCUMENTS OR ANY SUPPLEMENTAL


                                      50

<PAGE>


DOCUMENTATION OR THE COLLATERAL SHALL BE LITIGATED IN COURTS HAVING SITUS WITHIN
THE CITY OF MINNEAPOLIS, STATE OF MINNESOTA.  THE BORROWER HEREBY CONSENTS AND
SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS LOCATED WITHIN
SAID CITY AND STATE AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON THE
BORROWER, AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY REGISTERED
MAIL DIRECTED TO THE BORROWER AT THE ADDRESS STATED ON THE SIGNATURE PAGE HEREOF
AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF.

     12.13     SUBSIDIARY REFERENCE.  Any reference herein to a Subsidiary or
Subsidiaries of the Borrower, and any financial definition, ratio, restriction
or other provision of this Agreement which is stated to be applicable to "the
Borrower" and the Subsidiaries, shall apply only to the extent the Borrower has
any Subsidiaries, and does not imply that the Borrower is permitted to have
Subsidiaries when this Agreement otherwise prohibits the existence of such
Subsidiaries.

     12.14     WAIVER OF JURY TRIAL.  THE BORROWER AND THE LENDER EACH WAIVES
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS (a) UNDER THE LOAN DOCUMENTS OR UNDER ANY AMENDMENT, INSTRUMENT,
DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN
CONNECTION THEREWITH OR (b) ARISING FROM ANY RELATIONSHIP EXISTING IN CONNECTION
WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE
TRIED BEFORE A COURT AND NOT BEFORE A JURY.

     12.15     OTHER BORROWER'S WAIVERS.  Each Borrower waives any and all
defenses, claims and discharges of any other Borrower, or any other Obligor,
except the defense of discharge by payment in full.  Without limiting the
generality of the foregoing, no Borrower will assert, plead or enforce against
the Lender any defense of waiver, release, discharge in bankruptcy, statute of
limitations, RES JUDICATA, statute of frauds, anti-deficiency statute, fraud,
usury, illegality or unenforceability which may be available to any other
Borrower or any other Person liable in respect of any Obligations, or any setoff
available against the Lender to any other Borrower or any such other Person,
whether or not on account of a related transaction. Each Borrower expressly
agrees that such Borrower shall be and remain liable for any deficiency
remaining after foreclosure of any mortgage or security interest securing the
Obligations, whether or not the liability of, or any other, Obligor for such
deficiency is discharged pursuant to statute, judicial decision or contract.
Each Borrower agrees that its liability under this Agreement shall be primary
and direct, and that the Lender shall not be required first to resort for
payment of the Obligations to any other Borrower or other Persons or their
properties, or first to enforce, realize upon or exhaust any collateral security
for the Obligations, or to commence any action or obtain any judgment against
any other Borrower or against any such collateral security or to pursue any
other right or remedy the Lender may have against any other Borrower, before
enforcing this Agreement against such Borrower.


                                      51

<PAGE>


     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first written above.

                         CRYENCO, INC.


                         By:___________________________________
                         Title:________________________________

                         Address:

                         Attention:
                         Telephone:
                         Fax No.:
















                                      52

<PAGE>


                                  CRYENCO SCIENCES, INC.


                                  By:___________________________________
                                  Title:__________________________________

                                  Address:

                                  Attention:
                                  Telephone:
                                  Fax No.:


                                  FBS BUSINESS FINANCE CORPORATION


                                  By:___________________________________
                                  Title:__________________________________

                                  Address: First Bank Place MPFP0804
                                    601 Second Avenue South
                                    Minneapolis, MN 55402-4302

                                  Attention:  Business Credit Division
                                  Telephone:  (612)
                                  Fax No.: (612) 973-0829













                                      53

<PAGE>

                                    EXHIBITS

Exhibit A    -    Form of Borrowing Base Certificate
Exhibit B    -    Form of Borrower's Opinion of Counsel
Exhibit C    -    Form of Insurance Endorsement
Exhibit D    -    Form of Restricted Access Lockbox; Collateral Account; and
                  Disbursement Account Agreement

                                    SCHEDULES

Schedule 4.1 -    Trade Names, Etc.
Schedule 4.7 -    Insurance
Schedule 4.8 -    Litigation and Contingent Liabilities
Schedule 4.9 -    Liens
Schedule 4.10-    Subsidiaries
Schedule 4.11-    Partnerships and Joint Ventures
Schedule 4.12-    Business Locations
Schedule 4.13-    Collateral Locations
Schedule 4.15-    Leases
Schedule 4.16-    Patents, Trademarks, Copyrights
Schedule 4.18-    Contracts and Labor Disputes
Schedule 4.25-    Environmental Matters
Schedule 6.10-    Investments
Schedule 6.11-    Indebtedness











                                      54


<PAGE>
                                SUPPLEMENT A
                                    to
                       CREDIT AND SECURITY AGREEMENT
                   Dated as of December 19, 1995 Between
              FBS BUSINESS FINANCE CORPORATION (the "LENDER")
                                    and
    CRYENCO, INC. and CRYENCO SCIENCES, INC. (collectively the "BORROWER")

     1.   CREDIT AGREEMENT REFERENCE.  This Supplement A, as it may be
amended or modified from time to time, is a part of the Credit and Security
Agreement, dated as of December 19, 1995, between the Borrower and the Lender
(together with all amendments, modifications and supplements thereto, the
"CREDIT AGREEMENT").  Capitalized terms used herein which are defined in the
Credit Agreement shall have the meanings given such terms in the Credit
Agreement unless the context otherwise requires.

     2.   DEFINITIONS.

          2.1  CREDIT AMOUNTS.

                    (a) CREDIT AMOUNT.  The term "Credit Amount" shall mean the
                    maximum amount of Loans which the Lender will make available
                    to the Borrower which amount shall not exceed Twelve Million
                    Nine Hundred Sixty Thousand and No/100ths ($12,960,000);
                    PROVIDED, HOWEVER, that the aggregate outstanding principal
                    balance of the Loans PLUS the Letter of Credit Obligations
                    shall not exceed the Credit Amount.

                    (b)  REVOLVING CREDIT AMOUNT.  The term "Revolving Credit
                    Amount" shall mean: (i) from the Closing Date until December
                    31, 1997, $9,000,000; and (ii) from December 31, 1997
                    through the Termination Date, $10,000,000, PROVIDED,
                    HOWEVER, that the aggregate outstanding principal balance of
                    the Revolving Loans PLUS the Letter of Credit Obligations
                    shall not exceed the Revolving Credit Amount.

          2.2  BORROWING BASE.

               (a) DEFINITION.  The term "Borrowing Base" shall mean:

                    (i) an amount (the "ACCOUNTS RECEIVABLE AVAILABILITY") of up
               to 85% of the net amount (as determined by the Lender after
               deduction of such reserves and allowances as the Lender deems
               proper and necessary) of the Borrower's Eligible Accounts
               Receivable (such dollar amount, as adjusted from time to time, is
               hereinafter called the "ACCOUNTS RECEIVABLE AVAILABILITY
               SUBLIMIT"); PLUS

                    (ii) an amount (the "INVENTORY AVAILABILITY") of up to the
               lesser of (1) $5,600,000 or (2)(x) 60% of the net value (the
               lower of the cost, determined on a first in first out basis, or
               market value) of the finished

<PAGE>

               goods and raw materials components of Borrower's Eligible
               Inventory, as determined by the Lender after deduction of such
               reserves and allowances as the Lender deems proper and necessary,
               plus (y)  60% of the net value (the lower of the cost, determined
               on a first in first out basis, or market value) of the finished
               goods and raw materials components of Borrower's Costs, as
               determined by the Lender after deduction of such reserves and
               allowances as the Lender deems proper and necessary (and after
               deduction of any amount included in the Borrower's Costs which
               represents labor or overhead), plus (z) 15% of the net value (the
               lower of the cost, determined on a first in first out basis, or
               market value) of the materials component of the work-in-process
               component of the Borrower's Inventory and Costs (which materials
               component is identified as the "total material cost" included in
               the actual costs incurred for all jobs in progress, as shown on
               the Borrower's job status report prepared at the end of each
               month), as determined by the Lender after deduction of such
               reserves and allowances as the Lender deems proper and necessary
               (and after deduction of any amount included in the Borrower's
               Costs which represents labor or overhead), as adjusted as
               hereafter provided in SECTION 2.2(b) hereof (such dollar amount,
               as adjusted from time to time, is hereinafter called the
               "INVENTORY AVAILABILITY SUBLIMIT"); PLUS

                    (iii) an amount (the "EQUIPMENT AVAILABILITY") of up to the
               lesser of (1) 100% of the forced liquidation value (as determined
               by the Lender after deduction of such reserves and allowances as
               the Lender deems proper and necessary) of the Borrower's now
               owned Eligible Equipment or (2) $1,364,800 as adjusted as
               hereafter provided in SECTION 2.2(B) hereof (such dollar amount,
               as adjusted from time to time, is herein called the "EQUIPMENT
               AVAILABILITY SUBLIMIT").

               (b) AVAILABILITY ADJUSTMENTS.

                    (i) Inventory.  On December 31, 1997, the Inventory
               Availability Sublimit shall increase to $6,600,000.

                    (ii) Equipment.  On September 1, 1996, the Equipment
               Availability Sublimit shall reduce to the lesser of (i) 80% of
               the forced liquidation value (as determined by the Lender after
               deduction of such reserves and allowances as the Lender deems
               proper and necessary) of the Borrower's now owned Eligible
               Equipment or $1,091,840.  On the fifteenth day of each month
               beginning September 15, 1996, the Equipment Availability Sublimit
               shall further reduce by one thirty-sixth (1/36) of the amount of
               the Equipment Availability Sublimit on September 1, 1996, until
               the Equipment Availability Sublimit is zero unless the Lender, in
               its sole discretion, agrees to adjust or terminate such
               reductions.

                                       2

<PAGE>

          2.3  LETTER OF CREDIT SUBLIMIT.  The term "Letter of Credit Sublimit"
     shall mean $500,000.

          2.4  TERMINATION DATE.  The term "Termination Date" shall mean
     December 31, 1998.

          2.5  TERM LOAN AVAILABILITY.  The term "Term Loan Availability" shall
     mean an amount of up to the lesser of (1) 80% of the lower of the cost or
     the forced liquidation value (as determined by the Lender after deduction
     of such reserves and allowances as the Lender deems proper and necessary)
     of the Borrower's hereafter acquired Eligible Equipment or (2) $2,960,000.

          2.6  ADDITIONAL DEFINITIONS.  As used herein, the following terms
     shall have the following respective meanings:

               "ADJUSTED CD RATE":  With respect to the Term Loan if the
          Borrower elects to fix the interest rate, the interest rate per annum
          equal to the sum (rounded upward, if necessary, to the next one
          hundredth of one percent) of (a) the rate per annum obtained by
          dividing (i) the CD Rate then in effect, by (ii) 1.00 minus the
          Domestic Reserve Percentage, PLUS (b) the annual rate most recently
          estimated by FBNA as the then current net annual assessment rate
          payable by FBNA to the Federal Deposit Insurance Corporation (or any
          successor) for insuring time deposits made in dollars at FBNA's
          domestic offices, PLUS (c) the cost (converted to an equivalent rate
          per annum) of the customary brokerage fees incurred by FBNA in
          obtaining funds by the sale of its negotiable certificates of deposit.

               "ADJUSTED EURODOLLAR RATE":  With respect to each Interest Period
          applicable to a Eurodollar Rate Advance, the rate (rounded upward, if
          necessary, to the next one hundredth of one percent) determined by
          dividing the Eurodollar Rate for such Interest Period by 1.00 minus
          the Eurodollar Reserve Percentage.

               "ADVANCE":  Any portion of the outstanding principal balance of
          the Revolving Loans as to which the Borrower elected one of the
          available interest rate options and, if applicable, an Interest
          Period.  An Advance may be a Eurodollar Rate Advance or a Reference
          Rate Advance.

               "APPLICABLE MARGIN":  The term "Applicable Margin" shall mean:
          (1) the Initial Applicable Margin through February 29, 1996 and
          thereafter if the Cash Flow Leverage Ratio (as described in Section
          9.2 below) is greater than or equal to 2.5:1 but less than or equal to
          3.25:1 at the end of the fiscal quarter then ended (beginning with the
          fiscal quarter ending February 29, 1996); (2) the Reduced Applicable
          Margin if the Cash Flow Leverage Ratio (as described in Section 9.2
          below) is less than 2.5:1 at the end of the fiscal quarter then ended
          (beginning with the fiscal quarter ending February 29, 1996); and (3)
          the Increased Applicable Margin if the Cash Flow Leverage Ratio (as
          described in

                                       3

<PAGE>

          Section 9.2 below) is greater than 3.25:1 at the end of the fiscal
          quarter then ended (beginning with the fiscal quarter ending
          February 29, 1996).  As used in this definition, the following
          terms shall have the following respective meanings:

                    "INCREASED APPLICABLE MARGIN":  With respect to:

                    (a) Reference Rate Advances -- 1.0%,

                    (b) Eurodollar Rate Advances -- 3.5%.

                    "INITIAL APPLICABLE MARGIN":  With respect to:

                    (a) Reference Rate Advances -- 0.5%,

                    (b) Eurodollar Rate Advances -- 3.0%.

                    "REDUCED APPLICABLE MARGIN":  With respect to:

                    (a) Reference Rate Advances -- 0.%,

                    (b) Eurodollar Rate Advances -- 2.5%.

               "BOARD":  The Board of Governors of the Federal Reserve System or
          any successor thereto.

               "CD RATE":  With respect to the Term Loan if the Borrower elects
          to fix the interest rate, the rate of interest determined by FBNA for
          the remaining term of the Term Loan, to be the average (rounded
          upward, if necessary, to the nearest 1/100th of 1%) of the rates
          quoted to FBNA (at approximately the time of the Borrower's request to
          fix the interest rate paid with respect to the Term Loan) by
          certificate of deposit dealers selected by FBNA, in its sole
          discretion, for the purchase from FBNA, at face value, of certificates
          of deposit issued by FBNA in an amount and maturity comparable to the
          then remaining principal balance and then remaining term of the Term
          Loan, or at the option of FBNA, determined for such amount and
          maturity based on published composite quotations of certificate of
          deposit rates selected by FBNA.

               "DOMESTIC RESERVE PERCENTAGE":  As of any day, that percentage
          (expressed as a decimal) which is in effect on such day, as prescribed
          by the Board for determining the maximum reserve requirement
          (including without limitation, any basic, supplemental or emergency
          reserves) for a member bank of the Federal Reserve System, with
          deposits comparable in amount to those held by FBNA, in respect of new
          non-personal time deposits in dollars having a maturity comparable to
          the then remaining term of the Term Loan and in an amount of $100,000
          or more. The rate of interest applicable to the Term Loan shall be
          adjusted automatically on and as of the effective date of any change
          in the Domestic Reserve Percentage.

                                       4

<PAGE>

               "EURODOLLAR BUSINESS DAY":  A Business Day which is also a day
          for trading by and between Lenders in United States dollar deposits in
          the interbank Eurodollar market and a day on which banks are open for
          business in New York City.

               "EURODOLLAR RATE":  With respect to each Interest Period
          applicable to a Eurodollar Rate Advance, the interest rate per annum
          (rounded upward, if necessary, to the next one-sixteenth of one
          percent) at which United States dollar deposits are offered to the
          Lender in the interbank Eurodollar market two Eurodollar Business Days
          prior to the first day of such Interest Period for delivery in
          Immediately Available Funds on the first day of such Interest Period
          and in an amount approximately equal to the Advance to which such
          Interest Period is to apply as determined by the Lender and for a
          maturity comparable to the Interest Period; PROVIDED, that in lieu of
          determining the rate in the foregoing manner, the Lender may
          substitute the per annum Eurodollar interest rate (LIBOR) for United
          States dollars displayed on the Reuters Screen LIBO Page two
          Eurodollar Business Days prior to the first day of the Interest
          Period. "Reuters Screen LIBO Page" means the display designated as
          page "LIBO" on the Reuter Monitor Money Rates Screen (or such other
          page as may replace the LIBO page on that service) for the purpose of
          displaying London Interbank offered rates of major Lenders for United
          States dollar deposits.

               "EURODOLLAR RATE ADVANCE":  An Advance with respect to which the
          interest rate is determined by reference to the Adjusted Eurodollar
          Rate.

               "EURODOLLAR RESERVE PERCENTAGE":  As of any day, that percentage
          (expressed as a decimal) which is in effect on such day, as prescribed
          by the Board for determining the maximum reserve requirement
          (including any basic, supplemental or emergency reserves) for a member
          Lender of the Federal Reserve System, with deposits comparable in
          amount to those held by the Lender, in respect of "Eurocurrency
          Liabilities" as such term is defined in Regulation D of the Board. The
          rate of interest applicable to any outstanding Eurodollar Rate
          Advances shall be adjusted automatically on and as of the effective
          date of any change in the Eurodollar Reserve Percentage.

               "INTEREST PERIOD":  With respect to each Eurodollar Rate Advance,
          the period commencing on the date of such Advance or on the last day
          of the immediately preceding Interest Period, if any, applicable to an
          outstanding Advance and ending one, two, three or six months
          thereafter, as the Borrower may elect in the applicable notice of
          borrowing, continuation or conversion; PROVIDED THAT:

                         (1)  Any Interest Period that would otherwise end on a
                    day which is not a Eurodollar Business Day shall be extended
                    to the next succeeding Eurodollar Business Day unless such
                    Eurodollar Business Day falls in another calendar month, in
                    which case such Interest Period

                                       5

<PAGE>

                    shall end on the next preceding Eurodollar Business Day;

                         (2)  Any Interest Period that begins on the last
                    Eurodollar Business Day of a calendar month (or a day for
                    which there is no numerically corresponding day in the
                    calendar month at the end of such Interest Period) shall end
                    on the last Eurodollar Business Day of a calendar month; and

                         (3)  Any Interest Period that would otherwise end after
                    the Termination Date shall end on the Termination Date.

               "REFERENCE RATE ADVANCE":  An Advance with respect to which the
          interest rate is determined by reference to the Reference Rate.

               "REGULATORY CHANGE":  Any change after the date of the Credit
          Agreement in federal, state or foreign laws or regulations or the
          adoption or making after such date of any interpretations, directives
          or requests applying to a class of Lenders including the Lender under
          any federal, state or foreign laws or regulations (whether or not
          having the force of law) by any court or governmental or monetary
          authority charged with the interpretation or administration thereof.

     3.   REVOLVING LOANS.

          3.1  PROCEDURE FOR ADVANCES.  Any request for an Advance must be given
     so as to be received by the Lender not later than 1:00 p.m. (Minneapolis
     time) two Eurodollar Business Days prior to the date of the requested
     Advance if the Advance is requested as a Eurodollar Rate Advance and not
     later than 1:00 p.m. on the date of the requested Advance if the Advance is
     requested as a Reference Rate Advance.  Each request for an Advance shall
     specify (i) the date of the Advance, (ii) the amount of the Advance to be
     made on such date which shall be in a minimum amount of $500,000 for
     Eurodollar Rate Advances or, if more in the case of Eurodollar Rate
     Advances, an integral multiple of $500,000, (iii) whether such Advance is
     to be funded as a Reference Rate Advance or a Eurodollar Rate Advance, and
     (iv) in the case of a Eurodollar Rate Advance, the duration of the initial
     Interest Period applicable thereto.

          3.2  CONVERSIONS AND CONTINUATIONS.  On the terms and subject to the
     limitations hereof, the Borrower shall have the option at any time and from
     time to time to convert all or any portion of the Advances into Reference
     Rate Advances or Eurodollar Rate Advances, or to continue a Eurodollar Rate
     Advance as such; provided, however that a Eurodollar Rate Advance may be
     converted or continued only on the last day of the Interest Period
     applicable thereto and no Advance may be converted or continued as a
     Eurodollar Rate Advance if a Default or Event of Default has occurred and
     is continuing on the proposed date of continuation or conversion.  Advances
     may be converted to, or continued as, Eurodollar Rate Advances only in
     amounts of $500,000 or an integral multiple thereof.  The Borrower shall
     give the Lender written notice of any continuation or conversion of any
     Advance and such

                                       6

<PAGE>

     notice must be given so as to be received by the Lender not later than
     3:00 p.m. (Minneapolis time) two Eurodollar Business Days prior to
     requested date of conversion or continuation in the case of the
     continuation of, or conversion to, a Eurodollar Rate Advance.  Each such
     notice shall specify (a) the amount to be continued or converted, (b) the
     date for the continuation or conversion (which must be (i) the last day of
     the preceding Interest Period for any continuation or conversion of
     Eurodollar Rate Advances, and (ii) a Eurodollar Business Day), and (c) in
     the case of conversions to or continuations as Eurodollar Rate Advances,
     the Interest Period applicable thereto.  Any notice given by the Borrower
     under this Section shall be irrevocable.  If the Borrower shall fail to
     notify the Lender of the continuation of any Eurodollar Rate Advance within
     the time required by this Section, such Advance shall, on the last day of
     the Interest Period applicable thereto, automatically be converted into a
     Reference Rate Advance of the same principal amount.

          3.3  INTEREST RATES, INTEREST PAYMENTS AND DEFAULT INTEREST.  Interest
     shall accrue and be payable on the Advances as follows:

               (a)  Each Eurodollar Rate Advance shall bear interest on the
          unpaid principal amount thereof during the Interest Period applicable
          thereto at a rate per annum equal to the sum of (i) the Adjusted
          Eurodollar Rate for such Interest Period, plus (ii) the Applicable
          Margin.

               (b)  Each Reference Rate Advance shall bear interest on the
          unpaid principal amount thereof at a varying rate per annum equal to
          the sum of (i) the Reference Rate, plus (ii) the Applicable Margin.

               (c)  Any Advance not paid when due, whether at the date scheduled
          therefor or earlier upon acceleration, shall bear interest until paid
          in full (i) during the balance of any Interest Period applicable to
          such Advance, at a rate per annum equal to the sum of the rate
          applicable to such Advance during such Interest Period plus 2.0%, and
          (ii) otherwise, at a rate per annum equal to the sum of (A) the
          Reference Rate, plus (B) the Applicable Margin for Reference Rate
          Advances, plus (C) 2.0%.

               (d)  Interest shall be payable (i) with respect to each
          Eurodollar Rate Advance having an Interest Period of three months or
          less, on the last day of the Interest Period applicable thereto; (ii)
          with respect to any Eurodollar Rate Advance having an Interest Period
          greater than three months, on the last day of the Interest Period
          applicable thereto and on each day that would have been the last day
          of the Interest Period for such Advance had successive Interest
          Periods of three months duration been applicable to such Advance;
          (iii) with respect to any Reference Rate Advance, on the fifteenth
          (15) day of each month beginning January 15, 1996; (iv) with respect
          to all Advances, upon any permitted prepayment (on the amount
          prepaid); and (v) with respect to all Advances, on the Termination
          Date; provided that interest under Section 3.3 (c) shall be payable on
          demand.

                                       7

<PAGE>

          3.4  OPTIONAL PREPAYMENTS.   The Borrower may prepay Reference Rate
     Advances, in whole or in part, at any time, without premium or penalty
     except in the case of termination or cancellation of the Credit by the
     Borrower, in which event a credit termination fee shall be due and payable
     in accordance with Section 5.4.  Except upon an acceleration following an
     Event of Default or upon termination of the Credit in whole, the Borrower
     may pay Eurodollar Rate Advances only on the last day of the Interest
     Period applicable thereto.  Amounts paid (unless following an acceleration
     or upon termination of the Credit in whole) or prepaid on Advances under
     this Section 3.4 may be reborrowed upon the terms and subject to the
     conditions and limitations of the Credit Agreement.

          3.5  INTEREST RATE NOT ASCERTAINABLE, ETC.  If, on or prior to the
     date for determining the Adjusted Eurodollar Rate in respect of the
     Interest Period for any Eurodollar Rate Advance, the Lender determines
     (which determination shall be conclusive and binding, absent error) that:

               (a)  deposits in dollars (in the applicable amount) are not being
          made available to the Lender in the relevant market for such Interest
          Period, or

               (b)  the Adjusted Eurodollar Rate will not adequately and fairly
          reflect the cost to the Lender of funding or maintaining Eurodollar
          Rate Advances for such Interest Period,

     the Lender shall forthwith give notice to the Borrower of such
     determination, whereupon the obligation of the Lender to make or continue,
     or to convert any Advances to, Eurodollar Rate Advances, as the case may
     be, shall be suspended until the Lender notifies the Borrower that the
     circumstances giving rise to such suspension no longer exist.  While any
     such suspension continues, all further Advances by the Lender shall be made
     as Reference Rate Advances.  No such suspension shall affect the interest
     rate then in effect during the applicable Interest Period for any
     Eurodollar Rate Advance outstanding at the time such suspension is imposed.

          3.6  INCREASED COST.  If any Regulatory Change:

               (a)  shall subject the Lender to any tax, duty or other charge
          with respect to its Eurodollar Rate Advances, its obligation to make
          Eurodollar Rate Advances or shall change the basis of taxation of
          payment to the Lender of the principal of or interest on Eurodollar
          Rate Advances or any other amounts due under this Agreement in respect
          of Eurodollar Rate Advances or its obligation to make Eurodollar Rate
          Advances (except for changes in the rate of tax on the overall net
          income of the Lender imposed by the jurisdiction in which the Lender's
          principal office is located); or

               (b)  shall impose, modify or deem applicable any reserve, special
          deposit, capital requirement or similar requirement (including,
          without limitation, any such requirement imposed by the Board, but
          excluding with respect to any Eurodollar Rate Advance any such
          requirement to the extent included in

                                       8

<PAGE>


          calculating the applicable Adjusted Eurodollar Rate) against assets
          of, deposits with or for the account of, or credit extended by, the
          Lender or shall impose on the Lender or on the interbank Eurodollar
          market any other condition affecting its Eurodollar Rate Advances or
          its obligation to make Eurodollar Rate Advances;

     and the result of any of the foregoing is to increase the cost to the
     Lender of making or maintaining any Eurodollar Rate Advance, or to reduce
     the amount of any sum received or receivable by the Lender under this
     Agreement or under the Note, then, within 30 days after demand by the
     Lender, the Borrower shall pay to the Lender such additional amount or
     amounts as will compensate the Lender for such increased cost or reduction.
     The Lender will promptly notify the Borrower of any event of which it has
     knowledge, occurring after the date hereof, which will entitle the Lender
     to compensation pursuant to this Section.  A certificate of the Lender
     claiming compensation under this Section, setting forth the additional
     amount or amounts to be paid to it hereunder and stating in reasonable
     detail the basis for the charge and the method of computation, shall be
     conclusive in the absence of error.  In determining such amount, the Lender
     may use any reasonable averaging and attribution methods.  Failure on the
     part of the Lender to demand compensation for any increased costs or
     reduction in amounts received or receivable with respect to any Interest
     Period shall not constitute a waiver of the Lender's rights to demand
     compensation for any increased costs or reduction in amounts received or
     receivable in any subsequent Interest Period.

          3.7  ILLEGALITY.  If any Regulatory Change shall make it unlawful or
     impossible for the Lender to make, maintain or fund any Eurodollar Rate
     Advances, the Lender shall notify the Borrower, whereupon the obligation of
     the Lender to make or continue, or to convert any Advances to, Eurodollar
     Rate Advances shall be suspended until the Lender notifies the Borrower
     that the circumstances giving rise to such suspension no longer exist.  If
     the Lender determines that it may not lawfully continue to maintain any
     Eurodollar Rate Advances to the end of the applicable Interest Periods, all
     of the affected Advances shall be automatically converted to Reference Rate
     Advances as of the date of the Lender's notice, and upon such conversion
     the Borrower shall indemnify the Lender in accordance with Section 3.8.

          3.8  FUNDING LOSSES; EURODOLLAR RATE ADVANCES.  The Borrower shall
     compensate the Lender, upon its written request, for all losses, expenses
     and liabilities (including any interest paid by the Lender to lenders of
     funds borrowed by it to make or carry Eurodollar Rate Advances to the
     extent not recovered by the Lender in connection with the re-employment of
     such funds and including loss of anticipated profits) which the Lender may
     sustain:  (i) if for any reason, other than a default by the Lender, a
     funding of a Eurodollar Rate Advance does not occur on the date specified
     therefor in the Borrower's request or notice as to such Advance under
     Section 3.1 or 3.2, or (ii) if, for whatever reason (including, but not
     limited to, acceleration of the maturity of Advances following an Event of
     Default), any repayment of a Eurodollar Rate Advance, or a conversion
     pursuant to Section 3.7, occurs on any day other than the last day of the
     Interest Period applicable thereto.  The Lender's request for

                                       9

<PAGE>

     compensation shall set forth the basis for the amount requested and shall
     be final, conclusive and binding, absent error.

          3.9  DISCRETION OF LENDER AS TO MANNER OF FUNDING.  The Lender shall
     be entitled to fund and maintain its funding of Eurodollar Rate Advances in
     any manner it may elect, it being understood, however, that for the
     purposes of this Agreement all determinations hereunder (including, but not
     limited to, determinations under Section 3.8, but excluding determinations
     that the Lender may elect to make from the Telerate System, Inc. screen)
     shall be made as if the Lender had actually funded and maintained each
     Eurodollar Rate Advance during the Interest Period for such Advance through
     the purchase of deposits having a maturity corresponding to the last day of
     the Interest Period and bearing an interest rate equal to the Eurodollar
     Rate for such Interest Period.

          3.10 OVERDRAFT LOANS; OVER ADVANCES.  Overdraft Loans and Over
     Advances shall bear interest at the rate(s) determined pursuant to
     SECTION 2.7 or SECTION 2.8 of the Credit Agreement, as applicable.

     4.   TERM LOAN.

          4.1  PROCEDURE FOR TERM LOAN ADVANCES.  Any request for an advance
     under the Term Loan must be given so as to be received by the Lender not
     later than 1:00 p.m. (Minneapolis time) on the date of the requested
     advance.  Each request for a Term Loan advance shall: (i) specify the date
     of the advance, (ii) specify the amount of the advance to be made on such
     date which shall be in a minimum amount of $25,000, and (iii) be
     accompanied by evidence satisfactory to the Lender as to the purchase price
     or value of Eligible Equipment hereafter acquired by the Borrower.

          4.2  INTEREST.  The unpaid principal balance of the Term Loan shall
     bear interest to maturity at the Reference Rate in effect from time to time
     plus 0.75% per annum. On the terms and subject to the limitations hereof,
     the Borrower shall have the option between August 31 and September 15,
     1996, to convert the basis for calculating interest on the Term Loan from a
     floating Reference Rate basis, to a fixed rate of interest equal to the
     then existing Adjusted CD Rate as determined by FBNA, plus 3.5%.  The
     Borrower shall give the Lender written notice of its election to exercise
     said option not later than 3:00 p.m. (Minneapolis time) two Business Days
     prior to the requested date of conversion and in no event later than 3:00
     p.m. (Minneapolis time) on September 12, 1996.  Such notice shall specify
     the date for the continuation or conversion (which must be not later than
     September 15, 1996).  Any notice given by the Borrower under this Section
     shall be irrevocable.  If the Borrower shall fail to notify the Lender of
     its election to convert the Term Loan to a fixed rate loan, the option of
     the Borrower pursuant to this Section shall expire and interest on the Term
     Loan shall continue to accrue at the Reference Rate in effect from time to
     time plus 0.75% per annum.

          4.3  PAYMENTS.  Interest on the Term Loan shall be due and payable in
     arrears on the first (1st) day of each month for interest then accrued.  No
     principal shall

                                       10

<PAGE>

     be due and payable until September 15, 1996.  Commencing on September 15,
     1996, the Borrower shall pay on the fifteenth (15th) day of each month,
     one forty-eighth (1/48) of the outstanding principal balance of the Term
     Loan on September 1, 1996.

          4.4  PREPAYMENTS; FUNDING LOSSES.  Subject to the remainder of this
     Section, the Term Loan may be prepaid in whole or in part at any time
     without premium or penalty.  If the Borrower has elected to convert the
     basis for calculating interest on the Term Loan from a floating Reference
     Rate basis to a fixed rate of interest based on the Adjusted CD Rate, then
     in the event of any prepayment or in the event of the acceleration of the
     maturity of the Term Loan following an Event of Default, the Borrower shall
     compensate the Lender, upon its written request, for all losses, expenses
     and liabilities which the Lender may sustain as a result of such prepayment
     or acceleration.  The Lender's request for compensation shall set forth the
     basis for the amount requested and shall be final, conclusive and binding,
     absent error.

     5.   FEES.

          5.1  FACILITY FEE.  The Borrower shall pay to the Lender on the
     Closing Date a facility fee of $32,400.

          5.2  NON-USE FEE.  The Borrower shall pay to the Lender a non-use fee
     for the period from the earlier to occur of the Closing Date or December
     29, 1995 to the date the Credit terminates in an amount equal to 0.25% per
     annum on the average daily Unused Revolving Credit Amount, which non-use
     fee shall be payable quarterly in arrears on the first (1st) day of the
     month following the close of each quarter, beginning with the quarter
     ending March 31, 1996.

          5.3  LETTER OF CREDIT FEES.  The Borrower shall pay the Lender, or any
     Affiliate, a commission on the undrawn amount of each Letter of Credit and
     on each L/C Draft accepted by the Lender, or such Affiliate, in an amount
     equal to 2.0% per annum for a stand-by Letter of Credit or 1.5% for a
     documentary Letter of Credit.

          5.4  CREDIT TERMINATION FEE.  Upon termination or cancellation of the
     Credit by the Borrower, the Borrower shall pay to the Lender a termination
     fee in an amount equal to (a) two percent (2%) of the Revolving Credit
     Amount in the event that the Credit is terminated or cancelled by the
     Borrower during the period from the date hereof through the two year
     anniversary of such date, and (b) one percent (1%) of the Revolving Credit
     Amount thereafter, PROVIDED, HOWEVER, that no termination fee shall be due
     or payable for six (6) months after the Lender has demanded from the
     Borrower such amount or amounts as will compensate the Lender for increased
     capital requirements as set forth in SECTION 10.3 of the Credit Agreement.

     6.   ELIGIBLE ACCOUNT RECEIVABLE REQUIREMENTS.  The Account Receivable
must not be unpaid on the date that is 91 days after the date of the invoice
evidencing such Account Receivable.  If invoices representing 10% or more of
the unpaid amount of all Accounts Receivable from any one Account Debtor are
unpaid more than 90 days after the dates of such invoices, then all Accounts
Receivable relating to such Account Debtor shall

                                      11

<PAGE>

cease to be Eligible Accounts Receivable. Accounts Receivable owed by Jack B.
Kelley, Inc. and which exceed more than forty percent (40%) of the aggregate
amount of all Accounts Receivable, shall not be deemed Eligible Accounts
Receivable.  Accounts Receivable owed by Jack B. Kelley, Inc. and which do
not exceed more than forty percent (40%) of the aggregate amount of all
Accounts Receivable, shall not be deemed Eligible Accounts Receivable unless
Jack B. Kelley, Inc. has executed and delivered an agreement waiving any and
all rights of offset which Jack B. Kelley, Inc. might otherwise have with
respect to such Accounts Receivable, which agreement shall be in form and
substance satisfactory to the Lender.

     7.   ELIGIBLE INVENTORY REQUIREMENTS. None other than as stated in the
Credit Agreement.

     8.   ELIGIBLE EQUIPMENT REQUIREMENTS.  Only Equipment to be used
directly in the Borrower's manufacturing operations shall constitute Eligible
Equipment Without limiting the generality of the foregoing, office Equipment
shall not constitute Eligible Equipment.

     9.   ADDITIONAL COVENANTS.  From the date of the Credit Agreement and
thereafter until all of the Borrower's Obligations under the Credit Agreement
are paid in full, the Borrower agrees that, unless the Lender shall otherwise
consent in writing, it will not do any of the following:

          9.1  BOOK NET WORTH.  Permit the consolidated Book Net Worth of the
     Borrower to be less than $10,750,000 at any time during the Borrower's 1996
     fiscal year. Permit the consolidated Book Net Worth of the Borrower at any
     time during the Borrower's 1997 fiscal year to be less than $10,750,000
     plus 50% of the Borrower's 1996 consolidated net income after taxes plus
     100% of all other equity increases during the Borrower's 1996 fiscal year
     (without reduction for net losses or for other equity decreases during the
     Borrower's 1996 fiscal year).  Permit the consolidated Book Net Worth of
     the Borrower at any time during the Borrower's 1998 fiscal year to be less
     than $10,750,000 plus 50% of the Borrower's 1996 and 1997 consolidated net
     income after taxes plus 100% of all other equity increases during the
     Borrower's 1996 and 1997 fiscal years (without reduction for net losses or
     for other equity decreases during the Borrower's 1996 or 1997 fiscal
     years).   Permit the consolidated Book Net Worth of the Borrower at any
     time during the Borrower's 1999 fiscal year to be less than $10,750,000
     plus 50% of the Borrower's 1996, 1997 and 1998 consolidated net income
     after taxes plus 100% of all other equity increases during the Borrower's
     1996, 1997 and 1998 fiscal years (without reduction for net losses or for
     other equity decreases during the Borrower's 1996, 1997 or 1998 fiscal
     years).

          9.2  CASH FLOW LEVERAGE RATIO.  Permit the ratio, as of the last day
     of any fiscal quarter, of the consolidated interest bearing debt of the
     Borrower, to the consolidated EBITDA of the Borrower during the four
     consecutive fiscal quarters then ending, to exceed 4.5:1.

          9.3  FIXED CHARGE COVERAGE RATIO.  Permit the ratio, as of the last
     day of any fiscal quarter, of the consolidated EBITDA of the Borrower
     during the four

                                       12

<PAGE>

     consecutive fiscal quarters then ending, to the sum of their consolidated
     unfinanced capital expenditures, cash taxes, interest payments, dividends
     and mandatory debt retirement payments during the four consecutive fiscal
     quarters then ending, to be less than: (a) 1.1:1 through August 31, 1996;
     (b) 1.15:1  thereafter through August 31, 1997; (c) 1.2:1 thereafter;
     PROVIDED, HOWEVER, that during fiscal year 1996, instead of testing the
     Fixed Charge Coverage Ratio quarterly based on the consecutive four fiscal
     quarters then ending, said ratio shall be tested quarterly based on actual
     year to date results beginning with the fiscal quarter ending February 29,
     1996.

          9.4  CAPITAL EXPENDITURES.  Make consolidated Capital Expenditures
     and/or acquire the use of property pursuant to operating leases, if the
     aggregate amount of such Capital Expenditures, plus the value of such
     property to be used pursuant to any such operating lease exceeds the
     following amounts for the following periods: (a) $3,700,000 during the 1996
     fiscal year, (b) $6,500,000 during the 1997 fiscal year, or (c) $4,500,000
     during the 1998 fiscal year; PROVIDED, HOWEVER, that if the consolidated
     Fixed Charge Coverage Ratio of the Borrower is not at least 1.25:1 at the
     end of the 1996 fiscal year, then the $6,500,000 figure above shall be
     changed to $1,500,000, and PROVIDED FURTHER, that if the consolidated Fixed
     Charge Coverage Ratio of the Borrower is not at least 1.25:1 at the end of
     the 1997 fiscal year, then the $4,500,000 figure above shall be changed to
     $1,500,000.


Borrower's Initials  __________
Lender's Initials  ____________
Date  _________________________

                                       13