CONSULTING AGREEMENT

     THIS  CONSULTING  AGREEMENT  (the  "Agreement")  is  made  and entered into
effective  as  of  July  1,  1998,  by  and  between  Chancellor  Corporation, a
Massachusetts  corporation,  having  a  principal  business address at 210 South
Street,  Boston,  MA 02111 (the "Company"), and VMI Corporation, a Massachusetts
corporation,  having  a  principal business address at 405 Waltham Street, Suite
304,  Lexington,  MA  02173  (the  "Consultant").

     WHEREAS,  the  Company  desires that the Consultant provide certain general
business  consulting  services  to  the  Company,  including,  but certainly not
limited  to,  identification,  review  and analysis of potential acquisition and
merger  candidates  and capital formation, on the terms and conditions contained
in this Agreement, and the Consultant wishes to provide such consulting services
on  the  terms  and  conditions  contained  in  this  Agreement;

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
contained  herein,  the Company and the Consultant, each intending to be legally
bound  hereby,  agree  as  follows:

     1.  RETENTION  OF  CONSULTANT.  Subject to the terms and conditions of this
Agreement,  the  Company  hereby  retains  the  Consultant to perform consulting
services  in  accordance with Section 3 hereof, and the Consultant hereby agrees
to  render  such  services.

     2.  TERM.

(a)  Unless  otherwise  terminated  in  accordance  with  Section 10 hereof, the
Consultant  shall  perform the duties and services specified herein for a period
commencing on the date hereof (the "Effective Date") and ending on July 1, 2001.
The  period  during which the Consultant is obligated to perform such duties and
services,  as  the  same  may  be  reduced by termination pursuant to Section 11
hereof,  is  referred  to  herein  as  the  "Consulting  Term."

(b)  The Consulting Term of this Agreement may automatically extend for a period
of  two  (2) years if the Company achieves profitability from operations for two
(2)  out  of  the three (3) fiscal years ending (1998, 1999 and 2000) during the
Consulting  Term.  The  Consulting Term of this Agreement may also automatically
extend  for a period of two (2) years if an event whereby any new person (within
the  meaning  of  Section 13(b) of the 1934 Securities Exchange Act) becomes the
beneficial  owner  (directly  or  indirectly)  of  securities  of  the  Company
representing  Twenty  Five (25%) percent or more of the combined voting power of
the  Company's  then  outstanding  securities  entitled to vote generally in the
election  of  directors.

(c)  The  payment  of  fees  due  to  the  Consultant  under this Agreement will
accelerate  if  an  event  whereby any new person (within the meaning of Section
13(b)  of  the  1934  Securities  Exchange  Act)  becomes  the  beneficial owner
(directly  or  indirectly) of securities of the Company representing Forty (40%)
percent  or  more of the combined voting power of the Company's then outstanding
securities  entitled to vote generally in the election of directors.  If such an
event  should  occur,  the  Consultant  will  be  entitled to receive a lump sum
payment  of the aggregate of all fees entitled to it during the Consulting Term,
as  may  be  amended  pursuant  to  Section  2(b)  of  this  Agreement.

     3.  CONSULTING  SERVICES.  During the Consulting Term, the Consultant shall
perform  such  general business consulting services including, but certainly not
limited  to,  identification,  review  and analysis of potential acquisition and
merger  candidates  and  capital  formation,  and  such other services as may be
requested  of  him  from time to time by the Chief Executive Officer or Board of
Directors  of  the  Company.  All  of  the  consulting  services rendered by the
Consultant  to  the  Company  in accordance with the terms of this Agreement are
referred  to  herein  as  "Services."

<PAGE>

4.  COMPENSATION.

(a) As consideration for the Consultant's provision of Services hereunder and in
settlement  for  all previous amounts that may be outstanding, the Company shall
pay  the  Consultant  an  initial  fee  of  Seven  Hundred  and  Fifty  Thousand
($750,000.00) dollars.  Additionally, the Company shall pay the Consultant a fee
(the  "Fee") of Fifty Thousand ($50,000.00) dollars per month.  The Fee shall be
paid  in  installments  consistent  with  the Company's normal payroll schedule,
commencing  on  either  the first or fifteenth day of the month, as the case may
be,  following  the  date  of  commencement  of  the  Consulting  Term.

     (b)  As additional consideration for the Consultant's provision of Services
hereunder,  the  Company shall pay the Consultant a bonus (the "Bonus") based on
the  performance  of  the  Company  to be measured by the Company's consolidated
pre-tax operating income for the fiscal years ending during the Consulting Term.
The minimum Bonus to be paid to the Consultant will be calculated and paid based
upon  the  Company  achieving  a  minimum pre-tax income target according to the
following  schedule:

Fiscal  Year  Ending         Pre-Tax  Income  Target       Minimum  Bonus

December  31,  1999          $  1,250,000.00               $  350,000.00
December  31,  2000          $  1,500,000.00               $  500,000.00
December  31,  2001          $  2,000,000.00               $  650,000.00

     The  Consultant  shall  also  be entitled to additional bonus dollars based
upon  the  Company  exceeding  the  aforementioned  pre-tax income targets.  The
Company  shall pay the Consultant the sum of Fifty Thousand ($50,000.00) dollars
for  each  Five  Hundred Thousand ($500,000.00) dollars that the Company exceeds
the aforementioned pre-tax income targets, or a portion thereof of approximately
Ten (10%) percent.  As an illustration, if the Company achieves a pre-tax income
of  $1,750,000.00  in  fiscal  1999,  then the Consultant shall be entitled to a
Bonus  totaling  Four  Hundred  Thousand  ($400,000.00)  dollars.

     (c)  Any  fees not paid to the Consultant when due shall accrue interest at
the  then  prime  lending  rate  LESS One Hundred (100) basis points, compounded
monthly.  Additionally,  any  fees accrued under this Agreement shall become due
and  payable  in  full  upon  the receipt of any proceeds of any debt, equity or
other  such  offering  that  causes  a  significant  increase  in  the Company's
liquidity.

     (d)  The  Company  agrees  to  reimburse  the Consultant for all reasonable
business  expenses  (including,  without  limitation,  reasonable  travel  and
entertainment  expenses)  incurred  by  the  Consultant  in  rendering  Services
hereunder,  subject  to the Company's reimbursement policies in effect from time
to  time.  The  Consultant agrees to maintain reasonable records of his business
expenses  in  such  form  and detail as the Company may request and to make such
records  available  to  the  Company  as  and  when  requested.

     (e)  If  an  event  occurs  as described in Section 2(b) to this Agreement,
whereby  this  Agreement is automatically renewed for a period of two (2) years,
then  the  Compensation  contemplated  under  Section  4(a)  and the Bonus under
Section  4(b)  will  be  replaced by a Fee totaling Ninety Thousand ($90,000.00)
dollars  per  month  for  the  twenty  four  (24)  month  period.

<PAGE>

     5.  AGREEMENT  NOT  TO  SOLICIT OR SELL TO CUSTOMERS. The Consultant agrees
that,  during  the  Consulting  Term  and  for two years thereafter, it will not
without the prior written consent of the Company, either directly or indirectly,
call on, solicit, take away, accept as a client, customer or prospective client,
customer  or  attempt  to  call  on,  solicit,  take away or accept as a client,
customer, prospective client or customer, any person that was a client, customer
or  prospective  client or customer of the Company or any of its subsidiaries or
affiliates  in  so far as such solicitation is for a purpose within the scope of
the  Company's  business  (e.g.,  transportation  equipment  leasing).

6.  OWNERSHIP  AND  NON-DISCLOSURE  AND  NON-USE  OF  CONFIDENTIAL  INFORMATION

                  6.1  As  used  in  this  Agreement, "Confidential Information"
shall  mean  all  customer  sales  and  marketing  information, customer account
records,  proprietary  receipts  and/or  processing  techniques,  information
regarding  vendors  and  products, training and operations memoranda and similar
information,  personnel  records, pricing information, financial information and
trade  secrets  concerning  or  relating  to  the business, accounts, customers,
employees  and  affairs  of the Company, or any subsidiary or affiliate thereof,
obtained  by  or  furnished,  disclosed  or  disseminated  to the Consultant, or
obtained,  assembled  or  compiled  by  the  Consultant or under his supervision
during  the  course  of  his rendering Services to the Company, and all physical
embodiments  of the foregoing, all of which are hereby agreed to be the property
of  and  confidential  to  the  Company,  but Confidential Information shall not
include any of the foregoing to the extent the same is or becomes publicly known
through  no  fault  or  breach  of  this  Agreement  by  the  Consultant.

                  6.2  The Consultant agrees that he will not, either during the
Consulting  Term or at any time thereafter, without the prior written consent of
the Company, use, disclose or make available any Confidential Information to any
person  or  entity,  nor  shall  he use, disclose, make available or cause to be
used,  disclosed or made available, or permit or allow, either on his own behalf
or  on  behalf of others, any use or disclosure of such Confidential Information
other  than  in  the  proper  performance  of the Consultant's duties hereunder.

          6.3  The Company acknowledges and agrees that all financing documents,
work  papers and other work products of the Consultant prepared in the course of
its  engagement  by  the  Company  shall  remain the property of the Consultant.

         7.  REASONABLENESS  OF  RESTRICTIONS.  In  the event that any provision
relating  to  time  period  or  geographic  area of any restriction set forth in
Sections 5 or 6 shall be declared by a court of competent jurisdiction to exceed
the  maximum  time period or area of restriction that the court deems reasonable
and enforceable, the time period or area of restriction which the court finds to
be  reasonable  and  enforceable shall be deemed to become, and thereafter shall
be,  the  maximum  time  period  or  geographic  area  of  such  restriction.

         8. ENFORCEABILITY. Any provision of Sections 5 or 6 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,  but  shall be enforced to the
maximum extent permitted by law, and any such prohibition or unenforceability in
any  jurisdiction shall not invalidate or render unenforceable such provision in
any  other  jurisdiction.

         9.  TERMINATION;  COMPENSATION.  Notwithstanding  any provision in this
Agreement  to the contrary, this Agreement may be terminated by the Company only
for  "Cause"  at  any time during the Term hereof, and such termination shall be
effective  immediately  upon  written notice to the Consultant.  For purposes of
this  Agreement,  "Cause"  for  the  termination  of the Consultant's engagement
hereunder  shall  be  deemed to exist only if: (a) the Consultant commits fraud,
theft  or  embezzlement  against  any  the Company; (b) the Consultant discloses
trade  secrets  or  other  proprietary  information of the Company or any of its
subsidiaries or affiliates thereof to any unauthorized person or entity; (c) the
Consultant  engages  in  gross  negligence  or  willful  misconduct  that causes
substantial  and  irreparable harm to the business and operations of the Company
or  any of its subsidiaries or affiliates thereof. Upon any termination pursuant
to  this  Section  10,  the  Consultant  shall be entitled to be paid solely the
Consultant's  Fee  then in effect through the effective date of termination, and
the  Company  shall  have  no  further liability or other obligation of any kind
whatsoever  to  the  Consultant  hereunder.

<PAGE>

         10.  INDEMNIFICATION. The Company agrees to indemnify and hold harmless
the  Consultant and any of its affiliates and each of their respective officers,
directors,  employees  and  agents  (each  such  person  and  Consultant  being
hereinafter  called  an  Indemnified Party) against any losses, claims, damages,
liabilities,  or  actions,  including  shareholder  actions, in respect thereof,
joint  or  several,  to which and Indemnified Party may become subject under any
statute  or  at  common  law  or  otherwise,  and  to  reimburse  promptly  such
Indemnified  Party  for  any  reasonable  legal  or  other  expenses  (including
appropriate  compensation  for  preparation  time,  if  any)  incurred  by  such
Indemnified  Party  in  connection  with  investigating  any  written  claim  or
preparing for or defending or assisting in the defense of any action (whether or
not  such Indemnified Party is named as a party thereto) commenced or threatened
in  writing,  whether  or  not resulting in liability (including any loss to the
extent of the aggregate amount paid in settlement of any litigation commenced or
threatened,  or of any claim whatsoever set forth therein, if such settlement is
effected  with  the  written  consent  of  the Company), insofar as such losses,
claims, damages, liabilities, actions, settlements or expenses arise out of, are
based  upon  or  are  in any way connected with services provided to the Company
whether  performed  prior  to  or  after  the  date  hereof.

     The  Company  shall prepay the reasonable and estimable costs of defense of
Consultant,  as  set  forth  above,  upon  notice by Consultant that a claim has
arisen.

         11.  ARBITRATION.  Consultant  and  Chancellor  agree  that  any  legal
disputes  that  may  occur between Consultant and Chancellor, and that arise out
of, or are related in any way to, this Agreement and/or Consultant's performance
of services under this Agreement or the termination of this Agreement, and which
disputes  cannot  be  resolved informally, shall be resolved exclusively through
final  and binding private arbitration before an arbitrator mutually selected by
Consultant  and  Chancellor,  with each party to bear its own costs and attorney
fees.  If  the  Consultant and Chancellor are unable to agree upon an arbitrator
within  twenty-one  (21)  days  after  either  party  has  made  a  demand  for
arbitration,  the  matter will be submitted for arbitration to the Boston office
of  the American Arbitration Association pursuant to the rules governing dispute
resolution  in  effect as of January 1, 1999.  Notwithstanding the foregoing, in
no  event shall a demand for arbitration be made after the date when institution
of  legal or equitable proceedings based on such claim, dispute, or other matter
in  question  would  be  barred  by  the  applicable  statutes  of  limitation.

         12.  GENERAL  PROVISIONS.

                  12.1 Indulgences, Etc. Any failure or delay on the part of any
party  to  exercise  any  right, remedy, power or privilege under this Agreement
will not operate as a waiver thereof, nor will any single or partial exercise of
any  right, remedy, power or privilege preclude any other or further exercise of
the  same or of any other right, remedy, power or privilege, nor will any waiver
of  any  right,  remedy,  power  or  privilege with respect to any occurrence be
construed  as a waiver of that right, remedy, power or privilege with respect to
any  other  occurrence.

<PAGE>

                  12.2  Notices.  All  notices,  requests,  demands  and  other
communications required or permitted under this Agreement must be in writing and
will  be  deemed  to have been duly given, made and received only when delivered
(personally,  by  facsimile  transmission  or by courier service such as Federal
Express,  or  by  other messenger) or when deposited in the United States mails,
registered  or  certified  mail,  postage  prepaid,  return  receipt  requested,
addressed  as  set  forth  below:

                           (i)      If  to  the  Consultant:

                                     VMI  Corporation
                                     405  Waltham  Street
                                     Suite  304
                                     Lexington,  MA  02173
                                     Attention:  Brian  M.  Adley

                           (ii)     If  to  the  Company:

                                    Chancellor  Corporation
                                    210  South  Street
                                    Boston,  MA  02111
                                    Attention:  Peter  J.  Mullen

Any party may alter the address to which communications or copies are to be sent
by  giving notice of any change of address to the other party in conformity with
the  provisions  of  this  paragraph  for  the  giving  of  notice.

                  12.3  Binding  Nature of Agreement; Assignment. This Agreement
shall be binding upon and inure to the benefit of the Company and its successors
and  assigns  and  shall  be  binding  upon  the Consultant, his heirs and legal
representatives.  The  Company  may  assign  this  Agreement  at any time to any
affiliate,  provided  that  such  assignee assumes all of the obligations of the
Company  hereunder;  the  Consultant  may  not  assign  this  Agreement.

                  12.4 Execution in Counterparts. This Agreement may be executed
in  any  number  of counterparts, each of which will be deemed to be an original
and  all  of  which  will  together  constitute  one  and  the  same instrument.

                  12.5  Provisions  Separable.  The provisions of this Agreement
are  independent  of  and  separable  from  each other, and no provision will be
affected or rendered invalid or unenforceable by virtue of the fact that for any
reason  any  other or others of them may be invalid or unenforceable in whole or
in  part.

                  12.6  Entire  Agreement.  This  Agreement  contains the entire
understanding  between  the parties hereto with respect to the subject matter of
this  Agreement,  and  supersedes  all  prior and contemporaneous agreements and
understandings,  inducements or conditions, express or implied, oral or written,
with  respect to the subject matter of this Agreement. The express terms of this
Agreement  control  and  supersede any course of performance and/or usage of the
trade  inconsistent  with  any  of  the  terms hereof. This Agreement may not be
modified  or  amended  other  than  by  an  agreement  in  writing.

                  12.7  Remedies. The rights conferred upon the Company pursuant
to Section 10 hereof shall not be exclusive of, but shall be in addition to, any
other  rights  or  remedies  which  the  Company  may  have at law, in equity or
otherwise.

<PAGE>

                  12.8  Section Headings. The section headings in this Agreement
are  for  convenience  only;  they  form  no part of this Agreement and will not
affect  its  interpretation.

                  12.9 Governing Law. This Agreement, the rights and obligations
of  the  parties  hereto,  and any claims or disputes relating thereto, shall be
governed  by  and  construed  in accordance with the laws of the Commonwealth of
Massachusetts,  excluding  the  choice  of  law  rules  thereof.

                  12.10  Survival. The provisions of Sections 5, 6, 8, 9, 10, 11
and  12  hereof  shall  survive  the termination of this Agreement to the extent
necessary  to  effectuate  the  respective  purposes  of  such  provisions.


         IN  WITNESS WHEREOF, the parties have executed this Agreement as of the
date  first  set  forth  above.

                  CHANCELLOR  CORPORATION


                  By:  /s/  Rudolph  Peselman___________
                                       ----------------------

                  Name:   Rudolph  Peselman
                  Title:  Director,  Chancellor  Corporation


                  Attest:


                  By:  /s/  Peter  J.  Mullen______________
                       ----------------------

                  Name:  Peter  J.  Mullen
                  Title:  Clerk,  Chancellor  Corporation


                                  VMI  CORPORATION


                  By:  /s/  Derek  R.  Coulter____________
             -----------------------

                  Name:  Derek  R.  Coulter
                  Title:  Managing  Director,  VMI  Corporation



                  /s/  Jonathan  C.  Ezrin___________________
                  ------------------------
                  Notary  Public

                  My  Commission  Expires:  _______________     [  SEAL  ]