Exhibit 10.55
NationsBank of Texas, N.A.          Pledge Agreement

=========================================================== ====================
BANK/SECURED PARTY:                     PLEDGOR(S)/DEBTOR(S):

NationsBank of Texas, N.A.,             American Physicians Service Group, Inc.,
a national banking association          a Texas corporation
515 Congress Avenue                     1301 Capital of Texas Highway
11th Floor                              C-300
Austin, Texas  78701                    Austin, Texas 78746
Travis County, Texas

(Street address including county)     (Name and street address including county)
================================================================================
Pledgor/Debtor is:  [  ] Individual [X] Corporation  [  ] Partnership [  ] Other
Address is Pledgor's/Debtor's:  [  ] Residence  [  ] Place of Business  
[X]  Chief Executive Office if more than one place of business
================================================================================

Capitalized   terms  not  otherwise  defined  in  this  Pledge  Agreement  (this
"Agreement")   have  the  same  meaning  as  assigned  in  the  Loan   Agreement
(hereinafter defined).

1.  SECURITY  INTEREST.  For good and  valuable  consideration,  the receipt and
adequacy of which are hereby acknowledged,  Pledgor/Debtor (hereinafter referred
to as  "Pledgor")  pledges,  assigns and grants to Bank a security  interest and
lien in the  Collateral  (hereinafter  defined)  to secure the  payment  and the
performance of the  Obligation  (hereinafter  defined).  
2. 
3.  COLLATERAL.  The
security interest is granted in the following collateral (the "Collateral"): 
4.
A. DESCRIPTION OF COLLATERAL. 
B.
C. SPECIFIC INVESTMENT PROPERTY/SECURITIES: The
following  investment  property and/or securities,  together with all investment
property and/ or securities hereafter delivered to Bank in substitution therefor
or in addition  thereto:  
D. i. 500,000  shares of Common Stock,  $.01 par value
(together with any other shares of Common Stock of Prime pledged  hereunder from
time to time, the "Prime  Pledged  Shares") of Prime Medical  Services,  Inc., a
Delaware corporation  ("Prime").  ii. iii. a. 1,000 shares of Common Stock, $.10
par value of APS Financial  Corporation,  a Colorado corporation;  iv. v. b. 800
shares of Common Stock, $.10 par value, APS Insurance Services, Inc., a Delaware
corporation;  vi. vii. c. 1,874,600  shares of Common Stock,  $.001 par value of
APS Practice Management, Inc., a Texas corporation; viii. ix. x. d. 1,000 shares
of Common  Stock,  $.10 par value of  Syntera  Technologies,  Inc.,  a  Delaware
corporation;  and 

<PAGE>

xi. 
xii. e. 1,000 shares of Common  Stock,  $1.00 par value of
APS Realty,  Inc., a Texas  corporation (the Prime Pledged Shares and the shares
described in this Subsection  2.A.ii are collectively  referred to herein as the
"Pledged  Shares"). 
xiii.  
xiv.  all cash,  securities,  dividends,  increases,
distributions  and profits  received  from or on the Pledged  Shares,  including
distributions or payments in partial or complete  liquidation or redemption,  or
as a result of reclassifications,  readjustments,  reorganizations or changes in
the capital  structure of the Issuer and any other property at any time and from
time to time received, receivable or otherwise distributed or delivered to Bank,
and all rights and privileges pertaining thereto. 
xv. 
xvi. It is contemplated by
the parties that  Pledgor may provide  additional  collateral  from time to time
hereunder as additional  security for the Obligation,  and may from time to time
with  the  prior  written  consent  of Bank  sell or  otherwise  dispose  of any
Collateral  provided that Pledgor provides Bank with substitute  collateral.  At
the time of each addition or substitution of Collateral, the securities added or
substituted  shall be identified on a Pledge  Certificate,  substantially in the
form of Schedule II attached hereto (the "Pledge Certificate"), and delivered to
Bank.  Bank has no  obligation  to make any  advances  requested  in  connection
therewith  unless  (i)  such  additional   and/or   substituted   Collateral  is
satisfactory to Bank and (ii) the perfected  security  interest  granted to Bank
therein is completed to the  satisfaction  of Bank. All such  additional  and/or
substituted  Collateral shall be Collateral for purposes of this Agreement,  and
shall secure the Obligation in the same manner as the Collateral for which it is
added to and/or substituted.  
xvii. 
E. PROCEEDS. All additions,  substitutes and
replacements for and proceeds of the above Collateral  (including all income and
benefits  resulting  from  any  of the  above,  such  as  dividends  payable  or
distributable  in cash,  property  or stock;  interest,  premium  and  principal
payments;  redemption  proceeds  and  subscription  rights;  and shares or other
proceeds of  conversions  or splits of any  securities in the  Collateral).  Any
investment property and/or securities received by Pledgor,  which shall comprise
such  additions,   substitutes  and  replacements   for,  or  proceeds  of,  the
Collateral,  shall be held in trust for Bank and shall be delivered  immediately
to Bank.  Any cash  proceeds  shall be held in trust  for Bank and upon  request
shall be delivered  immediately to Bank. 
F. 
G. DEPOSIT ACCOUNTS.  The balance of
every  deposit  account of Pledgor  maintained  with Bank and any other claim of
Pledgor against Bank, now or hereafter existing, liquidated or unliquidated, and
all money,  instruments,  investment property,  securities,  documents,  chattel
paper,  credits,  claims,  demands,  income, and any other property,  rights and
interests of Pledgor which at any time shall come into the possession or custody
or  under  the  control  of Bank or any of its  agents  or  affiliates,  for any
purpose,  and  the  proceeds  of any  thereof.  Bank  shall  be  deemed  to have
possession of any of the  Collateral in transit to or set apart for it or any of
its agents or affiliates.

1.       OBLIGATION.
2.
A. DESCRIPTION OF OBLIGATION.  The following obligations ("Obligation") are 
secured by this Agreement:

i. ALL DEBT: All debts,  obligations,  liabilities  and agreements of Pledgor to
Bank, now or hereafter existing,  arising directly or indirectly between Pledgor
and Bank whether  absolute or contingent,  joint and several,  joint or several,
secured or unsecured,  due or not due,  liquidated or  unliquidated,  arising by
operation of law or otherwise,  and all renewals,  extensions and rearrangements
of any of the above;  including,  without  limitation,  all debts,  obligations,
liabilities  and  agreements  of Pledgor  now or  hereafter  arising  under,  or
governed by, that certain  Revolving  Credit Loan Agreement dated as of the date


                                       2
<PAGE>

hereof,   by  and  between  Pledgor  and  Bank,  and  any  renewal,   extension,
modification or restatement thereof or therefor (the "Loan Agreement").
ii.
iii.  PROMISSORY NOTE: All debt arising under that certain promissory note dated
as of the date hereof in the principal  face amount of  $10,000,000  executed by
Pledgor  payable  to the order of Bank,  and any and all  renewals,  extensions,
modifications and rearrangements thereof; iv. v. All costs and expenses incurred
by Bank, including attorney's fees, to obtain,  preserve,  perfect,  enforce and
defend this  Agreement  and  maintain,  preserve,  collect and realize  upon the
Collateral,  together with interest  thereon at the default rate provided in the
Loan  Agreement;  and vi. vii. All amounts which may be owed to Bank pursuant to
all other loan documents executed in connection with the indebtedness  described
in  subpart  i.  above.  viii.  In the  event  any  amount  paid  to Bank on any
Obligation  is  subsequently  recovered  from  Bank  in or as a  result  of  any
bankruptcy,  insolvency or fraudulent conveyance proceeding involving an obligor
of the  Obligation  other than Pledgor,  Pledgor shall be liable to Bank for the
amounts so recovered up to the fair market  value of the  Collateral  whether or
not the Collateral has been released or the security interest terminated. In the
event the Collateral has been released or the security interest terminated,  the
fair market value of the Collateral shall be determined, at Bank's option, as of
the date the Collateral was released, the security interest terminated,  or said
amounts were recovered.

A. USE OF PROCEEDS.  The proceeds of any  indebtedness or obligation  secured by
the Collateral  will not be used directly or indirectly to purchase or carry any
"margin stock" as that term is defined in Regulation U of the Board of Governors
of the Federal  Reserve  System,  or extend credit to or invest in other parties
for the purpose of purchasing or carrying any such "margin  stock," or to reduce
or retire any  indebtedness  incurred  for such purpose or otherwise in a manner
which would violate Regulations G, T or U.

1.  PLEDGOR'S  WARRANTIES.  Pledgor  hereby  represents  and warrants to Bank as
follows: 2. A. Financing Statements. Except as may be noted by schedule attached
hereto and incorporated herein by reference, no financing statement covering the
Collateral  is or will be on file in any public  office,  except  the  financing
statements relating to this security interest,  and no security interest,  other
than the one herein created, has attached or been perfected in the Collateral or
any part thereof.
B.
C.  OWNERSHIP.  Pledgor  owns  the  Collateral  free  from  any  setoff,  claim,
restriction,  lien,  security interest or encumbrance except liens for taxes not
yet due and payable and the security  interest  hereunder,  the applicability of
certain  federal and state  securities  laws,  including Rule 144 of the General
Regulations  under the Securities Act of l933, and as to the common stock of APS
Insurance  Services,  Inc., the agreements  described in Section 6.E. below, and
Pledgor  represents  and warrants that Pledgor has held the Prime Pledged Shares
and any other Prime Shares which may from time to time be pledged hereunder free
and clear of all liens (except for liens,  encumbrances and debt held by Bank or
described  above),  encumbrances  and debt,  and borne  the full  economic  risk
thereof  since  October 12, 1989.  
D. 
E. POWER AND  AUTHORITY.  Pledgor has full
power and  authority  to make this  Agreement,  and all  necessary  consents and
approvals of any persons,  entities,  governmental or regulatory authorities and
securities  exchanges  have been  obtained to  effectuate  the  validity of this
Agreement.  


                                       3
<PAGE>

F. 
G. PLEDGED SHARE  CHARACTERISTICS.  The Pledged Shares which have
been  pledged  by Pledgor to Bank under  this  Agreement,  or may  hereafter  be
pledged under this Agreement, satisfy and shall satisfy each of the requirements
and  characteristics  set forth on Schedule I hereto.  
H. 
I. The delivery at any
time  by  Pledgor  to Bank of  additional  Pledged  Shares  shall  constitute  a
representation  and  warranty  by Pledgor  that,  with  respect to such  Pledged
Shares, in each item thereof,  the matters  heretofore  warranted in Clauses (A)
through (D) immediately  above are true and correct at, and as if they were made
at, the date of such delivery. 
J. 
3. PLEDGOR'S COVENANTS. Until full payment and
performance  of all of the  Obligation  and  termination  or  expiration  of any
obligation or  commitment  of Bank to make advances or loans to Pledgor,  unless
Bank otherwise consents in writing: 
4. 
A. OBLIGATION AND THIS AGREEMENT. Pledgor
shall perform all of its agreements  herein and in any other agreements  between
it and Bank. 
B. 
C. OWNERSHIP OF COLLATERAL.  Pledgor shall defend the Collateral
against all claims and demands of all persons at any time  claiming any interest
therein  adverse to Bank.  Pledgor shall keep the Collateral free from all liens
and  security  interests  except those for taxes not yet due and payable and the
security  interest  hereby  created. 
D. 
E. BANK'S COSTS.  Pledgor shall pay all
costs necessary to obtain,  preserve,  perfect,  defend and enforce the security
interest  created by this  Agreement,  collect  the  Obligation,  and  preserve,
defend, enforce and collect the Collateral,  including but not limited to taxes,
assessments,  reasonable  attorney's fees, legal expenses and expenses of sales.
Whether  the  Collateral  is or is not in Bank's  possession,  and  without  any
obligation to do so and without  waiving  Pledgor's  default for failure to make
any such  payment,  Bank at its option may pay any such costs and  expenses  and
discharge  encumbrances on the Collateral,  and such payments shall be a part of
the Obligation and bear interest at the rate set out in the Obligation.  Pledgor
agrees to reimburse Bank on demand for any costs so incurred.  
F. 
G. INFORMATION AND INSPECTION.  Pledgor shall (i) promptly  furnish Bank any  
information  with
respect  to  the  Collateral   requested  by  Bank;   (ii)  allow  Bank  or  its
representatives to inspect and copy, or furnish Bank or its representatives with
copies of, all records relating to the Collateral and the Obligation;  and (iii)
promptly furnish Bank or its representatives with any other information Bank may
reasonably request. 
H. 
I. ADDITIONAL  DOCUMENTS.  Pledgor shall sign and deliver
any papers furnished by Bank which are necessary or desirable in the judgment of
Bank to obtain,  maintain and perfect the  security  interest  hereunder  and to
enable  Bank to  comply  with any  federal  or state  law in order to  obtain or
perfect  Bank's  interest  in  the  Collateral  or to  obtain  proceeds  of  the
Collateral.  
J. 
K. NOTICE OF CHANGES.  Pledgor shall notify Bank  immediately of
(i) any material change in the Collateral,  (ii) a change in Pledgor's residence
or location, (iii) a change in any matter warranted or represented by Pledgor in
this  Agreement,  or in any of the Loan Documents  relating to the Obligation or
furnished to Bank  pursuant to this  Agreement,  and (iv) the  occurrence  of an
Event of  Default  under  this  Agreement  or any  other  Loan  Document.  
L. 
M.POSSESSION OF COLLATERAL. Pledgor  shall deliver a copy of this  Agreement (or
other notice acceptable to Bank) to any Broker,  financial intermediary,  or any
other  person  in  possession  of any of the  Collateral  or on whose  books the
interest  of  Pledgor  in  the  Collateral  appears,  and  such  delivery  shall
constitute  notice to such person of Bank's security  interest in the Collateral
and  shall  constitute  Pledgor's 

                                       4
<PAGE>

instruction  to such  person  to note  Bank's
security interest on their books and records, or deliver to Bank certificates or
other evidence of the  Collateral  promptly upon Bank's  request.  Pledgor shall
deliver all investment  securities and other instruments and documents which are
a part of the Collateral and in Pledgor's possession to Bank immediately,  or if
hereafter acquired,  immediately following  acquisition,  in a form suitable for
transfer by delivery or accompanied by duly executed  instruments of transfer or
assignment  in  blank  with  signatures  appropriately  guaranteed  in form  and
substance  suitable to Bank. 
N. 
O. POWER OF ATTORNEY.  Pledgor appoints Bank and
any officer thereof as Pledgor's special  attorney-in-fact with limited power in
Pledgor's name and on Pledgor's  behalf, to perform only those acts that Pledgor
is obligated to do or may be required to do hereunder. Nothing in this paragraph
shall be construed to obligate Bank to take any action  hereunder nor shall Bank
be liable to Pledgor for failure to take any action hereunder.  This appointment
shall be deemed a power  coupled with an interest and shall not be terminable as
long as the Obligation is outstanding  and shall not terminate on the disability
or  incompetence  of Pledgor.  Without  limiting the ability to perform any acts
authorized  by the  foregoing,  Bank shall have the right and power to  receive,
endorse and  collect  all checks and other  orders for the payment of money made
payable to Pledgor but only to the extent that such checks or payments represent
any dividend,  interest payment or other distribution  payable in respect of the
Collateral  or any  part  thereof.  Bank  will  notify  Pledgor  after  Bank has
exercised the power,  and Bank shall deliver to Pledgor  copies of any documents
executed by Bank pursuant to the power.  Upon payment of the entire  Obligation,
the power  described in this  Section  shall be deemed to be  terminated.  
P. 
Q. OTHER PARTIES AND OTHER COLLATERAL. No renewal or  extensions of or any other
indulgence  with respect to the Obligation or any part thereof,  no modification
of the  document(s)  evidencing the Obligation,  no release of any security,  no
release  of any person  (including  any maker,  indorser,  guarantor  or surety)
liable on the  Obligation,  no delay in enforcement of payment,  and no delay or
omission  or lack of  diligence  or care in  exercising  any right or power with
respect to the Obligation or any security  therefor or guaranty thereof or under
this Agreement shall in any manner impair or affect the rights of Bank under any
law, hereunder, or under any other agreement pertaining to the Collateral.  Bank
need not file suit or assert a claim for  personal  judgment  against any person
for any part of the  Obligation  or seek to realize upon any other  security for
the Obligation,  before foreclosing or otherwise  realizing upon the Collateral.
Pledgor  waives any right that can be waived to the  benefit of or to require or
control  application of any other security or proceeds thereof,  and agrees that
Bank shall have no duty or obligation to Pledgor to apply to the  Obligation any
such other  security  or proceeds  thereof.  
R. 
S.  WAIVERS BY PLEDGOR.  Pledgor
waives  notice of the  creation,  advance,  increase,  existence,  extension  or
renewal  of, and of any  indulgence  with  respect  to, the  Obligation;  waives
presentment,  demand,  notice of  dishonor,  and protest;  waives  notice of the
amount  of the  Obligation  outstanding  at any time,  notice  of any  change in
financial condition of any person liable for the Obligation or any part thereof,
notice of any Event of Default, and all other notices respecting the Obligation;
and  agrees  that  maturity  of the  Obligation  and  any  part  thereof  may be
accelerated,  extended or renewed  one or more times by Bank in its  discretion,
without  notice to Pledgor.  Pledgor waives any right to require that any action
be brought  against  any other  person or to require  that  resort be had to any
other security or to any balance of any deposit account.  Pledgor further waives
any right of  subrogation  or to enforce  any right of action  against any other
pledgor  until the  Obligation  is paid in full.  
T. 
U. RULE 144 RIDER.  Pledgor
acknowledges that the Collateral is, or may be in the future, comprised in whole
or in part of control or  restricted  securities,  which shall be subject to the
additional terms and provisions  described on the Rule 144 Rider attached hereto
and made a part hereof for all purposes. 
V. 
5. MAINTENANCE OF COLLATERAL.  
6. 


                                       5
<PAGE>

A.
MAINTENANCE  OF  COLLATERAL.  At all times  during  the term of this  Agreement,
Pledgor agrees to maintain as security for the Obligation,  Prime Pledged Shares
with an Adjusted  Collateral  Value (as determined  herein) in excess of 182% of
the unpaid principal balance of the Obligation (the "Maintenance  Margin").  The
Adjusted Collateral Value shall be determined by multiplying the number of Prime
Pledged Shares (including any Additional  Shares) by the per share price of such
Prime stock at the most recent  close of trading on a trading  exchange  for the
Prime  stock.  In the event  that  Prime  Pledged  Shares  are not  traded on an
exchange,  the Adjusted  Collateral  Value of the Prime Pledged  Shares shall be
determined  by obtaining  the quoted value of such Prime  Pledged  Shares from a
reputable  brokerage  firm selected by Bank. If no such quote is available,  the
value will be determined by Bank in its sole discretion.  
B. 
C. No Borrowing (as
defined in the Loan Agreement)  requested by Pledgor shall be made to Pledgor if
the sum of (i) the outstanding principal balance of the Obligation plus (ii) the
amount  of the  Borrowing  requested,  equals  or  exceeds  50% of the  Adjusted
Collateral Value (the "Original Advance Percentage").
D. 
E. BREACH OF COLLATERAL MAINTENANCE. Pledgor agrees that the failure to maintain
Collateral with an Adjusted Collateral Value as set forth above shall constitute
an Event of Default under this Agreement.  In such event, the Pledgor shall have
five Business Days (as defined in the Loan  Agreement)  from the date Pledgor is
notified by Bank (in writing or orally) of such noncompliance,  to either pledge
additional  shares of Prime stock  satisfactory to Bank, in its sole discretion,
or reduce the unpaid  principal  balance of the Obligation  such that, in either
case,  the  Adjusted  Collateral  Value  shall be not less than the  Maintenance
Margin.  In the event Pledgor  fails to comply with the terms hereof,  Bank may,
without any further notice of any kind, exercise any of the following rights and
remedies, at Bank's option: 
F.
         (a)      The rights and remedies set out in Section 8.B. of this 
                  Agreement, including without limitation the right to
                  accelerate the Obligation and liquidate the Collateral.

         (b)      Sell all or any part of the  Collateral and apply the proceeds
                  of such sale to the  Obligation to bring the  Obligation  back
                  into  compliance  (that is, to reduce the unpaid  principal of
                  the  Obligation   such  that  the  unpaid   principal  of  the
                  Obligation  is less than  Original  Advance  Percentage of the
                  Prime Pledged Shares.

If an Event of Default exists hereunder and the Collateral is declining in value
or  threatens to decline  speedily in value,  Bank shall have no  obligation  to
notify  Pledgor of the failure to maintain Prime Pledged Shares with an Adjusted
Collateral Value as set forth in subparagraph A above or to provide Pledgor with
an opportunity to cure such noncompliance,  and in such case Pledgor agrees that
Bank may  immediately  at Bank's sole  option (i) declare  amounts due under the
Obligation to be immediately  due and payable,  and/or (ii) sell all or any part
of the Collateral and apply the proceeds of such Collateral to the Obligation.

A. ADDITIONAL PLEDGE PROVISION.  Notwithstanding the provisions of 6A and 6B, in
the  event the per share  price of the Prime  Pledged  Shares on any day is less
than $8.25, than all shares of Prime owned by Pledgor (other than 500,000 shares
of common  stock of Prime which shall be  excluded)  (the "Prime  Stock")  shall
become Additional Collateral  hereunder,  and Pledgor shall,  immediately,  upon
demand of Bank,  execute and deliver a Pledge  Certificate  covering  such Prime
Stock shares to Bank,  together with the original stock  certificates  and blank
stock  powers.  
B. 
C. RELEASE OF PRIME  PLEDGED  SHARES.  
D. 
i. In the event the
price per share of the  Prime  Pledged  Shares  increases  so that the  Adjusted
Collateral  Value is in excess of 250% of the  Obligation,  then upon receipt of
Pledgor's  written 


                                       6
<PAGE>

request to Bank  requesting  release of certain Prime Pledged
Shares,  and  provided  no  Default  or Event of  Default  has  occurred  and is
continuing under the Loan Agreement,  Bank shall as soon as reasonably  possible
(but in any event no earlier than ten  Business  Days  following  receipt of the
request)  release  certain  Prime  Pledged  Shares,  so  long  as  the  Adjusted
Collateral  Value of the remaining Prime Pledged Shares is not less than 200% of
the Obligation. 
ii. 
iii. In the event Pledgor has pledged all of its Prime Stock
shares to Bank as required  pursuant to Section 6C above,  then if the per share
price  of the  Prime  Pledged  Shares  exceeds  $8.50  during  any  ninety  (90)
consecutive  days,  and Pledgor  delivers a written  request to Bank  requesting
release of certain Prime Pledged Shares, provided no Default or Event of Default
has occurred and is continuing under the Loan Agreement, then Bank shall as soon
as  reasonably  possible  (but in any event no earlier  than ten  Business  Days
following  receipt of the request) release certain Prime Pledged Shares, so long
as the Adjusted  Collateral  Value of the remaining  Prime Pledged Shares is not
less than 200% of the  Obligation.  
iv. 
v.  Nothing in this  Section  6D.  shall
relieve Pledgor of its continuing  obligations under Sections 6A, 6B and 6D. vi.
E. RELEASE OF OTHER  COLLATERAL.  
F. 
i. In the event that FPIC Insurance  Group,
Inc. ("FPIC") exercises its option to purchase additional shares of common stock
of APS Insurance Services, Inc., a Delaware corporation ("APS Insurance") as set
forth in the Stock Purchase and Stock Option Agreement  entered into as of April
6, 1997 and in the  Shareholders  Agreement  entered into on June 30, 1997 among
APS  Insurance,  Pledgor  and FPIC,  Bank shall  release  its lien and  security
interest in the  Collateral  consisting  of the pledged  shares of APS Insurance
upon  receipt by Bank of the  purchase  price  therefor. 
ii. 
iii. The Bank also
agrees that provided no Event of Default (hereinafter  defined) has occurred and
is  continuing,  shares  of  common  stock  of  APS  Practice  Management,  Inc.
("Practice  Management") will be released from the lien and security interest of
this  Agreement  upon not less than ten (10) Business Days written notice to the
Bank,  setting  forth  the  number of  shares  to be  released,  the name of the
purchaser to whom the shares are to be transferred and the reason therefor.  
iv.
2. RIGHTS AND POWERS OF BANK.  
3. 
A.  GENERAL.  Bank,  before or after  default,
without  liability to Pledgor may:  take  control of proceeds,  including  stock
received as dividends or by reason of stock  splits;  release the  Collateral in
its  possession to any Pledgor,  temporarily  or otherwise;  require  additional
Collateral;  reject as unsatisfactory  any property hereafter offered by Pledgor
as Collateral;  take control of funds generated by the Collateral,  such as cash
dividends,  interest  and  proceeds,  and use  same to  reduce  any  part of the
Obligation  and exercise all other rights which an owner of such  Collateral may
exercise,  except the right to vote or dispose of the Collateral before an Event
of Default;  and at any time transfer any of the Collateral or evidence  thereof
into its own name or that of its nominee.  Other than the exercise of reasonable
care to ensure the safe custody of the  Collateral  in Bank's  possession,  Bank
shall  have  no  obligation,  duty or  responsibility  for  the  Collateral  and
specifically,  without limiting the foregoing, shall have no obligation, duty or
responsibility to collect any amounts payable,  or exercise any right or option,
in respect of the  Collateral or to sell all or any portion of the Collateral to
avoid market  loss.  Bank shall not be liable for failure to collect any account
or  instruments,  or for any act or omission on the part of Bank,  its officers,
agents or  employees,  except for its or their own willful  misconduct  or gross
negligence.  The foregoing rights and powers of Bank will be in addition to, and
not a limitation upon, any rights and powers of Bank given by law,  elsewhere in
this Agreement, or otherwise. 


                                       7
<PAGE>

B.
C. CONVERTIBLE COLLATERAL. Bank may present for
conversion any  Collateral  which is  convertible  into any other  instrument or
investment  security or a combination thereof with cash, but Bank shall not have
any duty to present for conversion any Collateral  unless it shall have received
from Pledgor detailed  written  instructions to that effect at a time reasonably
far in advance of the final conversion date to make such conversion possible.
D.
E. VOTING  RIGHTS.  Subject to the  following  sentence,  the  Pledgor  shall be
entitled  to exercise  any and all voting  and/or  consensual  rights and powers
relating or pertaining to the Collateral or any part thereof for any purpose not
inconsistent with the terms of this Agreement. Upon (i) the occurrence after the
date hereof of an Event of Default and (ii) the giving of written notice by Bank
to Pledgor of its  intention to (A) foreclose  upon or otherwise  dispose of the
Collateral or (B) exercise its voting rights  pertaining to the Collateral,  all
rights of the Pledgor to exercise the voting and/or consensual rights and powers
which it is entitled to exercise  hereunder  shall cease, at the option of Bank,
and all such rights  shall  thereupon  become  vested in Bank who shall have the
sole and exclusive right and authority to exercise such voting and/or consensual
rights and powers.  
F. 
4. DEFAULT.  
5. 
A. EVENT OF DEFAULT.  An event of default
("Event of Default")  shall occur (a) if Pledgor or any other  obligor on all or
part of the Obligation shall fail to timely and properly pay or observe, keep or
perform any term,  covenant,  agreement or condition in this Agreement or in any
other  agreement  between Pledgor and Bank or between Bank and any other obligor
on the  Obligation,  including but not limited to any other note or  instrument,
loan agreement,  security agreement,  deed of trust, mortgage,  promissory note,
assignment or other agreement or instrument concerning the Obligation; or (b) an
Event of  Default  shall  occur  under  the Loan  Agreement  or any  other  Loan
Document.

A. RIGHTS AND REMEDIES.  If any Event of Default shall occur,  then, in each and
every such case, Bank may,  without (a)  presentment,  demand,  or protest,  (b)
notice of default,  dishonor,  demand,  non-payment,  or protest,  (c) notice of
intent  to  accelerate  all or  any  part  of  the  Obligation,  (d)  notice  of
acceleration  of all or any part of the  Obligation,  or (e) notice of any other
kind,  all of which  Pledgor  hereby  expressly  waives  (except  for any notice
required  under  this  Agreement,  any other Loan  Document  or which may not be
waived under applicable law), at any time thereafter exercise and/or enforce any
of the following rights and remedies, at Bank's option: 
B. 
i. ACCELERATION.  The
Obligation shall, at Bank's option,  become immediately due and payable, and the
obligation,  if any, of Bank to permit further  borrowings  under the Obligation
shall at Bank's option immediately cease and terminate. 
ii. 
iii. LIQUIDATION OF
COLLATERAL.  Sell,  or instruct any agent or broker to sell,  all or any part of
the  Collateral  in a public  or  private  sale,  direct  any agent or broker to
liquidate  all or any part of any account and  deliver all  proceeds  thereof to
Bank,  and apply all proceeds to the payment of any or all of the  Obligation in
such  order  and  manner  as Bank  shall,  in its  discretion,  choose.  Bank is
authorized, at any sale of the Collateral, if it deems it advisable, to restrict
the  prospective  bidders of Purchasers to those persons who will  represent and
agree that they are purchasing for their own account,  for  investment,  and not
with a view to  distribution  or sale of any of the  Collateral.  Pledgor agrees
that,  because of the Securities  Act of 1933, as amended,  or any other laws or
regulations,  and  for  other  reasons,  there  may be  legal  and/or  practical
restrictions or limitations affecting Bank in any attempts to dispose of certain
portions of the  Collateral and for the  enforcement of their rights.  For these
reasons,  Bank is hereby  authorized  by Pledgor,  but not  obligated,  upon the
occurrence and during the  continuation  of an Event of Default,  to sell all or
any part of the Collateral at private sale,  subject to investment  letter or in


                                       8
<PAGE>

any other manner which will not require the Collateral,  or any part thereof, to
be registered in accordance with the Securities Act of 1933, as amended,  or the
rules and regulations promulgated thereunder,  or any other laws or regulations,
at a reasonable  price at such private sale or other  distribution in the manner
mentioned above.  Pledgor understands that Bank may in its discretion approach a
limited number of potential  purchasers and that a sale under such circumstances
may yield a lower price for the Collateral,  or any part or party thereof,  than
would  otherwise be  obtainable  if such  collateral  were either  afforded to a
larger number or potential purchasers, or registered or sold in the open market.
Pledgor  agrees  that such  private  sale shall be deemed to have been made in a
commercially reasonable manner, and that Bank has no obligation to delay sale of
any Collateral to permit the issuer thereof to register it for public sale under
any  applicable  federal  or  state  securities  laws.  Bank is  authorized,  in
connection  with any such sale (i) to  restrict  the  prospective  bidders on or
purchasers  of  any of the  Collateral  to a  limited  number  of  sophisticated
investors who will  represent and agree that they are  purchasing  for their own
account for investment and not with a view to the distribution or sale of any of
such  Collateral  and (ii) to impose such other  limitations  or  conditions  in
connection  with any such sale as Bank  reasonably  deems  necessary in order to
comply with  applicable law.  Pledgor  covenants and agrees that he will execute
and deliver such documents and take such other action as Bank  reasonably  deems
necessary in order that any such sale may be made in compliance  with applicable
law.  Upon any such  sale,  Bank  shall  have the right to  deliver,  assign and
transfer to the purchaser  thereof the Collateral so sold. Each purchaser at any
such sale shall hold the Collateral so sold  absolutely,  free from any claim or
right of Pledgor of whatsoever kind, including any equity or right of redemption
of  Pledgor.  Pledgor,  to  the  extent  permitted  by  applicable  law,  hereby
specifically waives all rights of redemption,  stay or appraisal which he has or
may have under any law now  existing or hereafter  enacted.  
iv. 
v. In addition,
and  without  limiting  the  foregoing,  Pledgor  agrees  that Bank may,  in its
discretion,  advertise,  prepare  for,  and  conduct a  foreclosure  sale of the
Collateral pursuant to newspaper  advertisements or other public advertisements,
in accordance  with (and subject to conditions set forth in) no action  letters,
pronouncements  and requirements of the Securities and Exchange  Commission,  in
order to comply with the Securities  Act of 1933, as amended,  or any other laws
or regulations.  
vi. 
vii. UNIFORM COMMERCIAL CODE. All of the rights, powers and
remedies of a secured  creditor  under the Uniform  Commercial  Code  ("UCC") as
adopted in the jurisdiction to which Bank is subject under this Agreement. 
viii.
ix.  RIGHT OF SET OFF.  Without  notice or demand to Pledgor,  set off and apply
against any and all of the Obligation any and all deposits  (general or special,
time or demand,  provisional or final) and any other  indebtedness,  at any time
held or owing by Bank or by any of Bank's affiliates or correspondents to or for
the credit of the account of Pledgor or any  guarantor  or indorser of Pledgor's
Obligation.  
x. 
xi. Pledgor specifically understands and agrees that any sale by
Bank of all or part of the  Collateral  pursuant to the terms of this  Agreement
may be  effected  by Bank at times  and in  manners  which  could  result in the
proceeds of such sale as being significantly and materially less than might have
been  received if such sale had  occurred  at  different  times or in  different
manners,  and Pledgor hereby releases Bank and its officers and  representatives
from and  against  any and all  obligations  and  liabilities  arising out of or
related to the timing or manner of any such sale.  
xii. 
xiii. If, in the opinion
of  Bank,  there  is any  question  that a public  sale or  distribution  of any
Collateral will violate any state or federal  securities law, Bank may offer and
sell such  Collateral in a transaction  exempt from  registration  under federal
securities  law,  and any such sale made in good  faith by Bank  shall be deemed
"commercially reasonable."


                                       9
<PAGE>


1.       GENERAL.
2.
A. PARTIES  BOUND.  Bank's  rights  hereunder  shall inure to the benefit of its
successors and assigns, and in the event of any assignment or transfer of any of
the Obligation or the Collateral, Bank thereafter shall be fully discharged from
any  responsibility  with respect to the Collateral so assigned or  transferred,
but Bank shall retain all rights and powers  hereby given with respect to any of
the  Obligation  or  the  Collateral  not  so  assigned  or   transferred.   All
representations, warranties and agreements of Pledgor if more than one are joint
and several and all shall be binding upon the personal  representatives,  heirs,
successors and assigns of Pledgor.

A. WAIVER.  No delay of Bank in exercising any power or right shall operate as a
waiver thereof;  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.  No waiver by Bank of any right  hereunder  or of any  default by Pledgor
shall be binding upon Bank unless in writing, and no failure by Bank to exercise
any power or right  hereunder or waiver of any default by Pledgor  shall operate
as a waiver of any other or  further  exercise  of such right or power or of any
further default.  Each right, power and remedy of Bank as provided for herein or
in any of the loan documents  related to the  Obligation,  or which shall now or
hereafter  exist  at law or in  equity  or by  statute  or  otherwise,  shall be
cumulative  and  concurrent  and shall be in addition to every other such right,
power or remedy. The exercise or beginning of the exercise by Bank of any one or
more of such rights,  powers or remedies shall not preclude the  simultaneous or
later exercise by Bank of any or all other such rights, powers or remedies.
B.
C. AGREEMENT CONTINUING.  This Agreement shall constitute a continuing agreement
applying to all future as well as existing  transactions,  whether or not of the
character  contemplated at the date of this Agreement,  and if all  transactions
between  Bank and  Pledgor  shall  be  closed  at any  time,  shall  be  equally
applicable to any new  transactions  thereafter.  Provisions of this  Agreement,
unless  by their  terms  exclusive,  shall be in  addition  to other  agreements
between the parties. Time is of the essence of this Agreement.
D.
E. DEFINITIONS.  Unless the context indicates otherwise,  definitions in the UCC
apply to words and  phrases  in this  Agreement;  if UCC  definitions  conflict,
Article 8 and/or 9 definitions apply.
F.
G. NOTICE.  Notice shall be deemed  reasonable  if it is made (i) in writing and
personally  delivered or mailed by prepaid certified or registered mail, or (ii)
made by facsimile  transmission  delivered or transmitted,  to the party to whom
such notice of  communication  is  directed,  to the address of such party shown
opposite its name on the signature pages hereof. Any such communication shall be
deemed to have been given  (whether  actually  received or not) on the day it is
personally  delivered or, if transmitted by facsimile  transmission,  on the day
that such communication is transmitted. 
H. 
I. MODIFICATIONS. No provision hereof
shall be modified or limited except by a written agreement  expressly  referring
hereto and to the  provisions  so  modified or limited and signed by Pledgor and
Bank.  The  provisions  of this  Agreement  shall not be  modified or limited by
course  of  conduct  or  usage  of  trade.   
J.  
K.  PARTIAL   INVALIDITY.   The
unenforceability  or  invalidity of any  provision of this  Agreement  shall not
affect the  enforceability  or validity of any other provision  herein,  and the
invalidity  or  unenforceability  of any  provision of any Loan  Document to any
person or circumstance  shall not affect the  enforceability or validity of such
provision as it may apply to other persons or  circumstances.  
L. 
M.  APPLICABLE
LAW AND VENUE. This Agreement has been delivered in the State of Texas and shall
be construed in accordance  with the laws of that State.  It is  performable  by
Pledgor  in the  county or city 

                                       10
<PAGE>

of  Bank's  address  set out  above and  Pledgor
expressly  waives  any  objection  as to venue in any  such  location.  Wherever
possible each provision of this Agreement shall be interpreted in such manner as
to be effective  and valid under  applicable  law, but if any  provision of this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be  ineffective to the extent of such  prohibition or invalidity,  without
invalidating  the remainder of such  provisions  or the remaining  provisions of
this Agreement. 
N. 
O. Financing Statement. To the extent permitted by applicable
law, a carbon,  photographic  or other  reproduction  of this  Agreement  or any
financing  statement  covering the Collateral shall be sufficient as a financing
statement.  
P. 
Q.  ARBITRATION.  ANY  CONTROVERSY  OR CLAIM BETWEEN OR AMONG THE
PARTIES HERETO  INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO
THIS INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS,  INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT,  SHALL
BE DETERMINED BY BINDING  ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE,  THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL  DISPUTES OF  J.A.M.S./ENDISPUTE  OR
ANY SUCCESSOR THEREOF ("J.A.M.S."),  AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY,  THE SPECIAL RULES SHALL CONTROL.  JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS  INSTRUMENT,  AGREEMENT  OR  DOCUMENT  MAY BRING AN ACTION,  INCLUDING A
SUMMARY OR EXPEDITED  PROCEEDING,  TO COMPEL  ARBITRATION OF ANY  CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION. 
R. 
i. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF
ANY  BORROWER'S  DOMICILE  AT THE  TIME OF THE  EXECUTION  OF  THIS  INSTRUMENT,
AGREEMENT  OR  DOCUMENT  AND  ADMINISTERED  BY  J.A.M.S.  WHO  WILL  APPOINT  AN
ARBITRATOR;  IF J.A.M.S.  IS UNABLE OR LEGALLY PRECLUDED FROM  ADMINISTERING THE
ARBITRATION,   THEN  THE  AMERICAN  ARBITRATION   ASSOCIATION  WILL  SERVE.  ALL
ARBITRATION  HEARINGS  WILL  BE  COMMENCED  WITHIN  90 DAYS  OF THE  DEMAND  FOR
ARBITRATION;  FURTHER,  THE ARBITRATOR  SHALL ONLY,  UPON A SHOWING OF CAUSE, BE
PERMITTED TO EXTEND THE  COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60
DAYS.
ii. 
iii.  RESERVATION  OF RIGHTS.  NOTHING IN THIS  ARBITRATION  PROVISION  SHALL BE
DEEMED TO (I) LIMIT THE  APPLICABILITY OF ANY OTHERWISE  APPLICABLE  STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT,  AGREEMENT OR
DOCUMENT;  OR (II) BE A WAIVER BY BANK OF THE  PROTECTION  AFFORDED  TO IT BY 12
U.S.C.  SEC. 91 OR ANY  SUBSTANTIALLY  EQUIVALENT  STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO)  SETOFF,  OR  (B)  TO  FORECLOSE  AGAINST  ANY  REAL  OR  PERSONAL  PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER.  BANK MAY  EXERCISE  SUCH SELF HELP RIGHTS,  FORECLOSE  UPON SUCH
PROPERTY,  OR OBTAIN SUCH 


                                       11
<PAGE>

PROVISIONAL OR ANCILLARY  REMEDIES  BEFORE,  DURING OR
AFTER THE  PENDENCY  OF ANY  ARBITRATION  PROCEEDING  BROUGHT  PURSUANT  TO THIS
INSTRUMENT,  AGREEMENT OR DOCUMENT, PROVIDED THAT IF BANK SHALL PETITION A COURT
FOR SUCH RELIEF OR REMEDIES,  THEN  PLEDGOR  SHALL BE ENTITLED TO ASSERT IN SUCH
COURT ANY CLAIMS OR DEFENSES  RELATED TO THE SUBJECT MATTER OF BANK'S  PETITION.
NEITHER THIS EXERCISE OF SELF HELP REMEDIES NOR THE  INSTITUTION  OR MAINTENANCE
OF AN  ACTION  FOR  FORECLOSURE  OR  PROVISIONAL  OR  ANCILLARY  REMEDIES  SHALL
CONSTITUTE  A WAIVER OF THE RIGHT OF ANY PARTY,  INCLUDING  THE  CLAIMANT IN ANY
SUCH ACTION,  TO ARBITRATE THE MERITS OF THE  CONTROVERSY  OR CLAIM  OCCASIONING
RESORT TO SUCH REMEDIES.
iv.
S.  Controlling Document.  To the extent that this Agreement conflicts with or 
is in any way incompatible with any other loan document concerning the
Obligation, any promissory note shall control over any other document, and if 
such promissory note does not address an issue, then each other loan document 
shall control to the extent that it deals most specifically with an issue.
T.
U. Notice of Final Agreement.  THIS WRITTEN AGREEMENT AND ANY OTHER DOCUMENTS  
EXECUTED IN CONNECTION HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE 
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR 
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL 
AGREEMENTS BETWEEN THE PARTIES.
V.

IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be duly
executed by their duly authorized representatives as of February 10, 1998.


Bank/Secured Party:                         Pledgor(s)/Debtor(s):

NATIONSBANK OF TEXAS, N.A.                  AMERICAN PHYSICIANS SERVICE
                                             GROUP, INC.,



By:      /s/ Teena Belcik                                                       
         -----------------
         Teena Belcik,                      Name:    /s/ William H Hayes        
         Vice President                     Title:   Sr VP Finance         




<PAGE>


                                                                                
         SCHEDULE I
                                       TO
                                PLEDGE AGREEMENT


         Type of Collateral:

         Shares of common stock, described in Section 2.A. of the Agreement, and
         which

                  (1)      are validly issued, fully paid and non-assessable;

                  (2) are owned of  record  and  beneficially  by  Pledgor,  and
         represented  by  stock  certificates  issued  in the  name  of  Pledgor
         properly endorsed to Bank;

                  (3)      may be sold by Bank, pursuant to the terms of the    
                           Pledge Agreement; and

                  (4) have been  delivered  and pledged to Bank  pursuant to the
        Pledge Agreement.


                                       i
<PAGE>


                                                                                
                                   SCHEDULE II

                               PLEDGE CERTIFICATE

         Reference is hereby made to that certain Pledge  Agreement  dated as of
February , 1998 ("Pledge Agreement"), between American Physicians Service Group,
Inc., a Texas corporation ("Pledgor") and NationsBank of Texas, N.A., a national
banking association  ("Bank").  This Pledge Certificate is delivered pursuant to
Section 2 of the Pledge Agreement.  All capitalized terms used and not otherwise
defined herein shall have their  respective  meanings as set forth in the Pledge
Agreement.

         Pledgor hereby certifies that concurrently with the delivery of this 
         Pledge Certificate,

         [X] Pledgor is delivering to Bank the following  items of Collateral as
         additional Collateral for the Obligation (collectively, the "Additional
         Collateral"):  ______ shares of Common  Stock,  $.01 par value of Prime
         Medical Services, Inc., a Delaware corporation.

         Pledgor hereby acknowledges that Pledgor has granted to Bank a security
interest in the Additional Collateral pursuant to the Pledge Agreement to secure
the Obligation and that the Collateral covered by the Pledge Agreement includes,
without  limitation,   Additional  Collateral.  Pledgor  hereby  represents  and
warrants that all of the representations and warranties  contained in the Pledge
Agreement are true and correct in all material respects,  including with respect
to the Additional  Collateral,  on the date hereof as though made as of the date
hereof.

         EXECUTED this 10th day of February, 1998.

                                    Pledgor(s)/Debtor(s):

                                    AMERICAN PHYSICIANS SERVICE GROUP, INC.,



                                     By:    /s/ William H Hayes
                                     Name:      William H Hayes
                                     Title:     Sr VP Finance

                                       i
<PAGE>




<PAGE>


                                                                                
         RULE 144 RIDER

         This Rule 144 Rider is made this  10th day of  February,  1998,  and is
incorporated  into and  shall be  deemed  to  supplement  the  Pledge  Agreement
("Agreement")  of the same date given by Pledgor  to secure  the  Obligation  to
Bank.  Terms used and not  otherwise  defined in this Rider which are defined in
the Agreement have the meanings given them in the Agreement.

         1. The securities  listed on Exhibit A hereto,  which Exhibit is made a
         part of this Rider and the Agreement  for all  purposes,  are or may be
         deemed (check one or more boxes):

         [X]      Restricted securities

         [X]      Control securities

         for  purposes  of  Rule  144  of  the  General  Regulations  under  the
         Securities  Act of 1933 ("Rule 144")  promulgated by the Securities and
         Exchange Commission.  These securities ("Rule 144 Securities") comprise
         all or part of the  Collateral  held by Bank  presently  subject to the
         terms and conditions of the Agreement and this Rider.

         2. Pledgor  represents  and warrants that Pledgor has held the Rule 144
         Securities free and clear of all liens (except for liens,  encumbrances
         and debt  held by Bank)  encumbrances  and  debt,  and  borne  the full
         economic risk thereof since October 12, 1989.

         3. Pledgor covenants and agrees that:

                  a. After an Event of Default,  Pledgor  will  cooperate  fully
                  with Bank with  respect to any sale by Bank of any of the Rule
                  144  Securities,  including full and complete  compliance with
                  all  requirements  of Rule  144,  and  will  give to Bank  all
                  information  and will do all things  necessary,  including the
                  execution  of all  documents,  forms,  instruments  and  other
                  items,   to  comply  with  Rule  144  for  the   complete  and
                  unrestricted  sale and/or  transfer of the Rule 144 Securities
                  and will  exercise its best efforts to have the issuer of such
                  securities,  upon the request of Bank, take all such action as
                  may be required to satisfy the public information requirements
                  of Rule 144(c).

                  b. Pledgor will not approve or consent to any amendment of the
                  articles of incorporation or charter of any issuer of the Rule
                  144 Securities that may materially  adversely affect the value
                  of the Rule 144  Securities,  or that permit any issuer of the
                  Rule 144 Securities to merge or  consolidate  with or into any
                  corporation or other person, without the prior written consent
                  of Bank.

                  c.  Pledgor  will  use all  reasonable  efforts,  upon  Bank's
                  written  request,  to  have  issuer  publish  all  information
                  necessary  to satisfy  Rule 144 in the event any issuer of the
                  Rule 144  Securities  is not current in its filings  under the
                  Securities  Exchange Act of 1934 at the time of a  foreclosure
                  sale by Bank.


<PAGE>



         By signing below, Pledgor accepts and agrees to the terms and covenants
contained in this Rider.

                                       Pledgor(s)/Debtor(s):

                                       AMERICAN PHYSICIANS SERVICE
                                        GROUP, INC.,



                                              /s/ William H Hayes
                                       Name:      William H Hayes       
                                       Title:     Sr VP Finance