LOAN AND SECURITY AGREEMENT


     THIS  LOAN  AND SECURITY AGREEMENT is made as of January  6,
2003,  by  and  between CITIZENS BUSINESS CREDIT, a  division  of
Citizens  Leasing Corporation (together with its  successors  and
assigns, "Lender"), a Rhode Island corporation with an office  at
100  Galleria  Parkway, Suite 1655, Atlanta, Georgia  30339;  and
MILTOPE CORPORATION ("Borrower"), an Alabama corporation with its
chief  executive office and principal place of business  at  3800
Richardson Road South, Hope Hull, Alabama 36043.

                         R e c i t a l s

     Borrower has requested that Lender make revolving loans  and
other   financial  accommodations  to  Borrower  as  more   fully
described in this Agreement.

     Lender  is  willing to make such loans and  other  financial
accommodations  to Borrower, subject to the terms and  conditions
hereinafter set forth.

     NOW, THEREFORE, in consideration of Ten Dollars ($10.00)  in
hand  paid and other good and valuable consideration, the receipt
of  which  is  hereby acknowledged, the parties hereby  agree  as
follows:

SECTION 1.DEFINITIONS; RULES OF CONSTRUCTION

     1.1.  Definitions.   When used herein  the  following  terms
shall  have the following meanings (terms defined in the singular
to have the same meaning when used in the plural and vice versa):

          Account - shall have the meaning given to "account"  in
     the UCC.

          Account  Debtor  -  any Person who  is  or  may  become
     obligated under or on account of an Account.

          Accounts  Formula Amount - on any date of determination
     thereof,  an amount up to 85% of the net amount of  Eligible
     Accounts  on  such date.  As used herein,  the  phrase  "net
     amount  of Eligible Accounts" shall mean the face amount  of
     such Accounts on any date less any and all returns, rebates,
     discounts  (which may, at Lender's option, be calculated  on
     shortest  terms),  Deposits, credits,  allowances  or  Taxes
     (including sales, excise or other taxes) at any time issued,
     owing,  claimed by Account Debtors, granted, outstanding  or
     payable in connection with, or any interest accrued  on  the
     amount of, such Accounts at such date.

          Affiliate   -  a  Person  (other  than  a  Subsidiary):
     (i)  which  directly  or  indirectly  through  one  or  more
     intermediaries controls, or is controlled by,  or  is  under
     common control with, a Person; (ii) which beneficially  owns
     or  holds 5% or more of any class of the Voting Stock  of  a
     Person; or (iii) 5% or more of the Voting Stock (or  in  the
     case  of a Person which is not a corporation, 5% or more  of
     the  equity interest) of which is beneficially owned or held
     by a Person or a Subsidiary of a Person.

          Agreement - the Loan and Security Agreement referred to
     in  the first sentence hereof and all Exhibits and Schedules
     hereto.

          Applicable  Law  -  all  laws,  rules  and  regulations
     applicable to the Person, conduct, transaction, covenant  or


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     Loan  Documents in question, including all applicable common
     law   and  equitable  principles;  all  provisions  of   all
     applicable state and federal constitutions, statutes, rules,
     regulations  and orders of governmental bodies; and  orders,
     judgments and decrees of all courts and arbitrators.

          Availability - the amount that Borrower is entitled  to
     borrow  from  time  to time as Revolver Loans,  such  amount
     being  the  difference derived when the sum of the principal
     amount  of  Revolver Loans then outstanding  (including  any
     amounts  which  Lender  may have paid  for  the  account  of
     Borrower  pursuant  to any of the Loan Documents  and  which
     have not been reimbursed by Borrower) is subtracted from the
     Borrowing  Base.   If  the  amount  of  the  Revolver  Loans
     outstanding is equal to or greater than the Borrowing  Base,
     Availability is 0.

          Availability  Reserve  - on any date  of  determination
     thereof, an amount equal to the sum of the following on such
     date:   (i) any amounts which Borrower is obligated  to  pay
     pursuant  to the provisions of the Loan Documents  but  does
     not pay when due and which Lender elects to pay pursuant  to
     any  of  the  Loan  Documents for the account  of  Borrower;
     (ii) a reserve for general inventory shrinkage, whether as a
     result  of theft or otherwise, that is determined by  Lender
     from  time  to time in its reasonable credit judgment  based
     upon  Borrower's  historical losses due to  such  shrinkage;
     (iii)  all  amounts of past due rent, fees or other  charges
     owing   at  such  time  by  Borrower  to  any  landlord   of
     any  premises where any of the Collateral is located  or  to
     any processor, repairman, mechanic or other Person who is in
     possession  of any Collateral or has asserted  any  Lien  or
     claim  thereto; (iv) $500,000 until such time that  Borrower
     shall  have  obtained the written consent of The  Montgomery
     Airport Authority, as lessor, and Lender shall have filed of
     public  record the Mortgage with respect to Borrower's  real
     Property  leased  from  such authority  and  received  title
     insurance  commitments in respect thereof in form reasonably
     acceptable  to Lender, and (v) for so long as any  Event  of
     Default  exists, such additional reserves as Lender  in  its
     sole  and absolute discretion may elect to impose from  time
     to  time,  without  waiving any such  Event  of  Default  or
     Lender's  entitlement  to accelerate  the  maturity  of  the
     Obligations as a consequence thereof.

          Average  Loan  Balance  - for  any  month,  the  amount
     obtained  by  adding the unpaid balance  of  Revolver  Loans
     owing by Borrower to Lender at the end of each day for  each
     day during the month in question and by dividing such sum by
     the  number of days in such month that this Agreement is  in
     effect.

          Bank - Citizens Bank of Rhode Island, N.A.

          Bankruptcy Code - Title 22 of the United States Code.

          Borrowing Base - on any date of determination  thereof,
     an amount equal to the lesser of:  (a) the Revolver Facility
     Amount,  or (b) an amount equal to the  (i) Accounts Formula
     Amount  on such date plus (ii) the Inventory Formula  Amount
     on  such  date minus (iii) the Availability Reserve on  such
     date.

          Borrowing   Base   Certificate  -  a   Borrowing   Base
     Certificate in the form of Exhibit B attached hereto.

          Business  Day - any day excluding Saturday, Sunday  and
     any day which is a legal holiday under the laws of the State
     of  Georgia  or  Rhode Island or is a day on  which  banking
     institutions located in such states are closed.

          Capital Expenditures - expenditures made or liabilities
     incurred  for  the  acquisition  of  any  fixed  assets   or
     improvements,  replacements,  substitutions   or   additions
     thereto  which  have a useful life of more  than  one  year,
     including  the total principal portion of Capitalized  Lease
     Obligations.

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          Capitalized Lease Obligation - any Debt represented  by
     obligations under a lease that is required to be capitalized
     for financial reporting purposes in accordance with GAAP.

          Cash  Equivalents  - (i) marketable direct  obligations
     issued  or  unconditionally guaranteed by the United  States
     government  and backed by the full faith and credit  of  the
     United States government having maturities of not more  than
     22  months  from  the  date  of acquisition;  (ii)  domestic
     certificates of deposit and time deposits having  maturities
     of  not  more  than 22 months from the date of  acquisition,
     bankers'  acceptances having maturities  of  not  more  than
     22  months  from the date of acquisition and overnight  bank
     deposits,  in  each  case  issued  by  any  commercial  bank
     organized  under  the laws of the United States,  any  state
     thereof  or the District of Columbia, which at the  time  of
     acquisition are rated A-2 (or better) by Standard  &  Poor's
     Corporation   or  P-2  (or  better)  by  Moody's   Investors
     Services, Inc., and (unless issued by a Lender) not  subject
     to  offset  rights  in favor of such bank arising  from  any
     banking   relationship  with  such  bank;  (iii)  repurchase
     obligations  with  a  term of not  more  than  30  days  for
     underlying securities of the types described in clauses  (i)
     and (ii) entered into with any financial institution meeting
     the  qualifications  specified in  clause  (ii)  above;  and
     (iv)  commercial  paper  having at the  time  of  investment
     therein  or  a  contractual commitment to invest  therein  a
     rating  of  A-2 (or better) by Standard & Poor's Corporation
     or  P-2 (or better) by Moody's Investors Services, Inc., and
     having  a  maturity  within  9  months  after  the  date  of
     acquisition thereof.

          CERCLA   -  the  Comprehensive  Environmental  Response
     Compensation and Liability Act, 42 U.S.C. ' 9602 et seq. and
     its implementing regulations.

          Chattel Paper - shall have the meaning ascribed to  the
     term "chattel paper" in the UCC.

          Claims  -  any  and  all claims, demands,  liabilities,
     obligations, losses, damages, penalties, actions, judgments,
     suits,   awards,  remedial  response,  costs,  expenses   or
     disbursements  of  any kind or nature whatsoever  (including
     reasonable attorneys', accountants' or consultants' fees and
     expenses), whether arising under or in connection  with  the
     Loan  Documents,  under any Applicable  Law  (including  any
     Environmental Law) or otherwise, that may now  or  hereafter
     be suffered or incurred by a Person.

          Closing  Date - the date on which all of the conditions
     precedent in Section 10 hereof are satisfied and the initial
     Loan is made under this Agreement.

          Collateral  -  all  of the Property  and  interests  in
     Property  described  in  Section 6  hereof,  and  all  other
     Property  and  interests in Property that now  or  hereafter
     secure   the   payment  and  performance  of  any   of   the
     Obligations.

          Commercial Tort Claim - shall have the meaning given to
     "commercial tort claim" in the UCC.

          Compliance Certificate - a Compliance Certificate to be
     provided  by Borrower to Lender in accordance with,  and  in
     the form annexed as Exhibit C to, this Agreement.

          Consolidated  -  the consolidation in  accordance  with
     GAAP  of  the accounts or other items as to which such  term
     applies.

          Current  Maturities of Long Term Debt  shall  mean  all
     payments  in  respect  of Long Term  Debt  (other  than  the


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     Obligations)  that are required to be made within  one  year
     from   the  date  of  determination,  whether  or  not   the
     obligation to make such payments would constitute a  current
     liability of the obligor under GAAP.

          Debt   -   as  applied  to  a  Person  means,   without
     duplication:   (i) all items which in accordance  with  GAAP
     would  be included in determining total liabilities as shown
     on  the liability side of a balance sheet of such Person  as
     at  the date as of which Debt is to be determined, including
     Capitalized Lease Obligations; (ii) all obligations of other
     Persons   which  such  Person  has  guaranteed;  (iii)   all
     reimbursement  obligations  in connection  with  letters  of
     credit or letter of credit guaranties issued for the account
     of  such  Person; and (iv) in the case of Borrower  (without
     duplication), the Obligations.

          Default - an event or condition the occurrence of which
     would,  with the lapse of time or the giving of  notice,  or
     both, become an Event of Default.

          Default  Rate - a fluctuating rate per annum which,  on
     any  date, is equal to the interest rate then in effect  for
     such date plus 2%.

          Deposit  Account  -  shall have the  meaning  given  to
     "deposit account" in the UCC.

          Deposits  -  any prepayment, deposit, down  payment  or
     similar payment made to Borrower in respect of an Account.

          Distribution  -  in  respect of  any  entity,  (i)  any
     payment  of any dividends or other distributions  on  Equity
     Interests of the entity (except distributions in such Equity
     Interests)  and  (ii)  any  purchase,  redemption  or  other
     acquisition or retirement for value of any Equity  Interests
     of  the  entity or any Affiliate of the entity  unless  made
     contemporaneously  from  the net proceeds  of  the  sale  of
     Equity Interests.

          Document - shall have the meaning ascribed to the  term
     "document" in the UCC.

          Dollars  and the sign "$" - lawful money of the  United
     States of America.

          Dominion   Account  -  a  special  account  of   Lender
     established by Borrower pursuant to this Agreement at a bank
     selected  by  Borrower,  but acceptable  to  Lender  in  its
     reasonable discretion, and over which Lender shall have sole
     and exclusive access and control for withdrawal purposes.

          EBITDA  -  for any Fiscal Quarter of Borrower,  without
     duplication,  the  sum  of  the following  for  such  period
     determined  on  a Consolidated basis: (i) Net  Income,  plus
     (ii)  depreciation, plus (iii) amortization, plus  (iv)  all
     interest   expense,  plus  (v)  income  tax  expense,   plus
     (vi)  other  non-cash charges deducted  in  calculating  Net
     Income (excluding extraordinary gains and losses).

          Eligible  Account - an Account arising in the  ordinary
     course  of  Borrower's business from the sale  of  goods  or
     rendition of services which is payable in Dollars and  which
     Lender,  in its customary credit judgment, deems  to  be  an
     Eligible  Account.  Without limiting the generality  of  the
     foregoing,  no  Account  shall be an  Eligible  Account  if:
     (i) it arises out of a sale made by Borrower to a Subsidiary
     or  an Affiliate of Borrower or to a Person controlled by an
     Affiliate  of Borrower; (ii) it is due or unpaid  more  than
     90  days after the original invoice date; (iii) 50% or  more
     of  the  Accounts  from the Account Debtor  are  not  deemed
     Eligible  Accounts hereunder; (iv) the total unpaid Accounts
     of  the  Account Debtor exceed 10% of the net amount of  all
     Eligible  Accounts or exceeds a credit limit established  by
     Lender  for such Account Debtor, in each case, to the extent
     of such excess; (v) any covenant, representation or warranty
     contained in this Agreement with respect to such Account has
     been  breached;  (vi) the Account Debtor is also  Borrower's

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<PAGE>

     creditor  or  supplier, or the Account Debtor  has  disputed
     liability  with  respect  to such  Account  or  the  Account
     otherwise  is  subject to any right of setoff, counterclaim,
     reserve  or  chargeback,  to  the  extent  of  such  offset,
     counterclaim,   disputed  amount,  reserve  or   chargeback;
     (vii)  it  arises from a sale to an Account Debtor with  its
     principal  office, assets or place of business  outside  the
     United  States, unless the sale is backed by an  irrevocable
     letter of credit issued or confirmed by a bank acceptable to
     Lender  and  that  is  in form and substance  acceptable  to
     Lender  and  payable in the full amount of  the  Account  in
     freely convertible Dollars at a place of payment within  the
     United  States and, if requested by Lender, such  letter  of
     credit,  or  amounts  payable  thereunder,  is  assigned  to
     Lender;  (viii) it arises from a sale to the Account  Debtor
     on   a   bill-and-hold,  guaranteed  sale,   sale-or-return,
     sale-on-approval,  consignment or any  other  repurchase  or
     return  basis; (ix) the Account Debtor is the United  States
     of  America  or  any  department, agency or  instrumentality
     thereof,  unless Borrower assigns its right  to  payment  of
     such  Account to Lender, in a manner satisfactory to Lender,
     so  as  to comply with the Assignment of Claims Act of  2940
     (32  U.S.C. '3727 and 42 U.S.C. '25), or is a state,  county
     or  municipality,  or  a  political  subdivision  or  agency
     thereof  and  Applicable  Law  disallows  or  restricts   an
     assignment  of  Accounts on which it is the Account  Debtor;
     (x)  the  Account  is  evidenced  by  chattel  paper  or  an
     instrument  that  have not been endorsed  and  delivered  to
     Lender;  or (xi) the performance of the services or delivery
     of  goods  giving rise to such Account has  been  bonded  or
     guaranteed, unless all rights of such surety or guarantor to
     payment  under  any such Account have been subordinated,  in
     form  acceptable to Lender, to the Lien of Lender under this
     Agreement.

           Eligible Inventory - such Inventory of Borrower (other
     than packaging materials, labels, supplies) which Lender, in
     its  sole  credit judgment, deems to be Eligible  Inventory.
     Without  limiting  the  generality  of  the  foregoing,   no
     Inventory shall be Eligible Inventory unless: (i) it is  raw
     materials  or  computer  subassemblies  in  their  original,
     unopened  packaging; (ii) it is owned by  Borrower  and  not
     held  by  it  on consignment or other sale or return  terms;
     (iii)  it is in good, new and saleable condition and is  not
     damaged  or defective; (iv) it is not slow-moving,  obsolete
     or  unmerchantable and is not goods returned to Borrower  by
     or  repossessed  from an Account Debtor; (v)  it  meets  all
     standards  imposed  by any Governmental Authority;  (vi)  it
     conforms   in   all   respects   to   the   warranties   and
     representations set forth in this Agreement; (vii) it is  at
     all times subject to Lender's duly perfected, first priority
     security interest and no other Lien except a Permitted Lien;
     (viii) it is situated at a location in compliance with  this
     Agreement,  is  not  in transit or outside  the  continental
     United  States and is not consigned to any Person; and  (ix)
     it  is not the subject of a negotiable warehouse receipt  or
     other negotiable Document.

          Environmental Laws - all federal, state and local laws,
     rules,  regulations, codes, ordinances,  programs,  permits,
     guidance,  orders and consent decrees, now or  hereafter  in
     effect  and  relating  to  health, safety  or  environmental
     matters, including the CERCLA.

          Environmental Release - a release as defined in  CERCLA
     or under any applicable Environmental Law.

          Equipment - shall have the meaning given to "equipment"
     in the UCC.

          Equity Interest - the interest of (i) a shareholder  in
     a  corporation, (ii) a partner (whether general or  limited)
     in  a  partnership  (whether  general,  limited  or  limited
     liability),  (iii) a member in a limited liability  company,
     or  (iv)  any other Person having any other form  of  equity
     security.

          ERISA  -  the  Employee Retirement Income Security  Act
     of 1974, as amended, and all rules and regulations from time
     to time promulgated thereunder.

          Event of Default - as defined in Section 11.1 hereof.


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<PAGE>

          Fiscal  Quarter  -  any  of  the  quarterly  accounting
     periods of Borrower.

          Fiscal   Year  -  the  fiscal  year  of  Borrower   for
     accounting and tax purposes.

          Fixed   Charge  Coverage  Ratio  shall   mean,   on   a
     consolidated   basis  for  Borrower  and  its   Consolidated
     Subsidiaries, the ratio of (i) EBITDA for the Fiscal Quarter
     just  ended and the immediately preceding 3 Fiscal Quarters,
     minus  total  Capital Expenditures incurred and  cash  Taxes
     paid  during  any  applicable period, to  (ii)  the  sum  of
     Interest Expense for the Fiscal Quarter just ended  and  the
     immediately   preceding  3  Fiscal  Quarters   and   Current
     Maturities of Long Term Debt, calculated at the end  of  the
     Fiscal Quarter just ended.

          Funded  Debt  of  any Person shall mean  at  any  date,
     without duplication, (i) all obligations of such Person  for
     borrowed   money,  (ii)  all  obligations  of  such   Person
     evidenced  by  bonds,  debentures, notes  or  other  similar
     instruments, (iii) all obligations of such Person to pay the
     deferred  price  of  property  or  services,  except   trade
     accounts payable arising in the ordinary course of business,
     (iv)   all  obligations  of  such  Person  as  lessee  under
     Capitalized  Leases, (v) all obligations of such  Person  to
     reimburse  any  bank or other Person in respect  of  amounts
     payable   under  a  banker's  acceptance,   and   (vi)   all
     obligations  of such Person to reimburse any bank  or  other
     Person  in  respect of amounts paid or to be  paid  under  a
     letter of credit or similar instrument.

          GAAP - generally accepted accounting principles in  the
     United States of America in effect from time to time.

          General  Intangible - shall have the meaning  given  to
     "general intangible" in the UCC.

          Governmental  Approvals  -  means  all  authorizations,
     consents,    approvals,   licenses   and   exemptions    of,
     registrations and filings with, and reports to, all national
     state or local government (whether domestic or foreign)  and
     any    political   subdivisions   thereof   in   any   other
     governmental,  quasi-governmental, judicial, administrative,
     public   or  statutory  instrumentality,  authority,   body,
     agency, bureau or entity.

         Governmental Authority - any federal, state,  municipal,
    national   or   other  governmental  department,  commission,
    board,  bureau, court, agency or instrumentality or political
    subdivision  thereof  or  any entity  or  officer  exercising
    executive,     legislative,    judicial,    regulatory     or
    administrative  functions of or pertaining to any  government
    or  any  court, in each case whether associated with a  state
    of  the  United States, the District of Columbia or a foreign
    entity or government.

          Guarantor  -  Parent  or  any  other  Person  who   may
     hereafter guarantee payment or performance of the  whole  or
     any part of the Obligations.

          Guaranty  Agreement - a guaranty that is  at  any  time
     executed by a Guarantor in favor of Lender.

          Insolvency  Proceeding - any action, case or proceeding
     commenced by or against a Person, or any agreement  of  such
     Person,  for (a) the entry of an order for relief under  any
     chapter  of the Bankruptcy Code or other insolvency or  debt
     adjustment law (whether state, federal or foreign), (b)  the
     appointment  of  a  receiver, trustee, liquidator  or  other
     custodian  for  such  Person or any part  of  its  Property,
     (c)  an  assignment  or trust mortgage for  the  benefit  of
     creditors   of   such  Person,  or  (d)   the   liquidation,
     dissolution or winding up of the affairs of such Person.


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<PAGE>

          Instrument  -  shall have the meaning ascribed  to  the
     term "instrument" in the UCC.

          Intellectual Property - Property constituting under any
     Applicable  Law  a  patent, patent  application,  copyright,
     trademark, service mark, tradename or mask work, or  license
     or other right to use any of the foregoing.

          Intellectual  Property Claim -  the  assertion  by  any
     Person  of a claim (whether asserted in writing, by  action,
     suit  or  proceeding  or  by other  means)  that  Borrower's
     ownership,  use,  marketing, sale  or  distribution  of  any
     Inventory,  Intellectual  Property  or  other  Property   is
     violative of any ownership, patent, copyright, trademark  or
     other rights of such Person.

           Intercreditor Agreement - the Intercreditor Agreement,
     dated  on  or  about  the date hereof, between  Regions  and
     Lender.

          Interest  Expense shall mean, for any period,  interest
     expense  (including  capitalized  interest)  in  respect  of
     Indebtedness  of Borrower and its Consolidated  Subsidiaries
     as determined in accordance with GAAP.

          Inventory - shall have the meaning given to "inventory"
     in the UCC.

          Inventory Formula Amount - on any date of determination
     thereof, an amount equal to the lesser of (i) $2,000,000  or
     (ii)  24% of the Value of Eligible Inventory  consisting  of
     raw  materials and computer subassemblies in their original,
     unopened packaging.

          Investment Property - shall have the meaning  given  to
     "investment property" in the UCC.

          Letter  of Credit Right - shall have the meaning  given
     to "letter-of-credit right" in the UCC.

          Lien  - any interest in Property securing an obligation
     owed to, or a claim by, a Person other than the owner of the
     Property,  whether  such interest is based  on  common  law,
     statute  or  contract.  The term "Lien" shall  also  include
     reservations,    exceptions,    encroachments,    easements,
     rights-of-way,  covenants, conditions, restrictions,  leases
     and   other  title  exceptions  and  encumbrances  affecting
     Property.  For the purpose hereof, Borrower shall be  deemed
     to  be  the  owner of any Property which it has acquired  or
     holds  subject  to  a  conditional sale agreement  or  other
     arrangement pursuant to which title to the Property has been
     retained  by  or  vested in some other Person  for  security
     purposes.

          Loan  Account  -  the loan account established  on  the
     books of Lender pursuant to Section 4.6 hereof.

          Loan  Documents - this Agreement, the Other  Agreements
     and the Security Documents.

          Loan  Year - a period commencing each calendar year  on
     the  same month and day as the date hereof and ending on the
     same  month  and day in the immediately succeeding  calendar
     year, with the first such period (i.e., the first Loan Year)
     to commence on the date of this Agreement.

          Loans  -  all  loans and advances of any kind  made  by
     Lender pursuant to this Agreement.

          Long  Term Debt shall mean at any date all Funded  Debt
     which matures (or the maturity of which may at the option of
     the  Parent or any Consolidated Subsidiary be extended  such
     that it matures) more than one year after such date.

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<PAGE>

          Margin Stock - as such term is defined in Regulation  U
     and Regulation G of the Board of Governors.

          Material  Adverse Effect - the effect of any  event  or
     condition  which,  alone or when taken together  with  other
     events  or  conditions  occurring or  existing  concurrently
     therewith,  (a)  has  a  material adverse  effect  upon  the
     business,  operations, Properties, condition  (financial  or
     otherwise) or business prospects of any Obligor; (b) has any
     material  adverse  effect whatsoever upon  the  validity  or
     enforceability  hereof or any of the other  Loan  Documents;
     (c)  has  or may be reasonably expected to have any material
     adverse  effect upon the value of the whole or any  material
     part of the Collateral, the Liens of Lender with respect  to
     the  Collateral or any material part thereof or the priority
     of  such  Liens;  (d)  materially  impairs  the  ability  of
     Borrower  or  any  other Obligor to perform its  obligations
     under  this Agreement, any Guaranty Agreement or any of  the
     other Loan Documents, including repayment of the Obligations
     when due; or (e) materially impairs the ability of Lender to
     enforce  or collect the Obligations or realize upon  any  of
     the  Collateral  in accordance with the Loan  Documents  and
     Applicable Law.

          Material Contract - an agreement to which an Obligor is
     a  party  (other than the Loan Documents) for which  breach,
     termination,  cancellation,  nonperformance  or  failure  to
     renew  could  reasonably  be expected  to  have  a  Material
     Adverse Effect.

          Maximum  Rate  -  the  maximum  non-usurious  rate   of
     interest  permitted by Applicable Law that at any  time,  or
     from  time  to time, may be contracted for, taken, reserved,
     charged  or  received  on the Debt in question  or,  to  the
     extent that at any time Applicable Law may thereafter permit
     a  higher  maximum non-usurious rate of interest, then  such
     higher  rate.   Notwithstanding any other provision  hereof,
     the  Maximum  Rate  shall be calculated  on  a  daily  basis
     (computed on the actual number of days elapsed over  a  year
     of 365 or 366 days, as the case may be).

          Money  Borrowed - (i) Debt arising from the lending  of
     money  by any Person to Borrower; (ii) Debt, whether or  not
     in  any such case arising from the lending by any Person  of
     money to Borrower, (A) which is represented by notes payable
     or  drafts  accepted  that evidence  extensions  of  credit,
     (B)   which  constitutes  obligations  evidenced  by  bonds,
     debentures, notes or similar instruments, or (C) upon  which
     interest  charges are customarily paid (other than  accounts
     payable)  or that was issued or assumed as full  or  partial
     payment   for  Property;  (iii)  Debt  that  constitutes   a
     Capitalized Lease Obligation; (iv) reimbursement obligations
     with  respect to letters of credit or guaranties of  letters
     of  credit  and (v) Debt of Borrower under any  guaranty  of
     obligations  that would constitute Debt for  Money  Borrowed
     under clauses (i) through (iii) hereof, if owed directly  by
     Borrower.

          Mortgages  - the mortgages, deeds of trust or deeds  to
     secure  debt  to be executed by Borrower on  or  before  the
     Closing Date in favor of Lender and by which Borrower  shall
     grant  and  convey to Lender Liens upon the Real  Estate  as
     security for the payment of the Obligations.

          Multiemployer  Plan  -  has the meaning  set  forth  in
     Section 4001(a)(3) of ERISA.

          Net  Income  (Loss)  - for any applicable  period,  the
     aggregate  net income (or loss) of Borrower from  continuing
     operations (excluding any income (or loss) included  therein
     resulting from extraordinary items).


                                8
<PAGE>
          Net  Proceeds  - with respect to a disposition  of  any
     Collateral,   proceeds  (including  cash  receivable   (when
     received)  by way of deferred payment) received by  Borrower
     from  the sale, lease, transfer or other disposition of  any
     Property,   including  insurance  proceeds  and  awards   of
     compensation  received with respect to  the  destruction  or
     condemnation  of  all  or  part of such  Property,  net  of:
     (i)  the reasonable and customary costs of such sale, lease,
     transfer  or  other disposition (including  legal  fees  and
     sales commissions); and (ii) amounts applied to repayment of
     Debt  (other  than the Obligations) secured by  a  Permitted
     Lien  on  the  Collateral disposed  of  that  is  senior  to
     Lender's Liens with respect to such Collateral.

          Net  Worth  - at any date of determination,  Borrower's
     total   shareholders'  equity  (including   capital   stock,
     additional  paid-in  capital and  retained  earnings,  after
     deducting  treasury stock) which would appear as such  on  a
     balance sheet of Borrower prepared in accordance with GAAP.

          Note - the Revolver Note.

          Obligations  -  all  debts,  liabilities,  obligations,
     covenants  and duties now or at any time or times  hereafter
     owing by Borrower to Lender, howsoever evidenced or arising,
     and  whether direct or indirect, absolute or contingent, due
     or to become due, primary or secondary, or joint or several,
     including  all  of  the Loans and all  interest  payable  in
     connection  therewith and all other sums  chargeable  to  or
     payable  by  Borrower  under the Loan Documents,  any  other
     agreement  heretofore or hereafter entered into by  Borrower
     with  or  executed  by  Borrower  in  favor  of  Lender,  or
     Applicable Law.

          Obligor  -  Borrower,  each Guarantor  and  each  other
     Person (other than Lender) who is at any time liable for the
     payment of any of the Obligations.

          Organization  Documents - with respect to  any  Person,
     its  charter,  certificate  or  articles  of  incorporation,
     articles  of  organization, operating agreement, partnership
     agreement  or similar agreement or instrument governing  the
     formation or operation of such Person.

          Original Term - as defined in Section 5.1 hereof.

          Other  Agreements - any and all agreements, instruments
     and  documents (other than this Agreement and  the  Security
     Documents),   heretofore,  now  or  hereafter  executed   by
     Borrower, any Subsidiary of Borrower or any other Person and
     delivered   to   Lender  in  respect  of  the   transactions
     contemplated  by  this Agreement, including  the  Note,  the
     Intercreditor Agreement and the Subordination Agreement.

          Out-of-Formula  Condition - as defined in  Section  2.1
     hereof.

          Out-of-Formula Loan - a Revolver Loan made when an Out-
     of-Formula  Condition exists or the amount of  any  Revolver
     Loan  which,  when  funded,  results  in  an  Out-of-Formula
     Condition.

          Parent - Miltope Group Inc., a Delaware corporation.

          Participant  -  each Person who shall  be  granted  the
     right by Lender to participate in any of the Loans described
     in  this  Agreement  and  who  shall  have  entered  into  a
     participation  agreement in form and substance  satisfactory
     to Lender.

          Payment  Items - all checks, drafts, or other items  of
     payment  payable to Borrower, including proceeds of  any  of
     the Collateral.


                                9
<PAGE>
          Permitted  Lien  -  a  Lien  of  a  kind  specified  in
     Section 9.2.5 hereof.

          Permitted  Use - a use of proceeds of any of the  Loans
     to  pay  (i)  on the Closing Date, the repayment of  certain
     indebtedness owing to Regions Bank and all fees and expenses
     then  payable to Lender under this Agreement, and (ii) after
     the  Closing Date, any Debt incurred in the ordinary  course
     of  Borrower's business to the extent not prohibited by this
     Agreement,  Capital Expenditures to the extent permitted  by
     the Loan Documents and any of the Obligations.

          Person   -  an  individual,  partnership,  corporation,
     limited  liability  company, limited liability  partnership,
     joint   stock   company,   land   trust,   business   trust,
     unincorporated  organization  or  other  form  of   business
     entity,  or  a government or agency or political subdivision
     thereof.

          Plan  -  an  employee  benefit plan  now  or  hereafter
     maintained  for  employees of Borrower that  is  covered  by
     Title IV of ERISA.

          Prime  Rate - the rate of interest announced or  quoted
     by  Bank  from  time to time as its prime rate,  which  rate
     might  not be the lowest rate charged by Bank; and, if  such
     prime rate for commercial loans is discontinued by Bank as a
     standard, a comparable reference rate designated by Bank  as
     a substitute therefor shall be the Prime Rate.

          Projections - Borrower's forecasted (a) balance sheets,
     (b)  profit  and loss statements, (c) cash flow  statements,
     and  (d)  capitalization  statements,  all  prepared  on   a
     consistent   basis  with  Borrower's  historical   financial
     statements, together with appropriate supporting details and
     a statement of underlying assumptions.

          Properly  Contested - in the case of  any  Debt  of  an
     Obligor (including any Tax) that is not paid as and when due
     or  payable  by reason of such Obligor's bona  fide  dispute
     concerning  its  liability to pay  same  or  concerning  the
     amount  thereof, (i) such Debt and any Liens  securing  same
     are  being  properly contested in good faith by  appropriate
     proceedings  promptly  instituted and diligently  conducted;
     (ii)  such  Obligor has established appropriate reserves  as
     shall  be  required in conformity with GAAP; (iii) the  non-
     payment  of  such Debt during the period being contested  by
     such  Obligor  will not have a Material Adverse  Effect  and
     does not and will not result in a forfeiture of, foreclosure
     upon or loss of any assets of such Obligor; (iv) no Lien  is
     imposed  upon any of such Obligor's assets with  respect  to
     such  Debt  unless  such Lien is at  all  times  junior  and
     subordinate  in  priority to the Liens in  favor  of  Lender
     (except  only  with  respect to  property  taxes  that  have
     priority   as  a  matter  of  applicable  state   law)   and
     enforcement  of such Lien is stayed during the period  prior
     to  the  final  resolution or disposition of  such  dispute;
     (v)  if the Debt results from or is determined by the entry,
     rendition or issuance against a Obligor or any of its assets
     of  a  judgment, writ, order or decree, such judgment, writ,
     order  or decree is stayed pending a timely appeal or  other
     judicial  review  and  such Obligor shall  have  established
     adequate reserves in accordance with GAAP for such judgment,
     writ,  order  or decree or the same is either fully  insured
     against by an insurer that has not denied or reserved rights
     with  respect  to  coverage or has been bonded  to  Lender's
     satisfaction;  and  (vi)  if  such  dispute  or  contest  is
     abandoned, settled or determined adversely to such  Obligor,
     such Obligor forthwith pays such Debt and all penalties  and
     interest in connection therewith.

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

          Purchase  Money  Debt  - means and  includes  (i)  Debt
     (other  than the Obligations) for the payment of all or  any


                                10
<PAGE>
     part  of  the purchase price of any fixed assets,  (ii)  any
     Debt (other than the Obligations) incurred at the time of or
     within  10  days  prior to or after the acquisition  of  any
     fixed assets for the purpose of financing all or any part of
     the   purchase  price  thereof,  and  (iii)  any   renewals,
     extensions or refinancings thereof, but not any increases in
     the principal amounts thereof outstanding at the time.

          Purchase  Money Lien - a Lien upon fixed  assets  which
     secures Purchase Money Debt, but only if such Lien shall  at
     all  times  be confined solely to the fixed assets  acquired
     through the incurrence of the Purchase Money Debt secured by
     such Lien.

          Real Estate - all parcels or tracts of real Property of
     Borrower located in Montogomery County, Alabama, and Windsor
     County, Vermont.

           Regions  - Regions Bank,  a bank organized  under  the
     laws of the State of Alabama.

          Regions  Documents  - the Regions  Note  and  all  loan
     agreements,   security  agreements,  mortgages   and   other
     documents,  instruments or agreements executed or  delivered
     by  Borrower  evidencing or securing any Debt  at  any  time
     owing by Borrower to Regions.

          Regions Note - a promissory note, dated on or about the
     Closing  Date, made by Borrower to the order of  Regions  in
     the original principal amount of $1,000,000.

          Reportable  Event  -  any of the events  set  forth  in
     Section 4043(b) of ERISA.

          Restricted Investment - any acquisition of Property  by
     Borrower or any of its Subsidiaries in exchange for cash  or
     other  Property,  whether in the form of an  acquisition  of
     Equity Interests or Debt, or the purchase or acquisition  by
     Borrower or any Subsidiary of any other Property, or a loan,
     advance,   capital  contribution  or  subscription,   except
     acquisitions of the following: (a) fixed assets to  be  used
     in the business of Borrower or any Subsidiary so long as the
     acquisition  costs  thereof constitute Capital  Expenditures
     permitted hereunder; (b) goods held for sale or lease or  to
     be  used  in  the manufacture of goods or the  provision  of
     services  by  Borrower  or any Subsidiary  in  the  ordinary
     course of business; (c) Current Assets arising from the sale
     or  lease  of  goods  or the rendition of  services  in  the
     ordinary  course of business of Borrower or any  Subsidiary;
     (d)  investments in Subsidiaries to the extent  existing  on
     the Closing Date; and (e) Cash Equivalents.

          Revolver Facility Amount - the amount of $8,000,000.

          Revolver  Loan - a Loan made by Lender as  provided  in
     Section 2.1.1 hereof.

          Revolver  Note  - the Revolver Note to be  executed  by
     Borrower in favor of Lender on the Closing Date in the  form
     of Exhibit A attached hereto.

          Schedule  of  Accounts - as defined  in  Section  7.2.1
     hereof.

          Security   -  shall  have  the  same  meaning   as   in
     Section 2(1) of the Securities Act of 1933.

          Security   Documents  -  the  Mortgages,  any  Guaranty
     Agreement, and all other instruments and agreements  now  or
     at  any time hereafter securing the whole or any part of the
     Obligations.

          Senior   Officer  -  the  chairman  of  the  board   of
     directors, the president or the chief financial officer  of,
     or any in-house legal counsel to, Borrower.

                                11
<PAGE>

          Solvent  -  as  to  any Person, such  Person  (i)  owns
     Property  whose  fair  saleable value is  greater  than  the
     amount required to pay all of such Person's Debts (including
     contingent debts), (ii) is able to pay all of its  Debts  as
     such Debts mature, (iii) has capital sufficient to carry  on
     its   business   and  transactions  and  all  business   and
     transactions in which it is about to engage; and (iv) is not
     "insolvent"  within the meaning of Section  101(32)  of  the
     Bankruptcy Code.

          Subordinated   Debt  -  Debt  of   Borrower   that   is
     subordinated   to   the   Obligations   pursuant   to    the
     Subordination Agreement.

          Subordination  Agreement - any agreement  entered  into
     among   Lender,   Borrower  and  a  creditor   of   Borrower
     subordinating the payment of Debt owing to such creditor  to
     the payment of the Obligations.

          Subsidiary  -  any  Person a  majority  of  the  Equity
     Interests  of  which  is  at the  time  owned,  directly  or
     indirectly, by Borrower or by one or more other Subsidiaries
     or by Borrower and one or more other Subsidiaries.

          Supporting Obligation - shall have the meaning given to
     "supporting obligation" in the UCC.

          Tangible Net Worth - as applied to any Person, the  Net
     Worth  of  such  Person  at  the  time  in  question,  after
     deducting  therefrom  the  amount of  all  intangible  items
     reflected  therein, including all unamortized debt  discount
     and  expense, unamortized research and development  expense,
     unamortized deferred charges, goodwill, patents, trademarks,
     service  marks, trade names, copyrights, unamortized  excess
     cost  of investment in Subsidiaries over equity at dates  of
     acquisition, and all similar items which should properly  be
     treated as intangibles in accordance with GAAP.

          Taxes  -  any present or future taxes, levies, imposts,
     duties, fees, assessments, deductions, withholdings or other
     charges  of  whatever  nature, including  income,  receipts,
     excise,   property,   sales,  transfer,  license,   payroll,
     withholding,  social  security and franchise  taxes  now  or
     hereafter  imposed or levied by the United  States,  or  any
     state,  local  or  foreign government or by any  department,
     agency  or  other political subdivision or taxing  authority
     thereof or therein and all interest, penalties, additions to
     tax and similar liabilities with respect thereto.

          Termination Date - the date on which this Agreement  is
     terminated for any reason under Section 5 hereof.

          UCC  -   the  Uniform Commercial Code (or any successor
     statute) as adopted and in force in the State of Georgia or,
     when the laws of any other state govern the method or manner
     of  the  creation or perfection of any security interest  in
     any  of the Collateral, the Uniform Commercial Code (or  any
     successor statute) of such state.

          Value  -  with  reference  to  the  value  of  Eligible
     Inventory,  value determined on the basis of  the  lower  of
     cost  or  market of such Eligible Inventory, with  the  cost
     thereof   calculated   on  a  first-in,   first-out   basis,
     determined in accordance with GAAP.

          Voting Stock - Securities of any class or classes of  a
     corporation  the  holders of which are  ordinarily,  in  the
     absence  of  contingencies, entitled to elect a majority  of
     the  corporate  directors  (or  Persons  performing  similar
     functions).


                                 12
<PAGE>

     1.2.  Accounting Terms.  Unless otherwise specified  herein,
all terms of an accounting character used in this Agreement shall
be   interpreted,  all  accounting  determinations   under   this
Agreement shall be made, and all financial statements required to
be   delivered  under  this  Agreement  shall  be  prepared,   in
accordance with GAAP, applied on a basis consistent with the most
recent audited Consolidated financial statements of Borrower  and
its  Subsidiaries heretofore delivered to Lender  and  using  the
same  method  for  inventory valuation as used  in  such  audited
financial  statements, except for any change in which  Borrower's
independent public accountants concur or as required by GAAP.  In
the event of any change in GAAP that occurs after the date hereof
and that is material to Borrower, Lender shall have the right  to
require  either  that  conforming  adjustments  be  made  to  any
financial  covenants  set  forth  in  this  Agreement,   or   the
components  thereof,  that are affected by such  change  or  that
Borrower  report  its financial condition based  on  GAAP  as  in
effect immediately prior to the occurrence of such change.

     1.3.  Other  Terms.   All  other  terms  contained  in  this
Agreement shall have, when the context so indicates, the meanings
provided  for  by  the UCC to the extent the  same  are  used  or
defined therein.

     1.4.  Certain Matters of Construction.  The terms  "herein,"
"hereof" and "hereunder" and other words of similar import  refer
to  this  Agreement as a whole and not to any particular section,
paragraph  or subdivision.  Any pronoun used shall be  deemed  to
cover all genders.  In the computation of periods of time from  a
specified  date to a later specified date, the word "from"  means
"from  and  including" and the words "to" and "until" each  means
"to  but  excluding."   All references to  statutes  and  related
regulations  shall  include  any  amendments  of  same  and   any
successor statutes and regulations.  All references to any Person
shall  mean  and include the successors and permitted assigns  of
such  Person.  All references to any of the Loan Documents  shall
include  any and all amendments or modifications thereto and  any
and  all  restatements, extensions or renewals thereof.  Wherever
the  phrase "including" shall appear in this Agreement, such word
shall  be  understood  to mean "including,  without  limitation."
Whenever  the  phrase  "to the best of Borrower's  knowledge"  or
words  of  similar  import  relating  to  the  knowledge  or  the
awareness of Borrower are used herein, such phrase shall mean and
refer to (i) the actual knowledge of a Senior Officer of Borrower
or  (ii)  the knowledge that a Senior Officer would have obtained
if they had engaged in good faith and the diligent performance of
their duties.

SECTION 2.CREDIT  FACILITIES

     Subject to the terms and conditions of, and in reliance upon
the  representations and warranties made in, this  Agreement  and
the  other  Loan Documents, Lender agrees to make a total  credit
facility  of  up to $8,000,000 available upon Borrower's  request
therefor, as follows:

     2.1. Revolver Loans.

          2.1.1      Revolver Loans.  Lender agrees,  during  the
term of this Agreement and for so long as no Default or Event  of
Default  exists, to make Revolver Loans to Borrower from time  to
time,  as  requested  by  Borrower in the  manner  set  forth  in
Section  4.1.1  hereof, up to a maximum principal amount  at  any
time  outstanding equal to the Borrowing Base at such time.   The
Revolver  Loans shall be evidenced by the Revolver Note and  used
solely for Permitted Uses.  In no event shall any proceeds of any
Revolver  Loans be used to purchase or to carry,  or  to  reduce,
retire  or refinance any Debt incurred to purchase or carry,  any
Margin   Stock.    If  the  unpaid  balance  of  Revolver   Loans
outstanding at any time should exceed the Borrowing Base at  such
time  (an "Out-of-Formula Condition"), such Revolver Loans  shall
nevertheless  constitute  Obligations that  are  secured  by  the
Collateral  and  entitled  to all of the  benefits  of  the  Loan
Documents.  In the event that Lender is willing in its  sole  and
absolute  discretion to make Out-of-Formula Loans,  such  Out-of-
Formula  Loans shall be payable on demand and shall bear interest
as  provided in this Agreement for Revolver Loans generally or at
such higher rate of interest as Lender may require as a condition
to making any such Out-of-Formula Loans.


                                13
<PAGE>

SECTION 3.INTEREST,  FEES  AND  CHARGES

     3.1. Interest.

          3.1.1.     Rates  of Interest. Borrower agrees  to  pay
interest in respect of all unpaid principal amounts of the  Loans
from  the  respective dates such principal amounts  are  advanced
until  paid  (whether  at  stated maturity,  on  acceleration  or
otherwise)  at a rate per annum equal to .5% plus the Prime  Rate
in  effect  from time to time.  The applicable rate  of  interest
shall be increased or decreased, as the case may be, by an amount
equal  to  any increase or decrease in the Prime Rate, with  such
adjustments to be effective as of the opening of business on  the
day  that  any  such change in the Prime Rate becomes  effective.
Interest on each Loan shall accrue from and including the date on
which  such Loan is made, but excluding the date of any repayment
thereof; provided, however, that, if a Loan is repaid on the same
day  made,  one day's interest shall be paid on such  Loan.   The
Prime  Rate on the date hereof is 4.25% per annum and, therefore,
the  rate  of  interest in effect hereunder on the  date  hereof,
expressed in simple interest terms, is 4.75% per annum.

          3.1.2.     Default  Rate of Interest.   Interest  shall
accrue  at  the  Default Rate (i) with respect to  the  principal
amount  of  any  portion of the Obligations (and, to  the  extent
permitted by Applicable Law, all past due interest) that  is  not
paid on the due date thereof (whether due at stated maturity,  on
demand,  upon  acceleration or otherwise), until such  amount  is
paid  in  full, and (ii) with respect to the principal amount  of
all  of  the  Obligations  (and,  to  the  extent  permitted   by
Applicable  Law,  all past due interest), upon  the  earliest  to
occur of (x) Borrower's receipt of notice of Lender's election to
charge the Default Rate based upon the existence of any Event  of
Default  or  (y)  the commencement by or against Borrower  of  an
Insolvency  Proceeding,  whether or not under  the  circumstances
described  in either clause (i) or (ii) hereof Lender  elects  to
accelerate  the  maturity  or  demand  payment  of  any  of   the
Obligations.  To the fullest extent permitted by Applicable  Law,
the  Default Rate shall apply and accrue on any judgment  entered
with  respect to any of the Obligations and with respect  to  the
unpaid  principal amount of the Obligations during any Insolvency
Proceeding of Borrower. Borrower acknowledges that the  cost  and
expense  to Lender attendant upon the occurrence of an  Event  of
Default  are  difficult  to ascertain or estimate  and  that  the
Default  Rate  is  a fair and reasonable estimate  to  compensate
Lender for such added cost and expense.

     3.2. Fees.

          3.2.1.     Origination  Fee.   Borrower  shall  pay  to
Lender an origination fee of $80,000, which shall be deemed fully
earned and payable upon Borrower's execution and delivery of this
Agreement.

          3.2.2.     Unused  Line  Fee.  Borrower  shall  pay  to
Lender  a  monthly fee equal to .5% per annum of  the  amount  by
which  the Average Loan Balance for any month (or portion thereof
that  this  Agreement  is in effect) is less  than  the  Revolver
Facility Amount, with such fee to be paid on the first day of the
following  month; but if this Agreement is terminated  on  a  day
other  than  the first day of a month, then any such fee  payable
for  the month in which termination shall occur shall be paid  on
the effective date of such termination.

          3.2.3.     Audit  and Appraisal Fees.   Borrower  shall
reimburse  Lender for all reasonable costs and expenses  incurred
in  connection with audits and appraisals of Borrower's books and
records  and  such other matters as Lender shall deem appropriate
at a rate not to exceed $800 per day for each auditor plus out of
pocket expenses; provided, however, that for so long as no  Event
of  Default exists, Borrower shall not be obligated to  reimburse
Lender for more than four (4) such audits during any fiscal  year
of Borrower.


                                14
<PAGE>

          3.2.4.     General Provisions Relating  to  Fees.   All
fees  shall  be fully earned by Lender when due and payable  and,
except  as  otherwise set forth herein or required by  Applicable
Law,  shall  not be subject to refund, rebate or proration.   All
fees  provided for in Section 3.2 hereof are and shall be  deemed
to be for compensation for services and are not, and shall not be
deemed  to  be,  interest  or  any  other  charge  for  the  use,
forbearance or detention of money.

     3.3.  Computation of Interest and Fees.  All interest,  fees
and  other charges hereunder shall be calculated daily and  shall
be  computed on the actual number of days elapsed over a year  of
360  days.  For the purpose of computing interest hereunder,  all
Payment  Items  received by Lender shall  be  deemed  applied  by
Lender on account of the Obligations (subject to final payment of
such items) on the second Business Day after receipt by Lender of
such  items  in  Lender's account located  in  Providence,  Rhode
Island,  and Lender shall be deemed to have received such Payment
Item on the date specified in Section 4.4 hereof.

     3.4.  Reimbursement of Expenses.  If, at any time  or  times
regardless  of  whether or not an Event of Default  then  exists,
Lender  incurs  reasonable legal or accounting  expenses  or  any
other costs or out-of-pocket expenses in connection with (i)  the
negotiation and preparation of this Agreement or any of the other
Loan   Documents,  any  amendment  of  or  modification  of  this
Agreement  or  any of the other Loan Documents, or  any  sale  or
attempted sale of any interest herein to a Participant;  (ii) the
administration  of  this  Agreement or  any  of  the  other  Loan
Documents  and the transactions contemplated hereby and  thereby;
(iii)  any  litigation,  contest, dispute,  suit,  proceeding  or
action  (whether  instituted by Lender,  Borrower  or  any  other
Person) in any way relating to the Collateral, this Agreement  or
any  of the other Loan Documents or Borrower's affairs; (iv)  any
attempt to enforce any rights of Lender against Borrower  or  any
other  Person which may be obligated to Lender by virtue of  this
Agreement  or  any  of  the other Loan Documents,  including  the
Account Debtors; or (v) any attempt to inspect (subject to limits
as  may  be  applicable  under  Section  3.2.3  hereof),  verify,
protect, preserve, perfect or continue the perfection of Lender's
Liens  upon,  restore,  collect,  sell,  liquidate  or  otherwise
dispose  of  or  realize  upon  the  Collateral;  then  all  such
reasonable legal and accounting expenses, other costs and out  of
pocket  expenses  of Lender shall be charged  to  Borrower.   All
amounts  chargeable to Borrower under this Section 3.4  shall  be
Obligations secured by all of the Collateral, shall be payable on
demand  to  Lender.  Borrower shall  also  reimburse  Lender  for
expenses  incurred  by  Lender  in  its  administration  of   the
Collateral to the extent and in the manner provided in Section  6
hereof.

     3.5. Bank Charges.  Borrower shall pay to Lender, on demand,
any  and  all  fees,  costs  or  expenses  which  Lender  or  any
Participant   pays  to  a  bank  or  other  similar   institution
(including,  any fees paid by Lender to any Participant)  arising
out  of  or in connection with (i) the forwarding to Borrower  or
any  other  Person  on  behalf  of Borrower,  by  Lender  or  any
Participant,  of  proceeds of Loans made by  Lender  to  Borrower
pursuant   to   this  Agreement  and  (ii)  the  depositing   for
collection, by Lender or any Participant, of any check or item of
payment  received  or delivered to Lender or any  Participant  on
account  of  the Obligations.  Borrower acknowledges  and  agrees
that  Lender may charge such costs, fees and expenses to Borrower
based  upon Lender's good faith estimate of such costs, fees  and
expenses  as  they  are  incurred by  Lender,  subject  to  later
adjustment for the amount actually incurred.

     3.6.   Maximum   Interest.   Regardless  of  any   provision
contained  in  any  of the Loan Documents, in no  contingency  or
event  whatsoever  shall the aggregate of all  amounts  that  are
contracted  for,  charged or received by Lender pursuant  to  the
terms  of  any of the Loan Documents and that are deemed interest
under  Applicable  Law exceed the highest rate permissible  under
any  Applicable  Law.  No agreements, conditions,  provisions  or
stipulations  contained  in  any of the  Loan  Documents  or  the
exercise by Lender of the right to accelerate the payment or  the
maturity  of  all  or  any  portion of the  Obligations,  or  the
exercise  of any option whatsoever contained in any of  the  Loan
Documents,  or  the  prepayment  by  Borrower  of  any   of   the
Obligations,  or  the  occurrence of any contingency  whatsoever,
shall  entitle Lender to charge or receive in any event, interest
or  any  charges,  amounts, premiums or fees deemed  interest  by
Applicable  Law  (such interest, charges, amounts,  premiums  and
fees referred to herein collectively as "Interest") in excess  of
the  Maximum Rate and in no event shall Borrower be obligated  to


                                15
<PAGE>

pay  Interest  exceeding such Maximum Rate, and  all  agreements,
conditions  or stipulations, if any, which may in  any  event  or
contingency  whatsoever  operate  to  bind,  obligate  or  compel
Borrower  to  pay Interest exceeding the Maximum  Rate  shall  be
without  binding  force or effect, at law or in  equity,  to  the
extent only of the excess of Interest over such Maximum Rate.  If
any Interest is charged or received in excess of the Maximum Rate
("Excess"),  Borrower acknowledges and stipulates that  any  such
charge  or  receipt shall be the result of an accident  and  bona
fide  error,  and such Excess, to the extent received,  shall  be
applied  first  to  reduce  the  principal  Obligations  and  the
balance, if any, returned to Borrower, it being the intent of the
parties  hereto not to enter into a usurious or otherwise illegal
relationship.  All monies paid to Lender hereunder or  under  any
of   the  other  Loan  Documents,  whether  at  maturity  or   by
prepayment,  shall be subject to any rebate of unearned  interest
as  and  to  the  extent  required by  Applicable  Law.   By  the
execution  of  this Agreement, Borrower covenants  that  (i)  the
credit or return of any Excess shall constitute the acceptance by
Borrower  of  such Excess, and (ii) Borrower shall  not  seek  or
pursue  any  other  remedy, legal or equitable,  against  Lender,
based  in  whole  or in part upon contracting  for,  charging  or
receiving  any Interest in excess of the Maximum Rate.   For  the
purpose  of  determining  whether or  not  any  Excess  has  been
contracted  for, charged or received by Lender, all  interest  at
any  time  contracted for, charged or received from  Borrower  in
connection  with any of the Loan Documents shall, to  the  extent
permitted  by  Applicable Law, be amortized, prorated,  allocated
and  spread  in  equal  parts throughout the  full  term  of  the
Obligations.   Borrower and Lender shall, to the  maximum  extent
permitted  under  Applicable  Law,  (i)  characterize  any   non-
principal  payment as an expense, fee or premium rather  than  as
Interest  and (ii) exclude voluntary prepayments and the  effects
thereof.   The provisions of this Section shall be deemed  to  be
incorporated  into  every  Loan  Document  (whether  or  not  any
provision of this Section is referred to therein).

SECTION 4.  LOAN ADMINISTRATION

     4.1.  Manner of Borrowing Revolver Loans.  Borrowings  under
the  credit  facility established pursuant to Section 2.1  hereof
shall be as follows:

               4.1.1.    Revolver Loan Requests.  A request for a
Revolver  Loan shall be made, or shall be deemed to be  made,  in
the following manner:  (i) Borrower may give Lender notice of its
intention  to borrow, in which notice Borrower shall specify  the
amount of the proposed borrowing and the proposed borrowing date,
no  later  than  11:00 a.m. on the proposed borrowing  date;  and
(ii)  unless  payment is otherwise timely made by  Borrower,  the
becoming  due  of  any  amount required to  be  paid  under  this
Agreement  or  any  of  the other Loan Documents,  as  principal,
accrued  interest,  fees  or  other  charges,  shall  be   deemed
irrevocably  to  be  a  request by Borrower  from  Lender  for  a
Revolver  Loan  on  the due date of, and in an  aggregate  amount
required to pay, such principal, accrued interest, fees or  other
charges  and  the  proceeds of each such  Revolver  Loan  may  be
disbursed  by  Lender by way of direct payment  of  the  relevant
Obligation  and  shall  bear interest at  the  rate  of  interest
applicable to Revolver Loans.  Lender shall have no obligation to
Borrower  to honor any deemed request for a Revolver  Loan  under
clause (ii) of the immediately preceding sentence, but may do  so
in  its  discretion and without regard to the existence  of,  and
without  being  deemed to have waived, any Default  or  Event  of
Default and without regard to the existence or creation of an Out-
of-Formula  Condition.  As an accommodation to  Borrower,  Lender
may   permit   telephonic  requests  for  loans  and   electronic
transmittal   of  instructions,  authorizations,  agreements   or
reports  to  Lender  by  Borrower.  Unless Borrower  specifically
directs Lender in writing not to accept or act upon telephonic or
electronic  communications from Borrower, Lender shall  not  have
any  liability  to  Borrower for any loss or damage  suffered  by
Borrower  as  a  result  of Lender's honoring  of  any  requests,
execution  of  any instructions, authorizations or agreements  or
reliance  on  any  reports communicated to it  telephonically  or
electronically  and purporting to have been  sent  to  Lender  by
Borrower  and Lender shall have no duty to verify the  origin  of
any such communication or the identity or authority of the Person
sending it.

                                16
<PAGE>

                4.1.2.     Disbursement Authorization.   Borrower
hereby irrevocably authorizes Lender to disburse the proceeds  of
each  Revolver Loan requested, or deemed to be requested pursuant
to  Section 4.1.1, as follows:  (i) the proceeds of each Revolver
Loan  requested  under  Section 4.1.1(i) shall  be  disbursed  by
Lender in immediately available funds, in the case of the initial
borrowing,   in  accordance  with  the  terms  of   the   written
disbursement  letter  from Borrower, and  in  the  case  of  each
subsequent  borrowing, by wire transfer to such bank  account  as
may  be  agreed upon by Borrower and Lender from time to time  or
elsewhere  if pursuant to a written direction from Borrower;  and
(ii)   the  proceeds  of  each  Revolver  Loan  requested   under
Section  4.1.1(ii) shall be disbursed by Lender by way of  direct
payment of the relevant interest or other Obligation.

     4.2. Repayment of Revolver Loans.

                4.2.1.     Payment of Principal.  The outstanding
principal amounts with respect to the Revolver Loans shall be due
and  payable  in  Dollars  without  any  offset  or  counterclaim
immediately  upon (a) each receipt by Borrower or Lender  of  any
proceeds  or payments of any of the Collateral, to the extent  of
such   proceeds  or  payments,  and  (b)  the  Termination  Date.
Notwithstanding anything to the contrary contained  elsewhere  in
this  Agreement,  if  an  Out-of-Formula Condition  shall  exist,
Borrower  shall, on demand, repay the outstanding Revolver  Loans
in  an amount sufficient to reduce the aggregate unpaid principal
amount of all Revolver Loans by an amount equal to such excess.

                4.2.2.     Payment of Interest.  Interest accrued
on  the Revolver Loans shall be due and payable on (i) the  first
calendar day of each month (for the immediately preceding month),
computed  through  the last calendar day of the preceding  month,
with  respect  to any Revolver Loan, and (ii) on the  Termination
Date.

     4.3.  Payment  of  Other Obligations.  The  balance  of  the
Obligations requiring the payment of monies shall be  payable  by
Borrower  to  Lender  in Dollars and without offset,  defense  or
counterclaim, as and when provided in the Loan Documents, or,  if
no  date of payment is otherwise specified in the Loan Documents,
on demand.

     4.4.  Application of Payments and Collections.  All  Payment
Items received by Lender by 12:00 noon, Atlanta, Georgia time, on
any Business Day shall be deemed received on the second  Business
Day  thereafter.   All Payment Items received after  12:00  noon,
Atlanta,  Georgia  time,  on any Business  Day  shall  be  deemed
received on the third Business Day thereafter.   If as the result
of  collections of Accounts as authorized by Section 7.2.6 hereof
a  credit balance exists in the Loan Account, such credit balance
shall  not  accrue interest in favor of Borrower,  but  shall  be
available  to  Borrower at any time or times for so  long  as  no
Default or Event of Default exists.

     4.5.  All  Loans  to Constitute One Obligation.   The  Loans
shall  constitute one general Obligation of Borrower and  (unless
and  to  the  extent otherwise expressly provided in any  of  the
Security Documents) shall be secured by Lender's Lien upon all of
the Collateral.

     4.6. Loan Account.  Lender shall establish an account on its
books (the "Loan Account") and shall enter all Loans as debits to
the  Loan  Account and shall also record in the Loan Account  all
payments made by Borrower on any Obligations and all proceeds  of
Collateral  which  are  finally paid to Lender,  and  may  record
therein, in accordance with customary accounting practice,  other
debits  and  credits,  including interest  and  all  charges  and
expenses properly chargeable to Borrower.

     4.7. Statements of Account.  Lender will account to Borrower
monthly  with  a  statement of Loans, charges and  payments  made
pursuant  to  this  Agreement, and, in the  absence  of  manifest
error,  such  accounting  rendered  by  Lender  shall  be  deemed
rebuttably conclusive upon Borrower unless Lender is notified  by
Borrower in writing to the contrary within 30 days after the date
each  accounting  is  deemed  to  have  been  sent  pursuant   to
Section  12.8.  Such notice shall only be deemed an objection  to
those items specifically objected to therein.

                                17
<PAGE>

     4.8.   Marshalling;  Payments Set Aside.   Lender  shall  be
under no obligation to marshal any assets in favor of Borrower or
any  other Obligor or against or in payment of any or all of  the
Obligations.   To  the extent that Borrower makes  a  payment  to
Lender  or  Lender  receives payment from  the  proceeds  of  any
Collateral or exercises its right of setoff, and such payment  or
the  proceeds of such enforcement or setoff (or any part thereof)
are  subsequently  invalidated,  declared  to  be  fraudulent  or
preferential,  set aside or required to be repaid to  a  trustee,
receiver  or  any other Person, then to the extent  of  any  such
recovery,  the obligation or part thereof originally intended  to
be  satisfied, and all Liens, rights and remedies therefor, shall
be  revived  and continued in full force and effect  as  if  such
payment  had not been made or such enforcement or setoff had  not
occurred.   The provisions of the immediately preceding  sentence
of  this  Section  4.9  shall survive  any  termination  of  this
Agreement and payment in full of the Obligations.

SECTION 5.TERM  AND  TERMINATION

     5.1.  Term of Agreement.  Subject to Lender's right to cease
making  Loans  to  Borrower upon or after the occurrence  of  any
Default or Event of Default or upon termination of this Agreement
as  provided  in Section 5.2 hereof, this Agreement shall  be  in
effect  for  a  period of three (3)  years from the date  hereof,
through January 5, 2006 (the "Original Term").

     5.2. Termination.

                5.2.1.     Termination  by  Lender.   Lender  may
terminate  this  Agreement  without  notice  upon  or  after  the
occurrence of an Event of Default; provided, however,  that  this
Agreement  shall automatically terminate as provided  in  Section
11.2 hereof.

                5.2.2.    Termination by Borrower.  Upon at least
60  days  prior written notice to Lender, Borrower  may,  at  its
option,  terminate  this Agreement.  Any  notice  of  termination
given  by  Borrower shall be irrevocable unless Lender  otherwise
agrees  in  writing.   Borrower  may  elect  to  terminate   this
Agreement  in  its  entirety  only.   For  purposes  hereof,  the
Obligations shall not be deemed to have been satisfied until  all
Obligations for the payment of money have been paid to Lender  in
same  day  funds  and all Obligations that are  at  the  time  in
question contingent have been fully cash collateralized in  favor
and  to  the  satisfaction of Lender or Lender  has  received  as
beneficiary  a direct pay letter of credit in form  and  from  an
issuing  bank  acceptable  to Lender  and  providing  for  direct
payment to Lender of all such contingent Obligations at the  time
they become fixed.

                5.2.3.     Termination Charges.  On the effective
date  of  termination of this Agreement for any reason,  Borrower
shall  pay  to  Lender  (in  addition  to  the  then  outstanding
principal,  accrued interest, fees and other charges owing  under
the terms of this Agreement and any of the other Loan Documents),
as  liquidated damages for the loss of the bargain and not  as  a
penalty, an amount equal to 1% of the Revolver Facility Amount if
termination occurs during the first or the second Loan Year.

                5.2.4.     Effect  of Termination.   All  of  the
Obligations  shall  be  immediately  due  and  payable  upon  the
effective  date of termination by Lender or, in  the  case  of  a
termination  by Borrower, upon the date specified  in  Borrower's
notice of termination of this Agreement as the effective date  of
such   termination.   All  undertakings,  agreements,  covenants,
warranties and representations of Borrower contained in the  Loan
Documents  shall survive any such termination, and  Lender  shall
retain  its  Liens in the Collateral and all of  its  rights  and
remedies   under   the   Loan  Documents   notwithstanding   such
termination, until Borrower has satisfied all of the  Obligations
in  the  manner described in Section 5.2.2.  Notwithstanding  the
payment  in full of the Obligations, Lender shall not be required
to  terminate  its  security interests in the Collateral  unless,
with  respect to any loss or damage Lender may incur as a  result
of  dishonored Payment Items received by Lender from Borrower  or
any  Account  Debtor and applied to the Obligations,  Lender  has

                                18
<PAGE>

either (at its option) (i) received a written agreement, executed
by  Borrower  and by any Person whose loans or other advances  to
Borrower are used in whole or in part to satisfy the Obligations,
indemnifying   Lender  from  any  such   loss   or   damage;   or
(ii)  retained such monetary reserves and Liens on the Collateral
for  such period of time as Lender, in its reasonable discretion,
may  deem  necessary  to protect Lender from  any  such  loss  or
damage.  The provisions of Section 4.8 hereof and all obligations
of  Borrower pursuant to this Agreement to indemnify Lender shall
in all events survive any termination of this Agreement.

SECTION 6.COLLATERAL SECURITY

     6.1.  Grant of Security Interest in Collateral.   To  secure
the  prompt  payment  and performance to Lender  of  all  of  the
Obligations,  Borrower  hereby  grants  to  Lender  a  continuing
security  interest in and Lien upon all of the following Property
and  interests  in  Property of Borrower, whether  now  owned  or
existing   or   hereafter  created,  acquired  or   arising   and
wheresoever located:

          (i)  All Accounts;

          (ii) All Inventory;

          (iii)     All Instruments;

          (iv) All Chattel Paper;

          (v)  All Documents;

          (vi) All General Intangibles;

          (vii)     All Equipment;

          (viii)       All    Investment   Property,    including
     Securities,  whether  certificated  or  uncertificated  (but
     excluding  any  portion  thereof  that  constitutes   Margin
     Stock), and all securities entitlements;

          (ixx)     All Deposit Accounts;

          (x)  All Supporting Obligations;

          (xi) All Letter of Credit Rights;

          (xii)     All Commercial Tort Claims;

          (xiii)     All  monies  now or at  any  time  or  times
     hereafter  in the possession or under the control of  Lender
     or a bailee or Affiliate of Lender;

          (xiv)     All accessions to, substitutions for and  all
     replacements, products and cash and non-cash proceeds of any
     of   the  foregoing,  including  proceeds  of  and  unearned
     premiums with respect to insurance policies insuring any  of
     the  Collateral and claims against any Person for  loss  of,
     damage to, or destruction of any of the Collateral; and

          (xv)  All books and records (including customer  lists,
     files, correspondence, tapes, computer programs, print-outs,
     and  other  computer  materials  and  records)  of  Borrower
     pertaining to any of the foregoing.

                                19
<PAGE>

     6.2.  Lien  Perfection; Further Assurances.  Promptly  after
Lender's request therefor, Borrower shall execute and deliver  to
Lender   such  instruments,  assignments  or  documents  as   are
necessary  under the UCC or other Applicable Law to  perfect  (or
continue the perfection of) Lender's Lien upon the Collateral and
shall  take  such other action as may be requested by  Lender  to
give  effect  to  or carry out the intent and  purposes  of  this
Agreement.  Unless prohibited by Applicable Law, Borrower  hereby
authorizes  Lender  to  execute  and  file  any  such   financing
statement on Borrower's behalf.  The parties agree that a carbon,
photographic  or  other reproduction of this Agreement  shall  be
sufficient  as  a  financing statement and may be  filed  in  any
appropriate office in lieu thereof.

     6.3.  Lien on Deposit Accounts.  As additional security  for
the  payment and performance of the Obligations, Borrower  grants
to  Lender  a security interest in and assigns to Lender  all  of
Borrower's  right,  title and interest in  and  to  each  Deposit
Account  of Borrower and in and to any deposits or other sums  at
any  time  credited to each such Deposit Account,  including  any
sums  in any blocked account or any special lockbox account.   In
connection  with  the foregoing, Borrower hereby  authorizes  and
directs  each bank or other depository at which a Deposit Account
is maintained to pay or deliver to Lender upon its written demand
therefor  made  at any time that an Event of Default  exists  and
without  further  notice to Borrower (such  notice  being  hereby
expressly   waived),  all  balances  in  each   Deposit   Account
maintained  by  Borrower with such depository for application  to
the  Obligations  then outstanding.  The rights given  Lender  in
this Section shall be cumulative with and in addition to Lender's
other rights and remedies in regard to the foregoing Property  as
proceeds  of  Collateral.  Borrower hereby  irrevocably  appoints
Lender  as  its attorney to collect any and all such balances  to
the extent any such payment is not made to Lender by such bank or
other  depository after demand thereon is made by Lender pursuant
hereto.

     6.4   Lien on Real Estate.  The due and punctual payment and
performance of the Obligations shall also be secured by the  Lien
created  by  the  Mortgages  upon the  Real  Estate  of  Borrower
described  therein.  The Mortgages shall be executed by  Borrower
in favor of Lender on or about the Closing Date and shall be duly
recorded,  at  Borrower's  expense, in  each  office  where  such
recording  is required to constitute a fully perfected Lien  upon
the Real Estate covered thereby.

SECTION 7.COLLATERAL ADMINISTRATION

     7.1. General.

                7.1.1.     Location of Collateral.  All  tangible
items  of  Collateral, other than Inventory in transit and  motor
vehicles,  shall  at  all  times be  kept  by  Borrower  and  its
Subsidiaries at one or more of the business locations  set  forth
in  Schedule  7.1.1  hereto and shall  not  be  moved  therefrom,
without  the prior written approval of Lender, except that  prior
to an Event of  Default and Lender's acceleration of the maturity
of  the Obligations in consequence thereof, Borrower may (i) make
sales  or  other  dispositions of any Collateral  to  the  extent
authorized by Section 9.2.9 hereof and (ii) may move Inventory or
any  record  relating  to any Collateral to  a  location  in  the
United States other than those shown on Schedule 7.1.1 hereto  so
long  as  Borrower  has given Lender at least 30  Business  Days'
prior written notice of such new location and prior to moving any
Inventory to such location Borrower has executed and delivered to
Lender  UCC-1  financing  statements and  any  other  appropriate
documentation to perfect or continue the perfection  of  Lender's
Liens with respect to such Inventory and all proceeds thereof.

                7.1.2.    Insurance of Collateral; Insurance  and
Condemnation Proceeds.

               (i)  Borrower shall maintain and pay for insurance
upon all Collateral, wherever located, covering casualty, hazard,
public liability, theft, malicious mischief, and such other risks
in  such  amounts  and  with  such  insurance  companies  as  are
reasonably  satisfactory to Lender.  All proceeds  payable  under
each  such  policy shall be payable to Lender for application  to

                                20
<PAGE>

the  Obligations.   Borrower  shall  deliver  the  originals   or
certified  copies  of such policies to Lender  with  satisfactory
lender's  loss  payable endorsements reasonably  satisfactory  to
Lender,  naming Lender as sole loss payee, assignee or additional
insured, as appropriate.  Each policy of insurance or endorsement
shall  contain  a clause requiring the insurer to give  not  less
than  30  days  prior written notice to Lender in  the  event  of
cancellation of the policy for any reason whatsoever and a clause
specifying  that the interest of Lender shall not be impaired  or
invalidated by any act or neglect of Borrower or the owner of the
Property  or by the occupation of the premises for purposes  more
hazardous  than are permitted by said policy.  If Borrower  fails
to provide and pay for such insurance, Lender may, at its option,
but  shall  not  be  required to, procure  the  same  and  charge
Borrower  therefor.   Borrower  agrees  to  deliver  to   Lender,
promptly  as  rendered, true copies of all reports  made  in  any
reporting forms to insurance companies.  For so long as no  Event
of  Default  exists,  Borrower shall have the  right  to  settle,
adjust  and  compromise any claim with respect to  any  insurance
maintained  by  Borrower provided that all proceeds  thereof  are
applied  in  the manner specified in this Agreement,  and  Lender
agrees  promptly  to  provide any necessary  endorsement  to  any
checks  or  drafts issued in payment of any such claim.   At  any
time  that  an  Event  of Default exists, only  Lender  shall  be
authorized to settle, adjust and compromise such claims.   Lender
shall  have all rights and remedies with respect to such policies
of  insurance as are provided for in this Agreement and the other
Loan Documents.

                7.1.3.    Protection of Collateral.  All expenses
of   protecting,   storing,  warehousing,   insuring,   handling,
maintaining and shipping the Collateral, all Taxes imposed by any
Applicable Law on any of the Collateral or in respect of the sale
thereof, and all other payments required to be made by Lender  to
any Person to realize upon any Collateral shall be borne and paid
by  Borrower.   If  Borrower fails to promptly  pay  any  portion
thereof  when due, Lender may, at its option and after notice  to
Borrower,  but shall not be required to, pay the same and  charge
Borrower therefor.  Lender shall not be liable or responsible  in
any  way for the safekeeping of any of the Collateral or for  any
loss or damage thereto (except for reasonable care in the custody
thereof while any Collateral is in Lender's actual possession) or
for  any  diminution in the value thereof,  or  for  any  act  or
default of any warehouseman, carrier, forwarding agency, or other
Person whomsoever, but the same shall be at Borrower's sole risk.

          7.1.4.     Defense  of  Title to Collateral.   Borrower
shall at all times defend Borrower's title to the Collateral  and
Lender's  Liens  therein against all Persons and all  claims  and
demands whatsoever.

     7.2. Administration of Accounts.

                7.2.1.     Records, Schedules and Assignments  of
Accounts.   Borrower shall keep accurate and complete records  of
its  Accounts and all payments and collections thereon and  shall
submit to Lender on such periodic basis as Lender shall request a
sales  and collections report for the preceding period,  in  form
satisfactory to Lender.  Borrower shall also provide to Lender on
or  before the 20th day of each month, (i) a detailed aged  trial
balance  of  all  Accounts existing as of the  last  day  of  the
preceding  month,  specifying the names, addresses,  face  value,
dates of invoices and due dates for each Account Debtor obligated
on an Account so listed ("Schedule of Accounts") and the basis on
which  such Schedules of Accounts are prepared and, upon Lender's
request  therefor, copies of proof of delivery and  the  original
copy  of all documents, including repayment histories and present
status  reports  relating to the Accounts so scheduled  and  such
other  matters  and information relating to the  status  of  then
existing Accounts as Lender shall reasonably request and  (ii)  a
detailed aged payables balance of all trade payables existing  as
of the last day of the preceding month.  In addition, if Accounts
in  an  aggregate face amount in excess of $50,000  cease  to  be
Eligible  Accounts  in  whole or in part, Borrower  shall  notify
Lender  of  such  occurrence promptly (and in  any  event  within
2  Business  Days) after Borrower's having obtained knowledge  of
such  occurrence  and  the  Borrowing  Base  shall  thereupon  be
adjusted  to  reflect  such occurrence.   Upon  Lender=s  written
request,  Borrower  shall promptly deliver to  Lender  copies  of
invoices or invoice registers related to all of its Accounts.

                                21
<PAGE>

                7.2.2.     Discounts, Allowances,  Disputes.   If
Borrower grants any discounts, allowances or credits that are not
shown  on  the  face  of  the invoice for the  Account  involved,
Borrower  shall report such discounts, allowances or credits,  as
the  case may be, to Lender as part of the next required Schedule
of  Accounts.  If any amounts due and owing in excess of  $50,000
are  in dispute between Borrower and any Account Debtor, Borrower
shall  provide Lender with written notice thereof at the time  of
submission of the next Schedule of Accounts, explaining in detail
the  reason for the dispute, all claims related thereto  and  the
amount in controversy.  Upon and after the occurrence of an Event
of  Default, Lender shall have the right to settle or adjust  all
disputes  and  claims  directly with the Account  Debtor  and  to
compromise  the  amount or extend the time  for  payment  of  the
Accounts  upon such terms and conditions as Lender may reasonably
deem  advisable,  and  to  charge  the  deficiencies,  costs  and
expenses thereof, including attorneys' fees, to Borrower.

                7.2.3.    Taxes.  If an Account includes a charge
for  any  Taxes  payable  to any governmental  taxing  authority,
Lender  is authorized, in its sole discretion, to pay the  amount
thereof  to  the  proper  taxing authority  for  the  account  of
Borrower  and to charge Borrower therefor if Borrower shall  fail
to pay such amounts within three (3) Business Days after Lender's
request  to do so ; provided, however, that Lender shall  not  be
liable for any Taxes that may be due by Borrower.

                7.2.4.    Account Verification.  Whether or not a
Default  or an Event of Default exists, any of Lender's officers,
employees  or agents shall have the right, at any time  or  times
hereafter,  in  the  name of Lender, any designee  of  Lender  or
Borrower,  to  verify the validity, amount or  any  other  matter
relating  to  any  Accounts  by  mail,  telephone,  telegraph  or
otherwise.   Borrower shall cooperate fully  with  Lender  in  an
effort  to facilitate and promptly conclude any such verification
process.

                7.2.5.     Maintenance  of Lockbox  and  Dominion
Account.   Borrower   shall  maintain   a   lockbox   arrangement
("Lockbox")  with Bank ("Collecting Bank").  Promptly  after  the
Closing Date, Borrower shall notify all Account Debtors to  remit
all  payments due Borrower to the Lockbox.  Borrower shall  issue
to Collecting Bank an irrevocable letter of instruction directing
Collecting  Bank  to  deposit all payments or  other  remittances
received  in  the  Lockbox to the Dominion  Account.   All  funds
deposited  in the Dominion Account shall immediately  become  the
property  of  Lender and Borrower shall obtain the  agreement  by
such  banks in favor of Lender to waive any offset rights against
the  funds  so  deposited.  Lender assumes no responsibility  for
lockbox   arrangements,  including  any  claim  of   accord   and
satisfaction or release with respect to deposits accepted by  any
bank thereunder.

                7.2.6.     Collection  of Accounts;  Proceeds  of
Collateral.   All Payment Items received by Borrower  in  respect
of  Accounts, together with the proceeds of any other Collateral,
shall  be held as Lender's property by Borrower as trustee of  an
express trust for Lender's benefit and Borrower shall immediately
deposit same in kind in the Dominion Account.  Lender retains the
right  at all times after the occurrence of a Default or an Event
of  Default  to  notify Account Debtors that Accounts  have  been
assigned  to Lender and to collect Accounts directly in  its  own
name and to charge to Borrower the collection costs and expenses,
including attorneys' fees.

     7.3. Administration of Inventory.

                 7.3.1.     Records  and  Reports  of  Inventory.
Borrower  shall  keep  accurate  and  complete  records  of   its
Inventory  consistent with past practices and without  change  in
format  or assumptions on which such Inventory reports are based.
Borrower  shall  furnish Lender Inventory  reports  in  form  and
detail  satisfactory  to  Lender at  such  times  as  Lender  may
request,  but at least once each month, not later than  the  20th
day  of  such month.  Borrower shall conduct a physical inventory
no  less  frequently than annually and shall provide to Lender  a
report based on each such physical inventory promptly thereafter,
together  with  such  supporting  information  as  Lender   shall
request.

                                22
<PAGE>

                7.3.2.     Returns of Inventory.  Borrower  shall
not  return any of its Inventory to a supplier or vendor thereof,
or  any  other  Person, whether for cash, credit  against  future
purchases  or then existing payables, or otherwise,  unless  such
return is in the ordinary course of business of Borrower and such
Person  and any payments received by Borrower in connection  with
any such return is promptly turned over to Lender for application
to the Obligations.

     7.4. Administration of Equipment.

                7.4.1.     Records  and Schedules  of  Equipment.
Borrower shall keep accurate records itemizing and describing the
kind,  type, quality, quantity and cost of its Equipment and  all
dispositions  made in accordance with Section 7.4.2  hereof,  and
shall  furnish  Lender  with a current  schedule  containing  the
foregoing information on at least an annual basis and more  often
if  requested  by  Lender.  Promptly after  request  therefor  by
Lender, Borrower shall deliver to Lender any and all evidence  of
ownership, if any, of any of the Equipment.

                7.4.2.     Dispositions of  Equipment.   Borrower
will  not sell, lease or otherwise dispose of or transfer any  of
the  Equipment  or  any part thereof without  the  prior  written
consent   of  Lender;  provided,  however,  that  the   foregoing
restriction shall not apply, for so long as no Default  or  Event
of Default exists, to (i) dispositions of Equipment which, in the
aggregate  during  any consecutive 12-month period,  has  a  fair
market  value  or book value, whichever is more,  of  $10,000  or
less,  provided  that all Net Proceeds thereof  are  remitted  to
Lender  for  application to the Obligations, or (ii) replacements
of Equipment that is substantially worn, damaged or obsolete with
Equipment  of  like kind, function and value, provided  that  the
replacement  Equipment shall be acquired prior to or concurrently
with any disposition of the Equipment that is to be replaced, the
replacement Equipment shall be free and clear of Liens other than
Permitted  Liens that are not Purchase Money Liens, and  Borrower
shall have given Lender at least 10 days prior written notice  of
such disposition.

                7.4.3.     Condition of Equipment.  The Equipment
is  in  good  operating condition and repair, and  all  necessary
replacements  of and repairs thereto shall be made  so  that  the
value  and  operating  efficiency  of  the  Equipment  shall   be
maintained  and  preserved, reasonable wear  and  tear  excepted.
Borrower  will not permit any of the Equipment to become  affixed
to  any  real  Property leased to Borrower so  that  an  interest
arises  therein  under  the real estate laws  of  the  applicable
jurisdiction  unless  the  landlord of  such  real  Property  has
executed a landlord waiver or leasehold mortgage in favor of  and
in form acceptable to Lender, and Borrower will not permit any of
the  Equipment  to  become an accession to any personal  Property
that is subject to a Lien unless the Lien is a Permitted Lien.

     7.5.  Borrowing Base Certificates.  On the Closing Date  and
on  or  before  the  third Business Day of each  week  after  the
Closing Date or at more frequent intervals as Lender may request,
Borrower  shall  deliver to Lender a Borrowing  Base  Certificate
prepared as of the close of business of the previous week, and at
such  other  times  as Lender may request.  All  calculations  of
Availability  in  connection with any Borrowing Base  Certificate
shall  originally be made by Borrower and certified by  a  Senior
Officer  to Lender, provided that Lender shall have the right  to
review  and  adjust,  in  the exercise of its  reasonable  credit
judgment,  any  such  calculation (i) to reflect  its  reasonable
estimate  of declines in value of any of the Collateral described
therein  and  (ii)  to the extent that such  calculation  is  not
in  accordance with this Agreement or does not accurately reflect
the amount of the Availability Reserve.

     7.6. Payment of Charges.  All amounts chargeable to Borrower
under  this Section 7 shall be Obligations secured by all of  the
Collateral and shall be payable on demand.


                                23
<PAGE>

SECTION 8.REPRESENTATIONS AND WARRANTIES

     8.1.  General  Representations and  Warranties.   To  induce
Lender  to  enter  into  this  Agreement  and  to  make  advances
hereunder,  Borrower  warrants  and  represents  to  Lender   and
covenants with Lender that:

               8.1.1.    Organization and Qualification.  Each of
Borrower  and  its  Subsidiaries is  an  entity  duly  organized,
validly  existing  and in good standing under  the  laws  of  the
jurisdiction  of  its  organization.  Each of  Borrower  and  its
Subsidiaries is duly qualified and is authorized to  do  business
and is in good standing as a foreign limited liability company or
corporation   in   each   state   or   jurisdiction   listed   on
Schedule 8.1.1 hereto.

                8.1.2.    Corporate Power and Authority.  Each of
Borrower and its Subsidiaries is duly authorized and empowered to
enter into, execute, deliver and perform this Agreement and  each
of  the  other  Loan  Documents to which  it  is  a  party.   The
execution, delivery and performance of this Agreement and each of
the  other  Loan  Documents  have been  duly  authorized  by  all
necessary action and do not and will not (i) require any  consent
or  approval  of  any of the holders of the Equity  Interests  of
Borrower  or any of its Subsidiaries; (ii) contravene  Borrower's
or    any    of   its   Subsidiaries'   Organization   Documents;
(iii) violate, or cause Borrower or any of its Subsidiaries to be
in  default  under,  any provision of any law, rule,  regulation,
order, writ, judgment, injunction, decree, determination or award
in  effect  having  applicability  to  Borrower  or  any  of  its
Subsidiaries; (iv) result in a breach of or constitute a  default
under  any  indenture or loan or credit agreement  or  any  other
agreement,  lease or instrument to which Borrower or any  of  its
Subsidiaries is a party or by which it or its Properties  may  be
bound or affected; or (v) result in, or require, the creation  or
imposition of any Lien (other than Permitted Liens) upon or  with
respect  to any of the Properties now owned or hereafter acquired
by Borrower or any of its Subsidiaries.

                8.1.3.     Legally  Enforceable Agreement.   This
Agreement is, and each of the other Loan Documents when delivered
under  this  Agreement  will  be,  a  legal,  valid  and  binding
obligation  of each of Borrower and its Subsidiaries  enforceable
against  it  in accordance with its respective terms,  except  as
enforceability   may   be  limited  by  bankruptcy,   insolvency,
reorganization  or  similar  laws  affecting  creditors'   rights
generally,  or  by  principles  of  equity  pertaining   to   the
availability of equitable remedies.

                8.1.4.     Capital Structure.   As  of  the  date
hereof, Schedule 8.1.4 hereto states (i) the correct name of each
of the Subsidiaries of Borrower, its jurisdiction of organization
and  the percentage of its Equity Interests having voting  powers
owned  by  Borrower,  and (ii) the name  of  each  of  Borrower's
corporate  or  joint venture Affiliates and  the  nature  of  the
affiliation.   Borrower has good title to all of  the  shares  it
purports  to  own  of  the  Equity  Interests  of  each  of   its
Subsidiaries, free and clear in each case of any Lien other  than
Permitted Liens.  All such Equity Interests have been duly issued
and are fully paid and non-assessable.

                8.1.5.     Corporate Names.  During the preceding
7  years,  neither Borrower nor any of its Subsidiaries has  been
known  as or used any corporate, fictitious or trade names except
those  listed on Schedule 8.1.5 hereto.  Except as set  forth  on
Schedule 8.1.5, during the preceding 7 years neither Borrower nor
any  of its Subsidiaries has been the surviving corporation of  a
merger  or consolidation or acquired all or substantially all  of
the assets of any Person.

                8.1.6.     Business Locations; Agent for Process.
Each  of Borrower's and its Subsidiaries' chief executive  office
and  other  places  of business are as listed on  Schedule  7.1.1
hereto.   During the preceding five-year period, neither Borrower
nor  any of its Subsidiaries has had an office, place of business
or  agent  for  service  of  process  other  than  as  listed  on
Schedule  7.1.1.  Except as shown on Schedule 7.1.1, no Inventory
is  stored with a bailee, warehouseman or similar Person, nor  is
any Inventory consigned to any Person.

                                24
<PAGE>

                8.1.7.    Title to Properties; Priority of Liens.
Each of Borrower and its Subsidiaries has good, indefeasible  and
marketable  title to and fee simple ownership of,  or  valid  and
subsisting leasehold interests in, all of its real Property,  and
good  title  to  all  of  the Collateral and  all  of  its  other
Property,  in  each  case  free and clear  of  all  Liens  except
Permitted  Liens.   Borrower has paid or  discharged  all  lawful
claims  which,  if  unpaid, might become a Lien  against  any  of
Borrower's  Properties that is not a Permitted Lien.   The  Liens
granted  to  Lender  under Section 6 hereof  are  first  priority
Liens,  subject only to those Permitted Liens which are expressly
stated to have priority over the Liens of Lender.

                 8.1.8.      Accounts.   Lender  may   rely,   in
determining  which  Accounts  are  Eligible  Accounts,   on   all
statements  and representations made by Borrower with respect  to
any  Account.  Unless otherwise indicated in writing  to  Lender,
with respect to each Account:

                (i)   It  is genuine and in all respects what  it
     purports to be, and it is not evidenced by a judgment;

                (ii) It arises out of a completed, bona fide sale
     and  delivery of goods or rendition of services by  Borrower
     in  the  ordinary course of its business and  in  accordance
     with  the  terms  and  conditions of  all  purchase  orders,
     contracts or other documents relating thereto and forming  a
     part  of  the  contract  between Borrower  and  the  Account
     Debtor;

                (iii)      It is for a liquidated amount maturing
     as  stated  in the duplicate invoice covering such  sale  or
     rendition of services, a copy of which has been furnished or
     is available to Lender; and

                (iv)  Borrower  has  made no agreement  with  any
     Account Debtor for any extension, compromise, settlement  or
     modification of any such Account or any deduction therefrom,
     except  for down payments received by Borrower or  discounts
     or  allowances which are granted by Borrower in the ordinary
     course  of its business for prompt payment and all of  which
     are  reflected in the calculation of the net amount of  each
     respective invoice related thereto and are reflected in  the
     Schedules  of  Accounts  submitted  to  Lender  pursuant  to
     Section 7.2.1 hereof.

                8.1.9.    Financial Statements; Fiscal Year.  The
Consolidated  and consolidating balance sheets  of  Borrower  and
such  other Persons described therein (including the accounts  of
all  Subsidiaries of Borrower for the respective  periods  during
which  a  Subsidiary relationship existed)  as of  December   31,
2001,   and   the  related  statements  of  income,  changes   in
stockholder's equity, and changes in financial position  for  the
periods  ended  on such dates, have been prepared  in  accordance
with  GAAP,  and  present fairly, in all material  respects,  the
financial  positions of  Borrower and such Persons at such  dates
and the results of Borrower's operations for such periods.  Since
December  31,  2001,  there has been no material  change  in  the
condition,  financial or otherwise, of Borrower  and  such  other
Persons  as  shown on the Consolidated balance sheet as  of  such
date, except changes in the ordinary course of business, none  of
which  individually  or  in  the aggregate  has  been  materially
adverse.

                 8.1.10.    Full   Disclosure.    The   financial
statements referred to in Section 8.1.9 hereof do not,  nor  does
this  Agreement  or any other written statement  of  Borrower  to
Lender,  contain any untrue statement of a fact or  omit  a  fact
necessary to make the statements contained therein or herein  not
misleading  in  any  material  respect.   There  is  no  fact  or
circumstances which Borrower has failed to disclose to Lender  in
writing  and which may reasonably be expected to have a  Material
Adverse Effect.

                8.1.11.   Solvent Financial Condition.   Each  of
Borrower and its Subsidiaries is now and, after giving effect  to
the Loans to be made hereunder, at all times will be, Solvent.


                                25
<PAGE>

               8.1.12.  Surety Obligations.  Neither Borrower nor
any  of  its  Subsidiaries is obligated as surety  or  indemnitor
under  any  surety  or similar bond or other contract  issued  or
entered  into  any  agreement to assure payment,  performance  or
completion of performance of any undertaking or obligation of any
Person.

                  8.1.13.    Taxes.    Borrower's   federal   tax
identification number is 11-2354135.  Borrower and  each  of  its
Subsidiaries has filed all federal, state and local  tax  returns
and other reports it is required by law to file and has paid,  or
made  provision for the payment of, all Taxes upon it, its income
and Properties as and when such Taxes are due and payable, except
to  the extent being Properly Contested.  The provision for Taxes
on  the  books of Borrower and its Subsidiaries are adequate  for
all  years not closed by applicable statutes, and for its current
fiscal year.

                 8.1.14.   Brokers.   There  are  no  claims  for
brokerage  commissions, finder's fees or investment banking  fees
in   connection  with  the  transactions  contemplated  by   this
Agreement.

                 8.1.15.   Patents,  Trademarks,  Copyrights  and
Licenses.  Borrower and its Subsidiaries each owns  or  possesses
all  Intellectual Property necessary for the present and  planned
future  conduct  of  its business without any conflict  with  the
rights   of   others;  there  is  no  objection  to  or   pending
Intellectual Property Claim with respect to any Borrower's  right
to  use any such Intellectual Property and Borrower is not  aware
of any grounds for challenge or objection thereto; and, except as
may be disclosed on Schedule 8.1.15, Borrower pays no royalty  or
other  compensation  to  any Person for  the  right  to  use  any
Intellectual  Property.   All such patents,  trademarks,  service
marks,  tradenames, copyrights, licenses and other similar rights
are listed on Schedule 8.1.15 hereto.

               8.1.16.  Governmental Approvals.  Each of Borrower
and  its  Subsidiaries has, and is in good standing with  respect
to,  all  Governmental Approvals necessary to continue to conduct
its  business as heretofore or proposed to be conducted by it and
to own or lease and operate its Properties as now owned or leased
by it.

                8.1.17.   Compliance with Laws.  Each of Borrower
and  its Subsidiaries has duly complied with, and its Properties,
business  operations  and leaseholds are  in  compliance  in  all
material  respects  with, the provisions of  all  Applicable  Law
(except to the extent that any such noncompliance with Applicable
Law  would not reasonably be expected to have a Material  Adverse
Effect)  and there have been no citations, notices or  orders  of
noncompliance issued to Borrower or any of the Subsidiaries under
any such law, rule or regulation.  No Inventory has been produced
in  violation of the Fair Labor Standards Act (29 U.S.C. ' 201 et
seq.).

                8.1.18.  Restrictions.  Neither Borrower nor  any
of  its  Subsidiaries  is  a party or subject  to  any  contract,
agreement, or charter or other corporate restriction,  which  has
or  could  be  reasonably  expected to have  a  Material  Adverse
Effect.  Neither Borrower nor any of its Subsidiaries is a  party
or subject to any contract or agreement which restricts its right
or   ability  to  incur  Debt,  other  than  as  set   forth   on
Schedule  8.1.18 hereto, none of which prohibit the execution  of
or  compliance with this Agreement or the other Loan Documents by
Borrower or any of its Subsidiaries, as applicable.

                8.1.19.   Litigation.  Except  as  set  forth  on
Schedule  8.1.19 hereto, there are no actions, suits, proceedings
or  investigations  pending,  or to the  knowledge  of  Borrower,
threatened,  against  or  affecting  Borrower  or  any   of   its
Subsidiaries, or the business, operations, Properties, prospects,
profits or condition of Borrower or any of its Subsidiaries, none
of  which  if  resolved adversely to Borrower or its Subsidiaries
would have Material Adverse Effect.  Neither Borrower nor any  of
its  Subsidiaries is in default with respect to any order,  writ,
injunction,  judgment, decree or rule of any court,  governmental
authority or arbitration board or tribunal.


                                26
<PAGE>

                8.1.20.  No Defaults.  No event has occurred  and
no  condition exists which would, upon or after the execution and
delivery  of this Agreement or Borrower's performance  hereunder,
constitute  a  Default or an Event of Default.  Neither  Borrower
nor  any  of  its Subsidiaries is in default, and  no  event  has
occurred and no condition exists which constitutes or which  with
the  passage  of  time  or the giving of  notice  or  both  would
constitute  a  default, under any Material  Contract  or  in  the
payment of any Debt to any Person for Money Borrowed.

                8.1.21.   Leases.  Schedule 8.1.21  hereto  is  a
complete  listing  of  all capitalized and  operating  leases  of
Borrower  and  its  Subsidiaries on the  date  hereof.   Each  of
Borrower and its Subsidiaries is in full compliance with  all  of
the  terms  of  each of its respective capitalized and  operating
leases.

                8.1.22.   Pension Plans.  Except as disclosed  on
Schedule  8.1.22  hereto,  neither  Borrower  nor  any   of   its
Subsidiaries has any Plan on the date hereof.  Borrower and  each
of  its  Subsidiaries is in full compliance with the requirements
of  ERISA and the regulations promulgated thereunder with respect
to  each  Plan.   No  fact or situation that could  result  in  a
material adverse change in the financial condition of Borrower or
any  of  its  Subsidiaries exists in connection  with  any  Plan.
Neither  Borrower nor any of its Subsidiaries has any  withdrawal
liability in connection with a Multiemployer Plan.

                8.1.23.  Trade Relations.  There exists no actual
or  threatened termination, cancellation or limitation of, or any
modification  or  change  in, the business  relationship  between
Borrower or any of its Subsidiaries and any customer or any group
of customers whose purchases individually or in the aggregate are
material  to the business of Borrower or any of its Subsidiaries,
or  with any material supplier, and there exists no condition  or
state  of  facts  or circumstances which would materially  affect
adversely Borrower or any of its Subsidiaries or prevent Borrower
or  any  of its Subsidiaries from conducting such business  after
the   consummation  of  the  transactions  contemplated  by  this
Agreement  in  substantially the same  manner  in  which  it  has
heretofore been conducted.

                8.1.24.   Labor  Relations. On the  date  hereof,
there are no material grievances, disputes or controversies  with
any  union or any other organization of Borrower's or any of  its
Subsidiaries' employees, or threats of strikes, work stoppages or
any  asserted  pending demands for collective bargaining  by  any
union or organization.

                8.1.25.   Investment Company Act; Public  Utility
Holding Company Act.  No Obligor is an "investment company" or  a
"person directly or indirectly controlled by or acting on  behalf
of  an  investment company" within the meaning  of the Investment
Company  Act  of 1940, or a "holding company," or  a  "subsidiary
company"  of a "holding company," or an "affiliate" of a "holding
company"  or  of  a "subsidiary company" of a "holding  company,"
within  the  meaning  of the Public Utility Holding  Company  Act
of 1935.

                8.1.26.  Margin Stock.  Neither Borrower nor  any
of  the  Subsidiaries is engaged, principally or as  one  of  its
important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Stock.

                 8.1.27.   No  Subsidiaries.   Borrower  has   no
Subsidiaries as of the date hereof.

     8.2.  Reaffirmation of Representations and Warranties.  Each
representation and warranty contained in this Agreement  and  the
other Loan Documents shall be deemed to be reaffirmed by Borrower
on  each date that Borrower requests an extension of credit under
this  Agreement,  except  for changes  as  to  which  Lender  has
consented  or  which are not violative of any provision  of  this
Agreement.   Notwithstanding the foregoing,  representations  and
warranties which by their terms are applicable only to a specific
date shall be deemed made only at and as of such date.


                                27
<PAGE>

     8.3.  Survival  of  Representations  and  Warranties.    All
representations  and  warranties of Borrower  contained  in  this
Agreement  or any of the other Loan Documents shall  survive  the
execution,  delivery and acceptance thereof  by  Lender  and  the
parties  thereto  and  the closing of the transactions  described
therein or related thereto.

SECTION 9.COVENANTS AND CONTINUING AGREEMENTS

     9.1.   Affirmative  Covenants.   During  the  term  of  this
Agreement,  and  thereafter  for  so  long  as  there   are   any
Obligations to Lender, Borrower covenants that, unless  otherwise
consented to by Lender in writing, it shall and shall cause  each
Subsidiary to:

                 9.1.1.      Visits   and  Inspections.    Permit
representatives of Lender, from time to time, as often as may  be
reasonably requested, but only during normal business  hours,  to
visit  and  inspect the Properties of Borrower and  each  of  its
Subsidiaries,  inspect, audit and make extracts  from  Borrower's
and  each  Subsidiary's  books  and  records,  and  discuss  with
Borrower's   officers,  employees  and  independent   accountant,
Borrower's  and each Subsidiary's business, assets,  liabilities,
financial   condition,   business  prospects   and   results   of
operations.

                9.1.2.     Notices.   Notify  Lender  in  writing
promptly after Borrower's obtaining knowledge thereof (i) of  the
occurrence  of  any  event or the existence  of  any  fact  which
renders any representation or warranty in this Agreement  or  any
of  the other Loan Documents inaccurate, incomplete or misleading
in  any  material  respect;  (ii)  of  the  commencement  of  any
litigation  affecting Borrower or any of its  Properties  or  the
institution of any administrative proceeding which, if determined
adversely  to  Borrower,  would have a Material  Adverse  Effect;
(iii)  at  least 60 days prior thereto, of Borrower's opening  of
any  new office or place of business or Borrower's closing of any
existing  office or place of business; (iv) of any labor  dispute
to  which  Borrower may become a party, any strikes  or  walkouts
relating  to  any  of  its plants or other  facilities,  and  the
expiration  of any labor contract to which it is a  party  or  by
which  it is bound; (v) of the existence of any Default or  Event
of  Default; or (vi) of any judgment rendered against Borrower in
an amount exceeding $25,000.

                9.1.3.     Financial Statements.   Keep  adequate
records  and  books  of  account with  respect  to  its  business
activities  in  which proper entries are made in accordance  with
GAAP  reflecting all its financial transactions; and cause to  be
prepared  and  furnished  to Lender  the  following  (all  to  be
prepared  in accordance with GAAP applied on a consistent  basis,
unless  Borrower's  certified public accountants  concur  in  any
change  therein  and such change is disclosed to  Lender  and  is
consistent with GAAP):

               (i)   not  later than 120 days after the close  of
     each  Fiscal Year of Borrower, unqualified audited financial
     statements of Borrower and its Subsidiaries as of the end of
     such  year,  on  a  Consolidated  and  consolidating  basis,
     certified   by  a  firm  of  independent  certified   public
     accountants of recognized standing selected by Borrower  but
     acceptable  to  Lender  (except for a  qualification  for  a
     change  in  accounting principles with which the  accountant
     concurs);

               (ii)  not later than 30 days after the end of each
     month  hereafter,  including the last  month  of  Borrower's
     Fiscal  Year,  unaudited  interim  financial  statements  of
     Borrower  and its Subsidiaries as of the end of  such  month
     and  of  the portion of Borrower's Fiscal Year then elapsed,
     on  a Consolidated and consolidating basis, certified by the
     controller of Borrower as prepared in accordance  with  GAAP
     and  fairly  presenting the Consolidated financial  position
     and  results  of operations of Borrower and its Subsidiaries
     for such month and period subject only to changes from audit
     and  year-end  adjustments and except that  such  statements
     need not contain notes;


                                28
<PAGE>

               (iii)      promptly  after the sending  or  filing
     thereof, as the case may be, copies of any proxy statements,
     financial  statements  or reports which  Borrower  has  made
     available  to  its shareholders and copies of  any  regular,
     periodic  and  special  reports or  registration  statements
     which  Borrower  files  with  the  Securities  and  Exchange
     Commission  or  any  governmental  authority  which  may  be
     substituted therefor, or any national securities exchange;

                (iv) promptly after the filing thereof, copies of
     any  annual report to be filed in accordance with  ERISA  in
     connection with each Plan; and

               (v)   such  other data and information  (financial
     and  otherwise) as Lender, from time to time, may reasonably
     request,  bearing  upon  or related  to  the  Collateral  or
     Borrower's and each of its Subsidiaries' financial condition
     or results of operations.

          Concurrently   with  the  delivery  of  the   financial
statements  described  in  clause  (i)  of  this  Section  9.1.3,
Borrower  shall  forward  to Lender a copy  of  the  accountants'
letter  to  Borrower's management that is prepared in  connection
with  such  financial  statements and  also  shall  cause  to  be
prepared  and  shall  furnish  to Lender  a  certificate  of  the
aforesaid certified public accountants certifying to Lender that,
based  upon  their  examination of the  financial  statements  of
Borrower and its Subsidiaries performed in connection with  their
examination of said financial statements, they are not  aware  of
any  Default or Event of Default, or, if they are aware  of  such
Default  or Event of Default, specifying the nature thereof,  and
acknowledging, in a manner satisfactory to Lender, that they  are
aware  that  Lender  is relying on such financial  statements  in
making its decisions with respect to the Loans.

                9.1.4.     Compliance Certificates.  Concurrently
with  the  delivery  of  the financial  statements  described  in
clause  (i)  of Section 9.1.3 and concurrently with the  delivery
of  the  monthly financial statement described in clause (ii)  of
Section  9.1.3  ending a Fiscal Quarter, or  more  frequently  if
requested  by  Lender, Borrower shall cause to  be  prepared  and
furnished  to  Lender a Compliance Certificate  executed  by  the
controller of Borrower.

                9.1.5.    Landlord and Storage Agreements.   Upon
Lender's  written  request, provide Lender  with  copies  of  all
agreements  between Borrower or any of its Subsidiaries  and  any
landlord  or  warehouseman which owns any premises at  which  any
Inventory may, from time to time, be kept.

                9.1.6.     Projections.  No later  than  30  days
prior  to  the  end of each Fiscal Year of Borrower,  deliver  to
Lender  Projections of Borrower for the forthcoming Fiscal  Year,
quarter by quarter.

                9.1.7.     Taxes.    Pay and discharge all  Taxes
prior  to  the  date  on  which such Taxes become  delinquent  or
penalties attach thereto, except and to the extent only that such
Taxes are being Properly Contested.

                9.1.8.    Compliance with Laws.  Comply with  all
Applicable  Law,  including all laws, statutes,  regulations  and
ordinances  regarding  the collection,  payment  and  deposit  of
Taxes, and all ERISA and Environmental Laws, and obtain and  keep
in  force  any  and all Governmental Approvals necessary  to  the
ownership  of  its Properties or to the conduct of its  business,
which  violation  or  failure to obtain  might  have  a  Material
Adverse   Effect.   Without  limiting  the  generality   of   the
foregoing, if any Environmental Release shall occur at or on  any
of  the Properties of Borrower or any Subsidiary, Borrower shall,
or  shall cause the applicable Subsidiary to, act immediately  to
investigate  the  extent  of, and to  make  appropriate  remedial
action  to eliminate, such Environmental Release, whether or  not
ordered  or  otherwise  directed to do  so  by  any  governmental
authority.

                                29
<PAGE>

               9.1.9.    Insurance.  In addition to the insurance
required  herein  with respect to the Collateral,  maintain  with
financially sound and reputable insurers, insurance with  respect
to  its  Properties  and  business against  such  casualties  and
contingencies of such type (including product liability, business
interruption,   larceny,   embezzlement,   or   other    criminal
misappropriation insurance) and in such amounts as  is  customary
in  the  business of Borrower or as otherwise reasonably required
by Lender.

               9.1.10.     Authority  Consent.   No  later   than
January 20, 2003, Borrower shall have delivered to Lender a  copy
of  a  written  consent  of The Montgomery Airport  Authority  to
Borrower's  grant to Lender of a mortgage Lien in and the  filing
of  a Mortgage with respect to all of Borrower's interest in  and
to the real Property leased by Borrower from such authority and a
title   insurance  commitment  with  respect  thereto   in   form
reasonably acceptable to Lender.

     9.2. Negative Covenants.  During the term of this Agreement,
and  thereafter  for  so  long as there are  any  Obligations  to
Lender,   Borrower  covenants  that,  unless  Lender  has   first
consented  thereto in writing, it shall not and shall not  permit
any Subsidiary to:

                9.2.1.     Fundamental Changes.  Enter  into  any
transaction to merge, reorganize, consolidate or amalgamate  with
any  Person, or liquidate, wind up or dissolve itself, except for
mergers   or  consolidations  of  any  Subsidiary  with   another
Subsidiary.

               9.2.2.    Loans.  Make any loans or other advances
of  money  to any Person other than to an officer or employee  of
Borrower  or  a Subsidiary for salary, travel advances,  advances
against  commissions and other similar advances in  the  ordinary
course of business.

                9.2.3.    Total Debt.  Create, incur, assume,  or
suffer   to   exist  any  Debt,  except:   (i)  the  Obligations;
(ii)  Subordinated Debt existing on the Closing Date; (iii)  Debt
of  any Subsidiary of Borrower to Borrower; (iv) accounts payable
to trade creditors and current operating expenses (other than for
Money  Borrowed)  which  are not aged more  than  120  days  from
billing date or more than 30 days from the due date, in each case
incurred in the ordinary course of business and paid within  such
time  period,  unless  the  same are  being  Properly  Contested;
(v)  obligations  to  pay  rent  in  connection  with  Borrower's
business  operations; (vi) Purchase Money Debt; (vii)  contingent
liabilities  arising  out of endorsements  of  checks  and  other
negotiable instruments for deposit or collection in the  ordinary
course   of   business;   and  (viii)  Debt   not   included   in
paragraphs (i) through (vii) above which does not exceed  at  any
time, in the aggregate, the sum of $25,000.

                9.2.4.    Affiliate Transactions.  Enter into, or
be  a party to any transaction with any Affiliate or stockholder,
except:  (i) the transactions contemplated by the Loan Documents;
(ii)  payment  of  customary  directors'  fees  and  indemnities;
(iii)  Distributions to the extent permitted under Section  9.2.7
hereof;  (iv) transactions with Affiliates that were  consummated
prior  to the date hereof and have been disclosed to Lender prior
to  the  Closing  Date;  and (v) in the ordinary  course  of  and
pursuant  to  the reasonable requirements of Borrower's  or  such
Subsidiary's  business and upon fair and reasonable  terms  which
are  fully  disclosed  to Lender and are  no  less  favorable  to
Borrower  or  such Subsidiary than would obtain in  a  comparable
arm's  length  transaction  with a Person  not  an  Affiliate  or
stockholder of Borrower or such Subsidiary.

                9.2.5.    Limitation on Liens.  Create or  suffer
to  exist  any Lien upon any of its Property, income or  profits,
whether now owned or hereafter acquired, except:

               (i)  Liens at any time granted in favor of Lender;

                (ii)  Liens for Taxes (excluding any Lien imposed
     pursuant to any of the provisions of ERISA) incurred in  the
     ordinary  course of Borrower's business and not yet  due  or
     being Properly Contested;

                                30
<PAGE>

                (iii)     Liens arising in the ordinary course of
     Borrower's  business by operation of law or regulation,  but
     only  if payment in respect of any such Lien is not  at  the
     time  required or the Debt secured by any such Lien is being
     Properly Contested and such Liens do not materially  detract
     from  the  value of the Property of Borrower  or  materially
     impair  the  use  thereof  in the  operation  of  Borrower's
     business;

                (iv) Purchase Money Liens securing Purchase Money
     Debt;

                (v)   Liens  securing Debt  of  a  Subsidiary  to
     Borrower or another such Subsidiary;

                (vi)  Liens  arising by virtue of the  rendition,
     entry or issuance against Borrower or any Subsidiary, or any
     Property  of  Borrower or any Subsidiary, of  any  judgment,
     writ,  order,  or decree for so long as each  such  Lien  is
     (a)  either  in existence for less than 20 consecutive  days
     after  it  first arises or is being Properly  Contested  and
     (b) is at all times junior in priority to the Liens in favor
     of Lender;

                (vii)     Liens incurred or deposits made in  the
     ordinary  course  of business to secure the  performance  of
     tenders,  bids,  leases,  contracts  (other  than  for   the
     repayment  of  Money  Borrowed), statutory  obligations  and
     other similar obligations or arising as a result of progress
     payments under government contracts, provided that,  to  the
     extent any such Liens attach to any of the Collateral,  such
     Liens  are at all times subordinate and junior to the  Liens
     upon the Collateral in favor of Lender;

                (viii)    easements, rights-of-way, restrictions,
     covenants  or  other agreements of record and other  similar
     charges  or encumbrances on real Property of Borrower  or  a
     Subsidiary  that do not interfere with the ordinary  conduct
     of the business of Borrower or such Subsidiary;

                (ix) Liens in existence immediately prior to  the
     Closing Date that are satisfied in full and released on  the
     Closing  Date  as a result of the application of  Borrower's
     cash  on  hand  at the Closing Date or the proceeds  of  the
     Loans to be made on the Closing Date;

                (x)  such other Liens as appear on Schedule 9.2.5
     hereto; and

                (xi)  such  other Liens as Lender  may  hereafter
     approve in writing.

                9.2.6.    Subordinated Debt.  Make any payment of
all or any part of any Subordinated Debt or take any other action
or  omit  to take any other action in respect of any Subordinated
Debt,   except   as  otherwise  permitted  by  the  Subordination
Agreement or by Lender in writing.

               9.2.7.     Distributions.   Declare  or  make  any
Distributions.

                9.2.8.     Capital  Expenditures.   Make  Capital
Expenditures  (including  expenditures  by  way  of   capitalized
leases)  which,  in  the  aggregate,  as  to  Borrower  and   its
Subsidiaries, exceed $1,000,000 during the 2002 Fiscal  Year  and
$500,000  during  any  Fiscal  Year  thereafter,  provided   that
Borrower may submit to Lender its budget for Capital Expenditures
in  future  Fiscal Years and Lender will consider in  good  faith
modifications to the foregoing limitations.

               9.2.9.    [Reserved]

                9.2.10.   Disposition of Assets.  Sell, lease  or
otherwise  dispose  of  any  of  its  Properties,  including  any
disposition  of  Property  as  part  of  a  sale  and   leaseback
transaction,  to or in favor of any Person, except (i)  sales  of
Inventory  in the ordinary course of business for so long  as  no
Event of Default exists hereunder, (ii) a transfer of Property to
Borrower   by   a  Subsidiary  of  Borrower,  and   (iii)   other
dispositions expressly authorized by other provisions of the Loan
Documents .

                                31
<PAGE>

               9.2.11.  Equity Interests of Subsidiaries.  Permit
any  of its Subsidiaries to issue any additional Equity Interests
except director's qualifying shares.

               9.2.12.  Bill-and-Hold Sales, Etc.  Make a sale to
any  customer  on  a  bill-and-hold, guaranteed  sale,  sale  and
return, sale on approval or consignment basis, or any sale  on  a
repurchase or return basis.

                9.2.13.  Restricted Investment.  Make or have any
Restricted Investment.

                9.2.14.   Tax Consolidation.  File or consent  to
the  filing of any consolidated income tax return with any Person
other than a Subsidiary.

                9.2.15.   Fiscal Year.  Establish a  fiscal  year
different from the Fiscal Year.

                9.2.16.   Directors=  and  Financing  Fees.   Pay
directors= fees or financing fees other than directors'  fees  to
outside directors at current levels.

               9.2.17.  Organization Documents.  Amend, modify or
otherwise  change any of the terms or provisions and any  of  its
Organization  Documents as in effect on date hereof,  except  for
changes  that  do  not  affect  in any  way  Borrower's  or  such
Subsidiary's rights and obligations to enter into and to  perform
the  Loan Documents to which it is a party and to pay all of  the
Obligations  and  that do not otherwise have a  Material  Adverse
Effect.

     9.3.  Specific Financial Covenants.  During the term of this
Agreement,  and  thereafter  for  so  long  as  there   are   any
Obligations   outstanding,  Borrower   covenants   that,   unless
otherwise consented to by Lender in writing, it shall not:

                9.3.1.     Fixed  Charge Coverage Ratio.   Permit
Borrower's Fixed Charge Coverage Ratio to be less than 1.5 to 1.0
as of the last day of each Fiscal Quarter hereafter, in each case
for the period of 4 Fiscal Quarters then ending.

               9.3.2.    Tangible Net Worth.  Permit the Tangible
Net  Worth of Borrower to be less than $9,000,000 as of the  last
day  of  any Fiscal Quarter; provided, however, that on the  90th
day  of  each  Fiscal Year after the Closing  Date,  the  minimum
Tangible   Net  Worth  required  hereunder  shall  be  thereafter
increased by an amount equal to 50% of Borrower's Net Income  for
the immediately preceding Fiscal Year.

     SECTION 10.    CONDITIONS PRECEDENT

     10.1.Conditions Precedent to Initial Loans.  Notwithstanding
any  other  provision of this Agreement or any of the other  Loan
Documents,  and  without affecting in any manner  the  rights  of
Lender  under the other sections of this Agreement, Lender  shall
not be required to fund any Loan requested by Borrower unless, on
or  before January 15, 2003, each of the following conditions has
been and continues to be satisfied:

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<PAGE>

                 10.1.1.    Documentation.   Lender  shall   have
received,  in form and substance satisfactory to Lender  and  its
counsel,  a duly executed counterpart of this Agreement  and  the
other  Loan  Documents, together with such additional  documents,
instruments  and  certificates as Lender and  its  counsel  shall
require  in connection therewith from time to time, all  in  form
and substance satisfactory to Lender and its counsel.

                10.1.2.   Evidence of Perfection and Priority  of
Liens  in Collateral.  Lender shall have received copies  of  all
filing  receipts  or acknowledgments issued by  any  governmental
authority  to  evidence  any filing or recordation  necessary  to
perfect  the  Liens of Lender in the Collateral and  evidence  in
form satisfactory to Lender that such Liens constitute valid  and
perfected  Liens,  and  that there are no other  Liens  upon  any
Collateral except for Permitted Liens.

                10.1.3.    Organization Documents.  Lender  shall
have  received a copy of the Organization Documents of  Borrower,
and  all amendments thereto, certified by the Secretary of  State
or  other  appropriate official of the jurisdiction of Borrower's
formation.

                10.1.4.    Good  Standing  Certificates.   Lender
shall  have  received  good standing certificates  for  Borrower,
issued by the Secretary of State or other appropriate official of
Borrower's  jurisdiction of organization  and  each  jurisdiction
where Borrower has qualified to do business.

                10.1.5.    Opinion  Letters.  Lender  shall  have
received  a  favorable, written opinion of Balch & Bingham,  LLP,
counsel to Borrower, as to the transactions contemplated by  this
Agreement and the matters set forth in Exhibit D attached hereto.

                10.1.6.    Insurance.  Lender shall have received
loss payable endorsements on Lender's standard form of loss payee
endorsement   naming   Lender  as  loss   payee   together   with
endorsements  naming  Lender  as a  co-insured  with  respect  to
Borrower's liability insurance coverage.

                10.1.7.    Disbursement  Letter;  Borrowing  Base
Certificate.   Lender  shall have received  written  instructions
from  Borrower directing application of proceeds of  the  initial
Loans  made pursuant to this Agreement, and an initial  Borrowing
Base Certificate from Borrower, in form satisfactory to Lender.

                10.1.8.   Dominion  Account.  Lender  shall  have
received  the  duly executed agreement establishing the  Dominion
Account with a financial institution acceptable to Lender for the
collection or servicing of the Accounts.

                10.1.9.  Landlord Agreements.  Lender shall  have
received landlord or warehouseman agreements in substantially the
form  presented  to  Borrower with respect  to  certain  premises
leased  by  Borrower and which are disclosed  on  Schedule  7.1.1
hereto.

                10.1.10. Title Insurance Policies.  Lender  shall
have  received,  had  at  least  15  days  to  review  and  found
acceptable  fully  paid  mortgagee title insurance  policies  (or
binding commitments to issue title insurance policies, marked  to
Lender's satisfaction to evidence the form of such policies to be
delivered after the Closing Date), in standard ALTA form,  issued
by  a title insurance company satisfactory to Lender, each in  an
amount  equal to not less than the fair market value of the  real
Property  or  leasehold interest (other than  the  real  Property
located  in  Indiana),  as  the  case  may  be,  subject  to  the
Mortgages, insuring the Mortgages to create a valid Lien  on  all
real Property and valid Liens on the leasehold interest described
therein  with no exceptions which Lender shall not have  approved
in writing and no survey exceptions.


                                33
<PAGE>
                10.1.11.Survey.  Lender shall have  received  and
found  acceptable an as-built survey with respect to each  parcel
of  real  Property  comprising a part of  the  Collateral,  which
survey  shall indicate the following:  (i) an accurate metes  and
bounds  or  lot,  block and parcel description of such  Property;
(ii)  the correct location of all buildings, structures and other
improvements on such Property, including all streets,  easements,
rights  of  way and utility lines; (iii) the location of  ingress
and  egress from such Property, and the location of any  set-back
or  other  building  lines affecting such Property;  and  (iv)  a
certification by a registered land surveyor in form and substance
acceptable to Lender, certifying to the accuracy and completeness
of  such  survey and to such other matters relating to such  real
Property and survey as Lender shall require.

                10.1.12.  Assignment  of Claims  Act  Compliance.
Borrower    shall   have  entered  into  a  appropriate   written
assignments  of  claims  as may be reasonable  and  necessary  to
comply  with  the Assignment of Claims Act with  respect  all  US
government supply agreements of Borrower currently in force.

                10.1.13. Regions Documents.  Borrower  shall have
entered  into the Regions Documents and Lender and Regions  shall
have entered into the Intercreditor Agreement.

     10.2.Conditions   Precedent  to   all   Credit   Extensions.
Notwithstanding any other provision of this Agreement or  any  of
the other Loan Documents, and without affecting in any manner the
rights  of  Lender  under the other sections of  this  Agreement,
Lender shall not be required to make any Loan or otherwise extend
any  credit  or  other financial accommodations  to  or  for  the
benefit  of  Borrower,  unless and until each  of  the  following
conditions has been and continues to be satisfied:

                10.2.1.    No  Default.  No Default or  Event  of
Default  exists at the time of, or would result from, the funding
of such Loan or other extension of credit.

                10.2.2.    No Litigation.  No action, proceeding,
investigation,   regulation  or  legislation  shall   have   been
instituted, threatened or proposed before any court, governmental
agency or legislative body to enjoin, restrain or prohibit, or to
obtain  damages in respect of, or which is related to  or  arises
out  of  any  of  the Loan Documents or the consummation  of  the
transactions contemplated hereby or thereby.

                10.2.3.    No Material Adverse Effect.  No  event
shall have occurred and no condition shall exist which has or may
be reasonably likely to have a Material Adverse Effect.

                10.2.4.    Current  Borrowing  Base  Certificate.
Lender shall have timely received a Borrowing Base Certificate in
compliance with the provisions of Section 7.5.

     10.3.Limited  Waiver  of Conditions  Precedent.   If  Lender
shall  make any Loans or otherwise extend any credit to  Borrower
under  this  Agreement  at  a  time when  any  of  the  foregoing
conditions precedent are not satisfied (regardless of whether the
failure  of  satisfaction  of any such conditions  precedent  was
known  or  unknown to Lender), the funding of such Loans  or  the
extension  of  such credit shall not operate as a waiver  of  the
right of Lender to insist upon the satisfaction of all conditions
precedent with respect to each subsequent borrowing requested  by
Borrower  or  a waiver of any Default or Event of  Default  as  a
consequence  of  the  failure  of  any  such  conditions  to   be
satisfied,  unless Lender, in writing waives the satisfaction  of
any condition precedent in which event such waiver shall only  be
applicable for the specific instance given and only to the extent
and  for  the  period of time expressly stated  in  such  written
waiver.

SECTION 11.EVENTS OF DEFAULT; RIGHTS AND REMEDIES ON DEFAULT

     11.1.Events of Default.  The occurrence of any one  or  more
of  the following events or conditions shall constitute an "Event
of Default":

                11.1.1.  Payment of Obligations.  Borrower  shall
fail  to pay on the due date thereof any of the other Obligations
(whether due at stated maturity, on demand, upon acceleration  or
otherwise).


                                34
<PAGE>
                11.1.2.  Misrepresentations.  Any representation,
warranty or other statement made or furnished to Lender by or  on
behalf  of  Borrower, any Subsidiary of Borrower or Guarantor  in
this   Agreement,  any  of  the  other  Loan  Documents  or   any
instrument,  certificate  or  financial  statement  furnished  in
compliance with or in reference thereto proves to have been false
or  misleading in any material respect when made or furnished  or
when reaffirmed pursuant to Section 8.2 hereof.

                11.1.3.   Breach of Specific Covenants.  Borrower
shall  fail  or neglect to perform, keep or observe any  covenant
contained in Sections 6.2, 6.3, 7.1.1, 7.1.2, 7.2, 9.1.1,  9.1.3,
9.2  or  9.3  hereof  on the date that Borrower  is  required  to
perform, keep or observe such covenant.

               11.1.4.  Breach of Other Covenants. Borrower shall
fail  or  neglect  to  perform,  keep  or  observe  any  covenant
contained in this Agreement (other than a covenant which is dealt
with  specifically  elsewhere in Section  11.1  hereof)  and  the
breach   of  such  other  covenant  is  not  cured  to   Lender's
satisfaction  within  15  days  after  the  sooner  to  occur  of
Borrower's  receipt of notice of such breach from Lender  or  the
date on which such failure or neglect first becomes known to  any
officer of Borrower; provided, however, that any such notice  and
opportunity to cure shall not apply in the case of any failure to
perform,  keep  or observe any covenant which is not  capable  of
being  cured  at all or within such 15 day period, or  which  has
been the subject of a prior failure within the preceding 90 days,
or which is a willful and knowing breach by Borrower.

                11.1.5.  Default  Under Security  Documents/Other
Agreements.  Any event of default shall occur under, or  Borrower
shall  default  in  the performance or observance  of  any  term,
covenant,  condition  or  agreement  contained  in,  any  of  the
Security Documents or the Other Agreements and such default shall
continue beyond any applicable grace period.

                11.1.6.   Other Defaults.  There shall occur  any
default  or  event of default on the part of Borrower  under  any
agreement, document or instrument to which Borrower is a party or
by  which  Borrower or any of its Property is bound, creating  or
relating  to  any Debt (other than the Obligations) if  (i)  such
Debt is Subordinated Debt; (ii) if such Debt is evidenced by  the
Regions Note; or (iii) the payment or maturity of any other  Debt
in an amount exceeding $50,000 in the aggregate is accelerated in
consequence  of  such event of default or demand for  payment  of
such Debt is made.

                11.1.7.   Uninsured Losses.  Any  material  loss,
theft,  damage or destruction of any of the Collateral not  fully
covered  (subject  to  such  deductibles  as  Lender  shall  have
permitted) by insurance.

                11.1.8.  Solvency.  Any Obligor shall cease to be
Solvent.

                11.1.9.  Insolvency Proceedings.  Any  Insolvency
Proceeding  shall  be commenced by or against Borrower  (and,  if
against  Borrower, the continuation of such Insolvency Proceeding
for  more  than  45 days), or Borrower shall make  any  offer  of
settlement,  extension  or composition  to  Borrower's  unsecured
creditors generally.

               11.1.10. Business Disruption; Condemnation.  There
shall occur a cessation of a substantial part of the business  of
Borrower,  any  Subsidiary of Borrower or  any  Guarantor  for  a
period  which  may  be reasonably expected  to  have  a  Material
Adverse  Effect; or Borrower, any Subsidiary of Borrower  or  any
Guarantor  shall suffer the loss or revocation of any license  or
permit  now  held  or  hereafter acquired  by  Borrower  or  such
Guarantor which is necessary to the continued or lawful operation
of  its business; or Borrower or any Guarantor shall be enjoined,
restrained  or  in  any way prevented by court,  governmental  or
administrative order from conducting all or any material part  of
its business affairs; or any material lease or agreement pursuant
to  which Borrower or any Guarantor leases, uses or occupies  any
Property  shall be canceled or terminated prior to the expiration
of  its stated term; or any material part of the Collateral shall
be taken through condemnation or the value of such Property shall
be materially impaired through condemnation.


                                35
<PAGE>
               11.1.11. [Reserved]

                11.1.12.  ERISA.  A Reportable Event shall  occur
which  Lender,  in its sole discretion, shall determine  in  good
faith  constitutes  grounds for the termination  by  the  Pension
Benefit  Guaranty Corporation of any Plan or for the  appointment
by  the appropriate United States district court of a trustee for
any  Plan, or if any Plan shall be terminated or any such trustee
shall  be  requested or appointed, or if Borrower, any Subsidiary
of  Borrower  or  any Guarantor is in "default"  (as  defined  in
Section  4219(c)(5)  of  ERISA) with respect  to  payments  to  a
Multiemployer  Plan resulting from Borrower's, such  Subsidiary's
or  such  Guarantor's  complete or partial withdrawal  from  such
Plan.

                11.1.13.  Challenge to Loan Documents.  Borrower,
any Subsidiary of Borrower or any Guarantor, or any Affiliate  of
any  of  them, shall challenge or contest in any action, suit  or
proceeding  the validity or enforceability of this  Agreement  or
any  of  the other Loan Documents, the legality or enforceability
of  any  of the Obligations or the perfection or priority of  any
Lien granted to Lender.

                11.1.14. Repudiation of or Default Under Guaranty
Agreement.   Any Guarantor shall revoke or attempt to revoke  the
Guaranty Agreement signed by such Guarantor, shall repudiate such
Guarantor's  liability thereunder, or shall be in  default  under
the  terms thereof, or shall fail to confirm in writing, promptly
after   receipt  of  Lender's  written  request  therefor,   such
Guarantor's  ongoing  liability under the Guaranty  Agreement  in
accordance with the terms thereof.

                 11.1.15.  Criminal  Forfeiture.   Borrower,  any
Subsidiary  of  Borrower  or any Guarantor  shall  be  criminally
indicted  or  convicted  under any  law  that  could  lead  to  a
forfeiture  of  any  Property  of  Borrower,  any  Subsidiary  of
Borrower or any Guarantor.

                11.1.16. Judgment.  A judgment or order  for  the
payment  of  money  in  an  amount that exceeds  the  uncontested
insurance available therefor by $50,000 or more shall be  entered
against  the  Borrower by any court and such  judgment  or  order
shall result in the creation of a Lien upon any asset of Borrower
that is not a Permitted Lien.

     11.2.Acceleration of the Obligations.  Without  in  any  way
limiting the right of Lender to demand payment of any portion  of
the  Obligations  payable  on  demand  in  accordance  with  this
Agreement, upon or at any time after the occurrence of  an  Event
of  Default  which  remains uncured after the expiration  of  any
applicable grace period and for so long as such Event of  Default
shall  exist, Lender may in its discretion declare the  principal
of   and  any  accrued  interest  on  the  Loans  and  all  other
Obligations  to  be,  whereupon the  same  shall  become  without
further notice or demand (all of which further notice and  demand
Borrower  expressly  waives),  forthwith  due  and  payable   and
Borrower  shall forthwith pay to Lender the entire  principal  of
and   accrued  and  unpaid  interest  on  the  Loans  and   other
Obligations plus reasonable attorneys' fees and expenses if  such
principal and interest are collected by or through an attorney-at-
law.   Notwithstanding the foregoing, upon the occurrence  of  an
Event  of Default specified in Section 11.1.9 hereof all  of  the
Obligations  shall become automatically due and  payable  without
declaration, notice or demand by Lender and this Agreement  shall
automatically  terminate as if terminated by Lender  pursuant  to
Section  5.2.1  and with the effect set forth  in  Section  5.2.4
hereof.

     11.3.Other  Remedies.  Upon and after the occurrence  of  an
Event  of  Default which remains uncured after the expiration  of
any  applicable grace period, and for so long as  such  Event  of
Default shall exist, Lender shall have and may exercise from time
to time the following rights and remedies:

                                36
<PAGE>

                11.3.1.   All  of the rights and  remedies  of  a
secured  party under the UCC or under other Applicable  Law,  and
all other legal and equitable rights and remedies to which Lender
may  be  entitled under any of the Loan Documents, all  of  which
rights  and remedies shall be cumulative and shall be in addition
to  any  other rights or remedies contained in this Agreement  or
any  of  the  other Loan Documents, and none of  which  shall  be
exclusive.

                11.3.2.  The right to collect all amounts at  any
time  payable to Borrower from any Account Debtor or other Person
at any time indebted to Borrower.

               11.3.3.  The right to take immediate possession of
the  Collateral,  and  to (i) require Borrower  to  assemble  the
Collateral,  at  Borrower's expense, and  make  it  available  to
Lender  at  a  place  designated by Lender  which  is  reasonably
convenient to both parties, and (ii) enter any premises where any
of  the  Collateral shall be located and to keep  and  store  the
Collateral  on said premises until sold (and if said premises  be
the  Property  of Borrower, then Borrower agrees  not  to  charge
Lender for storage thereof).

               11.3.4.  The right to sell or otherwise dispose of
all or any Collateral in its then condition, or after any further
manufacturing or processing thereof, at public or private sale or
sales, with such notice as may be required by Applicable Law,  in
lots  or  in bulk, for cash or on credit, all as Lender,  in  its
sole  discretion, may deem advisable.  Borrower agrees  that  any
requirement  of  notice to Borrower or any other Obligor  of  any
proposed   public  or  private  sale  or  other  disposition   of
Collateral by Lender shall be deemed reasonable notice thereof if
given  at  least 10 days prior thereto, and such sale may  be  at
such  locations  as Lender may designate in said notice.   Lender
shall  have  the  right  to  conduct  such  sales  on  Borrower's
premises,  without  charge  therefor,  and  such  sales  may   be
adjourned  from  time to time in accordance with Applicable  Law.
Lender  shall have the right to sell, lease or otherwise  dispose
of  the Collateral, or any part thereof, for cash, credit or  any
combination thereof, and Lender may purchase all or any  part  of
the  Collateral at public or, if permitted by law,  private  sale
and,  in  lieu of actual payment of such purchase price, may  set
off  the  amount  of  such price against  the  Obligations.   The
proceeds  realized  from  the sale or other  disposition  of  any
Collateral  may  be applied, after allowing 2 Business  Days  for
collection,  first  to the costs, expenses  and  attorneys'  fees
incurred  by  Lender in collecting the Obligations, in  enforcing
the  rights of Lender under the Loan Documents and in collecting,
retaking,  completing, protecting, removing, storing, advertising
for  sale,  selling  and  delivering any  Collateral,  second  to
interest  accrued  with respect to any of  the  Obligations;  and
third,  to  the principal of the Obligations.  If any  deficiency
shall arise, Borrower and each Guarantor shall remain jointly and
severally liable to Lender therefor.

Lender is hereby granted a license or other right to use, without
charge, Borrower's labels, patents, copyrights, rights of use  of
any  name,  trade secrets, tradenames, trademarks and advertising
matter,  or  any Property of a similar nature, as it pertains  to
the   Collateral,  in  advertising  for  sale  and  selling   any
Collateral  and  Borrower's rights under  all  licenses  and  all
franchise agreements shall inure to Lender's benefit.

     11.4.Setoff.  In addition to any Liens granted under any  of
the  Loan  Documents  and any rights now or  hereafter  available
under Applicable Law, Lender is hereby authorized by Borrower  at
any  time  that  an  Event of Default exists, without  notice  to
Borrower  or  any  other  Person (any such  notice  being  hereby
expressly waived) to set off and to appropriate and to apply  any
and all deposits, general or special (including Debt evidenced by
certificates  of  deposit whether matured or unmatured  (but  not
including  trust or escrow accounts)) and any other Debt  at  any
time  held  or owing by Lender or its Affiliates to  or  for  the
credit  or the account of Borrower against and on account of  the
Obligations  of  Borrower arising under  the  Loan  Documents  to
Lender,  including  all Loans and all claims  of  any  nature  or
description arising out of or in connection with this  Agreement,
irrespective  of whether or not (i) Lender shall  have  made  any
demand hereunder or (ii) Lender shall have declared the principal
of  and interest on the Loans and other amounts due hereunder  to
be due and payable as permitted by this Agreement and even though
such  Obligations  may be contingent or unmatured  or  (iii)  the
Collateral for the Obligations is adequate.


                                37
<PAGE>

     11.5.Remedies Cumulative; No Waiver.

                11.5.1.   All covenants, conditions,  provisions,
warranties,  guaranties, indemnities, and other  undertakings  of
Borrower   contained  in  this  Agreement  and  the  other   Loan
Documents, or in any document referred to herein or contained  in
any  agreement supplementary hereto or in any schedule or in  any
Guaranty  Agreement  given to Lender or contained  in  any  other
agreement  between Lender and Borrower, heretofore, concurrently,
or  hereafter entered into, shall be deemed cumulative to and not
in  derogation  or  substitution of any of the terms,  covenants,
conditions, or agreements of Borrower herein contained.

               11.5.2.  The failure or delay of Lender to require
strict performance by Borrower of any provision of this Agreement
or  to exercise or enforce any rights, Liens, powers, or remedies
hereunder  or  under  any of the aforesaid  agreements  or  other
documents or security or Collateral shall not operate as a waiver
of  such performance, Liens, rights, powers and remedies, but all
such  requirements,  Liens, rights, powers,  and  remedies  shall
continue  in full force and effect until all Loans and all  other
Obligations  owing  or to become owing from  Borrower  to  Lender
shall  have  been  fully satisfied.  None  of  the  undertakings,
agreements, warranties, covenants and representations of Borrower
contained  in  this Agreement or any of the other Loan  Documents
and  no Event of Default by Borrower under this Agreement or  any
other  Loan  Documents shall be deemed to have been suspended  or
waived  by  Lender, unless such suspension or  waiver  is  by  an
instrument in writing specifying such suspension or waiver and is
signed by a duly authorized representative of Lender and directed
to Borrower.

                11.5.3.   If  Lender shall accept performance  by
Borrower, in whole or in part, of any obligation that Borrower is
required  by  any of the Loan Documents to perform  only  when  a
Default  or Event of Default exists, or if Lender shall  exercise
any  right or remedy under any of the Loan Documents that may not
be  exercised  other  than when a Default  or  Event  of  Default
exists,  Lender's acceptance of such performance by  Borrower  or
Lender's  exercise of any such right or remedy shall not  operate
to waive any such Event of Default or to preclude the exercise by
Lender of any other right or remedy.

SECTION 12.MISCELLANEOUS

     12.1.Power   of   Attorney.   Borrower  hereby   irrevocably
designates, makes, constitutes and appoints Lender as  Borrower's
true  and  lawful  attorney (and agent-in-fact) and  Lender  may,
without  notice to Borrower and in either Borrower's or  Lender's
name, but at the cost and expense of Borrower:

                12.1.1.  At such time or times as Lender, in  its
sole  discretion, may determine, endorse Borrower's name  on  any
checks,  notes, acceptances, drafts, money orders  or  any  other
evidence of payment or proceeds of the Collateral which come into
the  possession  of  Lender  or under Lender's  control  for  the
purpose of crediting such payments to the Obligations pursuant to
the terms of this Agreement.

                 12.1.2.   At  such  time  or  times  during  the
existence  of  an  Event of Default which was uncured  after  the
expiration of any applicable grace period, as Lender in its  sole
discretion may determine: (i) demand payment of the Accounts from
the  Account  Debtors, enforce payment of the Accounts  by  legal
proceedings   or  otherwise,  and  generally  exercise   all   of
Borrower's rights and remedies with respect to the collection  of
the  Accounts;  (ii)  settle, adjust,  compromise,  discharge  or
release  any  of the Accounts or other Collateral  or  any  legal
proceedings  brought  to collect any of  the  Accounts  or  other
Collateral;  (iii) sell or assign any of the Accounts  and  other
Collateral upon such terms, for such amounts and at such time  or
times  as  Lender  deems advisable; (iv)  take  control,  in  any
manner,  of  any  item  of payment or proceeds  relating  to  any
Collateral; (v) prepare, file and sign Borrower's name to a proof
of  claim  in bankruptcy or similar document against any  Account
Debtor  or  to any notice of lien, assignment or satisfaction  of
lien   or  similar  document  in  connection  with  any  of   the
Collateral; (vi) receive, open and dispose of all mail  addressed
to  Borrower  and  to  notify postal authorities  to  change  the
address  for  delivery  thereof to such  address  as  Lender  may
designate;  (vii) endorse the name of Borrower upon  any  of  the
items  of  payment  or proceeds relating to  any  Collateral  and


                                38
<PAGE>

deposit  the  same  to the account of Lender on  account  of  the
Obligations; (viii) endorse the name of Borrower upon any chattel
paper,  document,  instrument, invoice,  freight  bill,  bill  of
lading or similar document or agreement relating to the Accounts,
Inventory   and   any  other  Collateral;  (ix)  use   Borrower's
stationery and sign the name of Borrower to verifications of  the
Accounts  and  notices thereof to Account Debtors;  (x)  use  the
information  recorded  on or contained  in  any  data  processing
equipment  and  computer hardware and software  relating  to  the
Accounts,  Inventory  and  any other Collateral;  (xi)  make  and
adjust claims under policies of insurance; and (xii) do all other
acts  and things necessary, in Lender's determination, to fulfill
Borrower's obligations under this Agreement.

     12.2.Indemnity.   Borrower hereby agrees  to  indemnify  and
defend  Lender  and  hold Lender harmless from  and  against  any
Claims  against  Lender  as the result of Borrower's  failure  to
observe, perform or discharge any of Borrower's duties hereunder.
In  addition, Borrower shall indemnify and defend Lender  against
and  save  Lender harmless from all Claims of any Person  arising
out  of,  related to, or with respect to any transactions entered
into  pursuant  to  this  Agreement or  any  of  the  other  Loan
Documents or Lender's Lien upon any of the Collateral, excluding,
however,   Claims  arising  by  reason  of  Lender's  own   gross
negligence  or  intentional  misconduct.   Without  limiting  the
generality of the foregoing, this indemnity shall extend  to  any
Claims   asserted  against  Lender  by  any  Person   under   any
Environmental Laws or similar laws by reason of Borrower's or any
other Person's failure to comply with laws applicable to solid or
hazardous    waste   materials   or   other   toxic   substances.
Additionally,  if  any  Taxes (excluding Taxes  imposed  upon  or
measured  solely by the net income of Lender, but including,  any
intangibles tax, stamp tax, recording tax or franchise tax) shall
be  payable  by Lender or Obligor on account of the execution  or
delivery  of this Agreement, or the execution, delivery, issuance
or  recording of any of the other Loan Documents, or the creation
of any of the Obligations hereunder, by reason of any existing or
hereafter enacted federal, state, foreign or local statute,  rule
or  regulation,  Borrower  will pay (or will  promptly  reimburse
Lender for the payment of) all such Taxes, including any interest
and penalties thereon, and will indemnify, defend and hold Lender
harmless  from and against all liability in connection therewith.
Notwithstanding  any  contrary provision in this  Agreement,  the
obligation of Borrower under this Section 12.2 shall survive  the
payment  in full of the Obligations and the termination  of  this
Agreement.

     12.3.Modification  of  Agreement; Sale  of  Interest.   This
Agreement may not be modified, altered or amended, except  by  an
agreement in writing signed by Borrower and Lender.  Borrower may
not  sell, assign or transfer any interest in this Agreement, any
of  the  other Loan Documents, or any of the Obligations, or  any
portion  thereof, including Borrower's rights, title,  interests,
remedies,  powers, and duties hereunder or thereunder.   Borrower
hereby  consents  to  Lender's participation,  sale,  assignment,
transfer or other disposition, at any time or times hereafter, of
the  Obligations,  this  Agreement and  any  of  the  other  Loan
Documents,  or  of  any  portion  hereof  or  thereof,  including
Lender's  rights, title, interests, remedies, powers, and  duties
hereunder  or  thereunder.  In the case  of  an  assignment,  the
assignee  shall have, to the extent of such assignment, the  same
rights,  benefits and obligations as it would if it were "Lender"
hereunder  and  Lender  shall  be  relieved  of  all  obligations
hereunder upon any such assignment.  Borrower agrees that it will
use  its best efforts to assist and cooperate with Lender in  any
manner  reasonably  requested by Lender to  effect  the  sale  of
participations in or assignments of any of the Loan Documents  or
any  portion thereof or interest therein, including assisting  in
the  preparation  of appropriate disclosure documents.   Borrower
further  agrees  that  Lender  may  disclose  credit  information
regarding   Borrower  and  its  Subsidiaries  to  any   potential
participant or assignee.

     12.4.Severability.   Wherever possible,  each  provision  of
this  Agreement  shall be interpreted in such  manner  as  to  be
effective and valid under Applicable Law, but if any provision of
this Agreement shall be prohibited by or invalid under Applicable
Law,  such  provision shall be ineffective only to the extent  of
such   prohibition   or  invalidity,  without  invalidating   the
remainder of such provision or the remaining provisions  of  this
Agreement.


                                39
<PAGE>

     12.5.Successors  and  Assigns.  This  Agreement,  the  Other
Agreements and the Security Documents shall be binding  upon  and
inure  to  the benefit of the successors and assigns of  Borrower
and Lender permitted under Section 12.3 hereof.

     12.6.Cumulative Effect; Conflict of Terms.   The  provisions
of  the  Other Agreements and the Security Documents  are  hereby
made cumulative with the provisions of this Agreement.  Except as
otherwise  provided in Section 4.2 hereof and except as otherwise
provided in any of the other Loan Documents by specific reference
to  the  applicable provision of this Agreement, if any provision
contained  in  this  Agreement is in  direct  conflict  with,  or
inconsistent  with,  any  provision in  any  of  the  other  Loan
Documents, the provision contained in this Agreement shall govern
and control.

     12.7.Execution  in  Counterparts.   This  Agreement  may  be
executed  in any number of counterparts and by different  parties
hereto  in separate counterparts, each of which when so  executed
and  delivered shall be deemed to be an original and all of which
counterparts taken together shall constitute but one and the same
instrument.

     12.8.Notice.  All notices, requests and demands to or upon a
party  hereto shall be in writing and shall be sent by  certified
or  registered mail, return receipt requested, personal  delivery
against  receipt or by telecopier or other facsimile transmission
and  shall  be  deemed  to  have been validly  served,  given  or
delivered when delivered against receipt or 3 Business Days after
deposit  in  the U.S. mail, postage prepaid, or, in the  case  of
facsimile  transmission, when received at the  office  where  the
noticed party's telecopier is located, in each case addressed  as
follows:

          If to Lender:            Citizens Business Credit
                                   100 Galleria Parkway,
                                   Suite 1655
                                   Atlanta, Georgia 30339
                                   Attention: Office Head
                                   Facsimile No.: 770.850.4895

          If to Borrower:          Miltope Corporation
                                   3800 Richardson Road South
                                   Hope Hull, Alabama 36043
                                   Attention: Mr. Thomas Dickinson,
                                   President
                                   Facsimile No.: 334.613.6302

or  to  such other address as each party may designate for itself
by  notice  given  in  accordance with this  Section  12.8.   Any
written notice or demand that is not sent in conformity with  the
provisions  hereof shall nevertheless be effective  on  the  date
that such notice is actually received by the noticed party.

     12.9.Credit  Inquiries.   Borrower  hereby  authorizes   and
permits  Lender (but Lender shall have no obligation) to  respond
to  usual  and  customary  credit inquiries  from  third  parties
concerning Borrower or any of its Subsidiaries.

     12.10.Time  of  Essence.  Time is of  the  essence  of  this
Agreement, the Other Agreements and the Security Documents.

                                40
<PAGE>

     12.11.Entire  Agreement; Exhibits.  This Agreement  and  the
other  Loan  Documents,  together  with  all  other  instruments,
agreements and certificates executed by the parties in connection
therewith   or   with  reference  thereto,  embody   the   entire
understanding  and  agreement  between  the  parties  hereto  and
thereto with respect to the subject matter hereof and thereof and
supersede  all prior agreements, understandings and  inducements,
whether express or implied, oral or written.  Appendix A and each
of  the  Exhibits  attached  hereto are  incorporated  into  this
Agreement and by this reference made a part hereof.

     12.12.Governing  Law; Consent To Forum. This  Agreement  has
been negotiated, executed and delivered at and shall be deemed to
have  been  made  in Atlanta, Georgia.  This Agreement  shall  be
governed  by  and construed in accordance with the  laws  of  the
State  of  Georgia:  provided,  however,  that  if  any  of   the
Collateral  shall  be  located  in any  jurisdiction  other  than
Georgia,  the laws of such jurisdiction shall govern the  method,
manner  and procedure for foreclosure of Lender's Lien upon  such
Collateral  and  the enforcement of Lender's  other  remedies  in
respect  of such Collateral to the extent that the laws  of  such
jurisdiction are different from or inconsistent with the laws  of
Georgia.   As  part of the consideration for new value  received,
and  regardless  of any present or future domicile  or  principal
place of business of Borrower or Lender, Borrower hereby consents
and agrees that the Superior Court of Fulton County, Georgia, or,
at  Lender's  option, the United States District  Court  for  the
Northern  District  of  Georgia,  Atlanta  Division,  shall  have
jurisdiction to hear and determine any claims or disputes between
Borrower and Lender pertaining to this Agreement or to any matter
arising  out of or related to this Agreement.  Borrower expressly
submits  and  consents  in advance to such  jurisdiction  in  any
action  or suit commenced in any such Court, and Borrower  hereby
waives  any objection which Borrower may have based upon lack  of
personal jurisdiction, improper venue or forum non conveniens and
hereby consents to the granting of such legal or equitable relief
as is deemed appropriate by such Court.

     12.13. Waivers by Borrower.  To the fullest extent permitted
by Applicable Law, Borrower waives (i) the right to trial by jury
(which Lender hereby also waives) in any action, suit, proceeding
or  counterclaim of any kind arising out of or related to any  of
the   Loan   Documents,  the  Obligations  or   the   Collateral;
(ii)  presentment, demand and protest and notice of  presentment,
protest,  default,  non payment, maturity,  release,  compromise,
settlement, extension or renewal of any or all commercial  paper,
accounts, contract rights, documents, instruments, chattel  paper
and  guaranties at any time held by Lender on which Borrower  may
in  any  way be liable and hereby ratifies and confirms  whatever
Lender  may  do  in  this regard; (iii) notice  prior  to  taking
possession  or control of the Collateral or any bond or  security
which might be required by any Court prior to allowing Lender  to
exercise  any  of  Lender's remedies; (iv)  the  benefit  of  all
valuation,  appraisement and exemption laws; and  (v)  notice  of
acceptance  hereof.   Borrower acknowledges  that  the  foregoing
waivers are a material inducement to Lender's entering into  this
Agreement  and that Lender is relying upon the foregoing  waivers
in  its  future  dealings with Borrower.  Borrower  warrants  and
represents  that it has reviewed the foregoing waivers  with  its
legal  counsel and has knowingly and voluntarily waived its  jury
trial  rights following consultation with legal counsel.  In  the
event  of  litigation, this Agreement may be filed as  a  written
consent to a trial by the Court.

                                41
<PAGE>

     IN  WITNESS  WHEREOF,  this Agreement has been duly executed
in  Atlanta,  Georgia,  on  the day and  year  specified  at  the
beginning of this Agreement.



                            MILTOPE CORPORATION ("Borrower")



                            By:___________________________________
                                       Title: President


                               Accepted in Atlanta, Georgia:

                               CITIZENS BUSINESS CREDIT, a division
                               of Citizens Leasing Corporation
                               ("Lender")


                            By:___________________________________

                            Title:______________________________



                                42
<PAGE>

                            EXHIBIT A
                          -------------
                          REVOLVER NOTE
                                                  January 6, 2003
U.S $8,000,000.00                                Atlanta, Georgia

     FOR  VALUE  RECEIVED,  the undersigned, MILTOPE  CORPORATION
("Borrower"),  an  Alabama  corporation,  hereby  unconditionally
promises  to  pay  to  the order of CITIZENS BUSINESS  CREDIT,  a
division  of Citizens Leasing Corporation (herein, together  with
any  subsequent holder hereof, called the "Holder") the principal
sum  of  $8,000,000.00 or such lesser sum as may  constitute  the
outstanding  principal amount of all Revolver Loans  pursuant  to
the terms of the Loan Agreement (as defined below) on the date on
which  such outstanding principal amounts become due and  payable
pursuant  to  Section  4.2  of  the  Loan  Agreement,  in  strict
accordance   with   the   terms   thereof.    Borrower   likewise
unconditionally promises to pay to Holder interest from and after
the  date  hereof on the outstanding principal amount of Revolver
Loans at such interest rates, payable at such times, and computed
in  such manner as are specified in Sections 3.1 and 4.2  of  the
Loan Agreement, in strict accordance with the terms thereof.

     This  Revolver Note ("Note") is issued pursuant to,  and  is
the  "Revolver  Note"  referred to  in,  the  Loan  and  Security
Agreement dated the date hereof (as the same may be amended  from
time  to time, the "Loan Agreement"), between Borrower and Holder
and  is and shall be entitled to all benefits thereof and of  all
Loan  Documents  executed and delivered in connection  therewith.
All  capitalized  terms  used herein,  unless  otherwise  defined
herein,  shall have the meanings ascribed to such  terms  in  the
Loan Agreement.

     The  repayment  of the principal balance  of  this  Note  is
subject  to  the provisions of Section 4.2 of the Loan Agreement.
The  entire unpaid principal balance and all accrued interest  on
this  Note  shall  be  due  and  payable  immediately  upon   the
termination  of the Loan Agreement as set forth in Section  5.2.4
of the Loan Agreement.

     All  payments  of principal and interest shall  be  made  in
Dollars  in immediately available funds as specified in the  Loan
Agreement.

     Upon or after the occurrence of an Event of Default that  is
uncured  after the expiration of any applicable grace period  and
for  so  long  as  such  Event of Default exists,  the  principal
balance and all accrued interest of this Note may be declared due
and  payable  in the manner and with the effect provided  in  the
Loan  Agreement,  and the unpaid principal balance  hereof  shall
bear  interest  at  the  Default Rate as  and  when  provided  in
Section 3.1.5 of the Loan Agreement.  Borrower agrees to pay, and
save  Holder harmless against, any liability for the payment  of,
all costs and expenses, including, but not limited to, reasonable
attorneys'  fees actually incurred, if this Note is collected  by
or through an attorney-at-law.

     All  principal amounts of Revolver Loans made by  Holder  to
Borrower  pursuant  to the Loan Agreement, and  all  accrued  and
unpaid  interest thereon, shall be deemed outstanding under  this
Note  and  shall continue to be owing by Borrower until  paid  in
accordance with the terms of this Note and the Loan Agreement.

     In  no contingency or event whatsoever, whether by reason of
advancement of the proceeds hereof or otherwise, shall the amount
paid  or agreed to be paid to Holder for the use, forbearance  or
detention  of money advanced hereunder exceed the highest  lawful
rate  permissible  under  any  law which  a  court  of  competent
jurisdiction may deem applicable hereto; and, in the event of any
such  payment  inadvertently paid by  Borrower  or  inadvertently
received  by  Holder,  such excess sum shall  be,  at  Borrower's

<PAGE>

option,  returned to Borrower forthwith or credited as a  payment
of  principal,  but  shall  not be  applied  to  the  payment  of
interest.   It  is  the intent hereof that Borrower  not  pay  or
contract  to  pay,  and that Holder not receive  or  contract  to
receive,   directly  or  indirectly  in  any  manner  whatsoever,
interest  in  excess of that which may be paid by Borrower  under
Applicable Law.

     Time  is of the essence of this Note.  To the fullest extent
permitted  by Applicable Law, Borrower, for itself and its  legal
representatives,   successors  and  assigns,   expressly   waives
presentment, demand, protest, notice of dishonor, notice of  non-
payment,  notice of maturity, notice of protest, presentment  for
the  purpose  of accelerating maturity, diligence in  collection,
and the benefit of any exemption or insolvency laws.

     Wherever  possible  each provision of  this  Note  shall  be
interpreted  in such a manner as to be effective and valid  under
Applicable  Law,  but  if any provision of  this  Note  shall  be
prohibited or invalid under Applicable Law, such provision  shall
be  ineffective to the extent of such prohibition  or  invalidity
without invalidating the remainder of such provision or remaining
provisions  of  this Note.  No delay or failure on  the  part  of
Holder  in  the  exercise of any right or remedy hereunder  shall
operate  as  a  waiver  thereof, nor as an  acquiescence  in  any
default,  nor shall any single or partial exercise by  Holder  of
any  right or remedy preclude any other right or remedy.  Holder,
at  its  option,  may enforce its rights against  any  Collateral
securing  this  Note without Holder enforcing its rights  against
any  Borrower, any Guarantor of the indebtedness evidenced hereby
or  any  other property or indebtedness due or to become  due  to
Borrower.   Borrower agrees that, without releasing or  impairing
Borrower's  liability hereunder, Holder may at any time  release,
surrender,  substitute or exchange any Collateral  securing  this
Note  and  may  at  any  time  release  any  party  primarily  or
secondarily liable for the indebtedness evidenced by this Note.

     The  rights of Holder and obligations of Borrower  hereunder
shall  be  construed in accordance with and governed by the  laws
(without giving effect to the conflict of law principles thereof)
of the State of Georgia.  This Note is intended to take effect as
an instrument under seal under Georgia law.

     IN  WITNESS  WHEREOF, Borrower has caused this  Note  to  be
executed under seal and delivered by its duly authorized officers
on the date first above written.


                                   BORROWER:

                                   MILTOPE CORPORATION



                                   By:___________________________
                                          Title: President

                                2
<PAGE>

                            EXHIBIT B
                            ---------

                   BORROWING BASE CERTIFICATE
                   --------------------------
      (Format and criteria subject to modification based on
        results of current and future field examinations)



VIA FACSIMILE
------------
Citizens Business Credit               Miltope Corporation
100 Galleria Parkway
Suite 1655                             Borrowing Base Certificate
Atlanta, Georgia 30339
                                       Certificate#: _________
Attention: Ms. Leigh Lones             Date Submitted: _________
                                       For the period ended ______

A.   ACCOUNTS RECEIVABLE (based on invoice dated a/r aging)
     -----------------------------------------------------
1.   a.  Eligible Accounts Receivable        $____________
     b.  Advance Rate                        85%
     c.  Accounts Availability               $____________

B.   TOTAL ACCOUNTS RECEIVABLE AVAILABILITY  $____________
     --------------------------------------

C.   INVENTORY
     ---------
1.   a.  Eligible Inventory (parts, units)   $____________
     b.  Advance Rate                        24%
     c.  Inventory Availability              $____________(not to
                                              exceed $2,000,000)

D.   TOTAL INVENTORY AVAILABILITY            $____________
     ---------------------------

E.   TOTAL OF LINES B AND D                  $____________
     ----------------------

F.   MAXIMUM LOAN AMOUNT                     $8,000,000
     -------------------

F.   LESSER OF LINES E OR F                  $____________
     ----------------------

G.   LOAN BALANCE
     ------------

1.   Beginning Loan Balance             $_____________

2.   Plus Revolver Loans Requested      $_____________

3.   Less Loan Collections              $_____________

4.   Adjustments (attach explanation)   $_____________

H.   ENDING LOAN BALANCE                     $____________
     -------------------
I.   TOTAL EXCESS AVAILABILITY (LINE F LESS LINE H)  $____________
     ---------------------------------------------

<PAGE>


  The   undersigned  hereby  represents  and  warrants  that  the
foregoing  is accurate and complete in all material respects  and
conforms with the representations regarding Eligible Accounts and
Eligible  Inventory  as  set  forth  in  the  Loan  and  Security
Agreement  between us, as in force at any date.  The  undersigned
further  represents  and warrants that no  Default  or  Event  of
Default has occurred and is continuing under such Loan Agreement.
Borrower understands that Citizens Business Credit will extend to
Borrower   Revolver  Loans  in  reliance  upon  the   information
contained herein.


                              MILTOPE CORPORATION


                              By:_____________________________

                              Title:__________________________

                              Date:___________________________






                                2
<PAGE>


                         SCHEDULE 7.1.1

                       BUSINESS LOCATIONS
                       ------------------

1.  Borrower currently has the following business locations,  and
    no others:

    Chief Executive Office:      3800 Richardson Road South
                                 Hope Hull, Alabama 36043

    Other Locations:             3082 Sterling Circle
                                 Boulder, Colorado 80301


2.  Borrower   maintains  its  books  and  records  relating   to
    Accounts and General
    Intangibles at:


                                 3800 Richardson Road South
                                 Hope Hull, Alabama 36043



3.  Borrower  has had no office, place of business or  agent  for
    process located in any
    county other than as set forth above.


4.  Borrower has no Subsidiaries.

<PAGE>

                         SCHEDULE 8.1.1

               JURISDICTIONS IN WHICH BORROWER IS
               ----------------------------------
                    AUTHORIZED TO DO BUSINESS
                    -------------------------



          Name of Entity                    Jurisdictions
          --------------                    -------------


        MILTOPE CORPORATION                   Alabama


<PAGE>


                         SCHEDULE 8.1.4

                        CAPITAL STRUCTURE
                        -----------------

1.   The classes and number of authorized shares of Borrower are
     as follows:

      Common stock.

2.  There are no other outstanding Securities of Borrower.

3.  Borrower  has  no subsidiaries or corporate  or  joint
    venture Affiliates.


<PAGE>

                         SCHEDULE 8.1.5

                         CORPORATE NAMES
                         ---------------


1.  Borrower's correct corporate name is MILTOPE CORPORATION


<PAGE>

                         SCHEDULE 8.1.15

          PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES
          --------------------------------------------
              NECESSARY FOR THE CONDUCT OF BUSINESS
              -------------------------------------

1.  Borrower has the following patents, copyrights and trademarks:

<TABLE>
                             PATENTS

   PATENT NUMBER       REGISTRATION DATE           TITLE
   ------------       -------------------  -----------------------
<S>                   <C>                  <C>
5,297,711             3/29/94              Perforated web
                                           transport system

5,297,124             3/22/94              Tape drive emulation
                                           system for a disk
                                           drive

5,214,415             5/25/93              Cursor control
                                           assembly with
                                           electromagnetic
                                           shielding

5,142,427             8/25/92              Magnetic transducer
                                           pressure pad

4,994,823             2/19/91              Color striping
                                           thermal printer

4,788,559             11/29/88             Apparatus and method
                                           for removing an
                                           image from the
                                           ribbon of a thermal
                                           transfer printer

4,726,293             2/23/88              Wrinkle-preventing
                                           passive roller
                                           system for printing
                                           machines

4,725,858             2/16/88              Roller pressure
                                           unloading means for
                                           a thermal printing
                                           mechanism

4,642,715             2/10/87              Environmental
                                           conditioning and
                                           safety system for
                                           disk-type mass
                                           memories

</TABLE>
<PAGE>
                           TRADEMARKS

<TABLE>

   SERIAL NUMBER        APPLICATION DATE         WORD MARK
   -------------        ----------------         ---------
    <S>                    <C>                    <C>
    75350229                9/2/97                ENIGMA
    75013341               11/1/95                PROWLER

</TABLE>

2.  Borrower  has  licenses relating to the use of  software  and
    equipment in the ordinary course of
    its business.

<PAGE>
                         SCHEDULE 8.1.18

      CONTRACTS RESTRICTING BORROWER'S RIGHT TO INCUR DEBTS
      -----------------------------------------------------

    There  are  no contracts that restrict the right of  Borrower
to incur Debt.

<PAGE>

                         SCHEDULE 8.1.19

                           LITIGATION
                           ----------

1.  There  are  no actions, suits, proceedings and investigations
    pending against Borrower.


2.  There  are  no  threatened  actions,  suits,  proceedings  or
    investigations of which Borrower is aware.

<PAGE>

                         SCHEDULE 8.1.21

                       CAPITALIZED LEASES
                       ------------------

    Borrower has no capitalized leases.


<PAGE>


                         SCHEDULE 8.1.22

                          PENSION PLANS
                          -------------

1.  401(k) plan.


<PAGE>
                            EXHIBIT C

                 FORM OF COMPLIANCE CERTIFICATE

                    [Letterhead of Borrower]




                    __________________, 200__




Citizens Business Credit
Suite 1655
100 Galleria Parkway
Atlanta, Georgia 30339
Attention: Ms. Leigh Lones


     The undersigned, the controller of MILTOPE CORPORATION.,  an
Alabama  corporation  ("Borrower"),  gives  this  certificate  to
Citizens  Business  Credit  ("Lender")  in  accordance  with  the
requirements  of Section 9.1.3 of that certain Loan and  Security
Agreement  dated  as  of January 6, 2003,  between  Borrower  and
Lender  ("Loan  Agreement").   Capitalized  terms  used  in  this
Certificate,  unless  otherwise defined herein,  shall  have  the
meanings ascribed to them in the Loan Agreement.

             1.      Based  upon my review of the balance  sheets
and  statements  of  income of Borrower  for  the  [fiscal  year]
[quarterly  period] ending __________________,  20__,  copies  of
which are attached hereto, I hereby certify that:

               (a) Fixed Charge Coverage Ratio is ____ to 1
     (minimum: not less than ___ to 1);

               (b) Tangible Net Worth is $______ (minimum:
     not less than $__________);

               (c) Capital Expenditures during the period and
     for the fiscal year to date total $__________ and
     $__________, respectively (maximum: $__________ annually).

            2.     No default exists on the date hereof under
any lease covering business premises leased by Borrower, other
than: _________________________________ [if none, so state]; and

            3.     No Default exists on the date hereof, other
than: __________________
________________________________________________ [if none, so
state]; and


<PAGE>

            4.     No Event of Default exists on the date
hereof, other than __________
____________________________________________________ [if none,
so state].

            5.     As of the date hereof, Borrower is current in
its payment of all accrued rent and other charges to Persons who
own or lease any premises where any of the Collateral is
located, and there are no pending disputes or claims regarding
Borrower's failure to pay or delay in payment of any such rent
or other charges.

                                  Very truly yours,




                                  _______________________________
                                            Controller

<PAGE>

                            EXHIBIT D
                            ---------


                   OPINION LETTER REQUIREMENTS


     Borrowers'  counsel's  opinion  letter  should  address  the
following in a manner satisfactory to Lender:

1.   Borrower's due incorporation, valid existence, good standing
and qualification as a foreign corporation.

2.  Corporate name of Borrower.

3.   Borrower's corporate power to execute, deliver  and  perform
the Loan Documents to which it is a party.

4.   Borrower's due authorization to execute, deliver and perform
the   Loan  Documents,  and  their  due  execution  and  delivery
thereof.

5.   Borrower's execution, delivery and performance of  the  Loan
Documents do not (a) violate the articles or bylaws, (b) cause  a
breach  or  default  under any agreement, (c)  violate  any  law,
regulation,  judgment or order, or (d) result  in  or  require  a
Lien or other encumbrance other than in favor of Lender.

7.   The  Loan Documents as legal, valid and binding obligations,
enforceable  against  all  Obligors  in  accordance  with   their
respective  terms,  subject  to  standard  bankruptcy  and  other
creditor's rights and equity exceptions.

8.    Counsel's  lack  of  knowledge  of  litigation   or   other
proceedings, except as disclosed in Loan Agreement.

9.   Absence  of  any registration, filing, consent  or  approval
requirement  of  governmental authority in  connection  with  the
execution, delivery and performance of the Loan Documents.

10.  Non-violation by the Loan Documents of any  Applicable  Laws
relating to interest or usury.

11.  Due payment of all applicable taxes and fees required to  be
paid  in  connection  with the Loans, the Loan  Documents,  UCC-1
financing statements and other Security Documents.

12.  Creation  in  favor of Lender of a duly  perfected  security
interest in the Collateral described in the Security Documents.

13.  Absence  of requirement under the laws of applicable  states
for  Lender  to qualify in such states to enter into  or  enforce
the provisions of the Loan Documents.

<PAGE>

<TABLE>
                         SCHEDULE 9.2.5

                         PERMITTED LIENS
                         ---------------

        Secured Party                 Nature of Lien
      -----------------          ------------------------------
      <S>                        <C>
      Regions Bank, N.A.         Security interest in all
                                 inventory, receivables and
                                 instruments of Borrower, all
                                 documents and files related to
                                 such collateral and all
                                 proceeds and products of such
                                 collateral

                                 All personal property and
                                 fixtures and interests of
                                 Borrower as described in Real
                                 Estate Mortgage and Security
                                 Agreement dated January 1, 1995

                                 Specified Equipment


      Innovative Strategic       All property of Borrower
      Advanced Systems, Inc.


      IBM Credit Corporation     Specified leased equipment


      GE Capital Corporation     Specified leased equipment



      Telogy, Inc.               Specified leased equipment



      Leasing Partners           Specified leased equipment


</TABLE>
<PAGE>




________________________________________________________________


                        MILTOPE CORPORATION
________________________________________________________________







________________________________________________________________

________________________________________________________________





                 LOAN  AND  SECURITY  AGREEMENT

                     Dated: January 6, 2003

                           $8,000,000




________________________________________________________________

________________________________________________________________








________________________________________________________________


                    CITIZENS BUSINESS CREDIT
________________________________________________________________

<PAGE>

                       TABLE OF CONTENTS



SECTION 1. DEFINITIONS; RULES OF CONSTRUCTION              - 1 -
     1.1.  Definitions.                                    - 1 -
     1.2.  Accounting Terms.                              - 17 -
     1.3.  Other Terms.                                   - 17 -
     1.4.  Certain Matters of Construction.               - 17 -

SECTION 2. CREDIT  FACILITIES                             - 18 -
     2.1.  Revolver Loans.                                - 18 -

SECTION 3. INTEREST,  FEES  AND  CHARGES                  - 20 -
     3.1   Interest                                       - 20 -
     3.2.  Fees.                                          - 23 -
     3.3.  Computation of Interest and Fees.              - 23 -
     3.4.  Reimbursement of Expenses.                     - 23 -
     3.5.  Bank Charges.                                  - 24 -
     3.6.  Maximum Interest.                              - 24 -
     3.7.  Illegality.                                    - 25 -
     3.8.  Increased Costs.                               - 25 -
     3.9.  Capital Adequacy.                              - 26 -
     3.10. Funding Losses.                                - 27 -

SECTION 4. LOAN ADMINISTRATION                            - 27 -
     4.1.  Manner of Borrowing Revolver Loans.            - 27 -
     4.2.  Payment of Other Obligations.                  - 29 -
     4.3.  Application of Payments and Collections.       - 30 -
     4.4.  All Loans to Constitute One Obligation.        - 30 -
     4.5.  Loan Account.                                  - 30 -
     4.6.  Statements of Account.                         - 30 -
     4.7.  Marshalling; Payments Set Aside.               - 30 -

SECTION 5. TERM  AND  TERMINATION                         - 31 -
     5.1.  Term of Agreement.                             - 31 -
     5.2.  Termination.                                   - 31 -

SECTION 6. COLLATERAL SECURITY                            - 32 -
     6.1.  Grant of Security Interest in Collateral.      - 32 -
     6.2.  Lien Perfection; Further Assurances.           - 32 -
     6.3.  Lien on Deposit Accounts.                      - 33 -
     6.4.  [Lien on Real Estate] [Other Collateral].      - 33 -

SECTION 7. COLLATERAL ADMINISTRATION                      - 33 -
     7.1.  General.                                       - 33 -
     7.2.  Administration of Accounts.                    - 34 -
     7.3.  Administration of Inventory.                   - 35 -
     7.4.  Payment of Charges.                            - 36 -

                                i
<PAGE>

SECTION 8. REPRESENTATIONS AND WARRANTIES                 - 36 -
     8.1.  General Representations and Warranties.        - 36 -
     8.2.  Reaffirmation of Representations and
           Warranties.                                    - 40 -
     8.3.  Survival of Representations and Warranties.    - 40 -

SECTION 9. COVENANTS AND CONTINUING AGREEMENTS            - 40 -
     9.1.  Affirmative Covenants.                         - 40 -
     9.2.  Negative Covenants.                            - 43 -
     9.3.  Specific Financial Covenants                   - 45 -

SECTION 10. CONDITIONS PRECEDENT                          - 46 -
     10.1.  Conditions Precedent to Initial Loans.        - 46 -
     10.2   Conditions Precedent to all Credit
            Extensions.                                   - 48 -

SECTION 11. EVENTS OF DEFAULT; RIGHTS AND REMEDIES ON
            DEFAULT                                       - 49 -
     11.1.  Events of Default.                            - 49 -
     11.2.  Acceleration of the Obligations.              - 50 -
     11.3.  Other Remedies.                               - 51 -
     11.4.  Setoff.                                       - 52 -
     11.5.  Remedies Cumulative; No Waiver.               - 52 -

SECTION 12. MISCELLANEOUS                                 - 53 -
     12.1.  Power of Attorney.                            - 53 -
     12.2.  Indemnity.                                    - 53 -
     12.3.  Modification of Agreement; Sale of Interest.  - 54 -
     12.4.  Severability.                                 - 54 -
     12.5.  Successors and Assigns.                       - 54 -
     12.6.  Cumulative Effect; Conflict of Terms          - 54 -
     12.7.  Execution in Counterparts.                    - 54 -
     12.8.  Notice.                                       - 54 -
     12.9.  Lender's Consent.                             - 55 -
     12.10. Credit Inquiries.                             - 55 -
     12.11. Time of Essence.                              - 55 -
     12.12. Entire Agreement; Appendix A and Exhibits.    - 55 -
     12.13. Interpretation.                               - 56 -
     12.14. Governing Law; Consent To Forum.              - 56 -
     12.15. Waivers by Borrower.                          - 56 -

                                ii
<PAGE>
                        LIST OF EXHIBITS
                        ---------------

Exhibits
--------
Exhibit A Revolver Note
Exhibit B Borrowing Base Certificate
Exhibit C Compliance Certificate
Exhibit D Opinion Letter

Schedules
---------
Borrower's and each Subsidiary's Business Locations
Jurisdictions in which Borrower and each Subsidiary is Authorized
to do Business
Capital Structure of Borrower
Corporate Names
Patents, Trademarks, Copyrights and Licenses
Contracts Restricting Borrower's Right to Incur Debts
Litigation
Capitalized and Operating Leases
Pension Plans
Permitted Liens

                                iii