EXHIBIT 10.12

                         MULTICURRENCY CREDIT AGREEMENT



                         DATED AS OF DECEMBER 17, 1999,


                                      AMONG



                                  ANICOM, INC.,




                                   THE LENDERS
                                  PARTY HERETO,




                         HARRIS TRUST AND SAVINGS BANK,
                           INDIVIDUALLY AND AS AGENT,



                                       And



                                  BANK ONE, NA,
                      individually and as Syndication Agent








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                                TABLE OF CONTENTS

SECTION                 DESCRIPTION                                       PAGE

SECTION 1.              THE REVOLVING CREDITS..................................1

       Section 1.1.     The Revolving Credit...................................1
       Section 1.2.     The Revolving Notes....................................1
       Section 1.3.     Letters of Credit......................................2
       Section 1.4.     Manner and Disbursement of Revolving Loans.............5
       Section 1.5.     The Swing Line.........................................7
               (a)      Swing Loans............................................7
               (b)      Swing Note.............................................7
               (c)      Minimum Borrowing Amount...............................7
               (d)      Interest on Swing Loans................................7
               (e)      Requests for Swing Loans...............................8
               (f)      Refunding Loans........................................9
               (g)      Participations.........................................9
               (h)      Indemnification........................................9
       Section 1.6.     Extensions of the Revolving Credit Termination Date...10
       Section 1.7.     Maturity of Loans.....................................10

SECTION 2.              INTEREST AND CHANGE IN CIRCUMSTANCES..................10

       Section 2.1.     Interest Rate Options on Revolving Notes..............10
       Section 2.2.     Minimum  LIBOR Portion Amounts........................12
       Section 2.3.     Computation of Interest...............................12
       Section 2.4.     Manner of Rate Selection..............................13
       Section 2.5.     Change of Law.........................................13
       Section 2.6.     Unavailability of Deposits or Inability to Ascertain
                            or Inadequacy of, Fixed Rate......................14
       Section 2.7.     Taxes and Increased Costs.............................14
       Section 2.8.     Change in Capital Adequacy Requirements...............15
       Section 2.9.     Funding Indemnity.....................................16
       Section 2.10.    Lending Branch........................................16
       Section 2.11.    Discretion of Lenders as to Manner of Funding.........17

SECTION 3.              FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.....17

       Section 3.1.     Fees..................................................17
       Section 3.2.     Prepayments...........................................18
       Section 3.3.     Terminations..........................................20
       Section 3.4.     Place and Application of Payments.....................20
       Section 3.5.     Notations.............................................21

SECTION 4.              GUARANTIES............................................22

       Section 4.1.     Collateral............................................22

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       Section 4.2.     Subsidiary Guaranties.................................22
       Section 4.3.     Further Assurances....................................22

SECTION 5.              DEFINITIONS; INTERPRETATION...........................22

       Section 5.1.     Definitions...........................................22
       Section 5.2.     Interpretation........................................39

SECTION 6.              REPRESENTATIONS AND WARRANTIES........................39

       Section 6.1.     Organization and Qualification........................39
       Section 6.2.     Subsidiaries..........................................39
       Section 6.3.     Corporate Authority and Validity of Obligations.......40
       Section 6.4.     Use of Proceeds; Margin Stock.........................40
       Section 6.5.     Financial Reports.....................................41
       Section 6.6.     No Material Adverse Change............................41
       Section 6.7.     Full Disclosure.......................................41
       Section 6.8.     Good Title............................................41
       Section 6.9.     Litigation and Other Controversies....................41
       Section 6.10.    Taxes.................................................41
       Section 6.11.    Approvals.............................................42
       Section 6.12.    Affiliate Transactions................................42
       Section 6.13.    Investment Company; Public Utility Holding Company....42
       Section 6.14.    ERISA.................................................42
       Section 6.15.    Compliance with Laws..................................42
       Section 6.16.    Other Agreements......................................43
       Section 6.17.    No Default............................................43
       Section 6.18.    Year 2000 Compliance..................................43

SECTION 7.              CONDITIONS PRECEDENT..................................43

       Section 7.1.     All Advances..........................................43
       Section 7.2.     Initial Advance.......................................44
       Section 7.3.     Termination of Existing Credit Agreements.............45

SECTION 8.              COVENANTS.............................................46

       Section 8.1.     Corporate Existence; Subsidiaries.....................46
       Section 8.2.     Maintenance of Properties.............................46
       Section 8.3.     Taxes and Assessments.................................46
       Section 8.4.     Insurance.............................................46
       Section 8.5.     Financial Reports.....................................47
       Section 8.7.     Interest Coverage Ratio...............................49
       Section 8.8.     Tangible Net Worth....................................49
       Section 8.9.     Debt to Earnings Ratio................................49
       Section 8.10.    Leverage Ratio........................................50
       Section 8.11.    Indebtedness for Borrowed Money.......................50
       Section 8.12.    Liens.................................................50

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       Section 8.13.    Investments, Loans, Advances and Guaranties...........51
       Section 8.14.    Acquisitions..........................................52
       Section 8.15.    Sales and Leasebacks..................................53
       Section 8.16.    Dividends and Certain Other Restricted Payments.......53
       Section 8.17.    Mergers, Consolidations and Sales.....................53
       Section 8.18.    ERISA.................................................54
       Section 8.19.    Compliance with Laws..................................54
       Section 8.20.    Burdensome Contracts With Affiliates..................54
       Section 8.21.    No Changes in Fiscal Year.............................54
       Section 8.22.    Inspection and Field Audit............................55
       Section 8.23.    Formation of Subsidiaries.............................55
       Section 8.24.    Subordinated Indebtedness.............................55
       Section 8.25.    Use of Proceeds.......................................55
       Section 8.26.    Year 2000 Compliance..................................56
       Section 8.27.    European Monetary Union...............................56

SECTION 9.              EVENTS OF DEFAULT AND REMEDIES........................57

       Section 9.1.     Events of Default.....................................57
       Section 9.2.     Non-Bankruptcy Defaults...............................59
       Section 9.3.     Bankruptcy Defaults...................................59
       Section 9.4.     Collateral for Undrawn Letters of Credit..............59

SECTION 10.             THE AGENT.............................................60

       Section 10.1.    Appointment and Authorization.........................60
       Section 10.2.    Rights as a Lender....................................60
       Section 10.3.    Standard of Care......................................60
       Section 10.4.    Costs and Expenses....................................61
       Section 10.5.    Indemnity.............................................61

SECTION 11.             MISCELLANEOUS.........................................62

       Section 11.1.    Withholding Taxes.....................................62
       Section 11.2.    Non-Business Days.....................................63
       Section 11.3.    No Waiver, Cumulative Remedies........................63
       Section 11.4.    Waivers, Modifications and Amendments.................63
       Section 11.5.    Costs and Expenses....................................63
       Section 11.6.    Documentary Taxes.....................................64
       Section 11.7.    Survival of Representations...........................64
       Section 11.8.    Survival of Indemnities...............................64
       Section 11.9.    Participations........................................64
       Section 11.10.   Assignment Agreements.................................65
       Section 11.11.   Notices...............................................65
       Section 11.12.   Construction..........................................66
       Section 11.13.   Headings..............................................67
       Section 11.14.   Severability of Provisions............................67

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       Section 11.15    Counterparts..........................................67
       Section 11.16.   Entire Understanding..................................67
       Section 11.17.   Currency..............................................67
       Section 11.18.   Currency Equivalence..................................67
       Section 11.19.   Binding Nature, Governing Law, Etc....................68
       Section 11.20.   Submission to Jurisdiction; Waiver of Jury Trial......68

Signature.....................................................................69

Exhibit A-1 - Revolving Credit Note
Exhibit A-2 - Swing Line Note
Exhibit B - Compliance Certificate
Exhibit C - Subordinated Indebtedness
Exhibit D - Subordination Provisions Applicable to Subordinated Debt
Exhibit E - Form of Guaranty
Exhibit F - Borrowing Base Certificate
Schedule 1 - Commitments
Schedule 6.2 - Subsidiaries


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                         MULTICURRENCY CREDIT AGREEMENT




To each of the Lenders party hereto:


Ladies and Gentlemen:

         The undersigned,  Anicom, Inc., a Delaware corporation (the "Company"),
applies to you for your several commitments, subject to the terms and conditions
hereof and on the basis of the  representations  and warranties  hereinafter set
forth, to extend credit to the Company, all as more fully hereinafter set forth.

SECTION 1.           THE REVOLVING CREDITS.

         Section 1.1. The Revolving Credit.  Subject to the terms and conditions
hereof,  each  Lender  severally  agrees  to  extend  a  revolving  credit  (the
"Revolving  Credit") to the Company  which may be availed of by the Company from
time to time  during the period  from and  including  the date hereof to but not
including the Revolving Credit  Termination  Date, at which time the commitments
of the Lenders to extend  credit under the Revolving  Credit shall  expire.  The
maximum amount of the Revolving Credit which each Lender agrees to extend to the
Company shall be as set forth opposite such Lender's  signature hereto under the
heading  "Revolving Credit Commitment" or as otherwise provided in Section 11.10
hereof, as such amount may be reduced pursuant hereto.  The Revolving Credit may
be utilized by the Company in the form of Revolving Loans and Letters of Credit,
all as more  fully  hereinafter  set  forth,  provided  that  (i) the  aggregate
Original  Dollar Amount of Loans  (whether  Revolving  Loans or Swing Loans) and
Letters of Credit outstanding at any one time shall not exceed the lesser of (x)
the Revolving Credit Commitments and (y) the Borrowing Base as determined on the
most recent  Borrowing Base  Certificate and (ii) the aggregate  Original Dollar
Amount of Revolving  Loans and Letters of Credit and  denominated in Alternative
Currencies  shall not exceed  $15,000,000.  During the period from and including
the date hereof to but not including the Revolving Credit  Termination Date, the
Company may use the Revolving  Credit  Commitments  by  borrowing,  repaying and
reborrowing Revolving Loans in whole or in part and/or by having the Agent issue
Letters of Credit,  having such Letters of Credit expire or otherwise  terminate
without having been drawn upon or, if drawn upon, reimbursing the Agent for each
such  drawing,  and  having  the  Agent  issue new  Letters  of  Credit,  all in
accordance with the terms and conditions of this Agreement. For purposes of this
Agreement,  where a  determination  of the  unused  or  available  amount of the
Revolving Credit  Commitments is necessary,  the Original Dollar Amount of Loans
(whether Revolving Loans or Swing Loans) outstanding and Letters of Credit shall
be deemed to utilize the Revolving  Credit  Commitments.  The obligations of the
Lenders  hereunder  are  several  and not joint,  and no Lender  shall under any
circumstances  be obligated to extend credit in excess of its  Revolving  Credit
Commitment.

         Section 1.2. The Revolving  Notes.  Subject to the terms and conditions
hereof,  the  Revolving  Credit may be availed of by the  Company in the form of
Revolving Loans (individually a "Revolving Loan" and collectively the "Revolving

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Loans") in U.S. Dollars or an Alternative Currency.  Each Borrowing of Revolving
Loans  under the  Revolving  Credit  shall be made  ratably  by the  Lenders  in
accordance  with their  Percentages  of the Revolving  Credit  Commitments.  All
Revolving  Loans  made by a Lender  under  the  Revolving  Credit  shall be made
against  and  evidenced  by a  single  Revolving  Credit  Note  of  the  Company
(individually a "Revolving Note" and collectively the "Revolving Notes") payable
to the order of such Lender in the amount of its  Revolving  Credit  Commitment,
with  each  Revolving  Note  to be in the  form  (with  appropriate  insertions)
attached  hereto as Exhibit A-1. Each  Revolving Note shall be dated the date of
issuance  thereof,  be  expressed  to bear  interest  as set forth in  Section 2
hereof,  and be expressed to mature on the Revolving  Credit  Termination  Date.
Without  regard to the  principal  amount of each  Revolving  Note stated on its
face,  the  actual  principal  amount at any time  outstanding  and owing by the
Company on account  thereof shall be the sum of all advances then or theretofore
made thereon less all payments of principal actually received.

         Section 1.3.    Letters of Credit.

         (a) General  Terms.  Subject to the terms and  conditions  hereof,  the
Revolving  Credit may be availed  of by the  Company in the form of standby  and
commercial  letters of credit issued by the Agent for the account of the Company
in U.S.  Dollars or an Alternative  Currency  (individually a "Letter of Credit"
and  collectively  the "Letters of  Credit"),  provided  that (i) the  aggregate
Original  Dollar  Amount of Letters of Credit issued and  outstanding  hereunder
shall not at any time  exceed the lesser of (x)  $20,000,000  and (y) the excess
(if any) of the Revolving Credit  Commitments over the aggregate Original Dollar
Amount  of  Loans   (including  both  Revolving  Loans  and  Swing  Loans)  then
outstanding and (ii) the aggregate Original Dollar Amount of Revolving Loans and
Letters  of Credit  denominated  in  Alternative  Currencies  shall  not  exceed
$15,000,000.  For purposes of this Agreement, a Letter of Credit shall be deemed
outstanding  as of any time in an amount equal to the maximum amount which could
be drawn thereunder under any circumstances and over any period of time plus any
unreimbursed  drawings  then  outstanding  with respect  thereto.  If and to the
extent any Letter of Credit expires or otherwise  terminates without having been
drawn upon, the  availability  under the Revolving Credit  Commitments  shall to
such extent be  reinstated.  The Letters of Credit shall be issued by the Agent,
but each Lender  shall be obligated  to  reimburse  the Agent for such  Lender's
Percentage  of the  amount  of each  draft  drawn  under a Letter  of  Credit in
accordance with this Section 1.3 and,  accordingly,  each Letter of Credit shall
be deemed to utilize the Revolving Credit Commitments of all Lenders pro rata in
accordance with their Percentages thereof.

         (b) Term. Each Letter of Credit issued hereunder shall expire not later
than the earlier of (i) twelve  (12)  months  from the date of  issuance  (or be
cancelable  not later than twelve (12) months from the date of issuance and each
renewal) or (ii) the Revolving Credit  Termination  Date. In the event the Agent
issues  any  Letter  of Credit  with an  expiration  date that is  automatically
extended  unless the Agent  gives  notice that the  expiration  date will not so
extend  beyond  its then  scheduled  expiration  date,  the Agent will give such
notice of  non-renewal  before  the time  necessary  to prevent  such  automatic
extension if before such required  notice date (i) the  expiration  date of such
Letter of Credit if so extended would be after the Revolving Credit  Termination
Date, (ii) the Revolving Credit Commitments have terminated or (iii) an Event of
Default exists and the Required Lenders have given the Agent instructions not to
so permit the extension of the expiration date of such Letter of Credit.
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         (c) General  Characteristics.  Each Letter of Credit  issued  hereunder
shall be payable  in U.S.  Dollars or an  Alternative  Currency,  conform to the
general  requirements  of the Agent for the  issuance  of standby or  commercial
letters  of  credit  , as the case may be,  as to form and  substance,  and be a
letter of credit which the Agent may lawfully issue.

         (d)  Applications.  At the time the  Company  requests  each  Letter of
Credit to be issued (or prior to the first issuance of a Letter of Credit in the
case of a continuing application),  the Company shall execute and deliver to the
Agent an  application  for such  Letter of  Credit in the form then  customarily
prescribed by the Agent  (individually  an  "Application"  and  collectively the
"Applications").  Subject  to the  other  provisions  of  this  subsection,  the
obligation of the Company to reimburse the Agent for drawings  under a Letter of
Credit shall be governed by the Application for such Letter of Credit.  Anything
contained  in  the  Applications  to  the  contrary  notwithstanding,   (i)  the
reimbursement  by the Company of draws under a Letter of Credit  denominated  in
U.S.  Dollars  shall  be made in U.S.  Dollars,  (ii) the  reimbursement  by the
Company  of draws made under a Letter of Credit  denominated  in an  Alternative
Currency shall be made by payment in U.S. Dollars of the U.S. Dollar Equivalent,
calculated on the date the Agent paid such draw, of the amount paid by the Agent
pursuant to such draw,  or, if the Agent shall elect by notice to the Company by
payment in the Alternative Currency which was paid by the Agent pursuant to such
drawing in an amount equal to such drawing,  (iii) the in the event the Agent is
not  reimbursed  by the Company for the amount the Agent pays on any draft drawn
under a Letter of Credit denominated in U.S. Dollars by 1:00 p.m. (Chicago time)
on the date  when  such  drawing  is paid,  the  obligation  of the  Company  to
reimburse the Agent for the amount of such draft paid shall bear interest (which
the Company hereby  promises to pay on demand) from and after the date the draft
is paid until payment in full thereof at a fluctuating rate per annum determined
by adding 2% to the  Domestic  Rate as from time to time in effect  (computed on
the basis of a year of 360 days for the actual number of days elapsed),  (iv) or
in the event the Agent is not reimbursed by the Company for the amount the Agent
pays on any draft drawn under a Letter of Credit  denominated  in an Alternative
Currency by 11:00 a.m.  local time at the place of payment or, if earlier,  such
local time as is necessary for such funds to be received and  transferred to the
Agent for same day value the date such  payment is due,  the  obligation  of the
Company  to  reimburse  the Agent for the  amount of such  draft paid shall bear
interest (which the Company hereby promises to pay on demand) from and after the
date the draft is paid until payment in full thereof at a  fluctuating  rate per
annum equal to (X) in the case of a drawing under a Letter of Credit denominated
in an Alternative  Currency as to which the Agent has requested that the Company
reimburse  such drawing in U.S.  Dollars,  the sum of 2% plus the Domestic  Rate
from time to time in effect (computed on the basis of a year of 360 days for the
actual  number of days  elapsed) and (Y) in the case of a drawing under a Letter
of  Credit  denominated  in an  Alternative  Currency  as to which the Agent has
requested that the Company reimburse such drawing in the Alternative Currency in
which such Letter of Credit was  denominated,  the sum of 2% plus the  Overnight
Foreign  Currency Rate,  (v) the Company shall pay fees in connection  with each
Letter  of Credit as set forth in  Section 3 hereof,  (vi)  except as  otherwise
provided in Section 3.4 hereof, prior to the occurrence of a Default or an Event
of Default the Agent will not call for  additional  collateral  security for the

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obligations of the Company under the Applications, and (vii) except as otherwise
provided in Section 3.4 hereof, prior to the occurrence of a Default or an Event
of Default  the Agent will not call for the funding of a Letter of Credit by the
Company prior to being presented with a draft drawn thereunder (or, in the event
the  draft  is a time  draft,  prior  to  its  due  date).  The  Company  hereby
irrevocably authorizes the Agent to charge any of the Company's deposit accounts
maintained  with the Agent for the amount  necessary to reimburse  the Agent for
any drafts drawn under Letters of Credit issued hereunder.

         (e) Change in Laws. If the Agent or any Lender shall  determine in good
faith that any change in any applicable law, regulation or guideline (including,
without  limitation,  Regulation  D of the  Board of  Governors  of the  Federal
Reserve System) or any new law,  regulation or guideline,  or any interpretation
of  any  of the  foregoing  by  any  governmental  authority  charged  with  the
administration  thereof or any central bank or other  fiscal,  monetary or other
authority  having  jurisdiction  over the Agent or such  Lender  (whether or not
having the force of law), shall:

                   (i) impose,  modify or deem  applicable any reserve,  special
         deposit or similar  requirement  against the Letters of Credit,  or the
         Agent's  or such  Lender's  or the  Company's  liability  with  respect
         thereto; or

                  (ii)  impose  on the Agent or such  Lender  any  penalty  with
         respect  to  the  foregoing  or  any  other  condition  regarding  this
         Agreement, the Applications or the Letters of Credit;

and the Agent or such Lender  shall  determine  in good faith that the result of
any of the  foregoing  is to increase  the cost  (whether by incurring a cost or
adding  to a cost) to the  Agent  or such  Lender  of  issuing,  maintaining  or
participating in the Letters of Credit hereunder  (without benefit of, or credit
for, any prorations,  exemptions,  credits or other offsets  available under any
such laws, regulations, guidelines or interpretations thereof), then the Company
shall pay on demand to the Agent or such Lender  from time to time as  specified
by the Agent or such Lender such additional  amounts as the Agent or such Lender
shall determine are sufficient to compensate and indemnify it for such increased
cost. If the Agent or any Lender makes such a claim for  compensation,  it shall
provide  the  Company  (with a copy to the  Agent in the case of any  Lender)  a
certificate  setting forth the  computation of the increased cost as a result of
any event mentioned herein in reasonable  detail and such  certificate  shall be
conclusive if reasonably determined.

         (f) Participations in Letters of Credit.  Each Lender shall participate
on a pro rata basis in accordance  with its  Percentage of the Revolving  Credit
Commitments  in the Letters of Credit issued by the Agent,  which  participation
shall  automatically  arise upon the  issuance  of each  Letter of Credit.  Each
Lender  unconditionally  agrees  that in the event the Agent is not  immediately
reimbursed  by the  Company  for the  amount  paid  by the  Agent  on any  draft
presented under a Letter of Credit,  then in that event such Lender shall pay to
the Agent (i) in the case of a Reimbursement Obligation payable in U.S. Dollars,
an  amount  equal  to such  Lender's  Percentage  of such  unpaid  Reimbursement
Obligation,  such  payment to be made in lawful money in the United  States,  in
immediately  available  funds  at  the  Agent's  principal  office  in  Chicago,
Illinois,  together  with  interest  on such  amount  accrued  from the date the

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related payment was made by the Agent to the date of such payment by such Lender
at a rate per annum equal to (X) from the date the  related  payment was made by
the Agent to the date two (2) Business  Days after payment by such Lender is due
hereunder,  the  Federal  Funds Rate for each such day and (Y) from the date two
(2)  Business  Days after the date such  payment is due from such  Lender to the
date such payment is made by such Lender,  the Domestic  Rate in effect for each
such  day and  (ii) in the  case of a  Reimbursement  Obligation  payable  in an
Alternative Currency, an amount equal to such Lender's Percentage of such unpaid
Reimbursement  Obligation,  such payment to be made in such Alternative Currency
in such funds  which are then  customary  for the  settlement  of  international
transactions  in such  currency,  together with interest on such amount  accrued
from the  date the  related  payment  was made by the  Agent to the date of such
payment  by the  Lender  at the  rate per  annum  equal to (X) from the date the
related  payment was made by the Agent to the date two (2)  Business  Days after
payment by such Lender is due hereunder, the Overnight Foreign Currency Rate for
each such day and (Y) from the date two (2)  Business  Days  after the date such
payment is due from such Lender to the date such payment is made by such Lender,
the sum of 1% plus the  Overnight  Foreign  Currency Rate for each such day. The
obligations of the Lenders to the Agent under this subsection shall be absolute,
irrevocable and  unconditional  under any and all  circumstances  whatsoever and
shall not be subject to any set-off,  counterclaim  or defense to payment  which
any Lender may have or have had against the Company, the Agent, any other Lender
or any other party  whatsoever.  In the event that any Lender fails to honor its
obligation to reimburse  the Agent for its  Percentage of the amount of any such
draft,  then in that  event  the  defaulting  Lender  shall  have  no  right  to
participate in any recoveries from the Company in respect of such draft.

         (g) Original  Dollar Amount  Determinations.  The Agent shall determine
the  Original  Dollar  Amount of Letters of Credit  denominated  in  Alternative
Currencies, and its determination thereof shall be conclusive and binding except
in the case of manifest error or willful misconduct.  The Original Dollar Amount
of a Letter of Credit  shall be  calculated  on the date of issuance  and on the
last day of each calendar quarter thereafter and at the request of any Lender or
the  Company,  at such  additional  times,  and  from  time to  time,  as may be
requested; provided, however, that the Original Dollar Amount of a Reimbursement
Obligation shall be calculated on the date of the Agent's payment of the drawing
giving rise to such  Reimbursement  Obligation and at such additional times, and
from time to time, as the Agent or Required Lenders may request.

         Section 1.4.    Manner and Disbursement of Revolving Loans.

         (a) Notice to the Agent and the Lenders. The Company shall give written
or telephonic  notice to the Agent (which notice shall be irrevocable once given
and, if given by telephone,  shall be promptly confirmed in writing) by no later
than  11:00  a.m.  (Chicago  time)  on the date the  Company  requests  that any
Borrowing  of  Revolving  Loans  be  made  to  it  under  the  Revolving  Credit
Commitments,  and the Agent  shall  promptly  notify  each Lender of the Agent's
receipt of each such  notice.  Each such  notice  shall  specify the date of the
Borrowing of Revolving Loans  requested  (which must be a Business Day and which
date shall be at least three Business Days subsequent to the date of such notice
in the case of any Revolving Loans  constituting a LIBOR Portion  denominated in
U.S.  Dollars and at least four  Business  Days  subsequent  to the date of such
notice  in  the  case  of any  Revolving  Loans  constituting  a  LIBOR  Portion

<PAGE>

denominated  in an  Alternative  Currency),  the type of  Revolving  Loan  being
requested,  and the amount of such Borrowing.  Each Borrowing of Revolving Loans
shall  initially  constitute  part of the Domestic  Rate  Portion  except to the
extent the Company has otherwise timely elected that such Borrowing, or any part
thereof, constitute part of a LIBOR Portion as provided in Section 2 hereof. The
Company  agrees  that the Agent may rely upon any written or  telephonic  notice
given  by  any  person  the  Agent  in  good  faith  believes  is an  Authorized
Representative  without the necessity of independent  investigation  and, in the
event any  telephonic  notice  conflicts  with the  written  confirmation,  such
telephonic  notice  shall  govern  if the Agent and the  Lenders  have  acted in
reliance thereon.

         (b) Disbursement of Revolving Loans. Not later than 1:00 p.m.  (Chicago
time) on the date  specified  for any  Borrowing of  Revolving  Loans to be made
hereunder (other than a Borrowing of Revolving Loans to the extent  constituting
a LIBOR Portion denominated in an Alternative Currency),  each Lender shall make
the proceeds of its Revolving Loan comprising  part of such Borrowing  available
to the Agent in Chicago, Illinois in immediately available funds to the Agent in
Chicago. Each Lender shall make the proceeds of each Revolving Loan constituting
a LIBOR Portion  denominated  in an  Alternative  Currency at such office as the
Agent has  previously  specified  in a notice to such Lender in such funds which
are then  customary for the  settlement of  international  transactions  in such
currency and no later than such local time as is necessary  for such funds to be
received  and  transferred  to the  Company  for same day  value on the date the
Revolving Loan is to be made. Subject to the provisions of Section 7 hereof, the
proceeds of each Lender's  Revolving Loan  denominated in U.S.  Dollars shall be
made  available to the Company at the office of the Agent in Chicago,  Illinois,
and the proceeds of each Lender's  Revolving Loans denominated in an Alternative
Currency  shall be made available to the Company at such office as the Agent has
previously  agreed  to with  the  Company,  in each  case in the  type of  funds
received  by the  Agent  from the  Lenders.  Unless  the Agent  shall  have been
notified by a Lender by no later than such time as would be  necessary  for such
Lender to make the proceeds of its Revolving  Loan available to the Agent on the
date a  Borrowing  is to be made  hereunder  that such Lender does not intend to
make the proceeds of its Revolving  Loan  available to the Agent,  the Agent may
assume that such Lender has made such  proceeds  available  to the Agent on such
date and the Agent may in reliance upon such  assumption  make  available to the
Company a corresponding amount. If such corresponding amount is not in fact made
available  to the  Agent by such  Lender  and the  Agent  has made  such  amount
available  to the  Company,  the Agent shall be entitled to receive  such amount
from such Lender  forthwith  upon the Agent's  demand,  together  with  interest
thereon in respect  of each day  during the period  commencing  on the date such
amount was made  available to the Company and ending on but  excluding  the date
the Agent  recovers such amount at a rate per annum equal to the effective  rate
charged to the Agent for overnight federal funds  transactions with member banks
of the federal reserve system, or in the case of a Revolving Loan denominated in
an Alternative  Currency,  the Overnight  Foreign Currency Rate, for each day as
determined  by the Agent (or in the case of a day which is not a  Business  Day,
then for the preceding  day). If such amount is not received from such Lender by
the Agent  immediately  upon demand,  the Company will, on demand,  repay to the
Agent the  proceeds  of such  Revolving  Loan  attributable  to such Lender with
interest  thereon at a rate per annum equal to the interest  rate  applicable to
the relevant Revolving Loan, but without such payment being considered a payment
or  prepayment  of a LIBOR  Portion,  so that the Company will have no liability
under Section 2.9 hereof with respect to such payment.
<PAGE>

         (c) Company's Failure to Notify. In the event the Company fails to give
notice  pursuant to Section 1.4(a) above of a Borrowing  equal to the amount for
which the Company is obligated to  reimburse  the Agent for a drawing  which the
Agent has paid on a Letter of Credit (a "Reimbursement  Obligation") and has not
notified the Agent by 12:00 noon  (Chicago  time) on the day such  Reimbursement
Obligation  becomes  due that the  Company  intends to repay such  Reimbursement
Obligation through funds not borrowed under this Agreement, the Company shall be
deemed to have requested a Borrowing of Revolving Loans  constituting a Domestic
Rate Portion on such day in the amount of the Reimbursement Obligation then due,
subject  to  Section 7  hereof,  which  Borrowing  shall be  applied  to pay the
Reimbursement Obligation then due.

         Section 1.5.    The Swing Line.

         (a) Swing Loans.  Subject to all of the terms and conditions hereof and
in reliance on the  obligations  of the Lenders to the Agent under this  Section
1.5,  Harris Bank agrees to make Loans (each, a "Swing Loan" and,  collectively,
the "Swing  Loans") in U.S.  Dollars to the Company  under a line of credit (the
"Swing  Line") which shall not in the aggregate at any time  outstanding  exceed
the lesser of (i) the Swing Line  Commitment or (ii) the excess,  if any, of (x)
the Revolving  Credit  Commitments in effect at such time over (y) the aggregate
Original  Dollar  Amount of Loans  (both  Revolving  Loans and Swing  Loans) and
Letters  of  Credit  outstanding  at the time of  computation.  The  Swing  Line
Commitment  shall be  available  to the  Company  and may be  availed  of by the
Company from time to time and borrowings thereunder may be repaid and used again
during the period ending on the Revolving Credit Termination Date.

         (b) Swing  Note.  All Swing  Loans made to the  Company by Harris  Bank
shall be evidenced by a promissory  note of the Company (the "Swing Note"),  the
Swing Note to be payable to Harris Bank's order in the  principal  amount of its
Swing Line  Commitment and otherwise in the form of Exhibit A-2 hereto.  Without
regard to the face  principal  amount of the Swing  Note,  the actual  principal
amount at any time  outstanding and owing by the Company on account of the Swing
Note on any date during the period  ending on the Revolving  Credit  Termination
Date shall be the sum of all Swing Loans then or theretofor made thereon through
such date less all payments actually received thereon through such date.


         (c) Minimum Borrowing Amount. Each Swing Loan shall be in an amount not
less than $100,000.


         (d) Interest on Swing Loans.  Each Swing Loan shall bear interest prior
to maturity either at the rate per annum equal at all times to the Domestic Rate
as from time to time in effect or subject to the  provisions  of Section  1.5(e)
hereof, at Harris Bank's Quoted Rate for the Interest Period selected  therefor.
Interest on each Swing Loan shall be due and payable  prior to such  maturity on
the  last  day of  each  Interest  Period  applicable  thereto.  Notwithstanding
anything to the contrary  contained in this Section 1.5(d), if any Swing Loan is
not paid when due (whether by lapse of time,  acceleration  or otherwise),  such
Swing Loan shall bear interest  whether before or after judgment,  until payment
in full thereof:
<PAGE>

                   (i) with  respect  to any  Quoted  Rate  Portion of the Swing
         Note, through the end of the Interest Period then applicable thereto at
         the rate per annum  determined  by  adding  2% to the rate of  interest
         otherwise  applicable thereto and effective at the end of such Interest
         Period, such Quoted Rate Portion shall automatically cease to exist and
         such principal  indebtedness shall thereafter bear interest at the rate
         per annum determined by adding the sum of 2% to the Domestic Rate as in
         effect from time to time; and

                  (ii) with respect to any portion of the principal indebtedness
         of the Swing Note bearing interest with reference to the Domestic Rate,
         at the  rate  per  annum  determined  by  adding  the  sum of 2% to the
         Domestic Rate as in effect from time to time.


Interest  on each Swing  Loan  shall be due and  payable on the last day of each
Interest  Period  applicable  thereto,  and interest after maturity  (whether by
lapse of time,  acceleration or otherwise) shall be due and payable upon demand.
All interest on the Swing Loans  bearing  interest at the Domestic Rate shall be
computed on the basis of a year of 365 or 366 days,  as the case may be, for the
actual  number of days  elapsed  and all  interest  on the Swing  Loans  bearing
interest at Harris  Bank's  Quoted Rate shall be computed on the basis of a year
of 360 days for the actual number of days elapsed.


         (e) Requests for Swing Loans.  The Company shall give Harris Bank prior
notice (which may be written or oral) no later than (i) 3:00 p.m. (Chicago time)
in the case of Swing Loans  bearing  interest at the  Domestic  Rate and (ii) no
later than 11:00 a.m. (Chicago time) in the case of Swing Loans bearing interest
at Harris  Bank's  Quoted Rate,  in each case on the date upon which the Company
requests  that any Swing Loan be made, of the amount and date of such Swing Loan
and in the event the Company is requesting the Swing Loan be made available by a
Quoted Rate Portion,  the Interest Period selected therefor.  If the Company has
requested  that such  Swing Loan be made  available  as a Quoted  Rate  Portion,
within thirty (30) minutes after receiving such notice,  Harris Bank shall quote
an interest  rate  determined  in its  discretion to the Company at which Harris
Bank would be willing to make such Swing Loan  available to the Company for such
Interest  Period (the rate so quoted for a given  Interest  Period  being herein
referred to as "Harris Bank's Quoted Rate"). The Company acknowledges and agrees
that the interest rate quote is given for immediate and irrevocable  acceptance,
and if the Company does not so immediately  accept Harris Bank's Quoted Rate for
the full amount  requested by the Company for such Swing Loan, the Harris Bank's
Quoted Rate shall be deemed  immediately  withdrawn and such Swing Loan shall be
made  bearing  interest  with  reference  to the  Domestic  Rate as set forth in
Section 1.5(d) above unless the Company has specifically in its notice to Harris
Bank for such Swing Loan specifically  requested otherwise,  in which event such
Swing Loan shall not be made at all.  Subject to all of the terms and conditions
hereof,  the proceeds of such Swing Loan shall be made  available to the Company
in  immediately  available  funds on the date so requested at the offices of the
Agent in Chicago, Illinois.  Anything contained in the foregoing to the contrary
notwithstanding  (i) the  obligation of Harris Bank to make Swing Loans shall be
subject to all of the terms and  conditions  of this  Agreement  and (ii) Harris
Bank shall not be obligated to make more than one Swing Loan during any one day.
<PAGE>

         (f) Refunding Loans. In its sole and absolute  discretion,  Harris Bank
may at any time, on behalf of the Company (which hereby  irrevocably  authorizes
Harris Bank to act on its behalf for such purpose),  request each Bank to make a
Revolving Loan in an amount equal to such Bank's Percentage of the amount of the
Swing Loans outstanding on the date such notice is given.  Whether or not any of
the  conditions  of Section  7.1 are  fulfilled  on such date,  unless a Bank is
legally  precluded  from  doing so,  each Bank shall  make the  proceeds  of its
requested  Revolving  Loan  available to Harris Bank, in  immediately  available
funds, at the principal office of Harris Bank in Chicago, Illinois, before 12:00
Noon (Chicago  time) on the Business Day following the day such notice is given.
The proceeds of such Revolving  Loans shall be immediately  applied to repay the
outstanding Swing Loans.

         (g)  Participations.  If any Bank refuses or otherwise  fails to make a
Revolving  Loan when  requested by Harris Bank pursuant to Section 1.5(f) above,
or if Harris  Bank is  required  at any time to return  to the  Company  or to a
trustee,  receiver,  liquidator,  custodian or other Person,  any portion of any
payment  of a Swing  Loan,  each such Bank (in this  Section,  a  "Participating
Bank") will, by the time and in the manner such  Revolving Loan was to have been
funded to Harris  Bank,  purchase  from Harris Bank an  undivided  participating
interest in the outstanding  Swing Loans in an amount equal to its Percentage of
the aggregate principal amount of Swing Loans that were to have been repaid with
such  Revolving  Loans or such  recapture  Swing Loan,  as the case may be. Each
Participating  Bank's obligation to fund such participation  shall bear interest
from the date due until  funded at the rate per annum equal to (i) from the date
the  related  payment was due from such  Participating  Bank to the date two (2)
Business Days thereafter, the Federal Funds Rate for each such day and (ii) from
the date two (2)  Business  Days  after the date such  payment  is due from such
Participating Bank to the date such payment is made by such Participating  Bank,
the  Domestic  Rate in effect for each such day.  Each Bank that so  purchases a
participation  in a Swing Loan  shall  thereafter  be  entitled  to receive  its
Percentage  of each  payment  of  principal  received  on the Swing  Loan and of
interest received thereon accruing from the date such Bank funded to Harris Bank
its  participation  in such Loan. The several  obligations of the  Participating
Banks under this Section 1.5 shall be absolute,  irrevocable  and  unconditional
under any and all  circumstances  whatsoever  and shall  not be  subject  to any
set-off,  counterclaim  or defense to payment which any  Participating  Bank may
have or have had  against  the  Company,  any  other  Bank or any  other  Person
whatever.  Without  limiting the generality of the foregoing,  such  obligations
shall not be affected by any Default or Event of Default or by any  reduction or
termination  of  any  Commitment  of  any  Bank,  and  each  payment  made  by a
Participating  Bank under this  Section  1.5 shall be made  without  any offset,
abatement, withholding or reduction whatsoever. Harris Bank shall be entitled to
offset amounts  received for the account of a Bank under this Agreement  against
unpaid amounts due hereunder from such Bank to Harris Bank or (if and so long as
Harris Bank is the Agent) the Agent  (whether as fundings of  participations  or
otherwise),  but shall not be entitled  to offset  against  amounts  owed to the
Harris Bank or the Agent by any Bank arising outside the Loan Documents.

         (h)  Indemnification.  The Participating  Banks shall, to the extent of
their  respective  Percentages,   indemnify  Harris  Bank  (to  the  extent  not
reimbursed  by the  Company  and  without  in any  way  impairing  or  otherwise
affecting  the  Company's  obligations  to do  so)  against  any  cost,  expense
(including  reasonable counsel fees and disbursements),  claim, demand,  action,
loss or liability  (except such as result from Harris Bank's gross negligence or
willful  misconduct) that Harris Bank may suffer or incur in connection with any
Swing Loan. The obligations of the Participating Banks under this Section 1.5(h)
and all other  parts of this  Section  1.5  shall  survive  termination  of this
Agreement.
<PAGE>

         Section 1.6.  Extensions of the Revolving Credit  Termination Date. The
Company  may advise  the Agent in writing of its desire to extend the  Revolving
Credit Termination Date for an additional 364 days; provided (i) such request is
made no later  than 90 days  prior to the date on which  such  Revolving  Credit
Termination Date is scheduled to occur,  (ii) not more than one such request for
the  extension of a  Termination  Date may be made in any one calendar  year and
(iii) in no event shall the Revolving Credit Termination Date be extended beyond
July 1, 2003. The Agent shall promptly  notify the Lenders of each such request.
Each Lender shall  notify the Agent in writing  within 45 days after such Lender
receives such notice from the Agent,  whether such Lender in its sole discretion
agrees to such  extension  (each such Lender  agreeing to such  extension  being
hereinafter  referred to as a "Consenting  Lender").  In the event that a Lender
shall fail to so notify the Agent within such 45-day  period,  whether it agrees
to such  extension,  such  Lender  shall be deemed to have  refused to grant the
requested extension. Upon receipt by the Agent of the consent of all the Lenders
within such 45-day period,  the Revolving Credit Termination Date or Dates shall
be  automatically  extended  for 364 days.  In the event the Company and all the
Lenders do not  consent  to the  requested  extension  of the  Revolving  Credit
Termination  Date, such Revolving  Credit  Termination  Date shall take place as
scheduled.

         Section 1.7.  Maturity of Loans.  Each  Revolving Loan shall mature and
become due and payable by the Company on the Revolving Credit  Termination Date.
Each Swing Loan shall  mature and become due and  payable on the  earlier of (i)
the last day of its Interest  Period and (ii) the Revolving  Credit  Termination
Date.

SECTION 2.           INTEREST AND CHANGE IN CIRCUMSTANCES.

         Section 2.1.    Interest Rate Options on Revolving Notes.

         (a)  Portions.  Subject to the terms and  conditions of this Section 2,
portions of the principal  indebtedness evidenced by the Revolving Notes (all of
the  indebtedness  evidenced by the Revolving Notes bearing interest at the same
rate for the same period of time being  hereinafter  referred to as a "Portion")
may, at the option of the Company,  bear interest with reference to the Domestic
Rate  ("Domestic Rate Portions") or with reference to the Adjusted LIBOR ("LIBOR
Portions"),  and Portions  may be converted  from time to time from one basis to
another.  All of the  indebtedness  evidenced by a particular class of Revolving
Notes which is not part of a LIBOR  Portion shall  constitute a single  Domestic
Rate  Portion.  LIBOR  Portions  may  be  denominated  in  U.S.  Dollars  or  an
Alternative  Currency,  but Domestic Rate Portions must be  denominated  in U.S.
Dollars only. All of the  indebtedness  evidenced by Revolving Notes of the same
type which bears  interest with  reference to a particular  Adjusted LIBOR for a
particular  Interest  Period and is denominated  in a particular  currency shall
constitute a single LIBOR  Portion.  There shall not be more than five (5) LIBOR
Portions applicable to the Revolving Notes outstanding at any one time, and each
Lender shall have a ratable  interest in each Portion  based on its  Percentage.
Anything contained herein to the contrary notwithstanding, the obligation of the
Lenders to create,  continue or effect by conversion  any LIBOR Portion shall be
conditioned  upon the fact that at the time no Default or Event of Default shall
have occurred and be continuing.  The Company hereby promises to pay interest on
each Portion at the rates and times specified in this Section 2.
<PAGE>

         (b) Domestic  Rate  Portion.  Each  Domestic  Rate  Portion  shall bear
interest at the rate per annum determined by adding the Applicable Margin to the
Domestic  Rate as in effect from time to time,  provided that if a Domestic Rate
Portion  or any part  thereof  is not paid when due  (whether  by lapse of time,
acceleration or otherwise)  such Portion shall bear interest,  whether before or
after judgment,  until payment in full thereof at the rate per annum  determined
by adding 2% to the interest rate which would  otherwise be  applicable  thereto
from time to time.  Interest  on each  Domestic  Rate  Portion  shall be payable
quarterly in arrears on the last day of each March, June, September and December
in each year  (commencing  December 31, 1999) and at maturity of the  applicable
Revolving  Notes,  and  interest  after  maturity  (whether  by  lapse  of time,
acceleration or otherwise)  shall be due and payable upon demand.  Any change in
the interest rate on the Domestic Rate Portions  resulting  from a change in the
Domestic  Rate  shall be  effective  on the date of the  relevant  change in the
Domestic Rate.

         (c) Libor  Portions.  Each LIBOR  Portion  shall bear interest for each
Interest Period selected  therefor at a rate per annum  determined by adding the
Applicable LIBOR Margin to the Adjusted LIBOR for such Interest Period, provided
that if any  LIBOR  Portion  is not  paid  when due  (whether  by lapse of time,
acceleration or otherwise)  such Portion shall bear interest,  whether before or
after judgment, until payment in full thereof (i) if such Portion is denominated
in U.S.  Dollars at the rate per annum  determined  by adding 2% to the interest
rate which would otherwise be applicable thereto through the end of the Interest
Period then applicable thereto, and effective at the end of such Interest Period
such  LIBOR  Portion  shall  automatically  be  converted  into and added to the
Domestic  Rate Portion and shall  thereafter  bear interest at the interest rate
applicable  to such Domestic Rate Portion after default and (ii) if such Portion
is denominated in an Alternative  Currency,  at the rate per annum determined by
adding 2% to the interest rate which would  otherwise be  applicable  thereto at
the time of such default until the end of the Interest Period applicable thereto
and,  thereafter,  at a rate per annum equal to the sum of the Applicable Margin
plus 2% plus the Overnight Foreign Currency Rate. Interest on each LIBOR Portion
shall be due and  payable  on the last day of each  Interest  Period  applicable
thereto and, with respect to any Interest  Period  applicable to a LIBOR Portion
in excess of 3 months,  on the date occurring every 3 months after the date such
Interest Period began and at the end of such Interest Period, and interest after
maturity (whether by lapse of time,  acceleration or otherwise) shall be due and
payable upon demand.  The Company shall notify the Agent on or before 11:00 a.m.
(Chicago  time) on the fourth  Business  Day  preceding  the end of an  Interest
Period  applicable to a LIBOR Portion  whether such LIBOR Portion is to continue
as a LIBOR Portion in the same currency, in which event the Company shall notify
the Agent of the new Interest  Period  selected  therefor,  and in the event the
Company shall fail to so notify the Agent, such LIBOR Portion, if denominated in
U.S.  Dollars,  shall  automatically be converted into and added to the Domestic
Rate  Portion  as of  and  on the  last  day of  such  Interest  Period  or,  if
denominated in an Alternative  Currency,  shall automatically as of the last day
of such Interest Period,  be continued as a LIBOR Portion in the same amount and
in the same  currency  and with an  Interest  Period of one  month,  subject  to
Section 7 hereof.  The Agent  shall  promptly  notify each Lender of each notice
received  from  the  Company  pursuant  to the  foregoing  provisions.  Anything
contained herein to the contrary notwithstanding,  the obligation of the Lenders
to  create,  continue  or  effect  by  conversion  any  LIBOR  Portion  shall be
conditioned  upon the fact that at the time no Default or Event of Default shall
have occurred and be continuing.
<PAGE>

         On the date the  Company  requests a Revolving  Loan in an  Alternative
Currency,  as provided in Section  2.4,  the Agent  shall  promptly  notify each
Lender of the currency in which such  Revolving  Loan is requested.  If a Lender
determines that such  Alternative  Currency is not available to it in sufficient
amount  and for a  sufficient  term to  enable it to  advance  or  continue  the
Revolving Loan requested of it as part of such LIBOR Portion and so notifies the
Agent no later than 2:00 p.m.  (Chicago time) on the same day it receives notice
from the Agent of such requested  Revolving  Loan, the Agent shall so notify the
Company by 2:45 p.m.  (Chicago time). If the Company  nevertheless  desires such
Revolving  Loan,  it must  notify the Agent by no later than 3:00 p.m.  (Chicago
time) on such day. If the Agent does not receive such notice from the Company by
3:00 p.m.  (Chicago  time),  the Company shall  automatically  be deemed to have
revoked its request for the Revolving  Loan and the Agent will  promptly  notify
the Lenders of such  revocation.  If the  Company  does give such notice by 3:00
p.m.  (Chicago  time),  each  Lender  that did not notify the Agent by 2:00 p.m.
(Chicago time) that the requested  Alternative  Currency is unavailable to it to
fund the requested  Revolving Loan shall,  subject to Section 7 hereof, make its
Revolving Loan in the requested  Alternative Currency in accordance with Section
1.4 hereof. Each Lender that did so notify the Agent by 2:00 p.m. (Chicago time)
that it would not be able to make the Revolving  Loan  requested  from it shall,
subject to Section 7 hereof,  make a Revolving Loan  denominated in U.S. Dollars
in the  Original  Dollar  Amount of, and with the same  Interest  Period as, the
Revolving Loan such Lender was originally requested to make. Such Revolving Loan
denominated in U.S. Dollars shall be made by the affected Lender on the same day
as the other Lenders make their  Revolving  Loans  denominated in the applicable
Alternative  Currency  as part of the  relevant  LIBOR  Portion,  but shall bear
interest with reference to the Adjusted LIBOR  applicable to U.S. Dollars rather
than the relevant  Alternative  Currency for the applicable  Interest Period and
shall be made available in accordance  with the  procedures for disbursing  U.S.
Dollar Loans under Section 1.4 hereof. Any Revolving Loan made in an Alternative
Currency shall be advanced in such  currency,  and all payments of principal and
interest thereon shall be made in such Alternative Currency.

         Section 2.2.  Minimum  Borrowing  Amounts.  Each  Domestic Rate Portion
shall be in an amount  equal to  $500,000  or such  greater  amount  which is an
integral  multiple of $100,000.  Each LIBOR Portion  denominated in U.S. Dollars
shall be in an amount equal to  $1,000,000  or such  greater  amount which is an
integral multiple of $500,000.  Each LIBOR Portion denominated in an Alternative
Currency  shall be in a minimum amount for which the U.S.  Dollar  Equivalent is
$2,000,000  and which is an integral  multiple of 500,000  units of the relevant
currency or, solely in the case of a LIBOR Portion denominated in an Alternative
Currency being continued in the same currency,  if less, the same amount of such
currency.

         Section 2.3.  Computation  of Interest.  All interest on the  Revolving
Loans  constituting  part of the Domestic  Rate Portion shall be computed on the
basis of a year of 365 or 366 days, as the case may be, for the actual number of

<PAGE>

days elapsed.  All interest on the Revolving Loans constituting all or part of a
LIBOR  Portion  shall  be  computed  on the  basis of a year of 360 days for the
actual number of days elapsed.

         Section 2.4.  Manner of Rate  Selection.  The Company  shall notify the
Agent by 11:00 a.m.  (Chicago  time) at least 3 Business  Days prior to the date
upon which the  Company  requests  that any LIBOR  Portion  denominated  in U.S.
Dollars be created or that any part of a LIBOR Portion otherwise  denominated or
any  part  of a  Domestic  Rate  Portion  be  converted  into  a  LIBOR  Portion
denominated  in U.S.  Dollars and (iii) by 12:00 Noon (Chicago  time) at least 4
Business  Days prior to the date upon which the Company  requests that any LIBOR
Portion denominated in an Alternative  Currency be created or that any part of a
LIBOR Portion  otherwise  denominated  or any part of a Domestic Rate Portion be
converted into a LIBOR Portion denominated in an Alternative Currency. Each such
notice shall specify in each instance the amount of the Portion being created or
converted  and in the case of the  creation  of or  conversion  into  any  LIBOR
Portion,  the Interest Period  selected  therefor and the currency in which such
Portion is to be denominated.  If any request is made to convert a LIBOR Portion
into another type of Portion available hereunder,  such conversion shall only be
made  so as to  become  effective  as of the  last  day of the  Interest  Period
applicable thereto. All requests for the creation, continuance and conversion of
Portions under this Agreement shall be irrevocable. Such requests may be written
or oral and the Agent is hereby  authorized  to honor  telephonic  requests  for
creations, continuances and conversions received by it from any person the Agent
in good faith believes to be an Authorized  Representative without the necessity
of independent investigation,  the Company hereby indemnifying the Agent and the
Lenders from any liability or loss ensuing from so acting.  The Agent shall give
prompt notice to the Lenders of any notice it receives  pursuant to this Section
and will give prompt  notice to each Lender of the  Overnight  Foreign  Currency
Rate  as  soon as it is  set.  The  Agent  shall  determine  the  interest  rate
applicable to each LIBOR Portion and the Original Dollar Amount of such Portions
denominated in an Alternative Currency,  and a reasonable  determination thereof
by the Agent  shall be  conclusive  and  binding  except in the case of manifest
error or willful  misconduct.  The Original  Dollar Amount of each LIBOR Portion
denominated in an Alternative  Currency shall be determined or redetermined,  as
applicable,  effective as of the first day of each Interest Period applicable to
such Portion.  The Agent shall give notice to the Company and each Lender of the
interest  rate  applicable  to each LIBOR  Portion and, if such LIBOR Portion is
denominated  in an  Alternative  Currency,  shall give notice to the Company and
each Lender of the Original Dollar Amount thereof.

         Section 2.5.  Change of Law.  Notwithstanding  any other  provisions of
this  Agreement or any Note,  if at any time any Lender shall  determine in good
faith that any change in  applicable  laws,  treaties or  regulations  or in the
interpretation  thereof  makes it unlawful for such Lender to create or continue
to maintain any Fixed Rate Portion in the relevant  currency,  it shall promptly
so notify the Agent  (which  shall in turn  promptly  notify the Company and the
other Lenders) and the obligation of such Lender to create, continue or maintain
any such  Fixed  Rate  Portion  in such  currency  under  this  Agreement  shall
terminate until it is no longer unlawful for such Lender to create,  continue or
maintain  such  Fixed Rate  Portion.  The  Company,  on  demand,  shall,  if the
continued  maintenance  of any such Fixed Rate  Portion is  unlawful,  thereupon
prepay the  outstanding  principal  amount of the affected  Fixed Rate  Portion,
together with all interest  accrued thereon and all other amounts payable to the
affected Lender with respect thereto under this  Agreement;  provided,  however,
that the Company may elect to convert the principal amount of the affected Fixed
Rate Portion into another type of Portion  available  hereunder,  subject to the
terms and conditions of this Agreement.
<PAGE>

         Section  2.6.  Unavailability  of Deposits or Inability to Ascertain or
Inadequacy of, Fixed Rate. Notwithstanding any other provision of this Agreement
or any Note, if prior to the commencement of any Interest  Period,  the Required
Lenders  shall  determine  in good faith  that (i)  deposits  in the  applicable
currency in the amount of any Fixed Rate Portion  scheduled to be outstanding in
such  currency  during such  Interest  Period are not readily  available to such
Lenders in the relevant market or (ii) by reason of circumstances  affecting the
relevant  market,  adequate and reasonable  means do not exist for  ascertaining
Adjusted  LIBOR Rate or Harris  Bank's Quoted Rate, as the case may be, or (iii)
currency  control or other  exchange  regulations  are imposed in the country in
which an Alternative  Currency is issued with the result that different types of
such  currency  are issued or (iv) in the  determination  of the  Agent,  a U.S.
Dollar Equivalent of an Alternative Currency is not readily calculable, then (x)
such Lenders  shall  promptly  give notice  thereof to the Agent (which shall in
turn promptly notify the Company and the other Lenders),  (y) the obligations of
the  Lenders to create,  continue  or effect by  conversion  any such Fixed Rate
Portion in such  amount  and for such  Interest  Period  shall  terminate  until
deposits in such amount,  in such currency and for the Interest  Period selected
by the  Company  shall again be readily  available  in the  relevant  market and
adequate and  reasonable  means exist for  ascertaining  Adjusted  LIBOR Rate or
Harris Bank's Quoted Rate, as the case may be, or the U.S. Dollar  Equivalent of
such affected currency, as the case may be and (z) within five (5) Business Days
of receipt of such notice from the Agent,  the Company shall repay all Revolving
Loans in such affected  currency or convert such Revolving  Loans into Revolving
Loans denominated in U.S. Dollars or another  Alternative  Currency,  subject to
the other terms set forth in this Agreement.

         Section 2.7. Taxes and Increased Costs.  With respect to any Fixed Rate
Portion,  if any  Lender  shall  determine  in good faith that any change in any
applicable law, treaty, regulation or guideline (including,  without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any new
law,  treaty,  regulation  or  guideline,  or any  interpretation  of any of the
foregoing by any governmental  authority charged with the administration thereof
or any  central  bank or  other  fiscal,  monetary  or  other  authority  having
jurisdiction  over such Lender or its lending  branch or the Fixed Rate Portions
contemplated by this Agreement (whether or not having the force of law), shall:

                   (i) impose, increase, or deem applicable any reserve, special
         deposit or similar  requirement  against assets held by, or deposits in
         or for the account of, or loans by, or any other  acquisition  of funds
         or  disbursements  by, such Lender which is not in any instance already
         accounted for in computing  the interest rate  applicable to such Fixed
         Rate Portion;

                  (ii) subject such Lender,  any Fixed Rate Portion or a Note to
         the extent it evidences such a Portion to any tax  (including,  without
         limitation,  any United States interest equalization tax or similar tax

<PAGE>

         however  named  applicable  to  the  acquisition  or  holding  of  debt
         obligations and any interest or penalties with respect thereto),  duty,
         charge,  stamp tax, fee,  deduction or  withholding  in respect of this
         Agreement,  any Fixed Rate Portion or a Note to the extent it evidences
         such a Portion, except such taxes as may be measured by the overall net
         income or gross  receipts of such Lender or its  lending  branches  and
         imposed by the  jurisdiction,  or any political  subdivision  or taxing
         authority thereof, in which such Lender's principal executive office or
         its lending branch is located;

                 (iii) change the basis of taxation of payments of principal and
         interest due from the Company to such Lender  hereunder or under a Note
         to the extent it  evidences  any Fixed Rate  Portion  (other  than by a
         change in taxation of the overall net income or gross  receipts of such
         Lender or its lending branches); or

                  (iv)  impose on such Lender any  penalty  with  respect to the
         foregoing or any other condition  regarding this  Agreement,  any Fixed
         Rate Portion, or its disbursement, or a Note to the extent it evidences
         any Fixed Rate Portion;

and such  Lender  shall  determine  in good  faith that the result of any of the
foregoing  is to increase  the cost  (whether by incurring a cost or adding to a
cost) to such Lender of creating or maintaining any Fixed Rate Portion hereunder
or to reduce the amount of principal or interest  received or receivable by such
Lender (without benefit of, or credit for, any prorations, exemption, credits or
other offsets available under any such laws, treaties,  regulations,  guidelines
or interpretations  thereof),  then the Company shall pay on demand to the Agent
for the  account of such Lender  from time to time as  specified  by such Lender
such additional amounts as such Lender shall reasonably determine are sufficient
to  compensate  and  indemnify  it for such  increased  cost or reduced  amount;
provided,  however,  that the  Company  shall not be  obligated  to pay any such
amount or amounts to the extent such  additional cost or payment was incurred or
paid by such Lender more than ninety (90) days prior to the date of the delivery
of the certificate  referred to in the immediately  following  sentence (nothing
herein to impair or otherwise affect the Company's liability hereunder for costs
or payments  subsequently  incurred or paid by such  Lender).  If a Lender makes
such a claim for  compensation,  it shall provide to the Company (with a copy to
the Agent) a certificate  setting forth the computation of the increased cost or
reduced amount as a result of any event  mentioned  herein in reasonable  detail
and such certificate shall be conclusive if reasonably determined.

         Section 2.8.  Change in Capital  Adequacy  Requirements.  If any Lender
shall  determine that the adoption after the date hereof of any applicable  law,
rule or regulation  regarding  capital  adequacy,  or any change in any existing
law, rule or regulation,  or any change in the  interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration  thereof, or compliance by such Lender
(or any of its  branches) or any  corporation  controlling  such Lender with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any such authority,  central bank or comparable  agency, has or would
have  the  effect  of  reducing  the rate of  return  on such  Lender's  or such
corporation's  capital,  as the case may be, as a  consequence  of such Lender's
obligations  hereunder or for the credit which is the subject matter hereof to a
level below that which such Lender or such  corporation  could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or such  corporation's  policies with respect to liquidity and capital adequacy)
by an amount  deemed  by such  Lender  to be  material,  then from time to time,
within  fifteen (15) days after demand by such Lender,  the Company shall pay to
the Agent for the  account  of such  Lender  such  additional  amount or amounts

<PAGE>

reasonably  determined  by such Lender as will  compensate  such Lender for such
reduction;  provided,  however,  that the  Company  shall  not be  obligated  to
compensate such Lender to the extent its rate of return was so reduced more than
ninety (90) days prior to the date of such demand  (nothing  herein to impair or
otherwise affect the Company's  liability hereunder to compensate for subsequent
reductions in such Lender's rate of return).

         Section 2.9. Funding Indemnity. In the event any Lender shall incur any
loss, cost or expense (including,  without limitation,  any loss (including loss
of  profit),   cost  or  expense  incurred  by  reason  of  the  liquidation  or
re-employment  of deposits or other funds  acquired or contracted to be acquired
by such  Lender to fund or  maintain  its part of any Fixed Rate  Portion or the
relending  or  reinvesting  of such  deposits or other funds or amounts  paid or
prepaid to such Lender) as a result of:

                   (i) any payment of a Fixed Rate  Portion on a date other than
         the last day of the then  applicable  Interest  Period for any  reason,
         whether  before or after  default,  and whether or not such  payment is
         required by any provisions of this Agreement; or

                  (ii) any failure by the Company to create, borrow, continue or
         effect by  conversion a Fixed Rate  Portion on the date  specified in a
         notice given pursuant to this Agreement;

then, upon the demand of such Lender, the Company shall pay to the Agent for the
account of such Lender such amount as will  reimburse such Lender for such loss,
cost or expense. If a Lender requests such a reimbursement,  it shall provide to
the  Company  (with  a copy  to the  Agent)  a  certificate  setting  forth  the
computation  of the  loss,  cost  or  expense  giving  rise to the  request  for
reimbursement in reasonable  detail and such certificate  shall be conclusive if
reasonably  determined;  provided,  however,  that  the  Company  shall  not  be
obligated  to pay any such  amount or amounts to the extent  such loss,  cost or
expense was incurred by such Lender more than ninety (90) days prior to the date
of the  delivery  of such  certificate  (nothing  herein to impair or  otherwise
affect the Company's  liability hereunder to compensate for any subsequent loss,
cost, or expense incurred by such Lender).

        Section 2.10. Lending Branch.  Each Lender may, at its option,  elect to
make,  fund or  maintain  its pro  rata  share  of the  Loans  hereunder  at the
branches,  offices,  subsidiaries or affiliates specified on the signature pages
hereof or on any Assignment Agreement executed and delivered pursuant to Section
11.10 hereof or at such of its branches, offices,  subsidiaries or affiliates as
such Lender may from time to time elect.  All the terms of this Agreement  shall
only apply to any such branch,  office,  subsidiary or affiliates  and the Loans
and Notes issued  hereunder  shall be deemed held by each Lender for the benefit
of any such branch,  office,  subsidiary or affiliate.  To the extent reasonably
possible,  a Lender shall  designate an alternate  branch or funding office with
respect to its pro rata share of the LIBOR  Portions to reduce any  liability of
the  Company  to  such  Lender  under   Section  2.7  hereof  or  to  avoid  the
unavailability  of an interest rate option under Section 2.6 hereof,  so long as
such designation is not otherwise disadvantageous to the Lender.
<PAGE>

        Section   2.11.   Discretion   of  Lenders  as  to  Manner  of  Funding.
Notwithstanding  any provision of this  Agreement to the  contrary,  each Lender
shall be  entitled  to fund and  maintain  its funding of all or any part of its
Notes in any  manner it sees fit,  it being  understood,  however,  that for the
purposes of this  Agreement all  determinations  hereunder  (including,  without
limitation, determinations under Sections 2.6, 2.7 and 2.9 hereof) shall be made
as if each Lender had actually  funded and maintained  each LIBOR Portion during
each Interest Period applicable thereto through the purchase of deposits in U.S.
Dollars or the  applicable  Alternative  Currency,  as the case may be, for such
LIBOR  Portion,  in the relevant  market in the amount of such Lender's pro rata
share of such LIBOR Portion,  having a maturity  corresponding  to such Interest
Period,  denominated in the relevant currency and bearing an interest rate equal
to the LIBOR Rate, as the case may be, for such Interest Period.

SECTION 3.           FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.

         Section 3.1.    Fees.

         (a)  Commitment  Fee. For the period from and including the date hereof
to but not including the Revolving  Credit  Termination  Date, the Company shall
pay to the Agent for the  account of the  Lenders a  commitment  fee at the rate
equal to the  Applicable  Margin in effect  from time to time  (computed  on the
basis  of a year of 360 days  for the  actual  number  of days  elapsed)  on the
average daily Unused Revolving Credit Commitments.  Such commitment fee shall be
payable quarterly in arrears on the last day of each March, June,  September and
December in each year (commencing December 31, 1999) and on the Revolving Credit
Termination Date.

         (b) Letter of Credit  Fees.  On the date of  issuance of each Letter of
Credit,  and as condition  thereto,  and  quarterly in arrears  thereafter,  the
Company  shall pay to the  Agent for the  account  of itself  and the  Lenders a
letter of credit fee computed at the rate per annum  (computed on the basis of a
year of 360 days for the actual number of days elapsed)  equal to the Applicable
Margin in effect from time to time for LIBOR  Portions  on the maximum  Original
Dollar  Amount  of the  related  Letter  of  Credit  which  is  scheduled  to be
outstanding during the immediately succeeding twelve (12) months. In addition to
the letter of credit fee called for above,  the Company further agrees to pay to
the Agent for its own account such processing and  transaction  fees and charges
as the Agent  from  time to time  customarily  imposes  in  connection  with any
amendment,  cancellation,  negotiation  and/or  payment of letters of credit and
drafts drawn thereunder.

         (c) Agent's Fee. On December 17, 1999 and on the date occurring on each
anniversary  of such date when any credit,  or commitment to extend  credit,  is
outstanding  hereunder,  the Company shall pay to the Agent, for its own use and
benefit, an Agent's fee as mutually agreed upon by the Company and the Agent.

         (d) Closing Fees. On the date hereof the Company shall pay to the Agent
a  non-refundable  closing fee for the  account of (i) each of Harris  Trust and
Savings  Bank,  Bank One, NA,  LaSalle  Bank  National  Association  and Bank of
America,  N.A.,  in an  amount  equal to 0.10% of each such  Lender's  Revolving
Credit  Commitment,  and (ii) each Fleet Capital  Corporation  and Firstar Bank,
N.A., in an amount equal to 0.25% of such Lender's Revolving Credit Commitment.
<PAGE>

         (e) Audit Fees.  The Company shall pay to the Agent for its own use and
benefit  charges  for  audits of the  Collateral  performed  by the Agent or its
agents or  representatives  in such  amounts  as the Agent may from time to time
request  (the  Agent  acknowledging  and  agreeing  that such  charges  shall be
computed  in the  same  manner  as it at  the  time  customarily  uses  for  the
assessment of charges for similar collateral audits); provided, however, that in
the absence of any Default and Event of Default, (i) the Agent shall not perform
more than two (2) such audits per calendar  year and (ii) the Company  shall not
be  required  to pay the Agent for more than two (2) such  audits  per  calendar
year.

         Section 3.2.    Prepayments.

         (a)    Voluntary Prepayments.

         (i) Domestic Rate Portions of Revolving  Notes.  The Company shall have
the  privilege  of  prepaying  in  whole or in part  (but if in part,  then in a
minimum amount of $500,000 or such greater amount which is an integral  multiple
of $100,000) the Domestic  Rate Portion of any  Revolving  Note at any time upon
notice to the Agent  prior to 11:00  a.m.  (Chicago  time) on the date fixed for
prepayment.

        (ii) LIBOR  Portions.  The Company  may prepay any LIBOR  Portion of any
Revolving Note only on the last date of the then applicable  Interest Period, in
whole or in part (but if in part,  then:  (x) if such Portion is  denominated in
U.S. Dollars, in an amount not less than $1,000,000 or such greater amount which
is an integral  multiple of $100,000,  (y) if such Portion is  denominated in an
Alternative Currency, an amount for which the U.S. Dollar Equivalent is not less
than  $1,000,000  and which is an  integral  multiple  of  100,000  units of the
relevant currency and (z) in all cases in an amount such that the minimum amount
required for LIBOR Portion  denominated in such currency pursuant to Section 2.2
hereof remains outstanding after giving effect to such payment),  upon notice to
the Agent (which notice shall be irrevocable once given, must be received by the
Agent no later than 11:00 a.m.  (Chicago  time) on the date fixed for prepayment
in the case of a  prepayment  of the  Domestic  Rate  Portion  and on the  third
Business  Day  preceding  the date of any  such  prepayment  of a LIBOR  Portion
denominated in U.S. Dollars or the fourth Business Day preceding the date of any
such prepayment of a LIBOR Portion denominated in the Alternative Currency,  and
in each  case  shall  specify  the  principal  amount  to be  repaid).  Any such
prepayment  shall be effected by payment of the  principal  amount to be prepaid
and accrued interest thereon to the end of the applicable Interest Period.

       (iii)  Revolving  Loans -- Generally.  In the case of a prepayment by the
Company under Section 3.2(a)(i) or (ii) hereof,  (x) any notice of prepayment by
the Company received by the Agent  subsequent to 11:00 a.m.  (Chicago time) on a
given day shall be treated as though  received at the opening of business on the
next Business Day, (y) the Agent shall promptly notify the Lenders of any notice
of prepayment by the Company,  (z) the Company shall prepay the relevant  amount
by paying to the Agent for the account of the Lenders the principal amount to be
prepaid  and  (i) if  such  a  prepayment  prepays  the  Notes  in  full  and is
accompanied  by the  termination in whole of the Revolving  Credit  Commitments,
accrued  interest  thereon to the date of prepayment and (ii) any amounts due to
the Lenders under Section 2.9 hereof.
<PAGE>

        (iv) Swing  Note.  The  Company may prepay the Swing Note in whole or in
part (but, if in part,  then in an amount not less than $100,000 and in integral
multiples of $100,000 and in an amount such that the minimum amount required for
a Swing Loan pursuant to Section 1.5(c) hereof remains  outstanding) at any time
upon one (1) Business  Day's prior notice to the Agent,  such  prepayment  to be
made by the payment of the principal  amount to be prepaid and accrued  interest
thereon to the date fixed for prepayment together with any compensation required
by Section 2.9 hereof (any failure of the Agent to require payment of any amount
due under  Section 2.9 not to preclude a later  demand that the amount so due be
paid).

         (b) Mandatory Prepayments. (i) The Company covenants and agrees that if
at any time the sum of the then  aggregate  Original  Dollar Amount of Revolving
Loans then outstanding  denominated in Alternative Currencies shall be in excess
of  $15,000,000,  the Company shall, no later than three (3) Business Days after
the  Agent's  demand,  pay over the  amount of such  excess to the Agent for the
ratable  benefit  of  the  Lenders  as and  for a  mandatory  prepayment  on the
Revolving  Notes until payment in full thereof.  Each such  prepayment  shall be
accompanied by accrued  interest on the amount prepaid to the date of prepayment
plus any  amounts  due to the Lenders  under  Section  2.9  hereof.  The Lenders
acknowledge  and agree  that,  upon such demand by the Agent,  the Company  may,
subject to Section 7 hereof,  request a Borrowing of Revolving Loans in order to
provide  it the funds  necessary  to repay such  excess.  The  Company  shall be
responsible for making such  arrangements with the Lenders as shall be necessary
to repay such excess. Unless and to the extent a Lender in its discretion agrees
otherwise,  nothing  in this  Section  shall  impair  or  otherwise  affect  the
Company's  obligation to repay a Revolving Loan made by such Lender  denominated
in an  Alternative  Currency,  nor  obligate a Lender to accept  repayment  of a
Revolving Loan made by such Lender denominated in an Alternative  Currency, in a
currency other than such Alternative Currency.

        (ii) The Company covenants and agrees that if at any time the sum of the
greater  of (x) the  aggregate  Original  Dollar  Amount of all  Loans  (whether
Revolving  Loans or Swing  Loans) and Letters of Credit and (y) the U.S.  Dollar
Equivalent of all Loans (whether  Revolving Loans or Swing Loans) and Letters of
Credit  exceeds the Revolving  Credit  Commitments  then in effect,  the Company
shall immediately and without notice or demand pay over the amount of the excess
to the Agent for the  ratable  benefit  of the  Lenders  as and for a  mandatory
prepayment  on the Notes until  payment in full  thereof.  Each such  prepayment
shall be  accompanied  by accrued  interest on the amount prepaid to the date of
prepayment plus any amounts due to the Lenders under Section 2.9 hereof.

       (iii) If at any time the sum of the aggregate  Original  Dollar Amount of
all Loans  (whether  Revolving  Loans or Swing Loans) and Letters of Credit then
outstanding shall be in excess of the Borrowing Base, as determined on the basis
of the most recent  Borrowing Base  Certificate,  the Company shall  immediately
(except to the extent  otherwise set forth in the definition of Borrowing  Base)
and without  notice or demand pay over the amount of the excess to the Agent for
the  account  of  the  Lenders  as  and  for  a  mandatory  prepayment  on  such
Obligations,  with each such  prepayment  first to be applied  to the  Revolving
Loans until payment in full thereof, with any remaining balance to be applied to
the Swing Loans until payment in full thereof, and with any remaining balance to
be held by the Agent as  collateral  security  for the  Obligations  owing  with
respect to the Letters of Credit.
<PAGE>

         Section 3.3. Terminations. The Company shall have the right at any time
and from time to time,  upon 5 Business  Days' prior  notice to the Agent (which
shall promptly so notify the Lenders),  to ratably  terminate without premium or
penalty and in whole or in part (but if in part, then in an aggregate amount not
less than  $1,000,000  or such greater  amount which is an integral  multiple of
$500,000) the Revolving  Credit  Commitments;  provided,  however,  that (i) the
Revolving  Credit  Commitments  may not be  reduced  to an amount  less than the
aggregate  Original  Dollar  Amount  of the  Loans and  Letters  of Credit  then
outstanding and (ii) any termination of the Revolving Credit  Commitments  below
$5,000,000  shall  reduce  the  Swing  Line  Commitment  by a like  amount.  Any
termination of the Revolving Credit Commitments pursuant to this Section may not
be reinstated.

         Section  3.4.  Place and  Application  of  Payments.  All  payments  of
principal,  interest, fees and all other Obligations payable hereunder and under
the other Loan  Documents to be made in U.S.  Dollars shall be made to the Agent
at its office at 111 West Monroe  Street,  Chicago,  Illinois  (or at such other
place as the Agent may specify) on the date any such payment is due and payable.
Payments  to be made in U.S.  Dollars  received  by the Agent  after  11:00 a.m.
(Chicago  time)  shall be deemed  received  as of the opening of business on the
next Business Day. Notwithstanding anything herein to the contrary, all payments
of  principal,  interest,  fees  and  all  other  Obligations  to be  made in an
Alternative  Currency  shall be made,  by no later than 12:00 noon local time at
the place of payment (or such earlier  local time as is necessary for such funds
to be received and  transferred  to the Agent for same day value on the date the
relevant  payment is due) to such office as the Agent has previously  specified.
Any payments to be made in an Alternative  Currency  received by the Agent after
such time shall be deemed  received  as of the  opening of  business on the next
Business Day. All such payments  shall be made (i) in the case of U.S.  Dollars,
in immediately  available funds at the place of payment,  or (ii) in the case of
amounts  payable  hereunder  in an  Alternative  Currency,  in such  funds  then
customary for settlement of  international  transactions  in such currency.  All
such  payments  shall  be made  without  set-off  or  counterclaim  and  without
reduction  for,  and free from,  any and all  present or future  taxes,  levies,
imposts,  duties,  fees,  charges,  deductions,  withholdings,  restrictions and
conditions of any nature imposed by any government or any political  subdivision
or taxing  authority  thereof (but excluding any taxes imposed on or measured by
the net income of any Lender).  Except as herein provided, all payments shall be
received  by the Agent  for the  ratable  account  of the  Lenders  and shall be
promptly  distributed  by the Agent ratably to the Lenders.  Principal  payments
(including prepayments) on the Notes shall first be applied to the Domestic Rate
Portion of such Notes until payment in full thereof, with any balance applied to
any Fixed  Rate  Portions  of such  Notes in the order in which  their  Interest
Periods expire.

         Anything contained herein to the contrary notwithstanding, all payments
and  collections  received in respect of the Obligations and all proceeds of the
Collateral received,  in each instance, by the Agent or any of the Lenders after
the  occurrence  of an Event of  Default  shall be  remitted  to the  Agent  and
distributed as follows:
<PAGE>

                   (a)  first,  to the  payment  of any  outstanding  costs  and
         expenses incurred by the Agent, and any security trustee  therefor,  in
         monitoring, verifying, protecting, preserving or enforcing the Liens on
         the Collateral in protecting, preserving or enforcing rights under this
         Agreement  or  any of  the  other  Loan  Documents,  and  in any  event
         including  all costs and expenses of a character  which the Company has
         agreed to pay under  Section  11.4 hereof (such funds to be retained by
         the Agent for its own account unless it has previously  been reimbursed
         for such costs and expenses by the Lenders, in which event such amounts
         shall be  remitted  to the  Lenders  to  reimburse  them  for  payments
         theretofore made to the Agent);

                   (b)  second,  to the payment of any  outstanding  interest or
         other fees or amounts due under this Agreement or any of the other Loan
         Documents other than for principal, pro rata as among the Agent and the
         Lenders in accord  with the amount of such  interest  and other fees or
         amounts owing each;

                   (c) third, to the payment of the principal of the Swing Note;

                   (d) fourth,  to the payment of the principal of the Revolving
         Notes and any  liabilities  in  respect  of unpaid  drawings  under the
         Letters of  Credit,  pro rata as among the  Lenders in accord  with the
         then respective  unpaid  principal  balances of the Revolving Notes and
         the then unpaid  liabilities  in respect of unpaid  drawings  under the
         Letters of Credit;

                   (e) fifth,  to the Agent,  to be held as collateral  security
         for any undrawn Letters of Credit, until the Agent is holding an amount
         of cash equal to the then outstanding amount of all Letters of Credit;

                   (f) sixth,  to the Agent and the  Lenders  pro rata in accord
         with the amounts of any other indebtedness,  obligations or liabilities
         of the Company  owing to them and secured by the  Collateral  Documents
         unless and until all such  indebtedness,  obligations  and  liabilities
         have been fully paid and satisfied; and

                   (g)  seventh,   to  the  Company  or  to  whoever  the  Agent
         reasonably determines to be lawfully entitled thereto.

         Section 3.5.  Notations.  Each Loan made against a Note,  the status of
all  amounts  evidenced  by a Note as  constituting  part of the  Domestic  Rate
Portion or a LIBOR Portion or Quoted Rate Portion, and, in the case of any Fixed
Rate  Portion,  the rates of interest and Interest  Periods  applicable  to such
Portion,  and the  currency  in which  such  Portion  is  denominated,  shall be
recorded  by the  relevant  Lender on its books and records or, at its option in
any instance,  endorsed on a schedule to the applicable  Note of such Lender and
the unpaid principal balance and status,  rate, Interest Periods and currency so
recorded or endorsed by such Lender  shall be prima facie  evidence in any court
or other  proceeding  brought  to  enforce  such  Note of the  principal  amount
remaining unpaid thereon, the status of the Loan or Loans evidenced thereby, the
currency  in which such  Loans  were  denominated,  and the  interest  rates and
Interest Periods  applicable  thereto;  provided that the failure of a Lender to
record any of the foregoing  shall not limit or otherwise  affect the obligation
of the Company to repay the principal  amount of each Note together with accrued
interest thereon.
<PAGE>

SECTION 4.           THE COLLATERAL AND GUARANTIES.

         Section 4.1.  Collateral.  The  Obligations  shall be secured by valid,
perfected  (subject to the proviso  appearing at the end of this  sentence)  and
enforceable  Liens on all right,  title and  interest  of the  Company  and each
Guarantor in all accounts and accounts  receivable,  notes and notes receivable,
contract rights,  instruments,  documents,  chattel paper,  general  intangibles
(including, without limitation, patents, trademarks, tradenames, copyrights, and
other intellectual property rights, but in any event excluding  applications for
trademarks  based on  "intent  to  use")  and  inventory  whether  now  owned or
hereafter acquired or arising, and all proceeds thereof; provided, however, that
the Lien of the Agent on Collateral  subject to a Capital  Lease or  conditional
sale  agreement  or subject to a purchase  money lien,  in each  instance to the
extent permitted hereby,  shall be subject to the rights of the lessor or lender
thereunder. The Company acknowledges and agrees that the Liens on the Collateral
shall be granted to the Agent for the  benefit of itself,  the  Lenders  and the
Agent,  in its  capacity as issuer of the Letters of Credit,  and shall be valid
and perfected first priority Liens subject, however, to the proviso appearing at
the end of the immediately  preceding sentence,  in each case pursuant to one or
more  Collateral  Documents  from  such  Persons,  each  in form  and  substance
satisfactory to the Agent.

         Section 4.2.  Subsidiary  Guaranties.  The Loans and other  Obligations
shall be guaranteed by each Material  Subsidiary  pursuant to a written guaranty
from such Material Subsidiary in form and substance reasonably acceptable to the
Required Lenders.

         Section 4.3. Further Assurances.  The Company agrees that it shall, and
shall cause each Subsidiary to, from time to time at the request of the Agent or
the Required  Lenders,  execute and deliver such  documents and do such acts and
things as the Agent or the Required  Lenders may reasonably  request in order to
provide for or perfect or protect such Liens on the Collateral. In the event the
Company or any Subsidiary  forms or acquires any other Subsidiary after the date
hereof,  the  Company  shall  within  10  Business  Days  of such  formation  or
acquisition  cause such newly  formed or acquired  Material  Subsidiary,  or any
Non-Material  Subsidiary  that  thereafter  becomes a  Material  Subsidiary,  to
execute a Guaranty and any such Subsidiary to execute such Collateral  Documents
as the Agent may then reasonably require,  and the Company shall also deliver to
the Agent,  or cause such  Subsidiary to deliver to the Agent,  at the Company's
cost and expense, such other instruments,  documents,  certificates and opinions
reasonably required by the Agent in connection therewith.

SECTION 5.           DEFINITIONS; INTERPRETATION.

         Section 5.1.  Definitions.  The following  terms when used herein shall
have the following meanings:
<PAGE>

         "Acquisition"  means (i) the acquisition of all or any substantial part
of the assets, property or business of any other person, firm or corporation, or
(ii) any  acquisition  of a majority of common  stock,  warrants or other equity
securities of any firm or corporation.

         "Adjusted  LIBOR"  means a rate per  annum  determined  by the Agent in
accordance with the following formula:

                                    Adjusted LIBOR =           LIBOR
                                                     -------------------------
                                                      100%-Reserve Percentage

"Reserve  Percentage"  means,  for the purpose of computing  Adjusted LIBOR, the
maximum rate of all reserve  requirements  (including,  without limitation,  any
marginal,  emergency,  supplemental  or other special  reserves)  imposed by the
Board of  Governors  of the  Federal  Reserve  System (or any  successor)  under
Regulation D on Eurocurrency  liabilities (as such term is defined in Regulation
D) for the  applicable  Interest  Period as of the  first  day of such  Interest
Period, but subject to any amendments to such reserve  requirement by such Board
or its successor,  and taking into account any transitional  adjustments thereto
becoming effective during such Interest Period. For purposes of this definition,
LIBOR  Portions  shall be deemed to be  Eurocurrency  liabilities  as defined in
Regulation D without benefit of or credit for prorations,  exemptions or offsets
under Regulation D. "LIBOR" means, for each Interest Period, (a) the LIBOR Index
Rate for such Interest Period,  if such rate is available,  and (b) if the LIBOR
Index Rate cannot be determined, the arithmetic average of the rates of interest
per annum (rounded upward, if necessary,  to the nearest 1/100th of 1%) at which
deposits in U.S. Dollars, or the relevant Alternative  Currency, as appropriate,
in immediately  available funds are offered to the Agent at 11:00 a.m.  (London,
England time) 2 Business Days before the beginning of such Interest  Period by 3
or more major banks in the interbank eurodollar market selected by the Agent for
a period equal to such  Interest  Period and in an amount equal or comparable to
the applicable  LIBOR Portion  scheduled to be outstanding from the Agent during
such Interest Period.  "LIBOR Index Rate" means,  for any Interest  Period,  the
rate  per  annum  (rounded  upwards,  if  necessary,  to  the  next  higher  one
hundred-thousandth  of a percentage point) for deposits in U.S. Dollars,  or the
relevant  Alternative  Currency,  as  appropriate,  for a  period  equal to such
Interest Period which appears on the Telerate Page 3740 or Telerate Page 3750 as
appropriate  for such  currency as of 11:00 a.m.  (London,  England time) on the
date 2 Business Days before the commencement of such Interest Period.  "Telerate
Page 3740" or  "Telerate  Page 3750" means each of the  displays  designated  as
"Page 3740" or "Page 3750"  respectively on the Telerate  Service (or such other
page as may replace Page 3740 or Page 3750 on that service or such other service
as may be  nominated  by the British  Bankers'  Association  as the  information
vendor for the  purpose of  displaying  British  Banker's  Association  Interest
Settlement Rates for U.S. Dollar deposits).  Each determination of LIBOR made by
the Agent shall be conclusive  and binding on the Company and the Lenders absent
manifest error.

         "Affiliate"  means any Person  directly or  indirectly  controlling  or
controlled by, or under direct or indirect common control with,  another Person.
A Person  shall be deemed to control  another  Person for the  purposes  of this
definition  if such  Person  possesses,  directly  or  indirectly,  the power to
direct,  or cause the  direction  of, the  management  and policies of the other
Person,  whether through the ownership of voting  securities,  common directors,
trustees or officers, by contract or otherwise.
<PAGE>

         "Agent" means Harris Trust and Savings Bank and any  successor  thereto
appointed pursuant to Section 10.1 hereof.

         "Agreement"  means this Credit  Agreement,  as the same may be amended,
modified or restated from time to time in accordance with the terms hereof.

         "Alternative  Currency" means, subject to the provisions of Section 2.6
hereof,  Canadian  Dollars,  French Francs,  Pounds  Sterling,  Deutsche  Marks,
Italian Lira and any other currency (other than U.S.  Dollars)  approved by each
Lender, so long as such currencies are freely  transferable and convertible into
U.S.  Dollars in the  international  interbank market and are traded and readily
available to each Lender in the London interbank market.

         "Anicom Canada" means Anicom Multimedia Wiring Systems Incorporated,  a
corporation organized under the laws of Nova Scotia, Canada.

         "Applicable  Margin" shall mean with respect to the  Commitment Fee and
each type of Portion  specified  below the rate specified for such Obligation in
the chart below, subject to quarterly adjustment as hereinafter provided:

                                 Applicable
                                   Margin
                                For Domestic      Applicable
       When Following Status  Rate Portion of     Margin For        Applicable
       Exists For any Margin  Revolving Loans        LIBOR            Margin
         Determination Date         Is:           Portions of     For Commitment
                                                Revolving Loans       Fee Is:
                                       Is:

      Level I Status                0%              1.00%             .20%

      Level II Status               0%              1.25%             .25%

      Level III Status              0%              1.50%             .30%

      Level IV Status             0.25%             2.00%             .35%

      Level V Status              0.50%             2.25%             .40%

provided,  however, that all of the foregoing percentages set forth in the chart
above are subject to the following:

                   (i) on or  before  the date  that is ten (10)  Business  Days
         after the latest  date by which the  Company is  required  to deliver a
         Compliance  Certificate to the Agent for a given  quarterly  accounting
         period  pursuant  to  Section  8.5(c)  hereof  (each  date  that is ten
         Business Days after the latest date by which the Company is required to

<PAGE>

         deliver a Compliance  Certificate to the Agent being herein referred to
         as the "Margin  Determination Date"), the Agent shall determine whether
         Level I Status,  Level II Status,  Level III Status, Level IV Status or
         Level V  Status  exists  as of the  close of the  applicable  quarterly
         accounting  period (each,  a "quarterly  test period")  based upon such
         Compliance  Certificate and the financial  statements  delivered to the
         Agent under  Section 8.5 hereof for such  quarterly  test  period,  and
         shall  promptly  notify the  Company of such  determination  and of any
         change in the Applicable Margin resulting therefrom;

                  (ii) any change in the Applicable Margin shall be effective as
         of such Margin  Determination  Date, with such new Applicable Margin to
         continue in effect  until the next Margin  Determination  Date.  If the
         Company has not  delivered a  Compliance  Certificate  by the date such
         Compliance  Certificate  is required to be delivered  under Section 8.5
         hereof,  until a Compliance  Certificate  is delivered  before the next
         Margin   Determination   Date,  the  Applicable  Margin  shall  be  the
         Applicable  Margin  for Level V  Status.  If the  Company  subsequently
         delivers a Compliance  Certificate before the next Margin Determination
         Date, the Applicable Margin established by such Compliance  Certificate
         shall take effect from the date ten (10)  Business  Days after the date
         of  such   delivery  and  remain   effective   until  the  next  Margin
         Determination Date; and

                 (iii) the initial Applicable Margin in effect through the first
         Margin  Determination Date occurring  subsequent to June 30, 2000 shall
         be the Applicable Margin for Level IV Status.

         "Application" is defined in Section 1.3 hereof.

         "Assignment Agreements" is defined in Section 11.10 hereof.

         "Authorized  Representative"  means those  persons shown on the list of
officers  provided by the Company  pursuant to Section  7.2(a)  hereof or on any
update of any such list provided by the Company to the Agent,  or any further or
different  officer of the Company so named by any Authorized  Representative  of
the Company in a written notice to the Agent.

         "Availability  Reserve"  is  defined  in the  definition  of  the  term
"Borrowing Base".

         "Borrowing"  means  the  total of Loans  of a single  type  made to the
Company by all the Lenders on a single date, and if such Loans are to be part of
a LIBOR Portion, for a single Interest Period. Borrowings of Revolving Loans are
made  and  maintained  ratably  from  each of the  Lenders  according  to  their
Percentages  of the applicable  Commitments.  Borrowings of Swing Loans are made
from Harris Bank in accordance with the procedures of Section 1.5 hereof.

         "Borrowing Base" means, as of any time it is to be determined, the sum
of :

                   (a)  85% (or  such  lesser  percentage  as the  Agent  or the
         Required Lenders may determine pursuant hereto) of the then outstanding
         unpaid amount of Eligible Receivables  (provided that in no event shall
         more than  $11,000,000  of the Borrowing  Base under this clause (a) be

<PAGE>

         attributable  to  Eligible  Receivables  outstanding  more than 90 days
         after the date of the relevant  invoice  evidencing such  Receivables);
         plus

                   (b)  60% (or  such  lesser  percentage  as the  Agent  or the
         Required Lenders may determine  pursuant hereto) of the value (computed
         at the lower of market or cost using the  first-in/first-out  method of
         inventory  valuation  applied  in  accordance  with  GAAP) of  Eligible
         Inventory; plus

                   (c) 85% of the unpaid amount of the Fiscal Year 2000 Tax
         Refund; minus

                   (d) the Rent Reserve as then in effect  (provided  that there
         shall be no reduction in the Borrowing  Base for the Rent Reserve until
         March 1, 2000); minus

                   (e) $10,000,000 (such amount being herein referred to as
         the "Availability Reserve");

provided that (i) the Borrowing Base shall be computed only as against and on so
much  of the  Collateral  as is  included  on the  Borrowing  Base  Certificates
furnished from time to time by the Company  pursuant to the terms hereof and, if
required  by the  Agent or the  Required  Lenders  pursuant  to any of the terms
hereof or any Collateral Document, as verified by such other evidence reasonably
required to be furnished to the Agent or the Lenders pursuant hereto or pursuant
to any such Collateral  Document and (ii) the Agent or the Required  Lenders may
reduce the advance rates against Eligible Inventory and Eligible  Receivables as
used in  computing  the  Borrowing  Base if the Agent or such  Lenders  in their
reasonable  discretion  exercised  in good faith  based upon the  results of the
field audit referred to in Section 8.22(b) hereof that there has been a material
adverse change in  circumstances  relating to any or all of such Collateral from
those  circumstances  believed  by the Agent or such  Lenders to exist as of the
date of this Agreement;  provided,  however, that so long as no Event of Default
has occurred and is  continuing,  the Company  shall not be required to make any
mandatory  prepayment  that would  otherwise be required by Section  3.2(b)(iii)
hereof at any time during the first thirty (30) days  immediately  following the
effective date of any such reduction of the advance rates.

         "Borrowing  Base  Certificate"  means  the  certificate  in the form of
Exhibit F hereto, or in such other form acceptable to the Agent, to be delivered
to the Agent and the Lenders pursuant to Section 8.5(a)(i) hereof.

         "Business  Day" means any day other than a Saturday  or Sunday on which
banks are not  authorized  or required to close in Chicago,  Illinois  and, when
used with  respect to LIBOR  Portions,  a day on which banks are also dealing in
U.S. Dollar deposits or the relevant Alternative Currency in London, England and
Nassau,  Bahamas and if the applicable  Business Day relates to the borrowing or
payment of a LIBOR Portion  denominated  in an  Alternative  Currency,  on which
banks and  foreign  exchange  markets  are open for  business  in the city where
disbursements of or payments on such Portion are to be made.

          "Canadian Dollar" means the lawful currency of Canada.
<PAGE>

         "Canadian  Security  Agreement" means that certain  Security  Agreement
dated the date of this  Agreement  from Anicom Canada to the Agent,  as the same
may be amended, modified or supplemented from time to time.

         "Capital  Lease" means any lease of Property  which in accordance  with
GAAP is required to be capitalized on the balance sheet of the lessee.

         "Capitalized  Lease Obligation" means the amount of the liability shown
on the balance sheet of any Person in respect of a Capital  Lease  determined in
accordance with GAAP.

         "Code" means the Internal  Revenue  Code of 1986,  as amended,  and any
successor statute thereto.

         "Collateral"  means all  properties,  rights,  interests and privileges
from time to time  subject to the Liens  granted to the Agent,  or any  security
trustee therefor, by the Collateral Documents.

         "Collateral  Documents"  means the  Security  Agreement,  the  Canadian
Security  Agreement  and  all  other  security  agreements,  pledge  agreements,
assignments, financing statements and other documents as shall from time to time
secure or relate to the Obligations or any part thereof.

         "Company" is defined in the introductory paragraph hereof.

         "Compliance Certificate" is defined in Section 8.5 hereof.

         "Commitments" means and includes the Revolving Credit Commitments and
the Swing Line Commitment.

         "Consolidated Net Income" means, for any period, the net income (or net
loss)  of the  Company  and its  Subsidiaries  for  such  period  computed  on a
consolidated  basis  in  accordance  with  GAAP,  including  without  limitation
interest income and, without limiting the foregoing,  after deduction from gross
income of all  expenses  and  reserves,  including  reserves for all taxes on or
measured by income,  but excluding any extraordinary  profits and also excluding
any taxes on such profits.

         "Controlled   Group"  means  all  members  of  a  controlled  group  of
corporations and all trades or businesses  (whether or not  incorporated)  under
common control which, together with the Company or any of its Subsidiaries,  are
treated as a single employer under Section 414 of the Code.

         "Convertible  Preferred  Stock"  shall  mean the  Series B  Convertible
Preferred Stock issued by the Company on September 21, 1998.
<PAGE>

         "Debt  to  Earnings  Ratio"  means,  as of any  time  the same is to be
determined,  the ratio of Total  Funded Debt at such time to EBITDA for the four
fiscal quarters of the Company then ended.

         "Default"  means any event or condition the  occurrence of which would,
with the passage of time or the giving of notice,  or both,  constitute an Event
of Default.

         "Deutsche  Mark" means the lawful  currency of the Federal  Republic of
Germany.

         "Disposition" means the lease, sale, conveyance or other disposition of
Property,  other  than sales or other  dispositions  expressly  permitted  under
Section 8.17 hereof.

         "Domestic  Rate"  means,  for any day,  the  greater of (i) the rate of
interest  announced by the Agent from time to time as its prime commercial rate,
as in effect on such day (it being  understood and agreed that such rate may not
be the Agent's best or lowest rate); and (ii) the sum of (x) the rate determined
by the Agent to be the  average  (rounded  upwards,  if  necessary,  to the next
higher 1/100 of 1%) of the rates per annum quoted to the Agent at  approximately
10:00 a.m.  (Chicago time) (or as soon thereafter as is practicable) on such day
(or, if such day is not a Business Day, on the  immediately  preceding  Business
Day) by two or more Federal funds brokers  selected by the Agent for the sale to
the Agent at face value of Federal funds in an amount equal or comparable to the
principal amount owed to the Agent for which such rate is being determined, plus
(y) 1/2 of 1%.

         "Domestic Rate Portions" is defined in Section 2.1(a) hereof.

         "EBIT" means,  for any period,  Consolidated Net Income for such period
plus all amounts deducted in arriving at such Consolidated Net Income amount for
such period for  Interest  Expense  and for  foreign,  federal,  state and local
income tax expense.

         "EBITDA" means,  for any period,  EBIT for such period plus all amounts
deducted in arriving at such EBIT in respect of all amounts properly charged for
depreciation  of fixed assets and  amortization of Capital Leases and intangible
assets during such period on the books of the Company and its Subsidiaries,  all
as determined in accordance with GAAP.

         "Eligible  Inventory"  means  any  Inventory  of  the  Company  or  any
Subsidiary in which the Agent has a perfected first priority  security  interest
and which complies with each of the following requirements:

                   (a)     it consists of Inventory  which is readily  usable or
         marketable by the Company or such
         Subsidiary in the ordinary course of its business;

                   (b) it substantially  conforms to such Person's advertised or
         represented   specifications,   applicable   government  standards  and
         regulations and other quality  standards and has not been determined by
         the  Agent  to be  unacceptable  due to age,  type,  variety,  quality,
         quantity or location;
<PAGE>

                   (c) it is not covered by a warehouse receipt or similar
         document;

                   (d) all  warranties of the Company or such  Subsidiary in the
         Loan Documents are true and correct with respect thereto;

                   (e)  it  has  been  identified  to the  Agent  in the  manner
         required by the Agent pursuant to the Security Agreement; and

                   (f) it is located at a location  disclosed to and approved by
         the Agent,  and if requested by the Agent,  any Person  (other than the
         Company or such  Subsidiary)  owning or controlling such location shall
         have waived all right, title and interest in and to such Inventory in a
         manner satisfactory to the Agent.

         "Eligible  Receivables"  means any  Receivable  of the  Company  or any
Subsidiary in which the Agent has a first priority  perfected  security interest
and which complies with each of the following requirements:

                   (a) it arises out of a bona fide sale of Inventory  which has
         been  delivered  to, or is in the  process of being  delivered  to, the
         account debtor on said Receivable in the ordinary course of business on
         ordinary trade terms;

                   (b) all  warranties of the Company or such  Subsidiary in the
         Loan Documents are true and correct with respect thereto;

                   (c)  it  has  been  identified  to the  Agent  in the  manner
         required by the Agent pursuant to the Security Agreement;

                   (d) it is  evidenced  by an  invoice  to the  account  debtor
         thereunder  dated  not more  than 5  Business  Days  subsequent  to the
         shipment date of the relevant Inventory;

                   (e) it has not remained  unpaid in whole or in part more than
         90 days from and after the date of the relevant invoice evidencing such
         Receivable  (provided  that  such  Receivable  shall  not  be  rendered
         ineligible  by this  Subsection  (e) if and so long as (i) the same has
         not been  unpaid  more  than 180 days  from and  after  the date of the
         relevant  invoice  evidencing  such  Receivable and such  Receivable is
         secured to the  Agent's  satisfaction  by (i) a surety bond issued by a
         reputable bonding company  acceptable to the Agent securing its payment
         or (ii) a statutory materialman's lien perfected to the extent required
         by applicable law);

                   (f) it is net of any credit or allowance given by the Company
         or such Subsidiary to such account debtor;

                   (g) it is not owing by an  account  debtor who (i) has become
         insolvent,  (ii)  is  the  subject  of  any  bankruptcy,   arrangement,
         reorganization  proceedings or other proceedings for relief of debtors,

<PAGE>

         (iii) has  admitted  its  inability  to pay its debt  generally  or has
         stopped  paying  its debts  generally  or (iv) is an  Affiliate  of the
         Company or such Subsidiary;

                   (h) the account debtor is not principally located outside the
         continental United States, Puerto Rico or Canada unless such Receivable
         is secured by an  irrevocable  letter of credit  issued by a commercial
         bank located in the United States and which is on terms and  conditions
         acceptable to the Agent;

                   (i) it is not owing by the  United  States of  America or any
         department,  agency  or  instrumentality  thereof  (including,  without
         limitation,  the Commodity Credit  Corporation)  unless the Agent shall
         have received evidence satisfactory to the Agent of compliance with the
         Assignment of Claims Act;

                   (j) it is not  owing by an  account  debtor  who  shall  have
         failed  to pay  25% or  more of all  Receivables  owed by such  account
         debtor  (exclusive of any  Receivables  owing by such account debtor to
         the extent the same are the subject of a bona fide dispute)  within the
         periods set forth in subsection (e) above;

                   (k) it is not subject to any counterclaim or defense asserted
         by the account  debtor  thereunder,  nor is it subject to any offset or
         contra account  payable to the account debtor (in any case,  unless the
         amount of such Receivable is net of such counterclaim,  defense, offset
         or contra account established to the satisfaction of the Agent); and

                   (l) it is not  evidenced by an  instrument  or chattel  paper
         unless the same has been endorsed and delivered to the Agent.

         "EMU" means economic and monetary union as  contemplated  in the Treaty
on European Union.

         "EMU Commencement" means the date of commencement of the third stage of
EMU (which at the date  hereof is expected to be on January 1, 1999) or the date
on  which  circumstances  arise  which  (in  the  opinion  of  the  Agent)  have
substantially  the same effect and result in substantially the same consequences
as  commencement  of the third  stage of EMU as  contemplated  by the  Treaty on
European Union.

         "EMU  Legislation"  means  legislative  measures of the  European  Euro
Members  of the  European  Union  for  the  introduction  of,  changeover  to or
operation of a single or unified European  currency (whether known as the "euro"
or otherwise), being in part the implementation of the third stage of EMU.

         "ERISA" means the Employee  Retirement  Income Security Act of 1974, as
amended, or any successor statute thereto.

         "Euro" means the single currency of Euro Members of the European Union.
<PAGE>

         "Euro Member"  means each state  described as a  "participating  member
state" in any EMU Legislation.

         "Euro Unit" means the currency unit of the Euro.

         "Event of Default"  means any event or condition  identified as such in
Section 9.1 hereof.

          "Existing  Lenders" means Harris Trust and Savings Bank,  Bank One, NA
(f/k/a/ The First National Bank of Chicago),  LaSalle Bank National  Association
(f/k/a LaSalle  National Bank) and Bank of America,  N.A. (f/k/a Bank of America
National Trust and Savings Association).

         "Existing Credit Agreements" means the Long-Term  Multicurrency  Credit
Agreement  dated as of November 4, 1998,  among the  Company,  Harris  Trust and
Savings Bank, as Agent and the Existing Lenders, as amended and supplemented and
the Short-Term Credit Agreement dated as of November 4, 1998, among the Company,
Harris Trust and Savings Bank, as Agent and the Existing Lenders, as amended and
supplemented.

          "Fiscal Year 2000 Tax Refund"  means an amount up to $7,665,000 of the
amount not yet received by the Company and shown on the Company's federal income
tax  return  for its  fiscal  year ended  December  31,  1999,  if the Agent has
received a letter  addressed to the Agent and the Lenders from the Company's tax
preparer  in  form  and  substance  satisfactory  to the  Agent  confirming  the
Company's  reasonable  expectation  of  receipt  of the  amount set forth on the
Company's tax return for fiscal 1999 to the; provided, however, that such amount
shall be  deemed  to be $0 on and at all  times  after  January  1, 2001 or such
earlier date on which the Agent  determines there remains no reasonable basis to
expect receipt of such.

         "Fixed Rate  Portion"  means and  includes  the LIBOR  Portions and the
Quoted Rate  Portions  and each  individually,  unless the context in which such
term is used shall otherwise require.

         "French Franc" means the lawful currency of the Republic of France.

         "GAAP" means generally accepted accounting principles as in effect from
time to time,  applied by the Company and its Subsidiaries on a basis consistent
with the preparation of the Company's most recent financial statements furnished
to the Lenders pursuant to Section 6.5 hereof.

         "Guarantor"  means each  Material  Subsidiary  (other than,  subject to
Section 4.1,  Anicom  Canada) of the Company  that  executes and delivers to the
Agent a Guaranty Agreement.

         "Guaranty   Agreement"   means  each  guaranty  issued  by  a  Material
Subsidiary to the Agent guaranteeing all or any Obligations.

         "Harris Bank" means Harris Trust and Savings Bank.
<PAGE>

         "Indebtedness  for  Borrowed  Money"  means  for  any  Person  (without
duplication) (i) all indebtedness created,  assumed or incurred in any manner by
such Person  representing  money  borrowed  (including  by the  issuance of debt
securities),  (ii) all indebtedness for the deferred  purchase price of property
or services (other than trade accounts payable arising in the ordinary course of
business  which  are not  more  than  sixty  (60)  days  past  due),  (iii)  all
indebtedness  secured by any Lien upon  Property of such Person,  whether or not
such Person has assumed or become  liable for the payment of such  indebtedness,
(iv) all Capitalized Lease Obligations of such Person and (v) all obligations of
such Person on or with respect to letters of credit,  bankers'  acceptances  and
other extensions of credit whether or not representing  obligations for borrowed
money.

         "Independent  Collateral  Report"  means  the  monthly  report  of  NCS
received  by the  Company  setting  forth  the  status of all  surety  bonds and
statutory materialmen's liens securing the Company's Receivables.

         "Intangible Assets" means, as of any time the same is to be determined,
goodwill, patents, trademarks,  copyrights and franchises of the Company and its
Subsidiaries  (including,  without  limitation,  unamortized  debt  discount and
expense,  organization  costs and  deferred  research and  development  expense)
determined on a consolidated basis in accordance with GAAP.

         "Interest  Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to Capitalized
Lease  Obligations  and all  amortization  of debt  discount and expense) of the
Company and its Subsidiaries for such period as computed on a consolidated basis
in accordance with GAAP.

         "Interest  Period" means,  (i) with respect to any LIBOR  Portion,  the
period  commencing  on,  as the  case  may be,  the  creation,  continuation  or
conversion  date with  respect  to such  LIBOR  Portion  and ending 1, 2, 3 or 6
months  thereafter  as selected by the Company in its notice as provided  herein
and (ii) with respect to any Swing Loan, initially, the period commencing on, as
the case may be, the creation or conversion date with respect to such Swing Loan
and ending on the date,  as the Company may select,  1-10 days  thereafter,  and
thereafter,  each  period  commencing  on the  last  day of the  next  preceding
interest period applicable to such Swing Loan and ending 1-10 days thereafter as
selected by the Company and in its notice as provided herein; provided that, all
of the  foregoing  provisions  relating to  Interest  Periods are subject to the
following:

                   (i) if any Interest Period would otherwise end on a day which
         is not a Business Day,  that  Interest  Period shall be extended to the
         next succeeding  Business Day, unless in the case of an Interest Period
         for a LIBOR Portion the result of such extension would be to carry such
         Interest  Period  into  another  calendar  month  in which  event  such
         Interest Period shall end on the immediately preceding Business Day;

                  (ii) no Interest  Period may extend beyond the final  maturity
date of the relevant Notes;
<PAGE>

                 (iii) the interest  rate to be  applicable  to each Portion for
         each  Interest  Period shall apply from and  including the first day of
         such Interest Period to but excluding the last day thereof; and

                  (iv) no Interest Period may be selected if after giving effect
         thereto  the  Company  will  be  unable  to  make a  principal  payment
         scheduled to be made during such Interest Period without paying part of
         a LIBOR  Portion  on a date  other  than the  last day of the  Interest
         Period applicable thereto.

For purposes of determining an Interest  Period, a month means a period starting
on one day in a calendar month and ending on a numerically  corresponding day in
the next calendar month, provided,  however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the month
in which an Interest  Period is to end, then such  Interest  Period shall end on
the last Business Day of such month.

         "Inventory"  means all finished goods (other than  packaging,  crating,
and  supplies  inventory)  held for sale in which the  Company  or the  relevant
Subsidiary now has or hereafter acquires title to.

         "Italian Lira" means the lawful currency of the Republic of Italy.

         "Lender"  means Harris Trust and Savings  Bank,  the other  signatories
hereto (other than the Company) and all other lenders  becoming  parties  hereto
pursuant to Section 11.10 hereof.

         "Letter of Credit" is defined in Section 1.3 hereof.

         "Leverage  Ratio" means,  as of any time the same is to be  determined,
the ratio of Total  Funded  Debt of the Company  and its  Subsidiaries  to Total
Capitalization  of the  Company and its  Subsidiaries,  all as  determined  on a
consolidated basis in accordance with GAAP.

         "Level I Status" shall mean, for any Margin Determination Date, that as
of the close of the  quarterly  test period with  reference to which such Margin
Determination  Date was set, the Pricing Leverage Ratio is less than or equal to
2.00 to 1.0.

         "Level II Status" shall mean, for any Margin  Determination  Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination  Date was set, the Pricing  Leverage Ratio is greater than 2.00 to
1.0 but less than or equal to 2.50 to 1.0.

         "Level III Status" shall mean, for any Margin  Determination Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination  Date was set, the Pricing  Leverage Ratio is greater than 2.50 to
1.0 but less than or equal to 3.00 to 1.0.

         "Level IV Status" shall mean, for any Margin  Determination  Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination  Date was set, the Pricing  Leverage Ratio is greater than 3.00 to
1.0 and less than or equal to 3.50 to 1.0.
<PAGE>

         "Level V Status" shall mean, for any Margin Determination Date, that as
of the close of the  quarterly  test period with  reference to which such Margin
Determination  Date was set, the Pricing  Leverage Ratio is greater than 3.50 to
1.0.

         "LIBOR Portions" means and includes LIBOR Portions,  unless the context
in which such term is used shall otherwise require.

         "LIBOR Portions" is defined in Section 2.1(a) hereof.

         "Lien" means any mortgage,  lien, security interest,  pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor  under  any  conditional  sale,  Capital  Lease or other  title
retention arrangement.

         "Loan  Documents"  means  this  Agreement,  the Notes,  the  Collateral
Documents, the Assignment Agreements and each other instrument or document to be
delivered hereunder or thereunder or otherwise in connection therewith.

         "Loans" means and includes Revolving Loans and Swing Loans, and each of
them individually.

         "Material  Subsidiary"  means any Subsidiary which has, as of the close
of any  completed  fiscal year of the  Company  (commencing  with the  Company's
fiscal year ending December 31, 1996), EBITDA for any such fiscal year (directly
and together with its subsidiaries) greater than 7% of the EBITDA of the Company
and its  Subsidiaries  for any  such  fiscal  year on a  consolidated  basis  in
accordance with GAAP.

         "Net Cash  Proceeds"  means,  with  respect to any  offering  of equity
securities of a Person or the issuance of any Indebtedness for Borrowed Money by
a Person,  cash and cash  equivalent  proceeds  received by or for such Person's
account,  net of  reasonable  legal,  underwriting,  and other fees and expenses
incurred as a direct result thereof.

         "Non-Material  Subsidiary"  means each Subsidiary other than a Material
Subsidiary.

         "Notes" means and includes the  Revolving  Notes and the Swing Note and
each of them  individually,  unless the context in which such term is used shall
otherwise require.

         "Obligations" means all obligations of the Company to pay principal and
interest  on  the  Loans,  all   reimbursement   obligations   owing  under  the
Applications,  all fees and charges  payable  hereunder,  and all other  payment
obligations of the Company arising under or in relation to any Loan Document, in
each case  whether now  existing  or  hereafter  arising,  due or to become due,
direct or indirect,  absolute or contingent,  and howsoever  evidenced,  held or
acquired.

         "Original Dollar Amount" means at any time the same is to be determined
(x) in relation to any LIBOR Portion denominated in an Alternative Currency, the
U.S.  Dollar  Equivalent of such Portion on the first day of the Interest Period

<PAGE>

then  applicable  thereto  (the  day on which  such  Portion  was most  recently
created,  continued or effected by conversion)  and (y) in relation to any other
Portion, the amount thereof in U.S. Dollars.

         "Overnight  Foreign Currency Rate" shall mean for any amount payable in
a currency other than U.S. Dollars, the rate of interest per annum as determined
by the Agent (rounded  upwards,  if necessary,  to the nearest whole multiple of
one-sixteenth  of one  percent  (1/16  of 1%)) at  which  overnight  or  weekend
deposits of the appropriate currency (or, if such amount due remains unpaid more
than three  Business  Days,  then for such  period of time not  longer  than six
months as the  Agent  may elect in its  absolute  discretion)  for  delivery  in
immediately  available  and freely  transferable  funds  would be offered by the
Agent to major banks in the  interbank  market upon  request of such major banks
for the applicable period as determined above and in an amount comparable to the
unpaid principal  amount of the related  Revolving Loan (or, if the Agent is not
placing deposits in such currency in the interbank market, then the Agent's cost
of funds in such currency for such period).

         "PBGC" means the Pension  Benefit  Guaranty  Corporation  or any Person
succeeding to any or all of its functions under ERISA.

         "Percentage"  means,  for each Lender,  the percentage of the Revolving
Credit Commitments  represented by such Lender's Revolving Credit Commitment or,
if the Revolving Credit Commitments have been terminated, the percentage held by
such Lender (including through participation interest in Swing Loans pursuant to
Section 1.5 hereof and Letters of Credit  pursuant to Section 1.3 hereof) of the
aggregate principal amount of all outstanding Obligations.

         "Person" means an individual,  partnership,  corporation,  association,
trust,   unincorporated  organization  or  any  other  entity  or  organization,
including a government or agency or political subdivision thereof.

         "Plan" means any employee  pension  benefit plan covered by Title IV of
ERISA or subject to the minimum funding  standards under Section 412 of the Code
that either (i) is maintained by a member of the Controlled  Group for employees
of a  member  of the  Controlled  Group,  or (ii) is  maintained  pursuant  to a
collective  bargaining  agreement or any other arrangement under which more than
one employer makes  contributions  and to which a member of the Controlled Group
is then making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions.

         "Portion" is defined in Section 2.1(a) hereof.

         "Pounds Sterling" means the lawful currency of the United Kingdom.

         "Pricing  Leverage  Ratio"  means,  as of any  time  the  same is to be
determined,  the ratio of (i) Total Funded Debt as of such date of determination
to (ii)  EBITDA for the four most  recently  completed  fiscal  quarters  of the
Company,  all as determined  on a  consolidated  basis in accordance  with GAAP;
provided, however, that:
<PAGE>

                   (a) the Pricing  Leverage Ratio as of the close of the fiscal
         quarter of the Company  ending on June 30, 2000 shall mean the ratio of
         (i)  Total  Funded  Debt as of such date of  determination  to (ii) the
         product  which  results  by  multiplying  (x) EBITDA for the two fiscal
         quarters of the Company then ended by (y) 2; and

                   (b) the Pricing  Leverage Ratio as of the close of the fiscal
         quarter of the  Company  ending on  September  30,  2000 shall mean the
         ratio of (i) Total Funded Debt as of such date of determination to (ii)
         the  product  which  results  by  multiplying  (x) EBITDA for the three
         fiscal quarters of the Company then ended by (y) 1.33.

         "Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.

          "Quoted  Rate  Portion"  means any  portion  of the  unpaid  principal
balance of the Swing Note which bears  interest  with  respect to Harris  Bank's
Offered Rate.

         "Reimbursement Obligation" is defined in Section 1.4(c) hereof.

         "Rent Reserve"  means,  as of any time, an amount (as determined by the
Agent)  equal to the sum of the  Company's  rental  expense  for the next  three
consecutive  calendar  months for each location at which more than $1,000,000 of
Inventory  is located  and for which the Company  has not yet  delivered  to the
Agent a landlord's  Lien waiver  reasonably  acceptable to the Agent in form and
substance as required by the terms of the Loan Documents.

         "Required  Lenders"  means, as of the date of  determinations  thereof,
those Lenders holding at least 66-2/3% of the Revolving  Credit  Commitments or,
in the event that no Revolving  Credit  Commitments are  outstanding  hereunder,
holding at least 66-2/3% in aggregate  principal  amount of the Loans and credit
risk on the Letters of Credit outstanding hereunder.

         "Revolving Credit" is defined in Section 1.1 hereof.

         "Revolving Credit  Commitments" means the commitments of the Lenders to
extend credit under the Revolving Credit in the amounts set forth opposite their
names on Schedule 1 attached  hereto and made a part hereof and  opposite  their
signatures on Assignment  Agreements  delivered pursuant to Section 11.10 hereof
under the heading "Revolving Credit Commitment",  as such amounts may be reduced
pursuant hereto.

         "Revolving Loan" is defined in Section 1.2 hereof.

         "Revolving Note" is defined in Section 1.2 hereof.

         "Revolving Credit Termination Date" means July 1, 2001, or such earlier
date on which the Revolving Credit  Commitments are terminated in whole pursuant
to Section  3.3,  9.2 or 9.3 hereof,  or such later date to which the  Revolving
Credit Termination Date is extended pursuant to Section 1.5 hereof.
<PAGE>

         "Security  Agreement" means that certain  Security  Agreement dated the
date of this  Agreement  among the Company,  the  Guarantors  (other than Anicom
Canada) and the Agent,  as the same may be amended,  modified,  supplemented  or
restated from time to time.

          "Shareholders'  Equity"  means,  as of  any  time  the  same  is to be
determined, the sum (without duplication) of (i) shareholders' equity (including
all capital  stock,  additional  paid-in-capital  and  retained  earnings  after
deducting  treasury stock,  but excluding  minority  interests in  subsidiaries)
which would appear on the balance sheet of the Company and its Subsidiaries plus
(to the extent not included in such  Shareholders'  Equity) (ii) the Convertible
Preferred  Stock,  all as determined on a consolidated  basis in accordance with
GAAP.

         "SEC" means the  Securities  and Exchange  Commission  or any successor
agency thereto.

          "Subordinated  Indebtedness"  means,  as of any time the same is to be
determined,  indebtedness of the Company or any Subsidiary subordinated in right
of payment to the  Obligations,  pursuant to documentation  containing  interest
rates, payment terms, maturities,  amortization schedules,  covenants, defaults,
remedies,  subordination  provisions  and  other  material  terms  in  form  and
substance satisfactory to the Lenders. The Lenders further acknowledge and agree
that  subordination  provisions  in the form or  substantially  the form annexed
hereto as Exhibit D constitute subordination provisions satisfactory in form and
substance to the Lenders.

         "Subsidiary" means any corporation or other Person more than 50% of the
outstanding  ordinary voting shares or other equity interests of which is at the
time  directly  or  indirectly  owned  by the  Company,  by one or  more  of its
Subsidiaries, or by the Company and one or more of its Subsidiaries.

         "Swing Line" is defined in Section 1.5(a) hereof.

         "Swing Line  Commitment"  means the  commitment  of Harris Bank to make
Swing Loans in the amount set forth  opposite its name under the heading  "Swing
Line Commitments" on Schedule 1 attached hereto and made a part hereof.

         "Swing Loans" is defined in Section 1.5(a) hereof.

         "Swing Note" is defined in Section 1.5(b) hereof.

         "Tangible  Net  Worth"  means,  as  of  any  time  the  same  is  to be
determined,  Shareholders'  Equity less the sum of (i) all notes receivable from
officers and employees of the Company and its  Subsidiaries  and (ii) Intangible
Assets.

         "Texcan"   means,   collectively,   Texcan   Cables,   Inc.,  a  Nevada
corporation, Texcan Cables International,  Inc., a Nevada corporation and Texcan
Cables Limited, a Canadian corporation.
<PAGE>

         "Texcan  Acquisition" means the acquisition of all or substantially all
of the assets of Texcan by Anicom  Canada on September 21, 1998 pursuant to that
certain  Asset  Purchase  Agreement  dated as of September  21, 1998 between the
Company, Anicom Canada and Texcan.

         "Total Capitalization" means the sum of Total Funded Debt and
Shareholders' Equity.

         "Total  Funded Debt" means,  at any time the same is to be  determined,
the  aggregate of all  Indebtedness  for  Borrowed  Money of the Company and its
Subsidiaries at such time, plus all Indebtedness for Borrowed Money of any other
Person which is directly or  indirectly  guaranteed by the Company or any of its
Subsidiaries  or  which  the  Company  or  any of its  Subsidiaries  has  agreed
(contingently  or otherwise)  to purchase or otherwise  acquire or in respect of
which the Company or any of its  Subsidiaries  has otherwise  assured a creditor
against loss.

         "Treaty on European  Union" means the Treaty of Rome of March 25, 1957,
as amended by the Single  European Act of 1986 and the Maastricht  Treaty (which
was signed at Maastricht on February 7, 1992, and came into force on November 1,
1993, as amended from time to time).

         "Unfunded  Vested  Liabilities"  means,  for any Plan at any time,  the
amount (if any) by which the present value of all vested nonforfeitable  accrued
benefits  under  such Plan  exceeds  the fair  market  value of all Plan  assets
allocable to such benefits,  all determined as of the then most recent valuation
date for such  Plan,  but only to the  extent  that  such  excess  represents  a
potential  liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.

         "Unused  Revolving  Credit   Commitments"   means,  at  any  time,  the
difference  between  the  Revolving  Credit  Commitments  then in effect and the
aggregate  outstanding  Original Dollar Amount of Revolving Loans and Letters of
Credit.

         "U.S. Dollars" and "$" means the lawful currency of the United States
of America.

         "U.S.  Dollar  Equivalent" means the amount of U.S. Dollars which would
be realized by converting an Alternative  Currency into U.S. Dollars in the spot
market at the exchange  rate quoted by the Agent,  at  approximately  11:00 a.m.
(London time) two Business Days prior to the date on which a computation thereof
is required to be made, to major banks in the interbank  foreign exchange market
for the purchase of U.S. Dollars for such Alternative Currency.

         "Welfare  Plan"  means a "welfare  plan" as defined in Section  3(1) of
ERISA.

         "Wholly-Owned Subsidiary" means a Subsidiary of which all of the issued
and outstanding shares of capital stock (other than directors' qualifying shares
as required by law) or other equity  interests  are owned by the Company  and/or
one or more Wholly-Owned Subsidiaries within the meaning of this definition.

         "Year 2000 Problem" means any significant risk that computer  hardware,
software,  or equipment containing embedded microchips essential to the business
or operations of the Company or any of the Subsidiaries will not, in the case of
dates or time periods  occurring  after December 31, 1999,  function at least as
efficiently  and  reliably  as in the case of times  or time  periods  occurring
before January 1, 2000, including the making of accurate leap year calculations.
<PAGE>

         Section 5.2.  Interpretation.  The  foregoing  definitions  are equally
applicable to both the singular and plural forms of the terms defined. The words
"hereof",  "herein",  and "hereunder" and words of like import when used in this
Agreement  shall refer to this  Agreement  as a whole and not to any  particular
provision of this Agreement. All references to time of day herein are references
to Chicago,  Illinois time unless  otherwise  specifically  provided.  Where the
character  or amount of any asset or  liability  or item of income or expense is
required to be determined or any  consolidation or other accounting  computation
is required to be made for the purposes of this  Agreement,  it shall be done in
accordance  with GAAP except where such  principles  are  inconsistent  with the
specific provisions of this Agreement.

SECTION 6.           REPRESENTATIONS AND WARRANTIES.

         The  Company  represents  and  warrants to the Agent and the Lenders as
follows:

         Section  6.1.  Organization  and  Qualification.  The  Company  is duly
organized, validly existing and in good standing as a corporation under the laws
of the  State of  Delaware,  has full and  adequate  corporate  power to own its
Property  and conduct its  business as now  conducted,  and is duly  licensed or
qualified and in good standing in each  jurisdiction  in which the nature of the
business  conducted  by it or the nature of the  Property  owned or leased by it
requires such licensing or qualifying.

         Section 6.2. Subsidiaries.  Each Subsidiary is duly organized,  validly
existing and in good standing under the laws of the  jurisdiction in which it is
incorporated  or organized,  as the case may be, has full and adequate  power to
own its Property and conduct its business as now conducted, and is duly licensed
or qualified  and in good standing in each  jurisdiction  in which the nature of
the business conducted by it or the nature of the Property owned or leased by it
requires such licensing or  qualifying,  except where the failure to obtain such
authorization,  license or qualification  would not result in a material adverse
change in the business, financial condition or Properties of the Company and its
Subsidiaries.  Schedule 6.2 hereto identifies each Subsidiary,  the jurisdiction
of its  incorporation  or  organization,  as the case may be, the  percentage of
issued and outstanding shares of each class of its capital stock or other equity
interests owned by the Company and the  Subsidiaries  and, if such percentage is
not 100%  (excluding  directors'  qualifying  shares  as  required  by  law),  a
description  of each  class of its  authorized  capital  stock and other  equity
interests and the number of shares of each class issued and outstanding.  All of
the  outstanding  shares of capital  stock and other  equity  interests  of each
Subsidiary are validly issued and outstanding  and fully paid and  nonassessable
and all such shares and other  equity  interests  indicated  on Schedule  6.2 as
owned by the Company or a Subsidiary are owned,  beneficially and of record,  by
the  Company  or such  Subsidiary  free and  clear of all  Liens.  There  are no
outstanding  commitments or other obligations of any Subsidiary to issue, and no
options,  warrants or other  rights of any Person to acquire,  any shares of any
class of  capital  stock or  other  equity  interests  of any  Subsidiary.  Each
Subsidiary  that is a Material  Subsidiary  is so noted on Schedule  6.2 hereto.
Each  Material  Subsidiary  is a Guarantor  except to the extent  Section 4.1 or
Section 8.1(b) hereof does not yet require such Subsidiary to be a Guarantor.
<PAGE>

         Section 6.3. Corporate  Authority and Validity of Obligations.  (a) The
Company has full right and authority to enter into this  Agreement and the other
Loan Documents,  to make the borrowings  herein provided for, to issue its Notes
in evidence thereof, to grant to the Agent the Liens described in the Collateral
Documents  executed  by the  Company,  and  to  perform  all of its  obligations
hereunder and under the other Loan  Documents.  The Loan Documents  delivered by
the Company have been duly authorized, executed and delivered by the Company and
constitute  valid  and  binding   obligations  of  the  Company  enforceable  in
accordance  with  their  terms  except  as  enforceability  may  be  limited  by
bankruptcy,   insolvency,   fraudulent  conveyance  or  similar  laws  affecting
creditors'  rights  generally and general  principles of equity  (regardless  of
whether the  application  of such  principles  is  considered in a proceeding in
equity or at law);  and this  Agreement and the other Loan Documents do not, nor
does the  performance  or  observance  by the  Company of any of the matters and
things herein or therein provided for,  contravene or constitute a default under
any provision of law or any judgment,  injunction,  order or decree binding upon
the  Company or any  provision  of the  charter,  articles of  incorporation  or
by-laws of the Company or any  covenant,  indenture or agreement of or affecting
the Company or any of its Properties, or result in the creation or imposition of
any Lien on any Property of the Company other than the Liens granted in favor of
the Agent pursuant to the Collateral Documents.

         (b)  Guarantors.  Each  Guarantor has full right and authority to enter
into any Loan  Documents it has executed,  to guarantee the  Obligations  of the
Company,  to grant to the Agent the Liens described in the Collateral  Documents
executed by such Person, and to perform all of its obligations  thereunder.  The
Loan Documents  delivered by each Guarantor have been duly authorized,  executed
and delivered by such Guarantor and constitute valid and binding  obligations of
such   Guarantor   enforceable   in  accordance   with  their  terms  except  as
enforceability may be limited by bankruptcy,  insolvency,  fraudulent conveyance
or similar laws affecting  creditors' rights generally and general principles of
equity  (regardless of whether the  application of such principles is considered
in a proceeding in equity or at law);  and such Loan  Documents do not, nor does
the performance or observance by such Guarantor of any of the matters and things
herein or therein  provided  for,  contravene  or constitute a default under any
provision of law or any judgment,  injunction,  order or decree binding upon the
Company  or  any  Guarantor  or  any  provision  of  the  charter,  articles  of
incorporation  or  by-laws  of the  Company or any  Guarantor  or any  covenant,
indenture or agreement  of or affecting  the Company or any  Guarantor or any of
their  Properties,  or result in the creation or  imposition  of any Lien on any
Property of the Company or any  Guarantor  other than the Liens granted in favor
of the Agent pursuant to the Collateral Documents.

         Section 6.4. Use of Proceeds;  Margin Stock.  The Company shall use the
proceeds of the Loans and other  extensions of credit made  available  hereunder
solely for its general  working  capital  purposes  and for such other legal and
proper purposes as are consistent with all applicable laws.  Neither the Company
nor any  Subsidiary  is  engaged in the  business  of  extending  credit for the
purpose of purchasing or carrying margin stock (within the meaning of Regulation
U of the Board of Governors of the Federal Reserve  System),  and no part of the
proceeds of any Loan or any other  extension  of credit made  hereunder  will be
used to purchase or carry any such  margin  stock or to extend  credit to others
for the purpose of purchasing or carrying any such margin stock.
<PAGE>

         Section 6.5. Financial Reports.  The consolidated  balance sheet of the
Company  and  its  Subsidiaries  as  at  December  31,  1998,  and  the  related
consolidated  statements  of  income,  retained  earnings  and cash flows of the
Company and its  Subsidiaries  for the fiscal year then ended,  and accompanying
notes thereto, which financial statements are accompanied by the audit report of
PricewaterhouseCoopers  LLP,  independent public accountants,  and the unaudited
interim  consolidated  balance sheet of the Company and its  Subsidiaries  as at
September 30, 1999, and the related  consolidated  statements of income and cash
flows of the  Company and its  Subsidiaries  for the nine (9) months then ended,
heretofore furnished to the Lenders,  fairly present the consolidated  financial
condition  of the  Company  and  its  Subsidiaries  as at  said  dates  and  the
consolidated  results of their  operations  and cash flows for the periods  then
ended in conformity with generally accepted  accounting  principles applied on a
consistent  basis.  Neither  the  Company  nor  any  Subsidiary  has  contingent
liabilities  which are material to it other than as indicated on such  financial
statements  or, with  respect to future  periods,  on the  financial  statements
furnished pursuant to Section 8.5 hereof.

         Section 6.6. No Material  Adverse  Change.  Since  September  30, 1999,
there has been no change in the  condition  (financial or otherwise) or business
prospects  of the  Company  or any  Subsidiary  except  those  occurring  in the
ordinary course of business, none of which individually or in the aggregate have
been materially adverse.

         Section 6.7. Full Disclosure.  The statements and information furnished
to the Lenders in  connection  with the  negotiation  of this  Agreement and the
other Loan  Documents and the  commitments by the Lenders to provide all or part
of the financing  contemplated  hereby do not contain any untrue statements of a
material fact or omit a material fact necessary to make the material  statements
contained herein or therein not misleading, the Lenders acknowledging that as to
any projections  furnished to Lenders, the Company only represents that the same
were prepared on the basis of information and estimates the Company  believed to
be reasonable.

         Section 6.8.  Good Title.  The Company and its  Subsidiaries  each have
good and  defensible  title to their  assets  as  reflected  on the most  recent
consolidated balance sheet of the Company and its Subsidiaries  furnished to the
Lenders  (except for sales of assets by the Company and its  Subsidiaries in the
ordinary course of business), subject to no Liens other than such thereof as are
permitted by Section 8.12 hereof.

         Section 6.9. Litigation and Other Controversies. There is no litigation
or governmental proceeding or labor controversy pending, nor to the knowledge of
the Company threatened, against the Company or any Subsidiary which if adversely
determined  would (a) impair the  validity or  enforceability  of, or impair the
ability of the Company to perform its obligations  under,  this Agreement or any
other  Loan  Document  or (b)  result  in any  material  adverse  change  in the
financial  condition,  Properties,  business or operations of the Company or any
Subsidiary.

        Section 6.10. Taxes. All tax returns required to be filed by the Company
or any Subsidiary in any jurisdiction  have, in fact, been filed, and all taxes,
assessments,  fees  and  other  governmental  charges  upon the  Company  or any

<PAGE>

Subsidiary or upon any of their  respective  Properties,  income or  franchises,
which are shown to be due and  payable  in such  returns,  have been  paid.  The
Company does not know of any proposed  additional tax  assessment  against it or
its  Subsidiaries  for which adequate  provision in accordance with GAAP has not
been made on its accounts. Adequate provisions in accordance with GAAP for taxes
on the  books of the  Company  and each  Subsidiary  have been made for all open
years, and for its current fiscal period.

        Section  6.11.  Approvals.  No  authorization,   consent,   license,  or
exemption  from,  or  filing or  registration  with,  any court or  governmental
department,  agency or  instrumentality,  nor any  approval  or  consent  of the
stockholders of the Company or any other Person,  is or will be necessary to the
valid execution, delivery or performance by the Company of this Agreement or any
other Loan Document.

        Section  6.12.  Affiliate  Transactions.  Neither  the  Company  nor any
Subsidiary is a party to any contracts or agreements  with any of its Affiliates
(other than with  Wholly-Owned  Subsidiaries)  on terms and conditions which are
less  favorable  to the  Company  or such  Subsidiary  than  would be usual  and
customary in similar contracts or agreements between Persons not affiliated with
each other.

        Section  6.13.  Investment  Company;  Public  Utility  Holding  Company.
Neither the Company nor any Subsidiary is an  "investment  company" or a company
"controlled"  by an  "investment  company"  within the meaning of the Investment
Company Act of 1940, as amended,  or a "public utility  holding  company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.

        Section 6.14. ERISA. The Company and each other member of its Controlled
Group has fulfilled its obligations  under the minimum funding  standards of and
is in compliance in all material  respects with ERISA and the Code to the extent
applicable  to it and has not incurred any liability to the PBGC or a Plan under
Title IV of ERISA other than a liability to the PBGC for premiums  under Section
4007 of  ERISA.  Neither  the  Company  nor any  Subsidiary  has any  contingent
liabilities with respect to any  post-retirement  benefits under a Welfare Plan,
other than liability for continuation coverage described in article 6 of Title I
of ERISA.

        Section  6.15.  Compliance  with  Laws.  The  Company  and  each  of its
Subsidiaries are in compliance with the  requirements of all federal,  state and
local  laws,  rules  and  regulations  applicable  to  or  pertaining  to  their
Properties  or  business  operations   (including,   without   limitation,   the
Occupational  Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, and laws and regulations  establishing  quality  criteria and standards
for  air,  water,   land  and  toxic  or  hazardous   wastes  and   substances),
non-compliance  with which could have a material adverse effect on the financial
condition,  Properties, business or operations of the Company or any Subsidiary.
Neither the Company nor any  Subsidiary  has received  notice to the effect that
its operations are not in compliance with any of the  requirements of applicable
federal,   state  or  local  environmental,   health  and  safety  statutes  and
regulations  or are the  subject of any  governmental  investigation  evaluating
whether  any  remedial  action is needed to respond to a release of any toxic or
hazardous  waste or substance  into the  environment,  which  non-compliance  or
remedial action could have a material adverse effect on the financial condition,
Properties, business or operations of the Company or any Subsidiary.
<PAGE>

        Section 6.16. Other  Agreements.  Neither the Company nor any Subsidiary
is in default  under the terms of any  covenant,  indenture  or  agreement of or
affecting the Company, any Subsidiary or any of their Properties,  which default
if uncured  would have a material  adverse  effect on the  financial  condition,
Properties, business or operations of the Company or any Subsidiary.

        Section 6.17.  No Default.  No Default or Event of Default has occurred
and is continuing.

        Section 6.18.  Year 2000  Compliance.  The Company and its  Subsidiaries
have  conducted  a  comprehensive   review  and  assessment  of  their  computer
applications, and have made such inquiry of their respective material suppliers,
service  vendors  (including  data  processors)  and customers as the Company or
relevant  Subsidiary (as the case may be) deem appropriate,  with respect to any
defect in computer  software,  data bases,  hardware,  controls and  peripherals
related to the occurrence of the year 2000 or the use of any date after December
31, 1999, in connection therewith. Based on the foregoing review, assessment and
inquiry,  the Company  believes that no such defect could reasonably be expected
to have a  material  adverse  effect  on the  financial  condition,  Properties,
business or operations of the Company and its Subsidiaries taken as a whole.

SECTION 7.           CONDITIONS PRECEDENT.

         The obligation of the Lenders to make any Loan or of the Agent to issue
any Letter of Credit under this Agreement is subject to the following conditions
precedent:

         Section 7.1.    All  Advances.  As of the time of the making of each
extension of credit  (including  the initial extension of credit) hereunder:

                   (a) each of the  representations  and warranties set forth in
         Section 6 hereof  and in the  other  Loan  Documents  shall be true and
         correct as of such time, except to the extent the same expressly relate
         to an earlier date;

                   (b) the Company shall be in full  compliance  with all of the
         terms and conditions of this Agreement and of the other Loan Documents,
         and  no  Default  or  Event  of  Default  shall  have  occurred  and be
         continuing  or would  occur as a result of  making  such  extension  of
         credit;

                   (c) after  giving  effect to such  extension  of credit,  (i)
         neither  the  aggregate  Original  Dollar  Amount  nor the U.S.  Dollar
         Equivalent of all Loans  (whether  Revolving  Loans or Swing Loans) and
         Letters of Credit  outstanding  under this  Agreement  shall exceed the
         lesser  of the  Borrowing  Base as  computed  based on the most  recent
         Borrowing Base Certificate and the Revolving Credit Commitments then in
         effect,  (ii) the  aggregate  Original  Dollar  Amount of all Revolving
         Loans   denominated   in  Alternative   Currencies   shall  not  exceed
         $15,000,000  and (iii) the  aggregate  Original  Dollar Amount of Swing
         Loans  outstanding  hereunder shall not exceed the lesser of the Unused
         Revolving Credit Commitments or the Swing Line Commitment;
<PAGE>
                   (d) in the case of the issuance of any Letter of Credit,  the
         Agent shall have  received a properly  completed  Application  therefor
         together with the fees called for hereby; and

                   (e) such  extension  of credit  shall not  violate any order,
         judgment or decree of any court or other  authority or any provision of
         law or  regulation  applicable  to the Agent or any Lender  (including,
         without  limitation,  Regulation  U of the  Board of  Governors  of the
         Federal Reserve System) as then in effect.

The  Company's  request for any Loan or Letter of Credit  shall  constitute  its
warranty  as to the  facts  specified  in  subsections  (a)  through  (d),  both
inclusive, above.

         Section 7.2.    Initial  Advance.  At  or  prior  to  the  making  of
the  initial  extension of  credit hereunder, the following conditions precedent
shall also have been satisfied:

                   (a) the Agent  shall  have  received  the  following  for the
         account of the Lenders (each to be properly executed and completed) and
         the same  shall  have been  approved  as to form and  substance  by the
         Agent:

                            (i)     the Revolving Notes;

                           (ii)     the Swing Note;

                          (iii)     the Security Agreements;

                           (iv)     the Guaranty Agreement;

                            (v) UCC Financing Statements to be filed against the
                  Company and each Subsidiary, as debtor, in favor of the Agent,
                  as secured party;

                           (vi)  the  Agent  shall  have  received  evidence  of
                  insurance  required to be maintained under the Loan Documents,
                  naming the Agent as loss payee;

                          (vii)  copies  (executed  or  certified,   as  may  be
                  appropriate)  of all legal  documents or proceedings  taken in
                  connection  with the execution and delivery of this  Agreement
                  and the other  Loan  Documents  to the extent the Agent or its
                  counsel may reasonably request; and

                         (viii) an incumbency  certificate  containing the name,
                  title  and  genuine   signatures  of  each  of  the  Company's
                  Authorized Representatives.

                   (b) the Agent and the Lenders shall have received the initial
         fees (if any) called for hereby;
<PAGE>

                   (c) the Agent shall have received a Y2K Questionnaire in form
         and substance acceptable to the Agent duly completed by the Company;

                   (d) each Lender  shall have  received  such  evaluations  and
         certifications as it may reasonably require (including a Borrowing Base
         Certificate  in the form  attached  hereto  as  Exhibit  F,  containing
         calculations  of the Borrowing Base and compliance  calculations of the
         financial  covenants  as of the  date of this  Agreement)  in  order to
         satisfy  itself  as to the  value  of  the  Collateral,  the  financial
         condition of the Company and its Subsidiaries, and the lack of material
         contingent liabilities of the Company and its Subsidiaries;

                   (e) the Agent shall have received  financing  statement,  tax
         and judgment  lien search  results  against the Property of the Company
         and each  Subsidiary  evidencing  the absence of Liens on its  Property
         except as permitted by Section 8.8 hereof;

                   (f) the Agent shall have  received  pay-off and lien  release
         letters  from  secured  creditors  of the Company  and each  Subsidiary
         setting  forth,  among other things,  the total amount of  indebtedness
         outstanding and owing to them (or outstanding  letters of credit issued
         for the account of the Company or any  Subsidiary)  and  containing  an
         undertaking  to cause to be  delivered  to the  Agent  UCC  termination
         statements and any other lien release instruments  necessary to release
         their  Liens on the assets of the Company  and each  Subsidiary,  which
         pay-off  and  lien  release  letters  shall  be in form  and  substance
         acceptable to the Agent;

                   (g) the Agent shall have received  such  assurances as it may
         reasonably  require in order to  satisfy  itself  the  Company  and its
         Subsidiaries are current in the payment of their rent expense;

                   (h) legal  matters  incident to the execution and delivery of
         this  Agreement and the other Loan  Documents  and to the  transactions
         contemplated  hereby  shall  be  satisfactory  to each  Lender  and its
         counsel;  and the Agent  shall  have  received  for the  account of the
         Lenders  the  written  opinion of counsel  for the  Company in form and
         substance satisfactory to the Lender and its counsel; and

                   (i) the Agent  shall  have  received  for the  account of the
         Lenders such other agreements, instruments, documents, certificates and
         opinions as the Agent or the Lenders may reasonably request.

         Section 7.3.  Termination of Existing  Credit  Agreements.  Each of the
Company and the Existing  Lenders  consent to the  termination of the "Revolving
Credit  Commitments" under each Existing Credit Agreement  effective on the date
the conditions  set forth in Section 7.2 hereof are  satisfied,  notwithstanding
the notice  requirements  for such  termination set forth in Section 3.3 of each
Existing Credit  Agreement.  The Existing Credit  Agreements shall terminate and
all amounts  payable  thereunder,  including  accrued and unpaid  facility  fees
payable under Section 3.1 of each  thereof,  shall be payable,  and the facility
fee payable  under  Section 3.1 hereof  shall begin to accrue,  on the date that
this  Agreement has been executed by all the parties  hereto and the  conditions
set forth in Section 7.2 hereof have been satisfied.
<PAGE>

SECTION 8.           COVENANTS.

         The Company  agrees  that,  so long as any credit is available to or in
use by the Company  hereunder,  except to the extent  compliance  in any case or
cases is waived in writing by the Required Lenders:

         Section 8.1. Corporate Existence;  Subsidiaries. (a) The Company shall,
and shall  cause  each  Subsidiary  to,  preserve  and  maintain  its  corporate
existence.  The Company will  preserve  and keep in force and effect,  and cause
each Subsidiary to preserve and keep in force and effect, all licenses,  permits
and franchises necessary to the proper conduct of its business.  Notwithstanding
anything  contained  herein to the  contrary,  so long as no Default or Event of
Default  has  occurred  and  is   continuing,   the  Company  may  dissolve  any
Non-Material  Subsidiary  so long as such  dissolution  would  not  result  in a
material  adverse change in the business,  financial  condition or Properties of
the Company and its Subsidiaries or impair the rights or benefits of the Lenders
under the Loan Documents.

         (b) The  Company  shall cause each  Material  Subsidiary  (other  than,
subject to Section 4.1, Anicom Canada),  whether now or hereafter  existing,  to
furnish the Agent (i) a Guaranty Agreement from such Material  Subsidiary in the
form or substantially in the form attached hereto as Exhibit E hereto or in such
other form as is reasonably  satisfactory to the Agent and the Required  Lenders
as to form and substance, and (ii) documentation acceptable to the Agent similar
to in form and scope to that  described  in  Sections  7.2(a)(ii),  7.2(a)(iii),
7.2(a)(iv),  7.2(c),  7.2(d) and 7.2(e) but relating to such  Guarantor  and its
Guaranty Agreement.

         Section 8.2.  Maintenance  of  Properties.  The Company will  maintain,
preserve and keep its  Properties  in good repair,  working  order and condition
(ordinary  wear and tear  excepted)  and will from time to time make all needful
and proper repairs, renewals, replacements, additions and betterments thereto so
that  at  all  times  the  efficiency  thereof  shall  be  fully  preserved  and
maintained, and will cause each Subsidiary to do so in respect of Property owned
or used by it.

         Section  8.3.  Taxes and  Assessments.  The  Company  will duly pay and
discharge,  and will cause each Subsidiary to duly pay and discharge, all taxes,
rates,  assessments,  fees and  governmental  charges  upon or against it or its
Properties,  in each case before the same become delinquent and before penalties
accrue  thereon,  unless and to the extent that the same are being  contested in
good faith and by  appropriate  proceedings  which  prevent  enforcement  of the
matter under contest and adequate reserves are provided therefor.

         Section 8.4. Insurance.  The Company will insure and keep insured,  and
will cause each Subsidiary to insure and keep insured, with good and responsible
insurance companies,  all insurable Property owned by it which is of a character
usually  insured by Persons  similarly  situated and operating  like  Properties
against loss or damage from such hazards and risks, and in such amounts,  as are
insured by Persons  similarly  situated and operating like  Properties;  and the
Company will insure, and cause each Subsidiary to insure, such other hazards and

<PAGE>

risks   (including   employers'  and  public  liability  risks)  with  good  and
responsible  insurance companies as and to the extent usually insured by Persons
similarly situated and conducting similar  businesses.  The Company shall in any
event  maintain,  and  cause  each  Subsidiary  to  maintain,  insurance  on the
Collateral to the extent required by the Collateral Documents.  The Company will
upon request of the Agent and any Lender furnish a certificate  setting forth in
summary form the nature and extent of the insurance  maintained pursuant to this
Section.

         Section 8.5.  Financial  Reports.  (a) The Company will, and will cause
each  Subsidiary to, maintain a standard system of accounting in accordance with
GAAP and  will  furnish  to the  Agent,  each  Lender  and  each of  their  duly
authorized   representatives  such  information   respecting  the  business  and
financial  condition  of the Company and its  Subsidiaries  as the Agent or such
Lender may  reasonably  request;  and without any  request,  will furnish to the
Lenders:

                   (i) as soon as available, and in any event within 15 Business
         Days  after  the last day of each  calendar  month,  a  Borrowing  Base
         Certificate  showing the  computation  of the Borrowing  Base as of the
         close  of  business  on the  last day of such  month,  prepared  by the
         Company  and  certified  to by its chief  financial  officer or another
         officer  of the  Company  acceptable  to the Agent,  together  with the
         Independent Collateral Report for the same calendar month;

                  (ii)  within 50 days after the end of each of the first  three
         quarterly  fiscal periods of the Company,  a copy of the Company's Form
         10-Q Report filed with the SEC;

                 (iii)  within 120 days after the end of each fiscal year of the
         Company,  a copy of the Company's  Form 10-K Report filed with the SEC,
         including  a copy of the annual  audit  report of the  Company  and the
         Subsidiaries  for such year  with  accompanying  financial  statements,
         prepared by the Company and certified by PricewaterhouseCoopers  LLP or
         any  other  independent  public  accountants  of  recognized   national
         standing  selected  by the  Company and  satisfactory  to the  Required
         Lenders, in accordance with GAAP;

                  (iv) not later than 10 days after the receipt thereof,  a copy
         of any final management letters on internal accounting controls for the
         Company  or  any  Subsidiary   prepared  by  its   independent   public
         accountants;

                   (v) promptly after sending or filing  thereof,  copies of all
         proxy  statements,  financial  statements and reports which the Company
         sends to its  shareholders,  and copies of all other regular,  periodic
         and special reports and all  registration  statements which the Company
         files  with the SEC or any  successor  thereto,  or with  any  national
         securities exchange;

                  (vi) promptly after  knowledge  thereof shall have come to the
         attention of any responsible officer of the Company,  written notice of
         any  threatened  or pending  litigation or  governmental  proceeding or
         labor  controversy  against the  Company or any  Subsidiary  which,  if
         adversely  determined,   would  materially  and  adversely  effect  the
         financial condition,  Properties, business or operations of the Company
         or any  Subsidiary  or of the  occurrence  of any  Default  or Event of
         Default hereunder; and
<PAGE>

                 (vii) as soon as possible and in any event within 10 days after
         the date on which (X) a  Non-Material  Subsidiary  becomes  a  Material
         Subsidiary,  (Y) the Company or any Subsidiary  establishes or acquires
         any Subsidiary or (Z) any  Subsidiary is dissolved or otherwise  merged
         out of  existence,  the  Company  shall  furnish the Lenders an updated
         Schedule 6.2 reflecting such event.

         (b) In the event the  Company is no longer  required  to file Form 10-Q
and 10-K  Reports with the SEC, the Company need not furnish such Reports to the
Lenders,  but shall  nonetheless  provide the Lenders the  financial  statements
previously contained in such Reports by the times required by subsections (a)(i)
and (ii) above.

         (c) Each of the financial  statements furnished to the Lenders pursuant
to  clauses  (a) or (b) of  this  Section  shall  be  accompanied  by a  written
certificate  in  the  form  attached  hereto  as  Exhibit  B  (the   "Compliance
Certificate") signed by the chief financial officer of the Company to the effect
that to the best of the  chief  financial  officer's  knowledge  and  belief  no
Default  or Event of Default  has  occurred  during  the period  covered by such
statements or, if any such Default or Event of Default has occurred  during such
period,  setting  forth a  description  of such  Default or Event of Default and
specifying  the action,  if any,  taken by the Company to remedy the same.  Such
certificate shall also set forth the calculations  supporting such statements in
respect of Sections 8.6, 8.7, 8.8, 8.9 and 8.10 of this Agreement.

         Section 8.6.  Minimum EBITDA.  The Company shall, as of the last day of
each fiscal quarter of the Company specified below, maintain EBITDA for the four
fiscal  quarters of the Company then ended in an amount not less than the amount
set forth below by such date:

                                                           EBITDA SHALL NOT BE
            FISCAL QUARTER ENDING ON                            LESS THAN
               December 31, 1999                                $2,000,000
                 March 31, 2000                                $20,000,000
                 June 30, 2000                                 $21,000,000
               September 30, 2000                              $24,000,000
               December 31, 2000                               $25,000,000
            at all times thereafter                            $28,000,000

; provided, however, that for the purposes hereof, (a) EBITDA as of the close of
the  fiscal  quarter  of the  Company  ending  on  December  31,  1999  shall be
calculated  for the fiscal  quarter of the Company then ended;  (b) EBITDA as of
the close of the fiscal quarter of the Company ending on March 31, 2000 shall be
equal to the product of EBITDA for the fiscal  quarter of the Company then ended
multiplied by 4; (c) EBITDA as of the close of the fiscal quarter of the Company
ending on June 30,  2000  shall be equal to the  product  of EBITDA  for the two
fiscal quarters of the Company then ended  multiplied by 2; and (d) EBITDA as of
the close of the fiscal quarter of the Company ended September 30, 2000 shall be
equal to the product of EBITDA for the three fiscal quarters of the Company then
ended multiplied by 1.33.
<PAGE>

         Section 8.7.  Interest Coverage Ratio. The Company will, as of the last
day of each fiscal quarter of the Company (commencing with the fiscal quarter of
the  Company  ending on March 31,  2000),  maintain  the  ratio  (the  "Interest
Coverage  Ratio") of EBIT for the four fiscal quarters of the Company then ended
to Interest  Expense for the same four  fiscal  quarters  then ended of not less
than 2.0 to 1.0; provided, however,

         (a) the Interest  Coverage  Ratio as of the close of the fiscal quarter
of the  Company  ending on March 31,  2000  shall be  calculated  for the fiscal
quarter of the Company then ended;

         (b) the Interest  Coverage  Ratio as of the close of the fiscal quarter
of the Company  ending on June 30, 2000 shall be  calculated  based upon the two
fiscal quarters of the Company then ended; and

         (c) the Interest  Coverage  Ratio as of the close of the fiscal quarter
of the Borrower ending on September 30, 2000 shall be calculated  based upon the
three fiscal quarters of the Company then ended

provided further that if an Acquisition  permitted by Section 8.14 hereof occurs
at any time during such period,  the Interest Coverage Ratio shall be calculated
on a pro forma basis to include the EBIT and  Interest  Expense of the Person or
assets so acquired for the entire period as if such  Acquisition had taken place
on the first day of such period,  all as  reasonably  calculated  by the Company
(the  expected  cost  savings  relating  to the EBIT of the  Person or assets so
acquired may be incorporated in these  calculations to the extent that the Agent
reasonably  determines that they are readily  quantifiable and verifiable,  in a
manner consistent with the Company's prior pro forma calculations  included with
SEC filings in connection with its prior acquisitions).

         Section 8.8.  Tangible Net Worth.  The Company will, as of the last day
of each fiscal quarter of the Company,  maintain  Tangible Net Worth at not less
than the Minimum  Required  Amount.  For  purposes of this Section 8.8, the term
"Minimum  Required  Amount"  shall  mean,  as of  any  time,  the  sum  of:  (i)
$30,000,000;  plus (ii) fifty percent (50%) of Consolidated  Net Income for each
fiscal  quarter of the  Company  (if  Consolidated  Net  Income for such  fiscal
quarter is positive)  completed  on or after March 31,  2000.  The Agent and the
Lenders hereby agree to distribute a copy of the field audit referred to in this
Section 8.22(b) to the Company.

         Section 8.9. Debt to Earnings  Ratio.  The Company will, as of the last
day of each fiscal quarter of the Company (commencing with the fiscal quarter of
the Company ending on December 31, 2000,  maintain the Debt to Earnings Ratio at
not greater than 4.5 to 1.0; provided, however, that if an Acquisition permitted
by Section 8.14 hereof occurs at any time during the four fiscal  quarter period
over which EBITDA is measured to determine the Debt to Earnings Ratio, such Debt
to Earnings Ratio shall be calculated on a pro forma basis to include the EBITDA
of the Person or assets so required for the entire period as if such Acquisition
had taken place on the first day of such period, all as reasonably calculated by
the Company (the expected  cost savings  relating to the EBITDA of the Person or
assets so acquired may be incorporated in these  calculations to the extent that
the  Agent  reasonably   determines  that  they  are  readily  quantifiable  and
verifiable and based on reasonable assumptions).
<PAGE>

         Section 8.10.  Leverage Ratio.  The Company will, as of the last day of
each fiscal quarter of the Company, maintain the Leverage Ratio at not more than
0.40 to 1.00.

        Section 8.11. Indebtedness for Borrowed Money. The Company will not, nor
will  it  permit  any  Subsidiary  to,  issue,  incur,  assume,  create  or have
outstanding any Indebtedness  for Borrowed Money;  provided,  however,  that the
foregoing provisions shall not restrict nor operate to prevent:

                   (a) the indebtedness of the Company on the Notes and other
        Obligations;

                   (b) Capitalized  Lease Obligations in an aggregate amount not
         to exceed $1,500,000 at any one time outstanding;

                   (c) Capitalized Lease Obligations of any Subsidiary which has
         become a Subsidiary as a result of an Acquisition  permitted by Section
         8.14 hereof if such Capitalized Lease Obligation was entered into prior
         to  the   Acquisition  of  such  Subsidiary  and  was  not  created  in
         contemplation of such Acquisition;

                   (d) purchase money indebtedness secured by Liens permitted by
         Section 8.12(d) hereof in an aggregate amount not to exceed  $2,000,000
         at any one time outstanding;

                   (e) purchase  money  indebtedness  (other than purchase money
         indebtedness  permitted by Section  8.11(d)  hereof) of any  Subsidiary
         which has become a Subsidiary as a result of an  Acquisition  permitted
         by Section 8.14 hereof if such  indebtedness  was created  prior to the
         Acquisition of such Subsidiary and was not created in  contemplation of
         such Acquisition;

                   (f)  the  currently  outstanding  indebtedness  described  on
         Exhibit C hereof if and so long as such  indebtedness  is  Subordinated
         Indebtedness;

                   (g) unsecured  Subordinated  Indebtedness incurred to finance
         Acquisitions permitted by Section 8.14 hereof;

                   (h) unsecured  indebtedness  of the Company to Finova Capital
         in an aggregate  principal  amount not to exceed  $5,000,000 at any one
         time outstanding; and

                   (i)  indebtedness  not  otherwise  permitted  by this Section
         aggregating not more than $500,000 at any one time outstanding.

        Section  8.12.  Liens.  The  Company  will not,  nor will it permit  any
Subsidiary  to,  create,  incur or  permit  to exist any Lien of any kind on any
Property owned by the Company or any Subsidiary;  provided,  however,  that this
Section shall not apply to nor operate to prevent:

                   (a) Liens  arising  by statute in  connection  with  worker's
         compensation, unemployment insurance, old age benefits, social security
         obligations, taxes, assessments, statutory obligations or other similar
         charges, good faith cash deposits in connection with tenders, contracts

<PAGE>

         or leases to which the  Company or any  Subsidiary  is a party or other
         cash deposits  required to be made in the ordinary  course of business,
         provided in each case that the obligation is not for borrowed money and
         that the  obligation  secured is not overdue  or, if overdue,  is being
         contested  in good  faith  by  appropriate  proceedings  which  prevent
         enforcement of the matter under contest and adequate reserves have been
         established therefor;

                   (b)   mechanics',   workmen's,   materialmen's,   landlords',
         carriers',  or other similar  Liens  arising in the ordinary  course of
         business  with  respect to  obligations  which are not due or which are
         being contested in good faith by appropriate  proceedings which prevent
         enforcement of the matter under contest;

                   (c) the  pledge of assets  for the  purpose  of  securing  an
         appeal,  stay or  discharge  in the  course  of any  legal  proceeding,
         provided that the aggregate  amount of  liabilities  of the Company and
         its  Subsidiaries  secured by a pledge of assets  permitted  under this
         clause,  including interest and penalties thereon, if any, shall not be
         in excess of $1,000,000 at any one time outstanding;

                   (d) purchase money Liens securing  indebtedness  permitted by
         Section  8.11(d)  hereof in respect of equipment now owned or hereafter
         acquired by the Company or any  Subsidiary  (not extending to any other
         Property),  or Liens on  equipment  so acquired  (not  extending to any
         other  Property)  existing  at the  time  of  acquisition  thereof,  or
         renewals, extensions and refundings of any such Liens (not extending to
         any other Property), provided that the principal amount of indebtedness
         secured  by any such  Lien  shall  not  exceed  80% of the cost or fair
         market value,  whichever is less, of the Property  covered by such Lien
         at the  time  of  the  creation  thereof  or the  acquisition  of  such
         Property; and

                   (e) the Liens  granted in favor of the Agent  pursuant to the
Collateral Documents.

        Section 8.13. Investments,  Loans, Advances and Guaranties.  The Company
will not, nor will it permit any  Subsidiary to,  directly or indirectly,  make,
retain or have outstanding any investments (whether through purchase of stock or
obligations  or  otherwise)  in, or loans or  advances  (other  than for  travel
advances  and other  similar  cash  advances  made to  employees in the ordinary
course of business)  to, any other  Person,  or be or become liable as endorser,
guarantor,  surety or otherwise for any debt,  obligation or  undertaking of any
other Person, or otherwise agree to provide funds for payment of the obligations
of another,  or supply funds  thereto or invest  therein or  otherwise  assure a
creditor of another  against loss or apply for or become liable to the issuer of
a letter of credit which supports an obligation of another,  or subordinate  any
claim  or  demand  it may have to the  claim  or  demand  of any  other  Person;
provided,  however, that the foregoing provisions shall not apply to nor operate
to prevent:

                   (a) investments in direct obligations of the United States of
         America or of any agency or  instrumentality  thereof whose obligations
         constitute  full faith and credit  obligations  of the United States of
         America,  provided  that any such  obligations  shall mature within one
         year of the date of issuance thereof;
<PAGE>

                   (b)  investments  in  commercial  paper  (including  as such,
         investments in short-term corporate  borrowings against  tax-advantaged
         preferred stock) rated at least P-1 by Moody's Investors Services, Inc.
         and at least A-1 by Standard & Poor's  Corporation  maturing within 270
         days of the date of issuance thereof;

                   (c)  investments  in  certificates  of deposit  issued by any
         United States  commercial  Agent having capital and surplus of not less
         than $100,000,000 which have a maturity of one year or less;

                   (d)  endorsement  of  items  for  deposit  or  collection  of
         commercial paper received in the ordinary course of business;

                   (e)  Acquisitions of Subsidiaries permitted by Section 8.14
         hereof;

                   (f) investments in obligations of a state, a territory,  or a
         possession of the United States, or any political subdivision of any of
         the  foregoing  or of the  District of Columbia as described in Section
         103(a) of the Code if these investments are graded in the highest major
         grade as  determined  by at least one  national  rating  service or are
         credit enhanced by credit enhancers whose credit is rated not less than
         A-1 by  Standard  &  Poor's  Corporation  or P-1 by  Moody's  Investors
         Services, Inc.;

                   (g) the Company's  guaranty of  indebtedness  of Wholly-Owned
         Subsidiaries incurred to finance Acquisitions permitted by Section 8.14
         hereof if and so long as such guaranty is Subordinated Indebtedness;

                   (h)     guaranties by Subsidiaries of the Obligations; and

                   (i) investments, loans, advances and guarantees not otherwise
         permitted by this Section  aggregating  not more than $3,000,000 at any
         one time outstanding.

In  determining  the  amount of  investments,  loans,  advances  and  guarantees
permitted under this Section,  investments shall always be taken at the original
cost  thereof  (regardless  of  any  subsequent   appreciation  or  depreciation
therein), loans and advances shall be taken at the principal amount thereof then
remaining  unpaid and  guarantees  shall be taken at the  amount of  obligations
guaranteed thereby.

        Section  8.14.  Acquisitions.  The Company will not, and will not permit
any Subsidiary to, make or commit to make any  Acquisitions;  provided  however,
that the Company and any Wholly-Owned  Subsidiary each may make Acquisitions if:
(i) the Company or such Subsidiary acquires by reason of such Acquisition either
(x)  assets  used or useful in a  business  which is the same or similar to that
currently  conducted by the Company or (y) the capital stock of a corporation or
any other  equity  interest of any  partnership  or other firm engaged in such a
same or  similar  business  and after  giving  effect to such  Acquisition,  the

<PAGE>

corporation,  partnership or other such firm so acquired  becomes a Wholly-Owned
Subsidiary;  (ii) no Default or Event of  Default  exists or would  exist at the
time of or after giving effect to such  Acquisition;  (iii) the Company provides
the Lenders a statement,  certified  as true and correct by its chief  financial
officer,  which  represents  and  warrants  that,  after  giving  effect to such
Acquisition,  the Company will, on a pro forma basis, continue to comply through
the  Termination  Date with  Sections  8.6, 8.7, 8.8, 8.9, 8.10 and 8.11 hereof,
such certificate to be accompanied by supporting financial  projections based on
reasonable  assumptions;  (iv) the Board of Directors or other governing body of
such Person whose property or voting stock is being so acquired has approved the
terms of such  Acquisition;  and (v) the Company has  provided  the Lenders such
financial and other  information  regarding the Person whose  property or voting
stock is being so acquired,  including  historical financial  statements,  and a
description of such Person, as the Agent or any Lender may reasonably request.

        Section 8.15.  Sales and  Leasebacks.  The Company will not, nor will it
permit any Subsidiary to, enter into any  arrangement  with any bank,  insurance
company or any other lender or investor providing for the leasing by the Company
or any Subsidiary of any Property  theretofore owned by it and which has been or
is to be sold or transferred by such owner to such lender or investor.

        Section 8.16.    Dividends and Certain Other Restricted Payments.

         (a) Restricted  Dividends.  The Company will not during any fiscal year
declare or pay any  dividends on or make any other  distributions  in respect of
any class or series of its capital stock (other than dividends payable solely in
its capital stock); provided that the foregoing shall not operate to prevent the
payment by the Company of dividends on its  Convertible  Preferred  Stock to the
extent  required by the terms of the  Company's  organizational  documents as in
effect  on the date  hereof,  so long as at the time of the  making of each such
dividend and  immediately  after giving effect  thereto,  no Default or Event of
Default shall occur or be continuing.

         (b) Restricted Repayments.  The Company will not during any fiscal year
directly or indirectly  purchase,  redeem or otherwise  acquire or retire any of
its  capital  stock  (except  out of the  proceeds  of, or in  exchange  for,  a
substantially  concurrent  issue  and  sale  of its  capital  stock);  provided,
however,  that the  foregoing  shall not  operate to prevent  the  Company  from
repurchasing  its common stock or common stock options provided that at the time
of each such purchase and immediately after giving effect thereto, no Default or
Event of Default shall occur or be continuing.

        Section 8.17.  Mergers,  Consolidations and Sales. The Company will not,
nor will it permit any Subsidiary to, be a party to any merger or consolidation,
or sell, transfer,  lease or otherwise dispose of all or any substantial part of
its other Property,  or in any event sell or discount (with or without recourse)
any of its notes or accounts receivable;  provided,  however,  that this Section
shall not apply to nor operate to prohibit:

                   (i) the merger of any  Subsidiary  acquired as a result of an
         Acquisition  permitted by Section 8.14 hereof with and into the Company
         or any Wholly-Owned Subsidiary;
<PAGE>

                  (ii) the sale of assets  which are no longer used or useful in
         the ordinary course of the Company's business;

                 (iii)  the sale or lease of  inventory  by the  Company  or any
         Subsidiary in the ordinary course of business; and

                  (iv) the sale of  delinquent  notes or accounts  receivable by
         the Company or any  Subsidiary  in the ordinary  course of business for
         purposes of  collection  only (and not for the purpose of any bulk sale
         or securitization transaction).

A sale or disposition of assets of the Company shall be deemed  substantial  for
the foregoing  purposes (i) if such assets are sold below the book value of such
assets,  and such  assets  constituted  10% or more of the  total  assets of the
Company or (ii) such assets  constituted  20% or more of the total assets of the
Company.

        Section 8.18.  ERISA.  The Company will, and will cause each  Subsidiary
to, promptly pay and discharge all  obligations  and  liabilities  arising under
ERISA  of a  character  which if  unpaid  or  unperformed  might  result  in the
imposition of a Lien against any of its  Properties.  The Company will, and will
cause each Subsidiary to, promptly notify the Agent of (i) the occurrence of any
reportable  event (as defined in ERISA) with respect to a Plan,  (ii) receipt of
any notice from the PBGC of its  intention  to seek  termination  of any Plan or
appointment of a trustee therefor,  (iii) its intention to terminate or withdraw
from any Plan,  and (iv) the  occurrence  of any event with  respect to any Plan
which would result in the  incurrence  by the Company or any  Subsidiary  of any
material liability,  fine or penalty, or any material increase in the contingent
liability of the Company or any Subsidiary  with respect to any  post-retirement
Welfare Plan benefit.

        Section 8.19.  Compliance  with Laws.  The Company will,  and will cause
each Subsidiary to, comply in all respects with the requirements of all federal,
state and local laws, rules, regulations, ordinances and orders applicable to or
pertaining  to the  Properties  or  business  operations  of the  Company or any
Subsidiary,  non-compliance  with which could have a material  adverse effect on
the financial  condition,  Properties,  business or operations of the Company or
any Subsidiary or could result in a Lien upon any of their Property.

        Section 8.20.  Burdensome  Contracts With  Affiliates.  The Company will
not, nor will it permit any Subsidiary to, enter into any contract, agreement or
business  arrangement  with any of its Affiliates on terms and conditions  which
are less  favorable  to the Company or such  Subsidiary  than would be usual and
customary in similar  contracts,  agreements  or business  arrangements  between
Persons not affiliated  with each other,  other than any contract,  agreement or
business  arrangement  with any Person which becomes a Subsidiary as a result of
an  Acquisition  permitted  by Section 8.14 hereof after the date hereof if such
contract,  agreement or arrangement was entered into prior to the acquisition of
such  Subsidiary and such contract,  agreement or arrangement was not created in
contemplation of such Acquisition.

        Section  8.21.  No Changes in Fiscal  Year.  Neither the Company nor any
Subsidiary  will change its fiscal year from its present basis without the prior
written consent of the Agent.
<PAGE>

        Section 8.22. Inspection and Field Audit. (a) The Company will, and will
cause  each   Subsidiary   to,   permit  the  Agent  and  its  duly   authorized
representatives and agents to visit and inspect any of the Properties, corporate
books and financial  records of the Company and each Subsidiary,  to examine and
make copies of the books of accounts and other financial  records of the Company
and each  Subsidiary,  and to discuss the affairs,  finances and accounts of the
Company  and each  Subsidiary  with,  and to be  advised  as to the same by, its
officers and independent  public  accountants (and by this provision the Company
authorizes  such  accountants to discuss with the Agent the finances and affairs
of the Company and of each Subsidiary) with reasonable notice to the Company and
at such  reasonable  times and reasonable  intervals as the Agent may designate.
After the occurrence of an Event of Default, the Company shall pay for all costs
and expenses  incurred by the Agent in  connection  with any such  visitation or
inspection;  provided,  however, that the Company shall be liable for such costs
and  expenses  prior to the  occurrence  of an Event of  Default as set forth in
Section 3.1(d) hereof.

         (b) Without limiting the generality of the foregoing, the Company shall
provide  such access to its  Properties,  corporate  books,  financial  records,
officers and accountants and such information regarding its Properties, business
and  financial  affairs  as is in each  case  necessary  to  allow  the  orderly
completion  of a field audit  reasonably  acceptable  in scope and detail to the
Required Lenders and performed by a firm of independent  auditors  acceptable to
the Required  Lenders  commencing not later than February 25, 2000 and completed
not later than March 31, 2000.

        Section   8.23.   Formation   of   Subsidiaries.   Except  for  existing
Subsidiaries  designated  on Schedule  6.2 hereto and  Subsidiaries  acquired in
Acquisitions or formed to effect  Acquisitions in each case permitted by Section
8.14 hereof,  the Company will not, and will not permit any  Subsidiary to, form
or acquire any Subsidiary without the prior written consent of the Agent.

         Section  8.24.  Subordinated  Indebtedness.  The Company shall not, and
shall not permit any Subsidiary to:

                   (a)    amend  or  modify  any  of  the  terms  or  conditions
relating  to  any  Subordinated Indebtedness;

                   (b) make any voluntary prepayment on, or effect any voluntary
         redemption of, any Subordinated Indebtedness (other than the prepayment
         by Anicom  Canada of  certain  indebtedness  pursuant  to the  Put/Call
         Agreement) if any Loans are  outstanding at the time of or after giving
         effect to such prepayment or redemption; or

                   (c) make any other  payment on  account  of any  Subordinated
         Indebtedness  which is prohibited  under the terms of any instrument or
         agreement subordinating such indebtedness to the Obligations.

        Section  8.25.  Use of  Proceeds.  The  proceeds of the initial  advance
hereunder  shall be used to pay the  Company's  indebtedness  under the Existing
Credit Agreement and the fees referred to in Section 7.2(b) hereof..
<PAGE>

        Section 8.26. Year 2000  Compliance.  The Company shall take all actions
necessary and commit adequate  resources to assure that its  computer-based  and
other systems (and those of all  Subsidiaries)  are able to effectively  process
dates,   including  dates  before,  on  and  after  January  1,  2000,   without
experiencing any Year 2000 Problem that could cause a material adverse effect on
the  business  or  financial  affairs of the  Company (or of the Company and its
Subsidiaries  taken on a consolidated  basis).  At the request of the Agent, the
Company  will  provide the Agent with  written  assurances  and  substantiations
(including,  but not limited  to, the  results of  internal  or  external  audit
reports  prepared in the ordinary course of business)  reasonably  acceptable to
the Agent as to the  capability of the Company and its  Subsidiaries  to conduct
its and their  businesses and operations  before,  on and after January 1, 2000,
without  experiencing a Year 2000 Problem  causing a material  adverse effect on
the  business  or  financial  affairs of the  Company (or of the Company and its
Subsidiaries taken on a consolidated basis).

        Section 8.27.  European  Monetary Union.  (a) If, as a result of the EMU
Commencement,  (i) any Alternative  Currency ceases to be lawful currency of the
state  issuing  the same  and is  replaced  by the Euro or (ii) any  Alternative
Currency and the Euro are at the same time both  recognized  by the central bank
or  comparable  governmental  authority of the state  issuing  such  currency as
lawful  currency of such state,  then any amount payable  hereunder by any party
hereto  in  such  Alternative  Currency  (including,   without  limitation,  any
Revolving Loan to be made under this Agreement)  shall instead be payable in the
Euro  and the  amount  so  payable  shall be  determined  by  redenominating  or
converting  such amount into the Euro at the exchange rate  officially  fixed by
the European  Central Bank for the purpose of  implementing  the EMU,  provided,
that to the  extent  any EMU  Legislation  provides  that an amount  denominated
either in the Euro or in the applicable  Alternative Currency can be paid either
in Euros or in the applicable Alternative Currency, each party to this Agreement
shall be  entitled  to pay or repay  such  amount in Euros or in the  applicable
Alternative  Currency.  Prior to the occurrence of the event or events described
in clause (i) or (ii) of the preceding  sentence,  each amount payable hereunder
in any such  Alternative  Currency will,  except as otherwise  provided  herein,
continue to be payable only in that Alternative Currency.

         (b) The Company  shall from time to time,  at the request of the Agent,
pay to the  Agent  for the  account  of each  Lender  the  amount of any cost or
increased  cost incurred by, or of any reduction in any amount  payable to or in
the effective  return on its capital to, or of interest or other return foregone
by,  such  Lender  or any  holding  company  of such  Lender  as a result of the
introduction of,  changeover to or operation of the Euro in any applicable state
to the extent  attributable  to such Lender's  obligations  hereunder or for the
credit which is the subject matter hereof.

         (c) With respect to the payment of any amount  denominated  in the Euro
or in any Alternative Currency,  the Agent shall not be liable to the Company or
any of the Lenders in any way whatsoever for any delay,  or the  consequences of
any delay,  in the  crediting  to any  account of any  amount  required  by this
Agreement  to be paid by the Agent if the Agent  shall have  taken all  relevant
steps to achieve,  on the date required by this  Agreement,  the payment of such
amount in immediately available, freely transferable, cleared funds (in the Euro
Unit or, as the case may be, in any  Alternative  Currency)  to the account with
the bank in the principal  financial center in the Euro Member which the Company
or, as the case may be, any Lender shall have  specified  for such  purpose.  In
this  paragraph  (c),  "all  relevant  steps"  means  all  such  steps as may be
prescribed from time to time by the regulations or operating  procedures of such
clearing or settlement  system as the Agent may from time to time  determine for
the purpose of clearing or settling payments of the Euro.
<PAGE>

         (d) If the basis of  accrual  of  interest  or fees  expressed  in this
Agreement  with  respect to the currency of any state that becomes a Euro Member
shall be  inconsistent  with any convention or practice in the London  interbank
market for the basis of accrual of interest or fees in respect of the Euro, such
convention or practice  shall replace such expressed  basis  effective as of and
from the date on which such state becomes a Euro Member;  provided,  that if any
Revolving Loan in the currency of such state is outstanding immediately prior to
such date, such  replacement  shall take effect,  with respect to such Revolving
Loan, at the end of the then current Interest Period.

         (e) In addition,  this Agreement  (including,  without limitation,  the
definition of LIBOR  Portions)  will be amended to the extent  determined by the
Agent (acting  reasonably and in consultation  with the Company) to be necessary
to reflect such EMU  Commencement  and change in currency and to put the Lenders
and the Company in the same position,  so far as possible,  that they would have
been in if such  implementation and change in currency had not occurred.  Except
as  provided  in  the  foregoing  provisions  of  this  Section  8.27,  no  such
implementation  or change in currency  nor any economic  consequences  resulting
therefrom  shall (i) give rise to any right to terminate  prematurely,  contest,
cancel,  rescind,  alter, modify or renegotiate the provisions of this Agreement
or (ii) discharge, excuse or otherwise affect the performance of any obligations
of the Company under this Agreement, any Notes or any other Loan Documents.

SECTION 9.           EVENTS OF DEFAULT AND REMEDIES.

         Section 9.1. Events of Default.  Any one or more of the following shall
constitute an "Event of Default" hereunder:

                   (a) default in the payment when due of all or any part of the
         principal  of or interest on any Note  (whether at the stated  maturity
         thereof or at any other time provided for in this  Agreement) or of any
         reimbursement  obligation  owing under any Application or of any fee or
         other  Obligation  payable by the Company  hereunder or under any other
         Loan Document; or

                   (b) default in the  observance or performance of any covenant
         set forth in Sections 8.5, 8.6, 8.7, 8.8, 8.9, 8.10,  8.11, 8.13, 8.14,
         8.15,  8.16,  8.17, 8.24 or 8.25 hereof or of any provision in any Loan
         Document  dealing with the  remittance  to the Agent of the proceeds of
         Collateral or requiring the maintenance of insurance thereon; or

                   (c) default in the  observance  or  performance  of any other
         provision  hereof or of any other Loan  Document  which is not remedied
         within  ten (10) days  after the  earlier of (i) the date on which such
         failure  shall first become known to any officer of the Company or (ii)
         written  notice  thereof  is given to the  Company  by the Agent or any
         Lender; or
<PAGE>

                   (d) any representation or warranty made by the Company herein
         or in any other  Loan  Document,  or in any  statement  or  certificate
         furnished by it pursuant  hereto or thereto,  or in connection with any
         extension  of credit  made  hereunder,  proves  untrue in any  material
         respect as of the date of the issuance or making thereof; or

                   (e) any event  occurs or condition  exists  (other than those
         described in  subsections  (a) through (d) above) which is specified as
         an event of default  under any of the other Loan  Documents,  or any of
         the Loan Documents  shall for any reason not be or shall cease to be in
         full force and effect,  or any of the Loan  Documents is declared to be
         null and void; or

                   (f) default shall occur under any  Indebtedness  for Borrowed
         Money issued,  assumed or guaranteed by the Company or any  Subsidiary,
         or under any indenture,  agreement or other  instrument under which the
         same may be issued,  and such  default  shall  continue for a period of
         time sufficient to permit the  acceleration of the maturity of any such
         Indebtedness  for Borrowed  Money  (whether or not such  maturity is in
         fact  accelerated),  or any such  Indebtedness for Borrowed Money shall
         not be paid  when  due  (whether  by lapse  of  time,  acceleration  or
         otherwise); or

                   (g) any judgment or judgments,  writ or writs,  or warrant or
         warrants of  attachment,  or any  similar  process or  processes  in an
         aggregate  amount in excess of $1,000,000 in excess of amounts  covered
         by  insurance  from an insurer  which has  acknowledged  its  liability
         thereon shall be entered or filed against the Company or any Subsidiary
         or against any of their Property and which remains unvacated, unbonded,
         unstayed or unsatisfied for a period of sixty (60) days; or

                   (h) the Company or any member of its  Controlled  Group shall
         fail to pay  when  due an  amount  or  amounts  aggregating  in  excess
         $500,000  which it shall have become  liable to pay to the PBGC or to a
         Plan under Title IV of ERISA;  or notice of intent to  terminate a Plan
         or Plans having  aggregate  Unfunded  Vested  Liabilities  in excess of
         $500,000  (collectively,  a "Material Plan") shall be filed under Title
         IV of ERISA by the Company or any other member of its Controlled Group,
         any plan administrator or any combination of the foregoing; or the PBGC
         shall institute  proceedings under Title IV of ERISA to terminate or to
         cause a trustee to be appointed to  administer  any Material  Plan or a
         proceeding  shall be  instituted  by a fiduciary of any  Material  Plan
         against  the Company or any member of its  Controlled  Group to enforce
         Section 515 or 4219(c)(5) of ERISA and such  proceeding  shall not have
         been dismissed within 30 days thereafter; or a condition shall exist by
         reason  of  which  the  PBGC  would  be  entitled  to  obtain  a decree
         adjudicating that any Material Plan must be terminated; or

                   (i) dissolution or termination of the existence of the
         Company or any Subsidiary; or

                   (j) the  Company  or any  Subsidiary  shall (i) have  entered
         involuntarily  against it an order for relief  under the United  States
         Bankruptcy  Code,  as  amended,  (ii) not pay,  or admit in writing its
         inability to pay, its debts generally as they become due, (iii) make an

<PAGE>

         assignment for the benefit of creditors,  (iv) apply for, seek, consent
         to, or acquiesce in, the appointment of a receiver, custodian, trustee,
         examiner, liquidator or similar official for it or any substantial part
         of its Property,  (v) institute any proceeding  seeking to have entered
         against it an order for relief under the United States Bankruptcy Code,
         as amended, to adjudicate it insolvent, or seeking dissolution, winding
         up, liquidation, reorganization, arrangement, adjustment or composition
         of it or its debts under any law relating to bankruptcy,  insolvency or
         reorganization  or relief of debtors or fail to file an answer or other
         pleading denying the material  allegations of any such proceeding filed
         against it, (vi) take any corporate action in furtherance of any matter
         described  in parts (i) through (v) above,  or (vii) fail to contest in
         good faith any  appointment  or proceeding  described in Section 9.1(k)
         hereof; or

                   (k) a custodian,  receiver, trustee, examiner,  liquidator or
         similar  official  shall be appointed for the Company or any Subsidiary
         or any  substantial  part of any of  their  Property,  or a  proceeding
         described in Section 9.1(j)(v) shall be instituted  against the Company
         or any Subsidiary,  and such appointment continues undischarged or such
         proceeding continues undismissed or unstayed for a period of 60 days.

         Section  9.2.  Non-Bankruptcy  Defaults.  When  any  Event  of  Default
described in  subsection  (a) through (i),  both  inclusive,  of Section 9.1 has
occurred and is  continuing,  the Agent shall,  upon the request of the Required
Lenders, by notice to the Company, take one or more of the following actions:

                   (a)  terminate the  obligations  of the Lenders to extend any
         further  credit  hereunder on the date (which may be the date  thereof)
         stated in such notice;

                   (b) declare the principal of and the accrued  interest on the
         Notes  to be  forthwith  due  and  payable  and  thereupon  the  Notes,
         including both  principal and interest and all fees,  charges and other
         Obligations payable hereunder and under the other Loan Documents, shall
         be and become  immediately  due and  payable  without  further  demand,
         presentment, protest or notice of any kind; and

                   (c) enforce any and all rights and  remedies  available to it
         under the Loan Documents or applicable law.

         Section 9.3. Bankruptcy  Defaults.  When any Event of Default described
in subsection (j) or (k) of Section 9.1 has occurred and is continuing, then the
Notes,  including both principal and interest,  and all fees,  charges and other
Obligations  payable  hereunder  and  under  the  other  Loan  Documents,  shall
immediately  become due and  payable  without  presentment,  demand,  protest or
notice of any kind, and the  obligations of the Lenders to extend further credit
pursuant to any of the terms hereof shall  immediately  terminate.  In addition,
the Agent  may  exercise  any and all  remedies  available  to it under the Loan
Documents or applicable law.

         Section 9.4.  Collateral for Undrawn Letters of Credit.  When any Event
of Default, other than an Event of Default described in subsection (j) or (k) of
Section 9.1, has occurred and is continuing,  the Company shall,  upon demand of
the Agent (which demand shall be made upon the request of the Required Lenders),

<PAGE>

and when any Event of Default  described in subsection (j) or (k) of Section 9.1
has  occurred  the  Company  shall,  without  notice or demand  from the  Agent,
immediately  pay to the Agent  the full  amount  of each  Letter of Credit  then
outstanding,   the  Company  agreeing  to  immediately  make  such  payment  and
acknowledging  and  agreeing  that the Agent and the  Lenders  would not have an
adequate  remedy at law for  failure of the Company to honor any such demand and
that the Agent and the  Lenders  shall have the right to require  the Company to
specifically  perform such  undertaking  whether or not any draws have been made
under any such Letters of Credit.

SECTION 10.          THE AGENT.

        Section 10.1. Appointment and Authorization. Each Lender hereby appoints
and  authorizes  the Agent to take such  action  as agent on its  behalf  and to
exercise  such  powers  hereunder  and  under the other  Loan  Documents  as are
designated  to the Agent by the terms  hereof  and  thereof  together  with such
powers as are reasonably  incidental  thereto.  The Lenders expressly agree that
the Agent is not  acting as a  fiduciary  of the  Lenders in respect of the Loan
Documents,  the Company or otherwise,  and nothing herein or in any of the other
Loan Documents  shall result in any duties or obligations on the Agent or any of
the Lenders  except as expressly set forth  herein.  The Agent may resign at any
time by sending 20 days prior written notice to the Company and the Lenders.  In
the event of any such resignation,  the Required Lenders may appoint a new agent
after  consultation  with the  Company,  which shall  succeed to all the rights,
powers and duties of the Agent hereunder and under the other Loan Documents. Any
resigning  Agent  shall  be  entitled  to  the  benefit  of all  the  protective
provisions  hereof  with  respect  to its  acts as an  agent  hereunder,  but no
successor  Agent shall in any event be liable or responsible  for any actions of
its predecessor.  If the Agent resigns and no successor is appointed, the rights
and  obligations  of such Agent shall be  automatically  assumed by the Required
Lenders and the Company  shall be directed to make all  payments due each Lender
hereunder directly to such Lender.

        Section 10.2. Rights as a Lender.  The Agent has and reserves all of the
rights,  powers and duties  hereunder and under the other Loan  Documents as any
Lender  may have and may  exercise  the same as though it were not the Agent and
the terms  "Lender" or  "Lenders"  as used  herein and in all of such  documents
shall,  unless the context otherwise expressly  indicates,  include the Agent in
its individual capacity as a Lender.

        Section 10.3.  Standard of Care. The Lenders  acknowledge that they have
received and approved  copies of the Loan  Documents and such other  information
and documents  concerning the  transactions  contemplated and financed hereby as
they have requested to receive and/or review. The Agent makes no representations
or  warranties  of any kind or  character  to the  Lenders  with  respect to the
validity,   enforceability,    genuineness,    perfection,   value,   worth   or
collectibility  hereof or of the Notes or any of the other Obligations or of any
of the other  Loan  Documents.  Neither  the Agent  nor any  director,  officer,
employee,  agent or  representative  thereof  (including  any  security  trustee
therefor)  shall in any event be  liable  for any  clerical  errors or errors in
judgment,  inadvertence or oversight, or for action taken or omitted to be taken
by it or them  hereunder  or under the other  Loan  Documents  or in  connection
herewith or therewith  except for its or their own gross  negligence  or willful
misconduct.  The Agent  shall  incur no  liability  under or in  respect of this

<PAGE>

Agreement or the other Loan  Documents  by acting upon any notice,  certificate,
warranty, instruction or statement (oral or written) of anyone (including anyone
in good faith  believed by it to be authorized to act on behalf of the Company),
unless it has actual  knowledge  of the  untruthfulness  of same.  The Agent may
execute  any of its  duties  hereunder  by or  through  employees,  agents,  and
attorneys-in-fact  and shall not be answerable to the Lenders for the default or
misconduct  of any such agents or  attorneys-in-fact  selected  with  reasonable
care.  The Agent shall be entitled to advice of counsel  concerning  all matters
pertaining to the agencies  hereby created and its duties  hereunder,  and shall
incur no liability to anyone and be fully protected in acting upon the advice of
such counsel.  The Agent shall be entitled to assume that no Default or Event of
Default exists unless  notified to the contrary by a Lender.  The Agent shall in
all events be fully  protected  in acting or  failing to act in accord  with the
instructions  of the  Required  Lenders.  The Agent  shall in all cases be fully
justified in failing or refusing to act hereunder unless it shall be indemnified
to its  satisfaction  by the Lenders  against any and all  liability and expense
which may be incurred by the Agent by reason of taking or continuing to take any
such  action.  The Agent may treat the owner of any Note as the  holder  thereof
until written  notice of transfer shall have been filed with the Agent signed by
such owner in form satisfactory to the Agent.  Each Lender  acknowledges that it
has  independently  and without  reliance  on the Agent or any other  Lender and
based  upon  such  information,   investigations   and  inquiries  as  it  deems
appropriate  made its own credit  analysis and decision to extend  credit to the
Company.  It shall be the  responsibility of each Lender to keep itself informed
as to the  creditworthiness of the Company and the Agent shall have no liability
to any Lender with respect thereto.  Upon the occurrence of an Event of Default,
the Agent shall take such action to enforce  its Lien on the  Collateral  and to
preserve and protect the Collateral as may be directed by the Required  Lenders.
The Agent hereby  agrees to  distribute  to the Lenders the results of any field
audits conducted pursuant to Section 8.22 hereof.

        Section 10.4.  Costs and  Expenses.  Each Lender agrees to reimburse the
Agent  for all costs  and  expenses  suffered  or  incurred  by the Agent or any
security  trustee in  performing  its duties  hereunder and under the other Loan
Documents,  or in the exercise of any right or power  imposed or conferred  upon
the Agent  hereby  or  thereby,  to the  extent  that the Agent is not  promptly
reimbursed  for same by the Company,  all such costs and expenses to be borne by
the Lenders ratably in accordance with the amounts of their respective Revolving
Credit Commitments.

        Section 10.5.  Indemnity.  The Lenders shall ratably  indemnify and hold
the Agent, and its directors,  officers,  employees,  agents and representatives
(including as such any security trustee therefor)  harmless from and against any
liabilities,  losses,  costs and expenses suffered or incurred by them hereunder
or under  the  other  Loan  Documents  or in  connection  with the  transactions
contemplated hereby or thereby,  regardless of when asserted or arising,  except
to the extent  they are  promptly  reimbursed  for the same by the  Company  and
except to the  extent  that any event  giving  rise to a claim was caused by the
gross negligence or willful misconduct of the party seeking to be indemnified.
<PAGE>

SECTION 11.          MISCELLANEOUS.

        Section 11.1.    Withholding Taxes.

         (a) Payments Free of Withholding.  Except as otherwise  required by law
and subject to Section  11.1(b)  hereof,  each payment by the Company under this
Agreement  and under any other Loan Document  shall be made without  withholding
for or on account of any present or future  taxes (other than overall net income
taxes on the  recipient)  imposed  by or within  the  jurisdiction  in which the
Company is domiciled, any jurisdiction from which the Company makes any payment,
or (in each  case) any  political  subdivision  or taxing  authority  thereof or
therein.  If any such  withholding  is so required,  the Company  shall make the
withholding,  pay the amount withheld to the appropriate  governmental authority
before  penalties  attach thereto or interest  accrues thereon and forthwith pay
such  additional  amount  as may be  necessary  to  ensure  that the net  amount
actually  received  by each  Lender  and the Agent  free and clear of such taxes
(including  such taxes on such  additional  amount) is equal to the amount which
that  Lender  or the Agent (as the case may be)  would  have  received  had such
withholding not been made. If the Agent or any Lender pays any amount in respect
of any such taxes,  penalties or interest, the Company shall reimburse the Agent
or such Lender for that  payment on demand in the currency in which such payment
was made.  If the Company pays any such taxes,  penalties or interest,  it shall
deliver  official tax  receipts  evidencing  that  payment or  certified  copies
thereof to the Lender or Agent on whose account such  withholding was made (with
a copy to the Agent if not the  recipient  of the  original)  on or  before  the
thirtieth day after payment.

         (b) U.S.  Withholding Tax Exemptions.  Each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the  Company  and the Agent on or before  the  earlier of the date the
initial Borrowing is made hereunder and 30 days after the date hereof,  two duly
completed  and signed  copies of either Form 1001  (relating  to such Lender and
entitling  it to a complete  exemption  from  withholding  under the Code on all
amounts to be  received by such  Lender,  including  fees,  pursuant to the Loan
Documents and the Loans) or Form 4224 (relating to all amounts to be received by
such Lender,  including  fees,  pursuant to the Loan Documents and the Loans) of
the United States Internal  Revenue  Service.  Thereafter and from time to time,
each  Lender  shall  submit to the Company  and the Agent such  additional  duly
completed and signed copies of one or the other of such Forms (or such successor
forms as shall be adopted from time to time by the relevant United States taxing
authorities)  as may be  (i)  requested  by the  Company  in a  written  notice,
directly  or  through  the  Agent,  to  such  Lender  and  (ii)  required  under
then-current  United States law or  regulations to avoid or reduce United States
withholding  taxes on  payments in respect of all amounts to be received by such
Lender, including fees, pursuant to the Loan Documents or the Loans.

         (c) Inability of Lenders to Submit Forms. If any Lender determines,  as
a result of any  change in  applicable  law,  regulation  or  treaty,  or in any
official application or interpretation  thereof,  that it is unable to submit to
the Company or the Agent any form or  certificate  that such Lender is obligated
to submit pursuant to subsection (b) of this Section 11.1 or that such Lender is
required to withdraw or cancel any such form or certificate previously submitted
or any such form or  certificate  otherwise  becomes  ineffective or inaccurate,
such  Lender  shall  promptly  notify the Company and Agent of such fact and the
Lender  shall to that  extent  not be  obligated  to  provide  any such  form or
certificate  and will be entitled to  withdraw  or cancel any  affected  form or
certificate, as applicable.
<PAGE>

        Section 11.2.  Non-Business  Days. If any payment  hereunder becomes due
and payable on a day which is not a Business  Day,  the due date of such payment
shall be extended to the next succeeding Business Day on which date such payment
shall be due and payable. In the case of any payment of principal falling due on
a day which is not a Business  Day,  interest  on such  principal  amount  shall
continue to accrue  during such  extension at the rate per annum then in effect,
which accrued amount shall be due and payable on the next scheduled date for the
payment of interest.

        Section 11.3. No Waiver, Cumulative Remedies. No delay or failure on the
part of any Lender or on the part of any holder of any of the Obligations in the
exercise  of any  power or right  shall  operate  as a waiver  thereof  or as an
acquiescence  in any  default,  nor shall any single or partial  exercise of any
power or right preclude any other or further exercise thereof or the exercise of
any other power or right.  The rights and remedies  hereunder of the Lenders and
any of the holders of the  Obligations  are cumulative to, and not exclusive of,
any rights or remedies which any of them would otherwise have.

        Section  11.4.  Waivers,  Modifications  and  Amendments.  Any provision
hereof or of any of the other Loan Documents may be amended, modified, waived or
released  and any  Default  or  Event of  Default  and its  consequences  may be
rescinded  and  annulled  upon the  written  consent  of the  Required  Lenders;
provided,  however,  that without the consent of all Lenders no such  amendment,
modification  or waiver  shall (i) increase the amount or extend the term of any
Lender's Revolving Credit Commitment (or, if relevant, Swing Line Commitment) or
(ii) reduce the amount of any  principal of or interest rate  applicable  to, or
extend the maturity of, any Obligation  owed to it or (iii) reduce the amount of
the fees to which it is entitled hereunder or (iv) change this Section or change
the  definition  of  "Required  Lenders"  or (v)  change  the  number of Lenders
required to take any action  hereunder or under any of the other Loan  Documents
or (vi) permit the Company to assign any of its rights  hereunder or release any
Guarantor  from its  obligations  under its  Guaranty  or (vii)  release  all or
substantially  all of the  Collateral  (except as otherwise  provided for in the
Loan Documents) or (viii) increase the advance rates against Eligible  Inventory
and Eligible  Receivables  as used in  computing  the  "Borrowing  Base" or (ix)
change the definition of "Availability Reserve" or (x) waive compliance with the
provisions of Section  8.22(b) hereof.  No amendment,  modification or waiver of
the Agent's  protective  provisions shall be effective without the prior written
consent of the Agent.

        Section 11.5.  Costs and Expenses.  The Company  agrees to pay on demand
the  costs  and  expenses  of the  Agent in  connection  with  the  negotiation,
preparation,  execution and delivery of this Agreement, the other Loan Documents
and the other instruments and documents to be delivered hereunder or thereunder,
and in connection with the transactions  contemplated hereby or thereby,  and in
connection  with any  consents  hereunder  or  waivers or  amendments  hereto or
thereto,  including the fees and expenses of Messrs. Chapman and Cutler, counsel
for  the  Agent,  with  respect  to all of the  foregoing  (whether  or not  the

<PAGE>

transactions contemplated hereby are consummated; provided, however, in no event
shall the Company's  obligation to reimburse the Agent for such fees  (exclusive
of  such  counsel's   expenses  and   disbursements)   in  connection  with  the
negotiation, preparation, execution and delivery of this Agreement and the other
Loan  Documents to be delivered as a condition  precedent to initial  funding of
the credit contemplated hereby exceed $35,000. The Company further agrees to pay
to Agent and the Lenders and any other holders of the  Obligations all costs and
expenses  (including  court costs,  the allocated  costs of inhouse  counsel and
outside  attorneys' fees), if any, incurred or paid by the Agent, the Lenders or
any other holders of the  Obligations in connection with any Default or Event of
Default or in connection  with the  enforcement  of this Agreement or any of the
other Loan Documents or any other instrument or document delivered  hereunder or
thereunder.  The Company  further agrees to indemnify and save the Lenders,  the
Agent  and any  security  trustee  for the  Lenders  harmless  from  any and all
liabilities,  losses, costs and expenses incurred by the Lenders or the Agent in
connection with any action, suit or proceeding brought against the Agent, or any
security trustee or any Lender by any Person (but excluding  attorneys' fees for
litigation solely between the Lenders to which the Company is not a party) which
arises out of the  transactions  contemplated  or financed  hereby or out of any
action or inaction by the Agent, any security trustee or any Lender hereunder or
thereunder,  except  for such  thereof as is caused by the gross  negligence  or
willful  misconduct of the party seeking to be  indemnified.  The  provisions of
this Section and the  protective  provisions  of Section 2 hereof shall  survive
payment of the Obligations.

        Section 11.6. Documentary Taxes. The Company agrees to pay on demand any
documentary,  stamp or similar taxes payable in respect of this Agreement or any
other Loan Document,  including  interest and  penalties,  in the event any such
taxes are assessed,  irrespective of when such assessment is made and whether or
not any credit is then in use or available hereunder.

        Section  11.7.  Survival of  Representations.  All  representations  and
warranties  made herein or in any of the other Loan Documents or in certificates
given  pursuant  hereto or thereto  shall  survive the execution and delivery of
this  Agreement and the other Loan  Documents,  and shall continue in full force
and  effect  with  respect to the date as of which they were made as long as any
credit is in use or available hereunder.

        Section  11.8.  Survival  of  Indemnities.  All  indemnities  and  other
provisions  relative  to  reimbursement  to the Agent and the Lenders of amounts
sufficient to protect the yield of the Agent and the Lenders with respect to the
Loans and Letters of Credit,  including,  but not limited to, Sections 1.3, 2.7,
and 2.9 hereof,  shall survive the termination of this Agreement and the payment
of the Obligations.

        Section 11.9. Participations. Any Lender may grant participations in its
extensions of credit hereunder to any other Lender or other lending  institution
(a  "Participant"),  provided that (i) no Participant  shall thereby acquire any
direct  rights  under  this  Agreement,  (ii)  no  Lender  shall  agree  with  a
Participant  not to exercise any of such Lender's rights  hereunder  without the
consent of such  Participant  except for rights which under the terms hereof may
only be  exercised  by all  Lenders  and  (iii)  no sale of a  participation  in
extensions  of credit  shall in any manner  relieve  the  selling  Lender of its
obligations hereunder.
<PAGE>

       Section 11.10. Assignment Agreements.  Each Lender may, from time to time
upon at least 5 Business  Days'  prior  written  notice to the Agent,  assign to
other commercial lenders part of its rights and obligations under this Agreement
(including without limitation the indebtedness evidenced by the Notes then owned
by  such  assigning  Lender,  together  with  an  equivalent  proportion  of its
Revolving  Credit  Commitments  to make  Loans  hereunder)  pursuant  to written
agreements  executed by such assigning Lender,  such assignee lender or lenders,
the Company and the Agent,  which  agreements shall specify in each instance the
portion of the  indebtedness  evidenced  by the Notes which is to be assigned to
each such assignee lender and the portion of the Revolving Credit Commitments of
the  assigning  Lender  to be  assumed  by  it  (the  "Assignment  Agreements");
provided,  however,  that (i) except with  respect to Swing Loans (which must be
assigned  in whole),  each such  assignment  shall be of a  constant,  and not a
varying,  percentage of the assigning Lender's rights and obligations under this
Agreement and the  assignment  shall cover the same  percentage of such Lender's
Revolving  Credit  Commitments,  Loans,  Notes and credit  risk with  respect to
Letters of Credit;  (ii)  unless the Agent  otherwise  consents,  the  aggregate
amount of the Revolving Credit  Commitments,  Loans,  Notes and credit risk with
respect to Letters of Credit of the assigning Lender being assigned  pursuant to
each  such  assignment  (determined  as of the  effective  date of the  relevant
Assignment  Agreement)  shall in no event be less  than  $5,000,000  (unless  it
constitutes the assigning Lender's entire Revolving Credit Commitment) and shall
be an integral multiple of $1,000,000; (iii) the Agent and the Company must each
consent,  which  consent  shall  not be  unreasonably  withheld,  to  each  such
assignment to a party which was not an original  signatory of this  Agreement or
an  Affiliate  thereof;  and (iv) the  assigning  Lender must pay to the Agent a
processing and recordation fee of $3,000 and any  out-of-pocket  attorneys' fees
and expenses incurred by the Agent in connection with such Assignment Agreement.
Upon  the  execution  of  each  Assignment  Agreement  by the  assigning  Lender
thereunder,  the  assignee  lender  thereunder,  the  Company  and the Agent and
payment to such assigning  Lender by such assignee  lender of the purchase price
for the portion of the  indebtedness  of the Company  being  acquired by it, (i)
such assignee lender shall thereupon  become a "Lender" for all purposes of this
Agreement with Revolving Credit  Commitments (and, if relevant,  shall be deemed
to be Harris Bank for  purposes of the Swing  Loans) in the amounts set forth in
such  Assignment  Agreement  and with all the  rights,  powers  and  obligations
afforded a Lender  hereunder,  (ii) such assigning  Lender shall have no further
liability for funding the portion of its Revolving Credit  Commitments  (and, if
relevant,  Swing Line  Commitment)  assumed  by such other  Lender and (iii) the
address  for  notices  to such  assignee  Lender  shall be as  specified  in the
Assignment  Agreement  executed  by it.  Concurrently  with  the  execution  and
delivery of such  Assignment  Agreement,  the Company  shall execute and deliver
Notes to the assignee Lender in the respective  amounts of its Revolving  Credit
Commitments  under the Revolving Credit and new Notes to the assigning Lender in
the respective  amounts of its Revolving Credit  Commitments under the Revolving
Credit (and,  if relevant,  Swing Line  Commitment)  after giving  effect to the
reduction  occasioned by such assignment,  all such Notes to constitute  "Notes"
for all purposes of this Agreement and of the other Loan Documents.

       Section 11.11. Notices. Except as otherwise specified herein, all notices
hereunder  shall  be  in  writing  (including,  without  limitation,  notice  by
telecopy) and shall be given to the relevant  party at its address or telecopier
number  set  forth  below,  in the case of the  Company,  or on the  appropriate
signature page hereof,  in the case of the Lenders and the Agent,  or such other

<PAGE>

address or telecopier  number as such party may  hereafter  specify by notice to
the Agent and the Company given by United States  certified or registered  mail,
by telecopy or by other  telecommunication  device capable of creating a written
record of such notice and its receipt. Notices hereunder to the Company shall be
addressed to:

                           to the Company at:

                           6133 North River Road, Suite 1000
                           Rosemont, Illinois  60018-5171
                           Attention:  Donald C. Welchko
                           Telephone: (847) 518-8700
                           Telecopy:  (847) 518-8777

                           with a copy (in case of notices of default) to:

                           Katten Muchin & Zavis
                           525 West Monroe Street, Suite 1600
                           Chicago, Illinois  60661-3693
                           Attention:  Steven A. Shapiro
                           Telephone:  (312) 902-5200
                           Telecopy:  (312) 902-1061

                           to the Agent at:

                           Harris Trust and Savings Bank
                           P.O. Box 755
                           111 West Monroe Street
                           Chicago, Illinois  60690
                           Attention:  Bonnie Ogden
                           Telephone:  (312) 461-7817
                           Telecopy:  (312) 293-5041

Each such notice, request or other communication shall be effective (i) if given
by  telecopier,  when such  telecopy is  transmitted  to the  telecopier  number
specified in this Section and a confirmation  of such telecopy has been received
by the sender,  (ii) if given by mail, five (5) days after such communication is
deposited in the mail,  certified or registered  with return receipt  requested,
addressed as aforesaid or (iii) if given by any other means,  when  delivered at
the addresses specified in this Section; provided that any notice given pursuant
to Section 1 or Section 2 hereof shall be effective only upon receipt.

       Section 11.12.  Construction.  The parties hereto  acknowledge  and agree
that this  Agreement and the other Loan  Documents  shall not be construed  more
favorably  in favor of one than the other  based upon which  party  drafted  the
same, it being acknowledged that all parties hereto contributed substantially to
the  negotiation  of  this  Agreement  and the  other  Loan  Documents.  NOTHING
CONTAINED  HEREIN  SHALL BE DEEMED OR  CONSTRUED  TO PERMIT ANY ACT OR  OMISSION
WHICH  IS  PROHIBITED  BY THE  TERMS OF ANY OF THE  OTHER  LOAN  DOCUMENTS,  THE
COVENANTS  AND  AGREEMENTS  CONTAINED  HEREIN  BEING IN  ADDITION  TO AND NOT IN
SUBSTITUTION  FOR THE  COVENANTS  AND  AGREEMENTS  CONTAINED  IN THE OTHER  LOAN
DOCUMENTS.
<PAGE>

         Section 11.13.  Headings.  Section  headings used in this Agreement are
for  convenience  of reference only and are not a part of this Agreement for any
other purpose.

       Section  11.14.  Severability  of  Provisions.   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. All rights, remedies and powers provided in this Agreement and the
other Loan  Documents  may be  exercised  only to the extent  that the  exercise
thereof does not violate any applicable mandatory provisions of law, and all the
provisions  of this  Agreement  and the other Loan  Documents are intended to be
subject to all applicable  mandatory  provisions of law which may be controlling
and to be  limited  to the extent  necessary  so that they will not render  this
Agreement or the other Loan Documents invalid or unenforceable.

        Section 11.15 Counterparts. This Agreement may be executed in any number
of  counterparts,  and by  different  parties  hereto  on  separate  counterpart
signature  pages,  and all such  counterparts  taken together shall be deemed to
constitute one and the same instrument.

       Section 11.16.  Entire  Understanding.  This Agreement  together with the
other Loan  Documents  constitute the entire  understanding  of the parties with
respect to the subject matter hereof and any prior  agreements,  whether written
or  oral,  with  respect   thereto  are  superseded   hereby  except  for  prior
understandings  related to fees payable to the Agent upon the initial closing of
the transactions contemplated hereby.

       Section 11.17. Currency. Each reference in this Agreement to U.S. Dollars
or to an Alternative  Currency (the "relevant  currency") is of the essence.  To
the fullest extent permitted by law, the obligation of the Company in respect of
any  amount  due  in  the  relevant   currency  under  this   Agreement   shall,
notwithstanding  any  payment  in any  other  currency  (whether  pursuant  to a
judgment or  otherwise),  be discharged  only to the extent of the amount in the
relevant currency that the Agent or Lender entitled to receive such payment may,
in accordance with normal banking procedures, purchase with the sum paid in such
other  currency  (after any premium and costs of  exchange)  on the Business Day
immediately  following the day on which such party receives such payment. If the
amount in the relevant  currency so purchased  for any reason falls short of the
amount  originally  due in the  relevant  currency,  the Company  shall pay such
additional amounts, in the relevant currency,  as may be necessary to compensate
for the shortfall. Any obligations of the Company not discharged by such payment
shall,  to the fullest extent  permitted by applicable law, be due as a separate
and  independent  obligation  and, until  discharged as provided  herein,  shall
continue in full force and effect.

       Section  11.18.  Currency  Equivalence.  If for the purposes of obtaining
judgment in any court it is  necessary  to convert a sum due from the Company on
the  Obligations  in the currency  expressed  to be payable  herein or under the

<PAGE>

Notes (the "specified  currency") into another currency,  the parties agree that
the rate of  exchange  used  shall be that at which in  accordance  with  normal
banking  procedures  the Agent could  purchase the specified  currency with such
other  currency on the Business Day  preceding  that on which final  judgment is
given. The obligation of the Company in respect of any such sum due to the Agent
or any  Lender on the  Obligations  shall,  notwithstanding  any  judgment  in a
currency  other than the specified  currency,  be discharged  only to the extent
that on the  Business  Day  following  receipt by the Agent or such  Lender,  as
applicable,  of any sum adjudged to be so due in such other currency,  the Agent
or such Lender, as applicable,  may in accordance with normal banking procedures
purchase the specified  currency with such other currency.  If the amount of the
specified currency so purchased is less than the sum originally due to the Agent
or such Lender in the  specified  currency,  the Company  agrees,  as a separate
obligation and notwithstanding any such judgment, to indemnify the Agent or such
Lender,  as the  case  may be,  against  such  loss,  and if the  amount  of the
specified  currency so purchased  exceeds the amount originally due to the Agent
or such Lender in the specified currency,  the Agent or such Lender, as the case
may be, agrees to remit such excess to the Company.

       Section 11.19.  Binding Nature,  Governing Law, Etc. This Agreement shall
be binding upon the Company and its successors  and assigns,  and shall inure to
the benefit of the Agent and the Lenders and the benefit of their successors and
assigns, including any subsequent holder of an interest in the Obligations.  The
Company may not assign its rights  hereunder  without the written consent of the
Lenders. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
ILLINOIS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

       Section  11.20.  Submission to  Jurisdiction;  Waiver of Jury Trial.  The
Company hereby submits to the  non-exclusive  jurisdiction  of the United States
District  Court for the Northern  District of Illinois and of any Illinois State
court  sitting  in the City of Chicago  for  purposes  of all legal  proceedings
arising out of or relating to this  Agreement,  the other Loan  Documents or the
transactions  contemplated hereby or thereby. The Company irrevocably waives, to
the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such  proceeding  brought in such a court
and any claim that any such proceeding  brought in such a court has been brought
in an  inconvenient  forum.  THE  COMPANY,  THE AGENT,  AND EACH  LENDER  HEREBY
IRREVOCABLY  WAIVES  ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL  PROCEEDING
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY.



<PAGE>



         Upon your acceptance  hereof in the manner  hereinafter set forth, this
Agreement  shall  constitute  a contract  between  us for the uses and  purposes
hereinabove set forth.

         Dated as of this 17th day of December, 1999.


                      ANICOM, INC.



                       By
                       Name:_________________________________________________
                       Title:________________________________________________




<PAGE>



         Accepted and Agreed to at Chicago, Illinois as of the day and year last
above written.

         Each of the Lenders  hereby  agrees  with each other  Lender that if it
should  receive  or  obtain  any  payment  (whether  by  voluntary  payment,  by
realization  upon  collateral,  by the exercise of rights of set-off or banker's
lien, by counterclaim or cross action, or by the enforcement of any rights under
this Agreement,  any of the other Loan Documents or otherwise) in respect of the
Obligations  in a greater  amount than such Lender would have  received had such
payment  been made to the  Agent  and been  distributed  among  the  Lenders  as
contemplated by Section 3.4 hereof then in that event the Lender  receiving such
disproportionate payment shall purchase for cash without recourse from the other
Lenders an interest in the  Obligations  of the Company to such  Lenders in such
amount as shall  result in a  distribution  of such payment as  contemplated  by
Section  3.4 hereof.  In the event any payment  made to a Lender and shared with
the other Lenders pursuant to the provisions  hereof is ever recovered from such
Lender,  the Lenders receiving a portion of such payment hereunder shall restore
the same to the payor Lender, but without interest.


                                          HARRIS TRUST AND SAVINGS BANK



                                       By
                                          Its Vice President

                                          111 West Monroe Street
                                          Chicago, Illinois  60603
                                          Attention:  Bonnie Ogden
                                          Telephone:  (312) 461-7817
                                          Telecopy:  (312) 293-5041



<PAGE>



                                          BANK ONE, NA (Main Office Chicago)



                                       By
                                             Its________________________________

                                          1 Bank One Plaza
                                          Chicago, Illinois  60670
                                          Attention:  Julia A. Bristow
                                          Telephone:  (312) 732-5927
                                          Telecopy:  (312) 732-1117



<PAGE>



                                          LASALLE BANK NATIONAL ASSOCIATION



                                       By
                                             Its________________________________

                                          135 South LaSalle Street
                                          Chicago, Illinois  60603
                                          Attention:  Marguerite A. Laughlin
                                          Telephone:  (312) 904-6150
                                          Telecopy:  (312) 904-6742


<PAGE>



                                          BANK OF AMERICA, N.A.



                                       By
                                             Its________________________________

                                          231 South LaSalle Street
                                          Chicago, Illinois  60697
                                          Attention:  Mr. Peter Gates
                                          Telephone:  (312) 828-5893
                                          Telecopy:  (312) 828-1974


<PAGE>



                                          FIRSTAR BANK, N.A.



                                       By
                                             Its________________________________

                                          777 East Wisconsin
                                          Milwaukee, Wisconsin  53202
                                          Attention:  John Falb
                                          Telephone:  (414) 765-6041
                                          Telecopy:  (414) 765-4632


<PAGE>



                                          FLEET CAPITAL CORPORATION



                                       By
                                             Its________________________________

                                          One S. Wacker Drive, Suite 1400
                                          Chicago, Illinois  60601
                                          Attention:  Tom Guido
                                          Telephone:  (312) 827-4223
                                          Telecopy:  (312) 332-6533





<PAGE>


                                   EXHIBIT A-1


                                  ANICOM, INC.
                       MULTICURRENCY REVOLVING CREDIT NOTE


                                                               Chicago, Illinois
                                                            --------------, ----

         On the Revolving  Credit  Termination  Date,  for value  received,  the
undersigned,  ANICOM,  INC.,  a Delaware  corporation  (the  "Company"),  hereby
promises  to pay to the order of  ____________________  (the  "Lender"),  at the
principal  office of Harris Trust and Savings  Bank in Chicago,  Illinois (or in
the case of any LIBOR Portions denominated in an Alternative  Currency,  at such
office as the Agent has previously  notified the Company in the currency of such
LIBOR  Portions in  accordance  with Section 3.4 of the Credit  Agreement),  the
aggregate  unpaid  principal  amount of all Loans  owing from the Company to the
Lender  under  the  Revolving  Credit  provided  for  in  the  Credit  Agreement
hereinafter mentioned.

         This  Note  evidences  loans  constituting  part  of a  "Domestic  Rate
Portion"  and  "LIBOR  Portions"  as such  terms  are  defined  in that  certain
Multicurrency  Credit  Agreement dated as of December 17, 1999, by and among the
Company,  Harris Trust and Savings Bank,  individually and as Agent  thereunder,
and the other  Lenders which are now or may from time to time  hereafter  become
parties thereto (said Credit Agreement, as the same may be amended,  modified or
restated from time to time, being referred to herein as the "Credit  Agreement")
made and to be made to the  Company by the  Lender  under the  Revolving  Credit
provided for under the Credit Agreement,  and the Company hereby promises to pay
interest  at the office  described  above on each loan  evidenced  hereby at the
rates  and at the times  and in the  manner  specified  therefor  in the  Credit
Agreement.

         Each loan made under the  Revolving  Credit  provided for in the Credit
Agreement  by the Lender to the Company  against  this Note,  any  repayment  of
principal hereon,  the status of each such loan from time to time as part of the
Domestic Rate Portion or a LIBOR Portion and, in the case of any LIBOR  Portion,
the currency thereof,  the interest rate and Interest Period applicable  thereto
shall be endorsed by the holder hereof on a schedule to this Note or recorded on
the books and records of the holder hereof  (provided that such entries shall be
endorsed  on a  schedule  to this Note  prior to any  negotiation  hereof).  The
Company agrees that in any action or proceeding instituted to collect or enforce
collection  of this Note,  the entries so endorsed on a schedule to this Note or
recorded  on the books and  records of the holder  hereof  shall be prima  facie
evidence of the unpaid  principal  balance of this Note, the status of each such
loan from time to time as part of the Domestic Rate Portion or a LIBOR  Portion,
and, in the case of any LIBOR Portion,  the currency thereof,  the interest rate
and Interest Period applicable thereto.

         This Note is issued by the Company  under the terms and  provisions  of
the Credit  Agreement  and is secured by,  among other  things,  the  Collateral
Documents,  and this  Note and the  holder  hereof  are  entitled  to all of the
benefits  and  security  provided  for thereby or referred to therein,  to which

<PAGE>

reference is hereby made for a statement  thereof.  This Note may be declared to
be, or be and become, due prior to its expressed maturity, voluntary prepayments
may be made hereon, and certain  prepayments are required to be made hereon, all
in the  events,  on the  terms  and  with the  effects  provided  in the  Credit
Agreement.  All capitalized terms used herein without  definition shall have the
same meanings herein as such terms are defined in the Credit Agreement.

         The Company  hereby  promises to pay all costs and expenses  (including
attorneys'  fees)  suffered or incurred by the holder hereof in collecting  this
Note or enforcing  any rights in any  collateral  therefor.  The Company  hereby
waives  presentment  for  payment and demand.  THIS NOTE SHALL BE  CONSTRUED  IN
ACCORDANCE  WITH,  AND GOVERNED  BY, THE INTERNAL  LAWS OF THE STATE OF ILLINOIS
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.


                                          ANICOM, INC.



                                       By:
                                             Name:______________________________
                                             Title:_____________________________


<PAGE>


                                   EXHIBIT A-2

                                  ANICOM, INC.
                                 SWING LINE NOTE

                                                             Chicago, Illinois
                                                           -------------, ----

         For  value  received,   the  undersigned,   Anicom,  Inc.,  a  Delaware
corporation   (the   "Company"),   hereby  promises  to  pay  to  the  order  of
_____________________________  (the "Lender"), at the principal office of Harris
Trust and Savings Lender in Chicago,  Illinois the aggregate unpaid principal of
all Swing  Loans  owing  from the  Company  to the  Lender  under the Swing Line
provided for in the Credit  Agreement  hereinafter  mentioned  on the  Revolving
Credit Termination Date.

         This Note  evidences  Swing Loans made and to be made to the Company by
the  Lender  under the Swing Line  Commitment  provided  for under that  certain
Multicurrency  Credit  Agreement dated as of December 17, 1999, by and among the
Company, Harris Trust and Savings Lender individually and as Agent and the other
Lenders which are now or may from time to time hereafter  become parties thereto
said Credit  Agreement,  as the same may be amended,  modified or restated  from
time to time,  being referred to herein as (the "Credit  Agreement") made and to
be made to the Company by the Lender under the Swing Line provided for under the
Credit  Agreement and the Company hereby  promises to pay interest at the office
specified  above on each loan evidenced  hereby at the rates and times specified
therefor  in  the  Credit  Agreement.  Capitalized  terms  used  herein  without
definition shall have the meanings ascribed to them in the Credit Agreement, and
this Note is subject to the terms of the Credit Agreement.

         Each  loan  made  under  the  Swing  Line  provided  for in the  Credit
Agreement  by the Lender to the Company  against  this Note,  any  repayment  of
principal hereon and the interest rates and interest periods  applicable thereto
shall be  endorsed  by the  holder  hereof on the  reverse  side of this Note or
recorded  on the books and  records of the  holder  hereof  (provided  that such
entries  shall be endorsed on the reverse side hereof  prior to any  negotiation
hereof) and the Company  agrees that in any action or  proceeding  instituted to
collect or enforce  collection  of this Note,  the  entries so  endorsed  on the
reverse  side hereof or recorded on the books and records of the Lender shall be
prima facie  evidence of the unpaid  balance of this Note and the interest rates
and interest periods applicable thereto.

         This Note is issued by the Company  under the terms and  provisions  of
the Credit  Agreement  and is secured by,  among other  things,  the  Collateral
Documents,  and this  Note and the  holder  hereof  are  entitled  to all of the
benefits and security  provided for thereby or referred to therein,  equally and
ratably  with all other  indebtedness  thereby  secured,  to which  reference is
hereby made for a statement thereof.  This Note may be declared to be, or be and
become,  due prior to its expressed  maturity upon the occurrence of an Event of
Default  specified in the Credit  Agreement,  voluntary  prepayments may be made
hereon,  and certain  prepayments  are  required to be made  hereon,  all in the
events, on the terms and with the effects provided in the Credit Agreement.
<PAGE>

         THE COMPANY  HEREBY  PROMISES TO PAY THE COSTS AND EXPENSES  (INCLUDING
ATTORNEYS'  FEES) SUFFERED OR INCURRED BY THE HOLDER THEREOF IN COLLECTING  THIS
NOTE OR ENFORCING ANY COLLATERAL THEREFOR. THE COMPANY HEREBY WAIVES PRESENTMENT
FOR PAYMENT AND DEMAND.  THIS NOTE SHALL BE CONSTRUED IN  ACCORDANCE  WITH,  AND
GOVERNED  BY,  THE  INTERNAL  LAWS OF THE STATE OF  ILLINOIS  WITHOUT  REGARD TO
PRINCIPLES OF CONFLICT OF LAW.

                                            ANICOM, INC.



                         By
                                               Its______________________________









<PAGE>


                                    EXHIBIT B


                             COMPLIANCE CERTIFICATE



To:      Harris Trust and Savings  Bank, as Agent under,
         and the Lenders party to, the Credit  Agreement
         described below

         This  Compliance  Certificate is furnished to the Agent and the Lenders
pursuant to that certain Multicurrency Credit Agreement dated as of December 17,
1999,  by  and  among  Anicom,   Inc.  (the  "Company")  and  you  (the  "Credit
Agreement").  Unless otherwise defined herein, the terms used in this Compliance
Certificate have the meanings ascribed thereto in the Credit Agreement.

         THE UNDERSIGNED HEREBY CERTIFIES THAT:

         1.     I am the duly elected __________________________ of the Company;

          2. I have reviewed the terms of the Credit  Agreement and I have made,
or have  caused  to be made  under my  supervision,  a  detailed  review  of the
transactions  and  conditions  of the  Company and its  Subsidiaries  during the
accounting period covered by the attached financial statements;

          3. The examinations  described in paragraph 2 did not disclose,  and I
have no knowledge of, the  existence of any  condition or the  occurrence of any
event which  constitutes  a Default or Event of Default  during or at the end of
the accounting period covered by the attached financial  statements or as of the
date of this Certificate, except as set forth below;

          4. The  financial  statements  required  by Section  8.5 of the Credit
Agreement and being  furnished to you  concurrently  with this  Certificate  are
true,  correct and complete as of the date and for the periods covered  thereby;
and

          5. The Attachment  hereto sets forth  financial data and  computations
evidencing  the  Company's  compliance  with  certain  covenants  of the  Credit
Agreement,  all of which data and computations are, to the best of my knowledge,
true,  complete and correct and have been made in  accordance  with the relevant
Sections of the Credit Agreement.

         Described below are the exceptions,  if any, to paragraph 3 by listing,
in detail,  the nature of the condition or event, the period during which it has
existed and the action  which the Company has taken,  is taking,  or proposes to
take with respect to each such condition or event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

         The foregoing certifications,  together with the computations set forth
in the  Attachment  hereto  and the  financial  statements  delivered  with this
Certificate  in support  hereof,  are made and delivered  this  _________ day of
__________________ 19___.


                                -------------------------------------------
                                ------------------------,  ----------------
                                (Print or Type Name)           (Title)




<PAGE>


                      ATTACHMENT TO COMPLIANCE CERTIFICATE
                                  ANICOM, INC.


           Compliance Calculations for Multicurrency Credit Agreement
                          Dated as of December 17, 1999
                     Calculations as of _____________, 19___
--------------------------------------------------------------------------------


A.       MINIMUM EBITDA (Section 8.6)

         1.       Consolidated Net Income as defined               ___________

         2.       Amounts deducted in arriving at
                  Consolidated Net Income in respect of

                  (a)      Interest Expense                        ___________

                  (b)      Federal, state and local
                           income taxes                            ___________

                  (c)      Depreciation of fixed assets and
                           amortization of Capital Leases and
                           intangible assets                       ___________

         3.       Sum of Lines 1, 2(a), 2(b) and 2(c)
                  ("EBITDA")                                       ___________

         4.       As listed in Section  8.6,  for the date of
                  this  certificate,
                  EBITDA shall not
                  be less than                                     ___________

B.       INTEREST COVERAGE RATIO (SECTION 8.7)

         1.       Consolidated Net Income as defined               ___________

         2.       Amounts deducted in arriving at
                  Consolidated Net Income in respect of

                  (a)      Interest Expense                        ___________

                  (b)      Federal, state and local
                           income taxes                            ___________
<PAGE>

         3.       Sum of Lines 1, 2(a) and 2(b)
                  ("EBIT")                                         ___________

         4.       Interest Expense                                 ___________

         5.       Ratio of EBIT (Line 3)
                  to Interest Expense (Line 4) ("Interest
                  Coverage Ratio")                                          :1
                                                                   ===========

         6.       As listed in Section  8.7,  for the date
                  of this  Certificate,
                  the Interest Coverage
                  Ratio shall not be less than                         2.0 : 1
                                                                    __________

         7. Company is in compliance?
                  (Circle yes or no)                                  Yes/No
                                                                   ===========

C.       TANGIBLE NET WORTH (SECTION 8.8)

         1.       Shareholders' Equity                   __________

         2.       Less

                  (a)      Notes receivable
                           from officers and
                           employees                     ____________
                                                         ------------

                  (b)      Intangible Assets             ____________

         3.       Line 1 minus Lines 2(a) and 2(b)
                  ("Tangible Net Worth")                            __________

         4.       As required  by Section  8.8,
                  Tangible  Net Worth must not be
                  less than Minimum Required Amount

                  (a)      Consolidated Net Income       ___________

                  (b)      .50 X Line 4(a)               ___________

                  (c)      Line 4(b) plus the            $__________ _________
                           Minimum Required
                           Amount for the immediately
                           preceding fiscal quarter
                           ("Minimum Required Amount")

         5.       Company is in compliance?
                  (Circle yes or no)                                  Yes/No
                                                                   ===========
<PAGE>

D.       DEBT TO EARNINGS RATIO (SECTION 8.9)

         1.       Total Funded Debt                                  _________

         2.       EBITDA (Line A3 above)       ___________

         3.       Ratio of Line 1 to Line 2
                  ("Debt to Earnings Ratio")                               : 1
                                                                     ---------

         4.       As listed in Section 8.9,
                  Debt to Earnings Ratio
                  must not be greater than                             4.5 : 1
                                                                     ---------

         5.       Company is in compliance?
                  (Circle yes or no)                                    Yes/No
                                                                   ===========

E.       LEVERAGE RATIO (SECTION 8.10)

         1.       Total Funded Debt            ____________

         2.       Shareholders' Equity         ____________

         3.       Line 1 plus Line 2           ____________

         4.       Total Capitalization
                  (from Line E3 above)         ____________

         5.       Ratio of Line 1 to Line 4
                  ("Leverage Ratio")                                         :1
                                                                 ==============

         7.       As listed in Section 8.10, fo
                  the date of this Certificate,
                  the Leverage Ratio shall not
                  be greater than                                       0.40 :1
                                                                  =============

         8. Company is in compliance?
                  (Circle yes or no)                                     Yes/No
                                                                  =============

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





<PAGE>




                                    EXHIBIT C


                            SUBORDINATED INDEBTEDNESS


            INSTRUMENT  INTEREST RATE    BALANCE AS OF 6/30/98   MATURITY

Note payable
 to James Hinshaw            prime            $440,213           In monthly
                                                                 installments
                                                                 through July 1,
                                                                 2002




<PAGE>


                                    EXHIBIT D
                     SUBORDINATION PROVISIONS APPLICABLE TO
                                SUBORDINATED DEBT


         (a) The  indebtedness  evidenced  by the  subordinated  notes*  and any
renewals or extensions thereof (hereinafter called "Subordinated Indebtedness"),
shall at all times be wholly  subordinate  and junior in right of payment to any
and all  credit  and other  indebtedness,  obligations  and  liabilities  of the
Company to the lenders  (collectively  the "Lenders") and their agent (each,  an
"Agent") under or in connection with that certain Multicurrency Credit Agreement
dated as of December 17, 1999 by and among the Company, Harris Trust and Savings
Bank,  individually ("Harris") and as Agent for the Lenders thereunder and other
Lenders  from time to time  party  thereto,  in each case  howsoever  evidenced,
whether  now  existing  or  hereafter  created  or  arising,  whether  direct or
indirect, absolute or contingent, or joint or several, as any of the same may be
modified,  supplemented  or  amended  from  time  to  time  (hereinafter  called
"Superior Indebtedness"),  in the manner and with the force and effect hereafter
set forth:

                   (1) In the event of any  liquidation,  dissolution or winding
         up of the Company of in the event of any execution sale,  receivership,
         insolvency, bankruptcy,  liquidation,  readjustment,  reorganization or
         other  similar  proceeding  relative to the Company or its  properties,
         then in any such event the holders of any and all Superior Indebtedness
         shall be  preferred  in the payment of their  claims over the holder or
         holders   of  the   Subordinated   Indebtedness,   and  such   Superior
         Indebtedness  shall be first  paid and  satisfied  in full  before  any
         payment  or  distribution  of any kind or  character,  whether in cash,
         property   or   securities   shall  be  made   upon  the   Subordinated
         Indebtedness; and in any such event any dividend or distribution of any
         kind or character,  whether in cash, property or securities which shall
         be made upon or in respect  of the  Subordinated  Indebtedness,  or any
         renewals  or  extensions  hereof,  shall be paid over to the holders of
         such  Superior  Indebtedness,  pro rata,  for  application  in  payment
         thereof  unless and until such  Superior  Indebtedness  shall have been
         paid and satisfied in full;

                   (2) Without limiting any of the other provisions  hereof,  in
         the event that the Subordinated Indebtedness is declared or becomes due
         and payable because of the occurrence of any event of default hereunder
         (or under the agreement or indenture,  as appropriate) or for any other
         reason  other than at the option of the  Company,  under  circumstances
         when the foregoing  clause (1) shall not be applicable,  the holders of
         the Subordinated  Indebtedness shall be entitled to payments only after
         there  shall  first  have been paid in full all  Superior  Indebtedness
         outstanding at the time the  Subordinated  Indebtedness  so becomes due
         and  payable  because of any such  event,  or  payment  shall have been
         provided for in a manner  satisfactory  to the holders of such Superior
         Indebtedness;
<PAGE>

                   (3) No payment on account of principal of,  premium,  if any,
         or interest on the Subordinated  Indebtedness  shall be made, nor shall
         any  assets  be  applied  to  the  purchase  or  other  acquisition  or
         retirement  of the  Subordinated  Indebtedness,  unless full payment of
         amounts  then due on all  Superior  Indebtedness  has been made or duly
         provided  for, and no payment on account of principal of,  premium,  if
         any, or interest on the  Subordinated  Indebtedness  shall be made, nor
         shall any assets be applied to the  purchase  or other  acquisition  or
         retirement  of the  Subordinated  Indebtedness,  if at the time of such
         payment or  application  or  immediately  after giving effect  thereto,
         there  shall  exist a default  in the  payment of any amount due on any
         Superior Indebtedness;

                   (4) If there  shall  have  occurred a default  (other  than a
         default in the payment of any amount due) with  respect to any issue of
         Superior  Indebtedness,  as defined therein or in the instrument  under
         which the same has been issued,  permitting the holders thereof,  after
         notice or lapse of time, or both, to accelerate  the maturity  thereof,
         and any such  holders  as  constitute  a  sufficient  number  or hold a
         sufficient amount of such Superior Indebtedness as to have the right to
         so accelerate the maturity thereof (the "Notifying  Debtholders") shall
         give written notice of the default to the Company (a "Default Notice"),
         then, unless and until such default shall have been cured or waived, no
         payment on account of principal of, premium, if any, or interest on the
         Subordinated  Indebtedness  shall be made,  nor  shall  any  assets  be
         applied to the  purchase  or other  acquisition  or  retirement  of the
         Subordinated Indebtedness,  at any time during the 180 days immediately
         following  the  delivery  of the  Default  Notice to the  Company  (the
         "Blockage  Period");  provided that if, during the Blockage  Period the
         Notifying  Debtholders  shall  have  accelerated  the  maturity  of the
         Superior Indebtedness held by such Notifying Debtholders, or shall have
         taken such action as is  necessary  under the  governing  agreement  or
         instrument  to accelerate  the maturity of such  Superior  Indebtedness
         (subject  only to the  expiration  of a grace  period not  exceeding 30
         days),  then the  Blockage  Period shall be extended for any such grace
         period and thereafter for so long as such  acceleration  shall continue
         to be in effect and judicial  proceedings shall be pending with respect
         thereto,  the  Notifying   Debtholders  shall  be  in  the  process  of
         foreclosing or otherwise collecting or realizing on collateral for such
         Superior  Indebtedness or the Notifying  Debtholders shall otherwise be
         pursuing collection procedures in good faith. At the expiration of such
         Blockage Period, (i) the Company shall,  absent the occurrence prior to
         payment thereof by the Company of any event set forth in Section 1 or 3
         hereof, pay to the holders of the Subordinated Indebtedness all amounts
         which  would have been  payable  other  than by reason of  acceleration
         during the Blockage  Period and (ii) if the default  referred to in the
         Default  Notice shall continue to exist and shall not have been waived,
         then the  Notifying  Debtholders  shall be  permitted  to  submit a new
         Default  Notice  respecting  such  event of  default.  If,  during  any
         Blockage  Period, a subsequent  Default Notice is served  respecting an
         event or events of default  which were in  existence  and known to such
         Notifying  Debtholder  on the  first day of the  pre-existing  Blockage
         Period,  then the Blockage period  triggered by the subsequent  Default
         Notice shall  terminate at the same time as the  pre-existing  Blockage
         Period;

                   (5)  Any  holders  of  Subordinated  Indebtedness  shall  not
         without  the prior  written  consent  of the  holders  of the  Superior

<PAGE>

         Indebtedness  take any  collateral for any  Subordinated  Indebtedness,
         whether  from the Company or any other party,  nor take any  guaranties
         for any Subordinated Indebtedness,  from any party, in each case if and
         so long as the terms of any of the Superior  Indebtedness prohibit such
         liens or  guaranties.  Without  limiting the effect of any of the other
         provisions of this Agreement,  any interest in or lien on any assets or
         properties of the Company or any other party which may (notwithstanding
         the foregoing  agreement) be held or hereafter acquired by or on behalf
         of  any  holder  of  Subordinated  Indebtedness  as  security  for  any
         Subordinated    Indebtedness   is   and   shall   be   absolutely   and
         unconditionally subject and subordinate in all respects to any security
         interest  or lien  which  may be held or  hereafter  acquired  by or on
         behalf of the holders of Superior  Indebtedness in the same such assets
         or properties as security for any Superior Indebtedness notwithstanding
         the time of attachment  of any interest  therein or lien thereon or the
         filing of any financing statement or any other priority provided by law
         or by agreement; and

                   (6) The holders of Subordinated  Indebtedness  shall not take
         any action to enforce collection of the Subordinated Indebtedness or to
         foreclose or otherwise  realize upon any security or guaranty  given to
         secure or guaranty the  Subordinated  Indebtedness  and the Company and
         any such  guarantor  shall  not  make any  payment  in  respect  of the
         Subordinated Indebtedness,  in each case during any Blockage Period, or
         otherwise unless the Company shall, 180 days prior to the taking of any
         such action,  have provided the holders of Superior  Indebtedness  with
         notice of the occurrence of the default giving rise to such action. Any
         provisions  of this  Section  6 to the  contrary  notwithstanding,  the
         restriction  contained in this  Section  shall no longer apply upon the
         first to occur of the  following:  (i) the  institution  of  bankruptcy
         proceedings  by or against the Company;  (ii) the  acceleration  of the
         Superior  Indebtedness;  or (iii) the payment or other  satisfaction of
         all of the  Superior  Indebtedness.  The  holders  of the  Subordinated
         Indebtedness  agree to accept a cure from the  Lenders  of any  default
         with respect to any Subordinated  Indebtedness (with the same force and
         effect as if such cure  were  timely  provided  by the  Company  or the
         appropriate  obligor)  at any time during the period  during  which the
         holders of the Subordinated  Indebtedness  agree not to act pursuant to
         this  Section and if any such  default is cured  during any such period
         shall be rescinded and annulled all with the same effect as though such
         default had not occurred and the rate of interest on such  Subordinated
         Indebtedness   shall  accrue  during  such  period  at  the  applicable
         predefault rate.

                   (7) The holders of  Subordinated  Indebtedness  undertake and
         agree for the  benefit  of each  holder  of  Superior  Indebtedness  to
         execute,  verify,  deliver  and file any  proofs  of  claim,  consents,
         assignments  or  other   instruments   which  any  holder  of  Superior
         Indebtedness may at any time require in order to prove and realize upon
         any  rights  or  claims  pertaining  to the  subordinated  notes and to
         effectuate the full benefit of the subordination  contained herein; and
         upon failure of the holder of any subordinated  note so to do, any such
         holder of  Superior  Indebtedness  shall be  deemed  to be  irrevocably
         appointed the agent and  attorney-in-fact of the holder of such note to
         execute,  verify,  deliver and file any such proofs of claim, consents,
         assignments or other instrument.
<PAGE>

                   (8) No right of any holder of any  Superior  Indebtedness  to
         enforce  subordination  as herein  provided shall at any time or in any
         way be  affected  or  impaired by any failure to act on the part of the
         Company  or  the   holders  of   Superior   Indebtedness,   or  by  any
         noncompliance  by the  Company  with any of the terms,  provisions  and
         covenants of the  subordinated  notes or the agreement under which they
         are issued, regardless of any knowledge thereof that any such holder of
         Superior Indebtedness may have or be otherwise charged with.

                   (9) The  Company  agrees,  for the  benefit of the holders of
         Superior Indebtedness,  that in the event that any subordinated note is
         declared due and payable before its expressed  maturity  because of the
         occurrence of a default hereunder,  (i) the Company will provide prompt
         notice  in  writing  of  such  happening  to the  holders  of  Superior
         Indebtedness and (ii) a holder of any Superior Indebtedness may declare
         the same to be immediately due and payable, regardless of the expressed
         maturity thereof.

                  (10) To the extent that the  Company  makes any payment on the
         Superior Indebtedness which is subsequently invalidated, declared to be
         fraudulent or preferential,  set aside or is required to be repaid to a
         trustee, receiver or any other party under any bankruptcy act, state or
         Federal  law,  common  law  or  equitable  cause  (such  payment  being
         hereinafter  referred to as a "Voided Payment"),  then to the extent of
         such Voided Payment that portion of the Superior Indebtedness which had
         been  previously  satisfied by such Voided Payment shall be revived and
         continue in full force and effect as if such  Voided  Payment has never
         been made.  In the event that a Voided  Payment is  recovered  from the
         holders  of the  Superior  Indebtedness,  a default  in the  payment of
         Superior   Indebtedness   specified  in   paragraph   (a)(3)  of  these
         subordination  provisions  shall be  deemed to have  existed  and to be
         continuing  from the date of the initial  receipt by the holders of the
         Superior  Indebtedness  of such Voided Payment until the full amount of
         such Voided Payment is fully and finally  restored to the holder of the
         Superior   Indebtedness   and  until  such  time  these   subordination
         provisions shall be in full force and effect.

                  (11) In the event that any payment or  distribution  of assets
         is made to any holder of subordinated  notes in  contravention of these
         subordination  provisions,   such  payment  or  distribution  shall  be
         received  and held by such  holder  in  trust  for the  benefit  of the
         holders  of the  then  outstanding  Superior  Indebtedness  and  shall,
         forthwith upon receipt  thereof,  be paid or distributed to the holders
         of the Superior  Indebtedness,  pro rata,  for  application  in payment
         thereof.

                  (12) The  foregoing  provisions  are solely for the purpose of
         defining the relative rights of the holders of Superior Indebtedness on
         the one hand, and the holders of the  Subordinated  Indebtedness on the
         other hand, and nothing herein shall impair, as between the Company and
         the holders of the  Subordinated  Indebtedness,  the  obligation of the
         Company,  which is unconditional and absolute,  to pay the principal of
         and premium,  if any, and interest on the Subordinated  Indebtedness in
         accordance  with their terms,  nor shall  anything  herein  prevent the
         holders of the Subordinated  Indebtedness  from exercising all remedies
         otherwise  permitted  by  applicable  law  or  hereunder  upon  default
         hereunder,   subject  to  the  rights  of  the   holders  of   Superior
         Indebtedness as herein provided for.


<PAGE>


                                    EXHIBIT E


                                    GUARANTY



         This  Guaranty  Agreement,  dated  as of  ____________,  ____,  made by
____________  _________________________________,  a _________________  organized
under the laws of _________________ (the "Guarantor");


                                   WITNESSETH:

         WHEREAS, Anicom, Inc., a Delaware corporation (the "Borrower"),  Harris
Trust and Savings Bank  ("Harris"),  individually and as Agent (Harris acting as
such agent and any  successor or  successors  to Harris in such  capacity  being
hereinafter  referred to as the "Agent") and the lenders from time to time party
thereto   (Harris  and  such  other  lenders  being   hereinafter   referred  to
collectively as the "Lenders" and  individually as a "Lender") have entered into
a  Multicurrency  Credit  Agreement  dated as of December  17, 1999 (such Credit
Agreement  as the same may from time to time  hereafter  be  modified or amended
being hereinafter  referred to as the "Credit Agreement")  pursuant to which the
Lenders have extended  various credit  facilities to the Borrower (the Agent and
the Lenders  being  hereinafter  referred  to  collectively  as the  "Guaranteed
Creditors" and individually as a "Guaranteed Creditor"); and

         WHEREAS,  the Borrower owns and holds all or  substantially  all of the
issued and outstanding common capital stock of the Guarantor; and

         WHEREAS,  it is a condition  to the  extension of credit by the Lenders
under the Credit  Agreement that the Guarantor shall have executed and delivered
this Guaranty; and

         WHEREAS,  the Borrower  has  provided and will  continue to provide the
Guarantor  with  business,  technical  and financial  support  beneficial to the
proper  conduct  of the  Guarantor's  business  and the  Guarantor  will  obtain
benefits  as a result of the  extensions  of credit  to the  Borrower  under the
Credit  Agreement;  and,  accordingly,  the Guarantor desires to enter into this
Guaranty in order to satisfy the condition described in the preceding paragraph;
and

         NOW,  THEREFORE,  in  consideration of the foregoing and other benefits
accruing  to the  Guarantor,  the receipt  and  sufficiency  of which are hereby
acknowledged,  the  Guarantor  hereby makes the  following  representations  and
warranties to the Guaranteed  Creditors and hereby covenants and agrees with the
Guaranteed Creditors as follows:

          1. The Guarantor hereby  unconditionally and irrevocably guarantees to
the Guaranteed Creditors, the due and punctual payment of all present and future
indebtedness of the Borrower evidenced by or arising out of the Credit Documents
(as  hereinafter  defined),  including,  but  not  limited  to,  (a) the due and
punctual  payment  of  principal  of and  interest  on all  notes  issued by the
Borrower under the Credit Agreement and any and all notes issued in extension or
renewal  thereof or in substitution or replacement  therefor  (collectively  the
"Notes") as and when the same shall  become due and  payable,  whether at stated

<PAGE>

maturity, by acceleration or otherwise,  and (b) the full and prompt performance
and  payment  when  due of any  and  all  other  indebtedness,  obligations  and
liabilities,  whether now existing or hereafter arising,  of the Borrower to the
Guaranteed  Creditors under or arising out of the Credit  Agreement,  the Notes,
Credit  Agreement  and each  guaranty  executed  by  another  subsidiary  of the
Borrower in connection with the Credit Agreement being hereinafter  collectively
referred  to as the  "Credit  Documents").  The  indebtedness,  obligations  and
liabilities  described  in the  immediately  preceding  clauses  (a) and (b) are
hereinafter referred to as the "Guaranteed  Obligations".  In case of failure by
Borrower  punctually to pay any indebtedness  guaranteed  hereby,  the Guarantor
hereby  unconditionally  agrees to make such payment or to cause such payment to
be made punctually as and when the same shall become due and payable, whether at
stated maturity, by acceleration or otherwise,  and as if such payment were made
by the Borrower.

          2. The  obligations  of the  Guarantor  under this  Guaranty  shall be
unconditional   and  absolute  and,  without  limiting  the  generality  of  the
foregoing, shall not be released, discharged or otherwise affected by:

                   (a) any extension, renewal, settlement, compromise, waiver or
         release in respect of any  obligation  of the  Borrower or of any other
         guarantor under the Credit Agreement or any other Credit Document or by
         operation of law or otherwise;

                   (b) any  modification  or amendment of or  supplement  to the
         Credit  Agreement or any other Credit Document;

                   (c) any  change  in the  corporate  existence,  structure  or
         ownership of (including  any of the foregoing  arising from any merger,
         consolidation, amalgamation or similar transaction), or any insolvency,
         bankruptcy,  reorganization or other similar proceeding affecting,  the
         Borrower,  any other guarantor,  or any of their respective  assets, or
         any resulting release or discharge of any obligation of the Borrower or
         of any other  guarantor  contained  in any  Credit  Document  (it being
         understood  and agreed that the term  "Borrower"  as used herein  shall
         mean and include any corporation, partnership, association or any other
         entity  or  organization   resulting  from  a  merger,   consolidation,
         amalgamation or similar transaction involving the Borrower);

                   (d) the existence of any claim, set-off or other rights which
         the Guarantor may have at any time against any  Guaranteed  Creditor or
         any other person, whether or not arising in connection herewith;

                   (e) any failure to assert,  or any assertion of, any claim or
         demand or any  exercise  of, or  failure  to  exercise,  any  rights or
         remedies against the Borrower, any other guarantor, any other person or
         any of their respective properties;

                   (f)  any  application  of any  sums  by  whomsoever  paid  or
         howsoever realized to any obligation of the Borrower regardless of what
         obligations of the Borrower remain unpaid;
<PAGE>

                   (g) any invalidity or unenforceability relating to or against
         the  Borrower  or any other  guarantor  for any  reason  of the  Credit
         Agreement  or  of  any  other  Credit  Document  or  any  provision  of
         applicable law or regulation  purporting to prohibit the payment by the
         Borrower or any other  guarantor of the principal of or interest on any
         Note or any other amount payable by it under the Credit Documents; or

                   (h) any other act or  omission to act or delay of any kind by
         any Guaranteed  Creditor or any other person or any other  circumstance
         whatsoever  that  might,  but for  the  provisions  of this  paragraph,
         constitute a legal or equitable  discharge  of the  obligations  of the
         Guarantor hereunder.

In order to hold the Guarantor liable hereunder, there shall be no obligation on
the part of the Guaranteed Creditors,  at any time, to resort for payment to the
Borrower  or  any  other  guarantor,  or  resort  to any  collateral,  security,
property,  liens or other  rights or  remedies  whatsoever,  and the  Guaranteed
Creditors shall have the right to enforce this Guaranty  irrespective of whether
or not other proceedings or steps seeking resort or realization upon or from any
of the foregoing are pending.

          3. The  Guarantor's  obligations  hereunder shall remain in full force
and effect until all commitments by the Guaranteed Creditors to extend credit to
the Borrower are  terminated  and the principal of and interest on the Notes and
all other  amounts  payable by the Borrower  under the Credit  Agreement and all
other Credit  Documents shall have been paid in full. If at any time any payment
of the  principal of or interest on any Note or any other amount  payable by the
Borrower under the Credit  Documents is rescinded or must be otherwise  restored
or returned upon the insolvency, bankruptcy or reorganization of the Borrower or
of any other guarantor, or otherwise, the Guarantor's obligations hereunder with
respect to such payment  shall be reinstated at such time as though such payment
had become due but had not been made at such time.

          4.  (a)  The   Guarantor   irrevocably   waives   acceptance   hereof,
presentment,  demand, protest and any notice not provided for herein, as well as
any requirement that at any time any action be taken by the Agent, any Lender or
any other person against the Borrower, another guarantor or any other person.

         (b) The Guarantor hereby agrees not to exercise or enforce any right of
exoneration,  contribution,  reimbursement, recourse or subrogation available to
the Guarantor against the Borrower or any other guarantor, or as to any security
therefor, unless and until all commitments by the Guaranteed Creditors to extend
credit to the Borrower are  terminated  and the principal of and interest on the
Notes and all other amounts  payable by the Borrower under the Credit  Agreement
and all other Credit  Documents shall have been paid in full; and the payment by
the Guarantor of any of its  obligations  hereunder shall not in any way entitle
the Guarantor to any right,  title or interest (whether by way of subrogation or
otherwise) in and to any of the Guaranteed  Obligations or any proceeds  thereof
or any security  therefor  unless and until all  commitments  by the  Guaranteed
Creditors to extend credit to the Borrower are  terminated  and the principal of
and interest on the Notes and all other  amounts  payable by the Borrower  under
the Credit  Agreement  and all other  Credit  Documents  shall have been paid in
full.
<PAGE>

          5.  Notwithstanding  any other provision hereof, the right of recovery
of the Guaranteed  Creditors  against the Guarantor  hereunder  shall not exceed
$1.00 less than the  amount  which  would  render  the  Guarantor's  obligations
hereunder void or voidable under applicable law,  including  without  limitation
fraudulent conveyance law.

          6. If  acceleration  of the time for payment of any amount  payable by
the Borrower under the Credit  Agreement or any other Credit  Document is stayed
upon the  insolvency,  bankruptcy or  reorganization  of the Borrower,  all such
amounts  otherwise  subject  to  acceleration  under  the  terms  of the  Credit
Agreement  or the other Credit  Documents  shall  nonetheless  be payable by the
Guarantor forthwith on demand by the Agent made at the request of the Guaranteed
Creditors.

          7. Any payment of a Guaranteed Obligation required to be made pursuant
to this Guaranty shall be made in the currency which such Guaranteed  Obligation
is required to be made in pursuant to the Credit  Agreement or such other Credit
Document giving rise to such Guaranteed Obligation.

          8.  This  Guaranty  shall  be  binding  upon  the  Guarantor  and  its
successors  and  assigns  and  shall  inure  to the  benefit  of the  Guaranteed
Creditors and their successors and assigns.  Any Guaranteed Creditor may, to the
extent permitted by the Credit Agreement, sell, transfer or assign its rights in
the  Guaranteed   Obligations  held  by  it,  or  any  part  thereof,  or  grant
participations  therein;  and in  that  event,  each  and  every  immediate  and
successive  assignee or transferee of, or holder or  participant  in, all or any
part of the  Guaranteed  Obligations,  shall  have  the  right to  enforce  this
Guaranty,  by suit or otherwise,  for the benefit of such assignee,  transferee,
holder or  participant  as fully as if such  assignee or  transferee,  holder or
participant  were  herein by name  specifically  given such  rights,  powers and
benefits; but each Guaranteed Creditor shall have an unimpaired right to enforce
this Guaranty for its own benefit or for the benefit of any such  participant as
to so much of the  Guaranteed  Obligations  that it has not  sold,  assigned  or
transferred.

          9. The Guarantor  acknowledges  that executed (or conformed) copies of
the Credit  Agreement and the other Credit Documents have been made available to
its  principal  executive  officers  and such  officers  are  familiar  with the
contents thereof.

         10. Any acknowledgment or new promise,  whether by payment of principal
or interest or otherwise and whether by the Borrower,  or others  (including the
Guarantor),  with respect to any of the  Guaranteed  Obligations  shall,  if the
statute  of  limitations  in  favor  of the  Guarantor  against  the  Guaranteed
Creditors  shall have  commenced  to run,  toll the  running of such  statute of
limitations,  and if the  period  of such  statute  of  limitations  shall  have
expired, prevent the operation of such statute of limitations.

         11. The records of the Agent and each  Lender as to the unpaid  balance
of the  Guaranteed  Obligations at any time and from time to time shall be prima
facie  evidence  thereof  without  further  or  other  proof  for all  purposes,
including the enforcement of this Guaranty and any collateral therefor.
<PAGE>

         12. Except as otherwise  required by law, each payment by the Guarantor
hereunder shall be made without  withholding for or on account of any present or
future taxes (other than overall net income taxes on the  recipient)  imposed by
or within the jurisdiction in which the Guarantor is domiciled, any jurisdiction
from which the  Guarantor  makes any  payment,  or (in each case) any  political
subdivision or taxing authority  thereof or therein.  If any such withholding is
so required,  the Guarantor shall make the withholding,  pay the amount withheld
to the appropriate  governmental  authority  before  penalties attach thereto or
interest  accrues  thereon and  forthwith pay such  additional  amount as may be
necessary  to ensure that the net amount  actually  received by each  Guaranteed
Creditor free and clear of such taxes  (including  such taxes on such additional
amount)  is equal to the  amount  which  that  Guaranteed  Creditor  would  have
received had such withholding not been made. If any Guaranteed Creditor pays any
amount in respect of any such taxes,  penalties or interest the Guarantor  shall
reimburse the Guaranteed  Creditor for that payment on demand in the currency in
which such payment was made. If the Guarantor pays any such taxes,  penalties or
interest,  it shall  deliver  official tax receipts  evidencing  that payment or
certified  copies  thereof to the  Guaranteed  Creditor  on whose  account  such
withholding  was  made  (with a copy to the  Agent if not the  recipient  of the
original)  on or before  the  thirtieth  day after  payment.  If any  Guaranteed
Creditor  determines it has received or been granted a credit  against or relief
or remission  for, or  repayment  of, any taxes paid or payable by it because of
any taxes,  penalties or interest  paid by the Guarantor and evidenced by such a
tax receipt,  such Guaranteed Creditor shall, to the extent it can do so without
prejudice to the  retention of the amount of such credit,  relief,  remission or
repayment,  pay to the Guarantor as applicable,  such amount as such  Guaranteed
Creditor  determines is  attributable to such deduction or withholding and which
will leave such  Guaranteed  Creditor (after such payment) in no better or worse
position  than it would have been in if the  Guarantor  had not been required to
make such  deduction or  withholding.  Nothing  herein shall  interfere with the
right of each Guaranteed  Creditor to arrange its tax affairs in whatever manner
it thinks fit nor oblige any  Guaranteed  Creditor to disclose  any  information
relating to its tax affairs or any computations in connection with such taxes.

         13. Each reference in the Credit Agreement or any other Credit Document
to U.S.  Dollars or to an alternative  currency (the "relevant  currency") is of
the essence.  To the fullest  extent  permitted by law,  the  obligation  of the
Guarantor in respect of any amount due in the relevant currency under the Credit
Agreement  shall,  notwithstanding  any payment in any other  currency  (whether
pursuant to a judgment or  otherwise),  be discharged  only to the extent of the
amount in the relevant currency that the Guaranteed Creditor entitled to receive
such payment may, in accordance  with normal banking  procedures,  purchase with
the sum paid in such other currency (after any premium and costs of exchange) on
the business day immediately following the day on which such Guaranteed Creditor
receives  such payment.  If the amount of the relevant  currency so purchased is
less than the sum  originally  due to such  Guaranteed  Creditor in the relevant
currency, the Guarantor agrees, as a separate obligation and notwithstanding any
such judgment,  to indemnify such Guaranteed  Creditor against such loss, and if
the amount of the  specified  currency so  purchased  exceeds the sum of (a) the
amount  originally  due to the  relevant  Guaranteed  Creditor in the  specified
currency plus (b) any amounts shared with other Guaranteed Creditors as a result
of allocations of such excess as a  disproportionate  payment to such Guaranteed
Creditor under Section 3.4 of the Credit  Agreement,  such  Guaranteed  Creditor
agrees to remit such excess to the Guarantor.
<PAGE>

         14.  THIS  GUARANTY  AND THE  RIGHTS  AND  OBLIGATIONS  OF THE  PARTIES
HEREUNDER  SHALL BE CONSTRUED IN ACCORDANCE  WITH AND GOVERNED BY THE LAW OF THE
STATE OF ILLINOIS  (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS), in which
State it shall be performed by the Guarantor.

         15. The  obligation  of the Guarantor  hereunder  shall be absolute and
unconditional  under all  circumstances  and irrespective of the validity or the
enforceability of the Guaranteed  Obligations and irrespective of any present or
future law of any  government  or of any agency  thereof  purporting  to reduce,
amend or otherwise affect any of the Guaranteed Obligations.  To the extent that
the Guarantor or any of its  properties or revenues has or hereafter may acquire
any right of immunity  from suit,  judgment or execution,  the Guarantor  hereby
irrevocably  waives  such  right  of  immunity  in  respect  of its  obligations
hereunder  and in respect  of any action or  proceeding,  wherever  brought,  to
enforce  any  judgment   against  the  Guarantor  for  breach  of  any  of  such
obligations.

         16. The Guarantor  hereby submits to the  nonexclusive  jurisdiction of
the United States  District  Court for the Northern  District of Illinois and of
any  Illinois  State court  sitting in the City of Chicago  for  purposes of all
legal  proceedings  arising  out of or  relating  to this  Guaranty,  the Credit
Agreement, the other Credit Documents or the transactions contemplated hereby or
thereby,  and consents to the service of process by registered or certified mail
out of any such court or by service of process on the Borrower (now at _________
_________________________________________________)  which the  Guarantor  hereby
irrevocably appoints as its agent to receive, for it and on its behalf,  service
of process in any action or proceeding in Illinois. Such service shall be deemed
completed on delivery to such process  agent  (whether or not it is forwarded to
and received by the  Guarantor)  provided that notice of such service of process
is given by the Guaranteed Creditors to the Guarantor.  If, for any reason, such
process agent ceases to be able to act as such, the Guarantor irrevocably agrees
to appoint a substitute  process agent acceptable to the Agent and to deliver to
the Agent a copy of the new agent's acceptance of that appointment within thirty
days.  Nothing  contained  herein  shall  affect  the  right  of the  Guaranteed
Creditors to serve legal process in any other manner or to bring any  proceeding
hereunder in any  jurisdiction  where the Guarantor may be amenable to suit. The
Guarantor  irrevocably  waives,  to the fullest  extent  permitted  by law,  any
objection  which it may now or hereafter  have to the laying of the venue of any
such  proceeding  brought in such a court and any claim that any such proceeding
brought  in such a court  has  been  brought  in an  inconvenient  forum.  Final
judgment (a certified or exemplified copy of which shall be conclusive  evidence
of the  fact and of the  amount  of any  indebtedness  of the  Guarantor  to the
Guaranteed  Creditors therein described) against the Guarantor in any such legal
action  or  proceeding  shall  be  conclusive  and  may  be  enforced  in  other
jurisdictions by suit on the judgment. The Guarantor, the Agent, and each Lender
hereby  irrevocably  waives  any and all  right to  trial  by jury in any  legal
proceeding  arising out of or relating to the Guaranty,  any Credit  Document or
the transactions contemplated hereby or thereby.

         17. The Guarantor shall at all times and from time to time do, execute,
acknowledge  and  deliver  or  cause  to be  done,  executed,  acknowledged  and
delivered all and singular every such further act, deed,  transfer,  assignment,
assurance,  document and  instrument  as the Agent or any Lender may  reasonably
require for the better  accomplishing  and effectuating of this Guaranty and the
provisions  contained herein, and every officer of the Agent and the Lenders and
each of them are irrevocably  appointed  attorneys or attorney to execute in the
name and on behalf of the  Guarantor  any  document or  instrument  for the said
purpose.
<PAGE>

         18. Except as otherwise  defined herein,  terms used herein and defined
in the Credit Agreement shall be used herein as so defined.

         IN WITNESS WHEREOF, the Guarantor has caused this Guaranty Agreement to
be executed and delivered as of the date first above written.


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



By
                      Its___________________________________________________



<PAGE>




                                    EXHIBIT F


                                  ANICOM, INC.


                           BORROWING BASE CERTIFICATE


To:      Harris  Trust and Savings  Bank,  as Agent under,
         and the  Lenders  party to, the Credit  Agreement
         described below.

         Pursuant to the terms of the Credit  Agreement dated as of December 17,
1999,  among  us  (the  "Credit  Agreement"),  we  submit  this  Borrowing  Base
Certificate to you and certify that the  information  set forth below and on any
attachments to this Certificate is true,  correct and complete as of the date of
this Certificate.
<TABLE>
<CAPTION>

A.     RECEIVABLES IN BORROWING BASE

<S>                                                                      <C>          <C>
      1.      Gross Receivables                                                       --------

              Less
              (a)   Ineligible sales                                     -------

              (b)   Owed by an account debtor who                        -------
                    is an Affiliate

              (c)   Owed by an account debtor principally located        -------
                    outside the  continental  United  States,
                    Puerto  Rico,  or Canada unless secured
                    by an acceptable letter of credit.

              (d)   Owed   by   the   United    States   of              -------
                    America   or   any department, agency,
                    or instrumentality thereof,  unless the
                    Agent is satisfied with compliance with
                    Assignment of Claims Act.

              (e)   Evidenced by instrument or chattel paper unless      -------
                    the same has been endorsed and delivered to the
                    Agent.
              (f)   Owed by an account debtor who is in an insolvency    -------
                    or reorganization proceeding

              (g)   Credits/allowances                                   -------

              (h)   Unpaid more than 90 days from invoice date and not   -------
                    secured by surety bond or materialman's lien

              (i)   Unpaid more than 180 days from invoice date          -------

              (j)   Invoiced more than 5 days from shipment date         -------

              (k)   Otherwise ineligible                                 -------

      2.      Total Deductions (sum of lines A1a - A1k;)                              --------
      3.      Total Eligible Receivables (line A1 minus line A2)                      --------
      4.      Eligible Receivables in Borrowing Base                                  --------
              (line A3 x .___)
      5.      Eligible Receivables included in Borrowing Base Secured                 --------
              by surety bonds or materialmen's liens outstanding
              greater than 90 days and less than 180 days from invoice
              date (NOTE:  not to exceed $11,000,000)

B.     INVENTORY IN BORROWING BASE

      1.      Gross inventory of Finished Goods                                       --------
      2.      Less
              (a)   Finished Goods not located at approved locations    -------
              (b)   Obsolete, slow moving, or not merchantable          -------
              (c)   Otherwise ineligible                                -------
      3.      Total Deductions (sum of lines B2a - B2c above)                         --------
      4.      Eligible Inventory (line B1 minus line B3)                              --------
      5.      Eligible Inventory in Borrowing Base (line B4 x .60)                    --------

C.     Total Borrowing Base

      1.      Line A4                                                   -------
      2.      Line B5                                                   -------
      3.      Fiscal Year 2000 Tax Refund X .85                         -------
      4.      Sum of Lines C1, C2 and C3                                -------
      5.      Rent Reserve                                              -------
      6.      Line C4 less the sume of (x) Line C5 plus                               --------
              (y) $10,000,000 ("Borrowing Base")

D.     REVOLVING CREDIT ADVANCES

      1.      Loans                                                     -------
      2.      Letters of Credit                                         -------
      3.      Total Outstandings (line D1 plus D2)                                    --------

E.     UNUSED AVAILABILITY

              (line C6 minus line D3)                                                 --------
</TABLE>

         Dated as of this ______ day of __________________.

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



                            By
                                 Name______________________________________
                                 Title_____________________________________


<PAGE>

                                   SCHEDULE 1


                          REVOLVING CREDIT COMMITMENTS

                          NAME OF LENDER            REVOLVING CREDIT COMMITMENT

        Harris Trust and Savings Bank                       $34,000,000
        Bank One, NA (Main Office Chicago)                  $31,500,000
        LaSalle Bank National Association                   $31,500,000
        Fleet Capital Corporation                           $24,000,000
        Firstar Bank, N.A.                                  $19,000,000
        Bank of America, N.A.                               $10,000,000



                             SWING LINE COMMITMENTS

                          NAME OF LENDER             EVOLVING CREDIT COMMITMENT

        Harris Trust and Savings Bank                        $5,000,000




<PAGE>


                                  SCHEDULE 6.2


                              MATERIAL SUBSIDIARIES


                                     JURISDICTION OF                  PERCENTAGE
                   NAME               INCORPORATION                   OWNERSHIP

Anicom Multimedia Wiring Systems,      Nova Scotia                        100%
Incorporated







                            NON-MATERIAL SUBSIDIARIES


                                        JURISDICTION OF               PERCENTAGE
                   NAME                  INCORPORATION                OWNERSHIP

3022504 Nova Scotia Limited               Nova Scotia                    100%

TW Communications Corporation               New York                     100%


--------
* Or debentures or other designation as may be appropriate.