TABLE OF CONTENTS
                                                                          Page


ARTICLE I

DEFINITIONS...............................................................  1
         1.1      Certain Definitions.....................................  1
         1.2      Accounting Terms........................................ 10

ARTICLE II

THE ...................................................................... 11
         2.1      Revolving Loan.......................................... 11
         2.1 (a)  Funding of the Revolving Loan........................... 11
         (b)      The Note; Repayment of Principal........................ 11
                  2.1 (c)           Revolving Loan Borrowing Request...... 11
         2.2      Term Loan............................................... 12
                  (a)      Funding of the Term Loan....................... 12
                  2.2 (b)  Term Note; Repayment of Principal.  ........... 12
         2.3      The Borrower's Loan Account............................. 13
         2.4      Interest Rate; Payments................................. 13
                  2.4 (a)  The Revolving Loans............................ 13
                  2.4 (b)  The Term Loan.................................. 14
         2.5      Fees and Expenses....................................... 14
                  (a)      Commitment Fee................................. 14
                  (b)      Expenses....................................... 14
         2.7      Optional Prepayment..................................... 14
         2.8      Application of Payments and Prepayments................. 14
         2.9      Default Interest........................................ 15
         2.10     Free Balances........................................... 15
         2.11     Payment to the Bank..................................... 15

                                   ARTICLE III

                                               CONDITIONS PRECEDENT....... 15
         3.1      Delivery of Documents as Conditions Precedent........... 15

                                   ARTICLE IV

                                                COLLATERAL SECURITY....... 18
         4.1      Grant of Security Interest.............................. 18
         4.2      Perfection of Security Interests........................ 19
         4.3      Notice to Account Debtors and Instrument Obligors....... 19
         4.4      Appointment as Attorney-in-Fact......................... 20


                                    ARTICLE V

                                          REPRESENTATIONS AND WARRANTIES.. 21
         5.1      Organization of Borrower................................ 21
         5.2      Authority and Consents.................................. 21
         5.3      Organization of General Partner......................... 22
         5.4      Corporate Authority and Consents........................ 22
         5.5      Binding Effect and Enforceability....................... 23
         5.6      Default of Indebtedness................................. 23
         5.7      Financial Condition and Litigation...................... 23
         5.8      Title and Liens......................................... 24
         5.9      Account Warranties...................................... 24
         5.10     Inventory Warranties.................................... 25
         5.11     Employee Plans.......................................... 25
         5.12     Taxes................................................... 26
         5.13     Compliance with Laws.................................... 26
         5.14     Subsidiaries and Affiliates............................. 26
         5.15     Assumed Names........................................... 26
         5.16     Solvency................................................ 26
         5.17     Regulation U............................................ 27
                  ........................................................ 27
         5.18     Occupational Safety and Health.......................... 27
         5.19     Environmental Protection................................ 27
         5.20     Compliance with Zoning and Other Regulations; 
                    Assessments .......................................... 28
         5.21     Disclosure.............................................. 28
         5.22     Labor Relations......................................... 28

                                   ARTICLE VI

                                                     COVENANTS............ 29
         6.1      Affirmative Covenants................................... 29
                  6.1 (a)  Payments....................................... 29
                  6.1 (b)  Financial Covenants............................ 29
                  (c)      Financial Information and Reporting............ 29
                  (d)      Account Covenants.............................. 32
                  (e)      Inventory and Equipment Covenants.............. 32
                  (f)      Insurance...................................... 33
                  (g)      Existence...................................... 34
                  (h)      Taxes and Laws................................. 34
                  (i)      Repair and Maintenance......................... 34
                  (j)      Inspection..................................... 35
                  (k)      Bank Costs..................................... 35
                  (l)      Indemnity and Release.......................... 36
                  (m)      Instruments and Chattel Paper.................. 36
                  (n)      Employee Plans................................. 36
                  (o)      Leases......................................... 37
                  (p)      Bank Deposits.................................. 37
                  (q)      Landlord Waivers............................... 38
         6.2      Negative Covenants...................................... 38
                  (a)      Liens.......................................... 38
                  (b)      Debt........................................... 38
                  (c)      Name Changes, Mergers and Acquisitions......... 39
                  (d)      Payments under Subordinated Debt............... 39
                  (e)      Transfer of Assets............................. 39
                  (f)      Investments and Loans.......................... 39
                  (g)      Prepayment or Modification of Indebtedness..... 39
                  (h)      False Statements............................... 40
                  (i)      Transactions with Affiliates................... 40
                  (j)      Guarantees..................................... 40
                  (k)      Capital Structure.............................. 40
                  (l)      Locations...................................... 40
                  (m)      Leases......................................... 40

 ARTICLE VII

                                                 EVENTS OF DEFAULT........ 41
         7.1      Payment Obligations..................................... 41
         7.2      Performance Obligations................................. 41
         7.3      Representation and Warranties........................... 41
         7.4      Judgments............................................... 41
         7.5      Insolvency and Related Proceedings...................... 41
         7.6      Material Agreements..................................... 42
         7.7      State Action............................................ 42
         7.8      Material Adverse Change................................. 42
         7.9      Tax Liens............................................... 43

ARTICLE VIII

                                          RIGHTS AND REMEDIES OF THE BANK. 43
         8.1      Termination of Commitment and Acceleration.............. 43
         8.2      Rights of Secured Creditor.............................. 43
         8.3      Sale of Collateral...................................... 44
         8.4      Entry on Premises....................................... 45
         8.5      Access to Records....................................... 45

ARTICLE IX

                                                   MISCELLANEOUS.......... 45
         9.1      Waiver.................................................. 45
         9.2      Applicable Law.......................................... 46
         9.3      Severability............................................ 46
         9.4      Counterparts............................................ 46
         9.5      Section Headings........................................ 46
         9.6      Binding Effect.......................................... 46
         9.7      Merger Clause........................................... 46
         9.8      Notices................................................. 46
         9.9      Consent to Service...................................... 47
         9.10     Waiver of Jury Trial.................................... 47
         9.10     Participations.......................................... 48



                           LOAN AND SECURITY AGREEMENT


         This  Loan and  Security  Agreement  (this  "Agreement")  is made as of
October  13,  1998 by and  among  LaSalle  National  Bank,  a  national  banking
association  (the  "Bank"),  Westell  Technologies,  Inc.,  ("WTI"),  a Delaware
corporation,   Westell,  Inc.  ("Westell"),  an  Illinois  corporation,  Westell
International,  Inc. ("International"),  a Delaware corporation,  and Conference
Plus,  Incorporated  ("CPI"),  a  Delaware  corporation  (each  individually,  a
"Borrower" and collectively, "Borrowers").

                                   WITNESSETH:

                  WHEREAS,   WTI   is   the   holding   company   for   Westell,
International,  and CPI. Westell designs,  manufactures,  markets and services a
broad  range of digital  and analog  products  used by  telephone  companies  to
deliver services primarily over existing copper wires, and International markets
and  distributes  Westell's  product  line to  international  markets.  CPI is a
multi-point    telecommunications   service   bureau   specializing   in   audio
teleconferencing,  multi-point video conferencing, broadcast fax, and multimedia
teleconference services.

                  WHEREAS,  in order  to  repay  the  existing  indebtedness  of
Borrowers,  to provide for Borrowers'  working capital needs, and to provide for
the purchase of machinery  and  equipment,  Borrowers  desire to borrow from the
Bank and have requested that the Bank make available and lend to the Borrowers a
revolving  credit  line in an  aggregate  amount not to exceed  Sixteen  Million
Dollars ($16,000,000.00), a term credit facility in the aggregate amount of Four
Million Dollars ($4,000,000.00), and an equipment line of credit in an aggregate
amount not to exceed Five Million Dollars ($5,000,000.00), upon the satisfaction
of certain terms and conditions, all as more fully set forth below; and

                  WHEREAS,  in order to  induce  the  Bank to make  such  credit
extensions to the Borrowers,  the Borrowers  propose to secure the  indebtedness
and obligations of the Borrowers to the Bank hereunder by granting to the Bank a
security  interest  in the  Borrowers'  personal  property,  including,  without
limitation, all accounts receivable,  general intangibles,  inventory, machinery
and equipment, chattel paper, instruments, and documents; and

                  WHEREAS, the Bank is willing to make such credit extensions to
the Borrowers only on such a secured basis.

                  NOW,  THEREFORE,  for and in  consideration  of the  foregoing
premises,  which  are  hereby  incorporated  herein  as  true,  and  the  terms,
conditions,  representations,  warranties,  covenants,  promises and  agreements
herein contained, the parties hereto agree as follows:


I.       DEFINITIONS.

         1.1      Certain Definitions.

                  "Accounts"  shall have the same meaning  assigned to that term
in the version of the Uniform  Commercial  Code currently in effect in the State
of Illinois,  wheresoever located and whether now or hereafter owned,  acquired,
arising or existing, including without limitation,  contract rights, any and all
manner of accounts receivable and all security agreements,  guaranties,  letters
of credit and any other collateral security for any or all of the foregoing.

                  "Account  Debtor" shall have the same meaning assigned to that
term in the version of the Uniform  Commercial  Code  currently in effect in the
State of Illinois.

                  "Accounts   Receivable  Aging  Reports"  means  those  reports
prepared by Borrowers  listing  Borrowers'  Account  balances (and the number of
days each such Account balance is outstanding) as of the last day of each month,
which  balances  Borrowers  shall  represent and warrant as being  calculated in
accordance with GAAP (including a reasonable provision for uncollectibility) and
which shall be  presented in an aging  format  acceptable  to the Bank and shall
include the status of all  disputes,  lawsuits,  and  delinquent  Accounts  over
$100,000.

                  "Acquisition"  means any  transaction  or  series  of  related
transactions for the purpose of or resulting, directly or indirectly, in (i) the
acquisition  of all or  substantially  all of the  assets  of  Person,  (ii) the
acquisition  of in excess of 50% of the  capital  stock,  partnership  interest,
membership  interest or equity of any Person, or otherwise causing any Person to
become a Subsidiary, or (iii) a merger or consolidation or any other combination
with any other Person,  provided that the  applicable  Borrower is the surviving
entity.

                  "Affiliate"  means (i) any  shareholder of any Borrower,  (ii)
any corporation or any other Person that directly or indirectly,  through one or
more  intermediaries,  controls or is controlled  by or is under common  control
with  any  Borrower  or  (iii)  any  officer,  director,   trustee,  partner  or
shareholder of any  corporation or any other Person that directly or indirectly,
through one or more  intermediaries,  controls or is  controlled  by or is under
common control with any Borrower.

                  "Agreement"  means,  collectively,   this  Loan  and  Security
Agreement,  together  with  any and all  exhibits,  attachments  and  amendments
thereto and modifications,  renewals, extensions, restatements and substitutions
thereof and therefor.

                   "Applicable Environmental Property" has the meaning set forth
in Section 5.19(a).

                   "Bank" means the LaSalle  National  Bank, a national  banking
association.

                  "Banking  Day" means any day other than a Saturday,  Sunday or
legal holiday in the State of Illinois.

                   "Borrowers" means collectively,  Westell, WTI,  International
and CPI.

                  "Borrowing Base  Certificate"  means those reports prepared by
Borrowers calculating the Revolving Loan Borrowing Base in the form of Exhibit A
hereto.

                  "Capital  Expenditures"  means  expenditures for the purchase,
creation, improvement, renovation or lease of a capital asset classified as such
in accordance with GAAP.

                  "Chattel  Paper" shall have the same meaning  assigned to that
term in the version of the Uniform  Commercial  Code  currently in effect in the
State of Illinois,  wheresoever  located and whether now or hereafter  existing,
arising or acquired,  including,  without limitation,  all installment contracts
and leases.

                  "Collateral" means all of Borrowers' Accounts,  Chattel Paper,
Documents,  Equipment, Fixtures, Goods, General Intangibles,  Inventory, monies,
and  Instruments,  wheresoever  located  and  whether  now or  hereafter  owned,
acquired,  arising or existing, all proceeds of any of the foregoing (including,
without  limitation,  all  proceeds of  insurance  policies or letters of credit
covering or related to any of the foregoing), and all writings,  correspondence,
books, files,  invoices,  bills of lading,  purchase orders,  computer files and
programs, computer tapes, discs and cards, accounting records, data, information
and other records  relating to any of the  foregoing,  together with all monies,
deposits, accounts, credits or other property now or hereafter in the possession
of the Bank for the account of the Borrowers.

                  "Current  Assets"  means at any date the  amount of all of the
current assets of Borrowers which would be classified as current assets shown on
a balance sheet at such date in accordance with GAAP, less any prepaid  expenses
and any deferred income tax assets included in current assets.

                  "Current  Liabilities"  means at any date the amount of all of
the  current  liabilities  of  Borrowers  which would be  classified  as current
liabilities  on a balance sheet at such date in accordance  with GAAP, and shall
include  the  current  portion  of  long-term  debt  (including  the Term  Loan,
Revolving  Loans and  Equipment  Loan) and the current  portion of capital lease
obligations.

                  "Current Ratio" means at any date,  Borrowers'  Current Assets
divided by Current Liabilities, expressed as a ratio.

                  "Default  Interest  Rate" means an  interest  rate equal to 2%
over the Prime Rate at the time of determination.

                  "Documents"  shall have the same meaning assigned to that term
in the version of the Uniform  Commercial  Code currently in effect in the State
of Illinois,  wheresoever  located and whether now owned,  acquired,  arising or
existing.

                  "Eligible   Accounts"  means  such  Accounts  arising  in  the
ordinary course of Borrowers' business which are subject to the Bank's perfected
security interest and no other Lien, encumbrance or security interest other than
Permitted Liens and which are evidenced by an invoice.  In addition,  no Account
shall be an Eligible Account, if:

                           (i) it arises out of a sale made by any  Borrower  to
         an Affiliate of such Borrower or to a Person controlled by an Affiliate
         of such  Borrower or a sale by one  division of Borrower to another one
         of its divisions; or

                   (ii) it is due or unpaid more than ninety (90) days after the
          original invoice date; or

                           (iii)  twenty-five  percent  (25%) or more at any one
         time of the Accounts  from a particular  Account  Debtor are not deemed
         Eligible Accounts hereunder; or

                           (iv)  any   covenant,   representation   or  warranty
         contained  in this  Agreement  with  respect to such  Account  has been
         materially breached; or

                           (v)  the  Account   Debtor  is  also  any  Borrower's
         creditor or supplier,  or the Account Debtor has disputed its liability
         with respect to such Account,  or the Account Debtor has made any claim
         with respect to any other  Account due from such Account  Debtor to any
         Borrower, or the Account otherwise is subject to any right of setoff by
         the Account  Debtor,  or the Account Debtor has filed a lawsuit against
         any Borrower; or

                           (vi) the  Account  Debtor has  commenced  a voluntary
         case under the federal bankruptcy laws, as now constituted or hereafter
         amended,  or made an  assignment  for the  benefit of  creditors,  or a
         decree  or  order  for  relief  has  been  entered  by a  court  having
         jurisdiction  in the  premises in respect of the  Account  Debtor in an
         involuntary case under the federal  bankruptcy laws, as now constituted
         or hereafter  amended,  or any other petition or other  application for
         relief  under the federal  bankruptcy  laws has been filed  against the
         Account  Debtor,  or  if  the  Account  Debtor  has  failed,  suspended
         business, ceased to be solvent, or consented to or suffered a receiver,
         trustee, liquidator or custodian to be appointed for it or for all or a
         significant portion of its assets or affairs; or

                           (vii) the sale is to an Account  Debtor  outside  the
         continental  United  States,  unless  the sale is on letter of  credit,
         guaranty or acceptance  terms, in each case (other than with respect to
         a L/C issued by Bank at Borrower's  request)  acceptable to the Bank in
         its sole,  but  reasonable  discretion,  except  with  respect to those
         Account Debtors set forth on Schedule 1 attached hereto; or

                           (viii)  the  sale  to  the  Account  Debtor  is  on a
         bill-and-hold,  guaranteed sale, sale-and-return,  sale on approval, or
         any other  repurchase or return basis or is evidenced by Chattel Paper;
         or

                           (ix) the  Account  Debtor  is the  United  States  of
         America or any department,  agency or instrumentality  thereof,  unless
         the applicable Borrower assigns its right to payment of such Account to
         the Bank  pursuant to the  Assignment of Claims Act of 1940, as amended
         (31 U.S.C. Sub-Section 203 et seq.); or

                           (x) the goods  giving rise to such  Account  have not
         been  shipped  and  delivered  to the  Account  Debtor  or the  Account
         otherwise does not represent a final sale; or

                           (xi) to the  knowledge of  Borrowers,  the Account is
         subject to any offset, deduction, defense, dispute, or counterclaim, or
         if the Account is contingent in any respect or for any reason; or

                           (xii) any  Borrower has made any  agreement  with any
         Account  Debtor for any  deduction  therefrom,  except for discounts or
         allowances  made in the ordinary course of business for prompt payment,
         all of which  discounts or allowances are reflected in the  calculation
         of the face value of each respective invoice related thereto;

                           (xiii)the  Accounts  of the Account  Debtor  exceed a
         reasonable  credit limit  determined by the Bank in its sole discretion
         after consideration of the history of the applicable Account Debtor, to
         the extent such Accounts exceed such limit.

                  The  foregoing  notwithstanding,  Bank  reserves  the right to
                  modify  the  criteria  for  "Eligible   Accounts"   after  the
                  occurrence of an Event of Default.

                  "Eligible   Inventory"   means  that  portion  of   Borrowers'
inventory  located in the United States consisting of raw materials and finished
goods,  but shall not  include  work-in-process  and  accounting  reserves.  The
foregoing  notwithstanding,  Bank  reserves the right to modify the criteria for
"Eligible Inventory" after the occurrence of an Event of Default.

                  "Employee Plan" includes any pension, retirement,  disability,
medical,  dental or other health  plan,  life  insurance or other death  benefit
plan,  profit  sharing,  deferred  compensation,  stock  option,  bonus or other
incentive plan, vacation benefit plan, severance plan, or other employee benefit
plan   or   arrangement,   including,   without   limitation,   those   pension,
profit-sharing and retirement plans of the Borrowers described from time to time
in the Financial  Statements and any pension plan, welfare plan, Defined Benefit
Pension Plans (as defined in ERISA) or any  multi-employer  plan,  maintained or
administered  by the  Borrowers to which any Borrower is a party or may have any
liability or by which any Borrower is bound.

                   "Environmental Laws" means all federal,  state and local Laws
(including,  without limitation, the common law), statutes,  ordinances,  rules,
regulations   and   other   requirements    (including,    without   limitation,
administrative  orders,  consent  agreements  and  conditions  contained  in the
applicable  permits),  relating  to  health,  safety and the  protection  of the
environment,  including,  without  limitation,  the Comprehensive  Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. ss. 9601 et seq.,
the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. ss. 6901 et seq.,
and the Clean Air Act 42.  U.S.C.  ss.  7401 et seq.,  as amended  or  hereafter
amended.

                  "Equipment" has the same meaning  assigned to that term in the
version  of the  Uniform  Commercial  Code  currently  in effect in the State of
Illinois,  including, without limitation, all machinery,  apparatus,  equipment,
furniture,   fixtures  and  motor  vehicles  and  all   accessions,   parts  and
appurtenances thereto and all substitutions or replacements thereof, wheresoever
located, whether now or hereafter owned, acquired, arising or existing.

                   "Equipment Loan" means the equipment loan of the Borrowers as
set forth in Section 2.3(a) hereof.

                   "Equipment Loan Advance" has the meaning set forth in Section
2.3(a) hereof.

                  "Equipment Loan Advance  Termination Date" has the meaning set
forth in Section 2.3(a) hereof.

                   "Equipment Loan  Termination  Date" has the meaning set forth
in Section 2.3(b) hereof.

                  "Equipment  Note"  means the  Equipment  Note  executed by the
Borrowers as defined in Section 2.3(b),  which is in the form attached hereto as
Exhibit D.

                  "ERISA" means the Employee  Retirement  Income Security Act of
1974, as amended from time to time.

                  "Event of Default"  means an event or occurrence  described in
Article VII of this Agreement.

                  "Financial Statements" means the balance sheets, statements of
income and retained earnings and statements of changes in cash flow of Borrowers
for each of the Fiscal  Years ended March 31, 1995,  March 31,  1996,  March 31,
1997, and March 31, 1998, which were delivered to Bank prior to the date hereof,
and  the  balance  sheets,  statements  of  income  and  retained  earnings  and
statements of changes in cash flow of the Borrowers for each Fiscal Year or each
month  thereof to be  delivered  to the Bank  pursuant to Section  6.1.(c).  and
3.1.(m). of this Agreement.

                  "Fiscal  Year" means the fiscal year of the  Borrowers  ending
March 31 of each year.

                  "Fixtures"  has the same meaning  assigned to that term in the
version  of the  Uniform  Commercial  Code  currently  in effect in the State of
Illinois,  including all  accessions,  parts and  appurtenances  thereto and all
substitutions or replacements  thereof,  wheresoever  located and whether now or
hereafter owned, acquired, arising or existing.

                  "Funds" has the meaning set forth in Section 6.1(p)(i).

                   "GAAP"  means  generally   accepted   accounting   principles
consistently applied by Borrowers.

                  "General  Intangibles" shall have the same meaning assigned to
that term in the version of the Uniform  Commercial  Code currently in effect in
the State of  Illinois,  including,  without  limitation,  all choses in action,
causes of action, corporate or other business records, computer programs, source
codes,  use codes,  software,  customer  lists,  tax refund claims,  trademarks,
service  marks,  trade  names,  trade  secrets,  patents,  patent  applications,
designs,  inventions,  licenses,  franchise rights,  copyrights,  registrations,
goodwill and all rights under any real or personal property leases, permits, all
claims under guaranties, security interests or other security held by or granted
to any Borrower to secure  payment of any of the Accounts by an Account  Debtor,
all rights to indemnification  and all other intangible personal property of any
kind or nature (other than Accounts), wheresoever located or arising and whether
now or hereafter owned, acquired, arising or existing.

                  "Goods"  shall have the same meaning  assigned to that term in
the version of the Uniform  Commercial  Code currently in effect in the State of
Illinois, all accessions,  parts and appurtenances thereto and all substitutions
or replacements thereof, wheresoever located and whether now or hereafter owned,
acquired, arising or existing.

                   "Hazardous Materials" means (i) hazardous substances, as that
term is defined by CERCLA, and the Illinois  Environmental  Protection Act, Ill.
Rev. Stat. 415 ILCS 5/1 et seq.; (ii) hazardous or toxic  chemicals,  materials,
or substances within the meaning of any other applicable  Environmental Law, all
as amended or hereafter amended.

                  "Indebtedness" means, without duplication, all items which, in
accordance  with GAAP,  would be  included  as  liabilities  and shall  include,
without limitation, capitalized leases, letters of credit, secured and unsecured
debt and  contingent  but accrued  liabilities  as  reflected  in the  Financial
Statements.

                  "Instruments"  shall have the same  meaning  assigned  to that
term in the version of the Uniform  Commercial  Code  currently in effect in the
State of  Illinois,  wheresoever  located and whether  now or  hereafter  owned,
acquired, arising or existing.

                  "Intercompany  Notes" shall mean the  promissory  notes now or
hereafter  existing  evidencing the intercompany  indebtedness of the Borrowers,
Westell Canada, Ltd., Westell Worldwide Services, Inc., or Westell Europe, Ltd.,
which are set forth on Schedule 2 attached hereto.

                   "Interest  Period" shall mean:  (i) as to any LIBOR Loan, the
period  commencing on the borrowing  date or on the  conversion or  continuation
date of such  LIBOR  Loan  and  ending  on the  earlier  of (A) the  numerically
corresponding day (or, if there is no numerically corresponding day, on the last
day)  in the  calendar  month  that is 1, 2, 3 or 6  months  thereafter,  as the
Borrower may elect and (B) ninety (90) days from the beginning of the applicable
Interest  Period,  and (ii) as to any Prime Rate Loan, the period  commencing on
the borrowing date or on the conversion or continuation  date of such Prime Rate
Loan and ending on the  earlier of (A) the last  Banking  Day of each  November,
February,  May, and August, (B) the day prior to the conversion to a LIBOR Loan,
and (C) the  expiration  or earlier  termination  of this  Agreement;  provided,
however,  that (i) if any Interest Period would end on a day that shall not be a
Banking  Day,  such  Interest  Period  shall be extended to the next  succeeding
Banking Day unless,  with  respect to LIBOR  Loans  only,  such next  succeeding
Banking Day would fall in the next calendar  month,  in which case such Interest
Period shall end on the  immediately  preceding  Banking  Day,  (ii) no Interest
Period with respect to any Loan shall end later than the  expiration of the term
of this Agreement,  and (iii) interest shall accrue from and including the first
day of an Interest Period to and including the last day of such Interest Period.

                  "Inventory"  shall have the same meaning assigned to that term
in the version of the Uniform  Commercial  Code currently in effect in the State
of  Illinois,   all  accessions,   parts  and  appurtenances   thereto  and  all
substitutions or replacements  thereof,  wheresoever  located and whether now or
hereafter owned,  acquired,  arising or existing,  including without limitation,
goods, raw materials,  supplies,  work in process,  finished goods, or inventory
which has been returned to or repossessed or stopped in transit.

                  "L/C" has the meaning set forth in Section 2.4 hereof.

                  "Laws" means all  ordinances,  statutes,  rules,  regulations,
codes, orders, injunctions, writs or decrees of any government, whether federal,
state, municipal or local, of any political subdivision or agency thereof, or of
any court,  board or similar entity  established by any of the foregoing  having
jurisdiction over the Property, assets, business or operations of any Borrower.

                  "Leverage  Ratio"  means  the  total  Unsubordinated  Debt  of
Borrowers  divided by the sum of the Tangible Net Worth of Borrowers,  expressed
as a ratio.

                  "LIBOR-Based  Rate" means that rate of interest per year equal
to (i) the LIBOR Rate plus (ii) two percent (2%).

                   "LIBOR Rate  Option" has the meaning set forth in Section 2.6
hereof.

                   "LIBOR  Loan"  shall mean any Loan with  respect to which the
Borrower  shall  have  selected  an  interest  rate  based on the Libor  Rate in
accordance with the provisions of Sections 2.1(c) and 2.2(a), and 2.3(c) of this
Agreement; provided, however, that there shall not be in excess of one (1) LIBOR
Loan  outstanding at any one time with respect to the Term Loan,  five (5) LIBOR
Loans  outstanding at any one time with respect to the Revolving Loans, and five
(5) LIBOR Loans outstanding at any one time with respect to the Equipment Loans.
The Revolving  Loans,  the Term Loan and the Equipment  Loan may be LIBOR Loans;
provided, however, Borrower shall not be permitted to request LIBOR Loans if any
Event of Default or default shall have occurred and be continuing,  and any then
outstanding  LIBOR Loans shall be converted  into Prime Rate Loans at the end of
the applicable Interest Period.

                  "LIBOR Rate" means during any LIBOR Rate Borrowing  Period for
each LIBOR-Based Rate Loan, that rate of interest per year equal to the quotient
obtained by dividing (x) the rate of interest  determined  by the Bank to be the
average of the rate per annum at which  deposits in U.S.  dollars are  generally
offered  in the  London  Interbank  Market at 11:00 A.M.  London  time,  two (2)
Banking  Days  before  the  first day of such  LIBOR  Rate  Borrowing  Period as
published in the "Wall Street Journal" or any other national  publication  which
publishes such rate, for a period equal to such LIBOR Rate Borrowing  Period, in
the amount of the  applicable  Loan, by (y) the  difference  between one hundred
percent (100%) and any applicable  reserve  requirements  (rounded upward to the
nearest whole multiple of one hundredth  (1/100) of one percent (1%) per annum),
including without limitation,  any statutory maximum requirement for the Bank to
hold reserves for "Eurocurrency  Liabilities" under Regulation D of the Board of
Governors  of the  Federal  Reserve  System (or any similar  reserves  under any
successor regulation or regulations).

                   "LIBOR  Rate  Option"  has the  meaning  set forth in Section
2.6(b)(ii).

                  "Liens" means 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 the common law, statute or contract, and including but
not  limited  to  the  security  interest  or  lien  arising  from  a  mortgage,
encumbrance,  pledge,  conditional sale or trust receipt or a lease, consignment
or bailment  for  security  purposes.  The term "Lien"  shall  include,  without
limitation,  reservations,   exceptions,  covenants,  conditions,  restrictions,
leases  and other  encumbrances  affecting  Property.  For the  purpose  of this
Agreement,  each 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.

                  "Loans"  means the  Revolving  Loans,  the Term Loan,  and the
Equipment  Loan of the  Borrowers  as  described  in Sections  2.1,  2.2 and 2.3
hereof.

                   "Loan  Documents" shall have the meaning set forth in Section
3.1.

                   "Lockbox  Account"  has the  meaning  set  forth  in  Section
6.1(p)(i) hereof.

                   "Maximum  Rate" has the meaning  set forth in Section  2.6(e)
hereof.

                  "Net  Worth"  means the sum of the total of all assets  which,
under GAAP,  would appear as assets on the balance sheet of Borrowers,  less the
total of all liabilities,  which, under GAAP, would appear as liabilities on the
balance sheet of Borrowers.

                   "Notes"  means the  Revolving  Note,  the Term Note,  and the
Equipment Note executed by the Borrowers,  as defined in Sections 2.1(b), 2.2(b)
and 2.3(b) hereof.

                  "Obligations"   means  each  and  every  promise,   agreement,
covenant,  debt and all other  obligations and  indebtedness of the Borrowers to
the Bank, its successors or assigns,  whether  primary,  secondary,  contingent,
direct, or indirect,  howsoever incurred, created, arising or evidenced, whether
presently or hereafter existing,  evidenced, arising or becoming due, including,
without  limitation,  such  obligations and indebtedness of the Borrowers to the
Bank arising from or in connection with the Loans or under this  Agreement,  the
Notes or any Loan  Documents  or any  refinancings,  substitutions,  extensions,
renewals, replacements and modifications for or of the foregoing.

                  "Permitted Liens" means Liens,  security  interests,  charges,
mortgages,  pledges  or any other  encumbrances  (i)  provided  for  under  this
Agreement,  the Notes or the Loan  Documents in favor of the Bank;  (ii) arising
out of judgments or awards in respect of which any Borrower  shall in good faith
be prosecuting an appeal or proceedings  for review and in respect of which such
Borrower shall have secured a subsisting  stay of execution  pending such appeal
or proceedings for review,  provided such Borrower shall have set aside reserves
which the Bank reasonably deems adequate with respect to such judgment or award;
(iii) for taxes, assessments or governmental charges or levies, provided payment
thereof shall not be past due or for taxes being  contested in good faith and by
appropriate  proceedings  and with respect to which adequate  reserves are being
maintained and which Liens do not have priority over the Lien of the Bank;  (iv)
deposits,  Liens  or  pledges  to  secure  payments  of  worker's  compensation,
unemployment  insurance or other forms of governmental  insurance or benefits or
to secure performance of tenders,  statutory  obligations,  leases and contracts
(other than for borrowed money) arising in the ordinary course of business;  (v)
mechanics', workmen's, repairmen's, warehousemen's, vendors' or carriers' Liens,
or other similar statutory Liens, or any easements with respect thereto,  not to
exceed an aggregate amount of $250,000 at any time  outstanding,  arising in the
ordinary  course of  business  and  securing  sums  which  are not past due,  or
deposits  or pledges to obtain the  release of any such  Liens;  (vi)  statutory
landlords'  liens  under  leases to which any  Borrower  is a party;  (vii) such
capital leases as are listed on Schedule  6.2(b)  hereto;  and (viii) subject to
Section 6.2(o) and the other provisions of this Agreement,  purchase money Liens
on Property acquired in the ordinary course of business,  to finance or secure a
portion of the  purchase  price  thereof,  provided  that in each case such lien
shall be limited to the Property so acquired and the  liability  secured by such
lien does not exceed  either the purchase  price or the fair market value of the
asset acquired and,  provided  further,  the aggregate  principal  amount of the
indebtedness  secured by such liens and the  aggregate  principal  amount of the
indebtedness  incurred  in  connection  with the  capital  leases  set  forth in
subsection (vii) hereof, does not exceed $1,000,000 in the aggregate.

                  "Person"  means any  individual,  sole  proprietorship,  joint
venture,   partnership,   limited   partnership,   association,   unincorporated
organization,  joint-stock company or association,  trust, corporation,  entity,
institution or government body.

                   "Prime  Rate"  means  the  rate  of  interest   announced  or
published publicly from time to time by the Bank as its prime or equivalent rate
of  interest,  which  rate does not  purport  to be the most  favorable  rate of
interest offered by Bank to its commercial borrowers.

                   "Prime  Rate  Option"  has the  meaning  set forth in Section
2.6(b)(i).

                  "Prime  Rate Loan"  shall mean any Loan with  respect to which
Borrowers  shall have  selected  an  interest  rate based upon the Prime Rate in
accordance with the provisions of Sections 2.1(c), 2.3(a) or 2.3(c).

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

                  "Revolving Loan" means the revolving loans to the Borrowers as
defined in Section 2.1(a) hereof.

                  "Revolving  Loan Borrowing  Base" means,  at any time, the sum
of: (a) 80% of the face amount of the Eligible  Accounts,  less unapplied  cash;
and (b) the lesser of (i) 40% of the value of the  Eligible  Inventory  and (ii)
$9,000,000, less the face amount of any L/C's outstanding.

                   "Revolving Loan  Termination  Date" has the meaning set forth
in Section 2.1(a) hereof.

                  "Revolving  Note"  means the  Revolving  Note  executed by the
Borrowers as defined in Section 2.1(b),  which is in the form attached hereto as
Exhibit B.

                  "Subordinated  Debt" means any  indebtedness  of the Borrowers
which is expressly subordinated to the Obligations and to the rights of the Bank
hereunder, and which has been approved by the Bank in writing.

                  "Subsidiary"   means  any  corporation  of  which  twenty-five
percent (25%) or more of the outstanding shares of capital stock having ordinary
voting power for the election of directors is owned,  directly or  indirectly by
any Borrower and any Affiliates or Subsidiaries of any Borrower.

                  "Tangible  Net Worth"  means the Net Worth of  Borrowers  plus
Subordinated  Debt,  less all of the  following:  (i) all prepaid  expenses  and
deposits  (ii) the book  value of all such  assets  which  would be  treated  as
general  intangibles  under  GAAP,  including,  without  limitation,   goodwill,
trademarks,   tradenames,   copyrights,  patents,  licenses,  deferred  charges,
unamortized  debt  discount  and expenses and  covenants  not to compete,  (iii)
accounts,  notes and other  receivables due from employees,  Affiliates,  and/or
shareholders of the Borrowers, and (iv) product development costs.

                   "Term Loan" means the term loan of the Borrowers as set forth
in Section 2.2(a) hereof.

                   "Term Loan  Termination  Date" has the  meaning  set forth in
Section 2.2(b) hereof.

                  "Term Note" means the Term Note  executed by the  Borrowers as
defined in Section 2.2(b), which is in the form attached hereto as Exhibit C.

                  "Unsubordinated Debt" means the Indebtedness of Borrowers,  as
shown on the Borrowers'  Financial Statements for any period, less the aggregate
Subordinated Debt outstanding for such period.

                  "Voting  Trust" means the Westell  Technologies,  Inc.,  f/k/a
Electronic Information Technologies, Inc., Voting Trust Agreement dated February
23, 1994, as amended.

         1.2      Accounting Terms.

                  Any  accounting  terms used but not otherwise  defined  herein
shall have their customary meanings as defined in, pursuant to, or in accordance
with GAAP. All other terms used but not otherwise  defined herein shall have the
meanings  provided  by the  version of the Uniform  Commercial  Code  enacted in
Illinois to the extent such terms are used or defined therein.


                                   ARTICLE II

                                   THE CREDIT

         2.1      Revolving Loan

         2.1      (a) Funding of the  Revolving  Loan.  Subject to the terms and
                  conditions of this  Agreement,  the Bank agrees to lend to the
                  Borrowers,  jointly  and  severally,  from time to time  until
                  August 30, 1999 (the "Revolving Loan  Termination  Date") such
                  sums, in a minimum  amount of $100,000 and integral  multiples
                  of $100,000 thereafter,  as Borrowers may request, pursuant to
                  Section 2.1(c) hereof;  provided,  however, that the aggregate
                  principal amount of all loans  outstanding  under this Section
                  2.1 (the  "Revolving  Loan" or  "Revolving  Loans") at any one
                  time shall not exceed  the  lesser of (i) the  Revolving  Loan
                  Borrowing    Base   or   (ii)    Sixteen    Million    Dollars
                  ($16,000,000.00) (the "Revolving Loan Commitment").

                  The Borrowers may borrow,  repay and reborrow hereunder,  from
                  the date hereof until the  Revolving  Loan  Termination  Date,
                  either the full amount of the Revolving Loan Commitment or any
                  lesser sum in the minimum  amounts  referred to above.  If, at
                  any time,  the  Revolving  Loans  exceed  the  Revolving  Loan
                  Commitment, the Borrowers shall immediately notify the Bank of
                  the  existence  of and  pay to the  Bank  the  amount  of such
                  excess.

         2.1      (b) The Note; Repayment of Principal. In order to evidence the
                  Revolving  Loans,  on the  date  hereof,  the  Borrowers  will
                  execute and deliver a promissory  note, in the form of Exhibit
                  B hereto (together with any and all amendments, modifications,
                  supplements,    substitutions,   renewals,   extensions,   and
                  restatements,  thereof and therefor,  the "Revolving Note", or
                  together with the Term Note and the Equipment Note, the "Note"
                  or "Notes"),  repayable  and maturing in  accordance  with and
                  bearing interest as set forth therein.

         2.1      (c)  Revolving  Loan  Borrowing  Request.  The  request of the
                  Borrowers  for a Revolving  Loan,  except with  respect to the
                  initial draw of Revolving  Loans as of the date hereof,  shall
                  be by the  delivery  of a written,  telephonic  or  telecopied
                  notice  addressed  to the Bank  designating  the amount of the
                  requested  Revolving  Loan, the date on which the Loans are to
                  be made  available  to  Borrowers,  and for a LIBOR Loan,  the
                  Interest  Period;  provided,  however,  that  such  notice  is
                  received  by the Bank not later than 2:00 p.m.  on the Banking
                  Day on which any  Borrower is  requesting a Prime Rate Loan to
                  be made,  and not later than two (2) Banking Days prior to the
                  date on which any Borrower is  requesting  a LIBOR Loan.  Each
                  and  every  request  for a  Revolving  Loan  shall  constitute
                  Borrowers' representation and warranty that (i) as of the date
                  of said request, no Event of Default (or event which, with the
                  giving of notice or lapse of time or both, would constitute an
                  Event of Default)  has  occurred  and is  continuing,  (ii) no
                  material  adverse  change has  occurred in the  operations  or
                  financial  condition  of the  Borrowers  since the date of the
                  most  recent  Fiscal Year for which the  Borrowers'  Financial
                  Statements  have  been  delivered  to the  Bank  and  received
                  thereby,  (iii)  the  representations  and  warranties  of the
                  Borrowers  set forth within  Article V are true and correct as
                  of the date of the request for a Revolving Loan (except to the
                  extent a representation or warranty is specifically made as of
                  a  particular   date),   (iv)  the  affirmative  and  negative
                  covenants  set forth in  Article  VI are not  currently  being
                  breached as of the date of such request for a Revolving  Loan,
                  and (v) the aggregate Revolving Loans, including the Revolving
                  Loan requested, do not exceed the Revolving Loan Commitment.

         2.2      Term Loan.

         2.2      (a)  Funding  of the  Term  Loan.  Subject  to the  terms  and
                  conditions of this Agreement,  the Bank shall make a term loan
                  (the "Term Loan";  the Term Loan, the Equipment  Loan, and the
                  Revolving Loans are  collectively  referred to as the "Loans")
                  on the date hereof to the Borrowers in the principal amount of
                  Four   Million   Dollars    ($4,000,000)   (the   "Term   Loan
                  Commitment").  Borrowers  shall  notify Bank  whether the Term
                  Loan or any  portion  thereof  is to be a LIBOR  Loan  and the
                  Interest  Period  with  respect  thereto.  Borrowers  shall be
                  permitted  to  renew  any  portion  of the Term  Loan  bearing
                  interest  at the LIBOR Rate  Option or convert  any portion of
                  the  Term  Loan  into a LIBOR  Loan  in  accordance  with  the
                  provisions of Section 2.6(i) and (j) hereof.

         2.2      (b) Term Note;  Repayment of  Principal.  In order to evidence
                  the Term Loan on the date hereof,  the Borrowers  will execute
                  and deliver a promissory note, in the form of Exhibit C hereto
                  (together   with  any  and  all   amendments,   modifications,
                  supplements,    substitutions,   renewals,   extensions,   and
                  restatements,  thereof  and  therefor,  the  "Term  Note",  or
                  together with the Revolving  Note and the Equipment  Note, the
                  "Note" or Notes"),  repayable and maturing in accordance  with
                  and  bearing  interest  as  set  forth  therein.  Payments  of
                  principal  amounts  due under  the Term Note  shall be made in
                  twelve  (12) equal  quarterly  installments  of Three  Hundred
                  Thirty-Three  Thousand Three Hundred  Thirty-Three  and 33/100
                  Dollars  ($333,333.33)  each,  commencing on November 30, 1998
                  and continuing on the last Banking Day of each February,  May,
                  August and November  thereafter,  with a final  installment on
                  August 30, 2001 (the "Term Loan Termination Date").

         2.3      Equipment Loan

         2.3      (a) Funding of the Equipment  Loans.  Subject to the terms and
                  conditions of this  Agreement,  Bank agrees to make  equipment
                  advances to Borrowers  (the  "Equipment  Loan  Advances"),  as
                  Borrowers  may request  from time to time  pursuant to Section
                  2.3(c)  hereof  for the  purchase  of  equipment,  each,  in a
                  minimum  amount of $100,000  and integral  multiples  thereof;
                  provided,  however, that the aggregate principal amount of all
                  loans  outstanding under this Section 2.3 (the "Equipment Loan
                  Advance" or "Equipment Loan Advances"),  at any one time shall
                  not exceed Five Million Dollars  ($5,000,000)  (the "Equipment
                  Loan Advance  Commitment").  Each Equipment Loan Advance shall
                  be in a minimum amount of $100,000 (or in the remaining amount
                  available  to be borrowed  under the  Equipment  Loan  Advance
                  Commitment  on  the  date  of  the  requested  Equipment  Loan
                  Advance,  if such amount is less then $100,000),  in an amount
                  not to exceed seventy-five percent (75%) of the actual invoice
                  cost of Equipment  to be  purchased  with the proceeds of such
                  Equipment Loan Advance, less any taxes,  installation charges,
                  or delivery charges. Amounts borrowed in the form of Equipment
                  Loan  Advances may not be reborrowed  following  repayment and
                  shall be  advanced in such manner as to afford Bank a purchase
                  money  security  interest in the Equipment to be acquired with
                  the proceeds of such  Equipment  Loan  Advance.  All Equipment
                  Loan  Advances  must be made  before  August  30,  1999.  (the
                  "Equipment Loan Advance Termination Date").

         2.3      (b)  Equipment  Note;  Repayment  of  Principal.  In  order to
                  evidence the Equipment  Loan Advances on the date hereof,  the
                  Borrowers will execute and deliver to Bank a promissory  note,
                  in the form of  Exhibit  D hereto  (together  with any and all
                  amendments,   modifications,    supplements,    substitutions,
                  renewals, extensions, and restatements,  thereof and therefor,
                  the  "Equipment   Loan  Note"),   repayable  and  maturing  in
                  accordance with and bearing interest as set forth therein.  On
                  the Equipment  Loan Advance  Termination  Date,  the aggregate
                  outstanding  Equipment  Loan  Advances  shall be  repayable in
                  twelve (12) equal consecutive quarterly installments,  each in
                  that  amount  necessary  to  fully  amortize  the  outstanding
                  principal balance of the Equipment Loan Advances within twelve
                  (12) quarters,  commencing November 30, 1999 and continuing on
                  the  last  day of each  February,  May,  August  and  November
                  thereafter,  with a  final  payment  of the  then  outstanding
                  principal balance of the Equipment Loan Advances on August 30,
                  2002 (the "Equipment Loan Termination Date").

         2.3      (c)  Equipment  Loan  Borrowing  Request.  The  request of the
                  Borrowers  for  an  Equipment  Loan  Advance  shall  be by the
                  delivery  of  a  written,   telephonic  or  telecopied  notice
                  addressed to the Bank  designating the amount of the requested
                  Equipment Loan Advance to be made by the Bank  designating the
                  date  on  which  the  Equipment  Loan  Advance  is to be  made
                  available to Borrowers,  and the applicable  Interest  Period;
                  provided,  however,  that such  notice is received by the Bank
                  not  later  than  2:00 p.m.  on the  Banking  Day on which any
                  Borrower is requesting  the Equipment  Loan Advance to be made
                  as a Prime Rate Loan,  and not later than two (2) Banking Days
                  prior to the Banking Day on which any  Borrower is  requesting
                  an Equipment  Loan Advance to be made as LIBOR Loan . Each and
                  every request for an Equipment  Loan Advance shall  constitute
                  Borrowers' representation and warranty that (i) as of the date
                  of said request, no Event of Default (or event which, with the
                  giving of notice or lapse of time or both, would constitute an
                  Event of Default)  has  occurred  and is  continuing,  (ii) no
                  material  adverse  change has  occurred in the  operations  or
                  financial  condition  of the  Borrowers  since the date of the
                  most  recent  Fiscal Year for which the  Borrowers'  Financial
                  Statements  have  been  delivered  to the  Bank  and  received
                  thereby,  subject to Bank's reasonable discretion to determine
                  whether such a material adverse change has occurred, (iii) the
                  representations  and  warranties  of the  Borrowers  set forth
                  within  Article V are true and  correct  as of the date of the
                  request for an Equipment  Loan Advance,  (iv) the  affirmative
                  and  negative  covenants  set  forth  in  Article  VI are  not
                  currently  being  breached and are inviolate as of the date of
                  such  request  for an  Equipment  Loan  Advance,  and  (v) the
                  aggregate  Equipment  Loan  Advances,  including the Equipment
                  Loan  Advance  requested,  do not  exceed the  Equipment  Loan
                  Advance Commitment. Each request for an Equipment Loan Advance
                  shall also be  accompanied  by  evidence  of a vendor  invoice
                  showing the  Equipment  purchased or to be purchased  with the
                  proceeds of such Equipment Loan Advance.

         2.4      Letters of Credit.

         2.4      (a) Subject to the  limitation set forth in Section 2.1 hereof
                  and  provided  that an Event of Default does not then exist or
                  would not then be  created  thereby  or any event  which  with
                  notice or lapse of time or both would  constitute  an Event of
                  Default  does not then  exist,  Bank  shall from time to time,
                  upon any  Borrower's  request,  issue  or  cause to be  issued
                  standby or trade  letters of credit  ("L/Cs") for or on behalf
                  of Borrowers  having face amounts not to exceed Three  Million
                  Dollars ($3,000,000) in the aggregate  outstanding;  provided,
                  however,  that no L/C shall have an expiration  date occurring
                  more than 180 days after the Revolving Loan Termination  Date.
                  Borrowers  shall pay to Bank (i) for  issuing  any trade L/Cs,
                  all  reasonable  and  customary  charges,  fees  and  expenses
                  charged by Bank in connection with the issuance of trade L/Cs,
                  and (ii) for issuing any standby L/C's, a fee in the amount of
                  1% per annum of the face  amount of any L/C issued by Bank for
                  the account of the  Borrowers,  payable  quarterly in advance,
                  while any such standby L/C is outstanding.

         2.4      (b)  Each  of the  Borrowers'  requests  for an  L/C  must  be
                  received by Bank at least three (3) Banking  Days prior to the
                  requested  issue date of such L/C, and shall be accompanied by
                  a duly completed application therefor and such other documents
                  in support thereof as Bank may reasonably require.

         2.4(c)   At such  time as the  Bank  honors  a demand  for  payment  on
                  account of an L/C made by the beneficiary thereunder, the Bank
                  shall  immediately  make a Revolving  Loan to the Borrowers in
                  the amount of such payment or  disbursement,  as long as there
                  shall be sufficient availability to support the making of such
                  Loan.  If there does not exist  sufficient  availability,  the
                  Borrowers  hereby agree to reimburse  Bank,  immediately  upon
                  demand, for each payment or disbursement made by Bank under or
                  on account of any L/C, honoring any demand for payment made by
                  the  beneficiary  thereunder,  with  interest on the amount so
                  paid or disbursed by Bank or any issuing bank, from the date a
                  demand for payment is made by Bank to, but not  including  the
                  date Bank is reimbursed therefor, at a rate per annum equal to
                  the Prime Rate Option.

         2.4(d)   The obligation of the Borrowers to reimburse Bank for payments
                  and disbursements  made by Bank under or on account of any L/C
                  honoring  a  demand  for  payment  made  by  the   beneficiary
                  thereunder shall be absolute and  unconditional  under any and
                  all circumstances and irrespective of any setoff, counterclaim
                  or  defense to payment  which  Borrowers  may have or have had
                  against   Bank  or  such   beneficiary,   including,   without
                  limitation,  any  defense  based on the failure of such demand
                  for  payment  to  conform  to the  terms  of  such  L/C or any
                  nonapplication  or  misapplication  by such beneficiary of the
                  proceeds of such demand for payment or the legality, validity,
                  regularity  or  enforceability  of such L/C or any document or
                  contract  related to or  required  to be  presented  under the
                  terms of such L/C; provided, however, that the Borrowers shall
                  not be obligated to reimburse Bank for any wrongful payment or
                  disbursement made by Bank under or on account of such L/C as a
                  result of acts or omissions  constituting  gross negligence or
                  willful misconduct on the part of Bank or any of its officers,
                  employees or agents.

         2.4(e)   The  Borrowers  agree  that,  upon  the  earlier  of  (i)  the
                  occurrence of an Event of Default or (ii) the  Revolving  Loan
                  Termination Date, they will  immediately,  upon written demand
                  by Bank, pay to Bank an amount equal to the amount of the then
                  aggregate  stated  amount of all L/C's issued and  outstanding
                  hereunder.  Any amounts so  received  by Bank  pursuant to the
                  provisions of the foregoing sentence shall be retained by Bank
                  as collateral security for Borrowers'  Obligations  including,
                  without limitation, all Obligations of Borrowers to Bank under
                  or in connection  with this  Agreement,  any L/C or any of the
                  Loans.

         2.4(f)   Bank shall,  promptly  following its receipt thereof,  examine
                  all documents  purporting to represent a demand for payment by
                  the beneficiary under any L/C issued by Bank to ascertain that
                  the same  appear on their  face to be in  conformity  with the
                  terms and conditions of such L/C. If, after examination,  Bank
                  shall have determined that a demand for payment under such L/C
                  does not conform to the terms and  conditions of such L/C, the
                  Bank shall, as soon as reasonably practicable,  give notice to
                  the  beneficiary  to the effect  that  negotiation  was not in
                  accordance with the terms and conditions of such L/C,  stating
                  the reasons  therefor and that the relevant  document is being
                  held at the disposal of such  beneficiary or is being returned
                  to such  beneficiary,  as Bank may elect.  The beneficiary may
                  attempt to correct any such  nonconforming  demand for payment
                  under such L/C if, and to the extent that, such beneficiary is
                  entitled  (without  regard to the provisions of this sentence)
                  and  able  to do so.  If Bank  determines  that a  demand  for
                  payment under such L/C conforms to the terms and conditions of
                  such L/C, then Bank shall make payment to the  beneficiary  in
                  accordance  with the terms of such L/C.  Bank  shall  have the
                  right,  provided  it is not then in default  under such L/C by
                  reason of its having  wrongfully  failed to honor a demand for
                  payment  previously made by the beneficiary under such L/C, to
                  require the  beneficiary  to surrender such L/C to Bank on the
                  stated  expiration  date  of such  L/C.  Borrowers  agree,  if
                  necessary, and to the extent reasonably feasible, to cause the
                  beneficiary to so surrender such L/C.

         2.4      (g) If reserve requirements,  capital adequacy requirements or
                  any  similar  requirements  or  restrictions,   or  any  other
                  requirements  of law not  presently  applicable to Bank or any
                  issuing bank are hereafter  imposed upon or determined or held
                  to be  applicable  to Bank at any time and from  time to time,
                  which  would   materially   increase  the  costs  to  Bank  of
                  continuing letter of credit financing  hereunder or materially
                  affect the  profitability (on an after-tax basis) to such Bank
                  hereby,  then Bank will give  written  notice to  Borrowers of
                  such  requirement or restriction and of the additional  costs,
                  or loss of prospective loss or  profitability,  resulting from
                  the  imposition  or   application   of  such   requirement  or
                  restriction to Bank, and the Borrowers  shall,  promptly after
                  request  therefor  by Bank,  compensate  Bank  for  additional
                  costs, or for any loss of profitability, accruing to Bank from
                  the date such  restriction  or  requirement is imposed upon or
                  determined or held to be applicable to Bank to the  expiration
                  or final surrender of all L/C's issued hereunder.

         2.5      The  Borrowers'  Loan Account.  The Bank shall maintain a loan
                  account  ("Loan  Account")  on its  books  in  which  shall be
                  recorded  (i)  the  Loans  made by the  Bank to the  Borrowers
                  pursuant  to this  Agreement,  (ii) all  payments  made by the
                  Borrowers on the Loans, and (iii) all other appropriate debits
                  and credits as provided in this Agreement,  the Loan Documents
                  or  the  Notes,  including,   without  limitation,  all  fees,
                  charges,  expenses  and  interest  provided  for  hereunder or
                  thereunder. All advances to the Borrowers and all other debits
                  and credits provided for in this Agreement or the Notes, shall
                  be evidenced by entries made by the Bank in its internal  data
                  control  systems,  in  accordance  with the  Bank's  customary
                  accounting  practices as in effect from time to time,  showing
                  the date, amount and reason for each such debit or credit. The
                  Bank may send the  Borrowers  statements  of all  amounts  due
                  hereunder as reflected in the Loan Account,  which  statements
                  shall  be   considered   presumptively   correct   as  to  the
                  indebtedness due and owing by the Borrowers to the Bank unless
                  the  Borrowers  notify  the Bank  within  sixty  (60)  days of
                  receipt of any such statement that the Borrowers consider such
                  statement  to be  incorrect  and  the  Borrowers  specifically
                  identify the items on such statement which they consider to be
                  incorrect   and  attach  any  evidence  in  their   possession
                  supporting their position.

         2.6      Interest Rates; Borrowing Periods.

         2.6(a)   Interest on the Loans.  Accrued interest on the Loans shall be
                  due and payable on the last day of each  Interest  Period.  In
                  addition,  all accrued and unpaid  interest on the Loans shall
                  be paid upon the  payment  in full of the  entire  outstanding
                  principal  amount of the Loans and,  if payment in full is not
                  made when  due,  thereafter  on  demand.  Borrowers  shall pay
                  interest calculated on the outstanding unpaid principal amount
                  of the  Revolving  Loans on the basis of the Prime Rate Option
                  or the LIBOR Rate Option, as the case may be.

                  2.6(b)  Rate  Options.  If the LIBOR Rate Option is offered by
                  the Bank,  Borrowers may,  subject to this Section 2.6, select
                  the  subject  options  to apply  simultaneously  to  different
                  portions of the Loans;  provided  that any LIBOR Loan shall be
                  in an aggregate  principal  amount of $100,000 or any integral
                  multiple thereof.  For purposes of this Agreement,  the "Prime
                  Rate  Option"  and  "LIBOR  Rate  Option"  shall be defined as
                  follows:

                  (i)      "Prime Rate Option" shall mean a fluctuating interest
                           rate per annum  (computed  for the  actual  number of
                           days  elapsed on the basis of a 365-day  year)  which
                           shall be equal to the Prime Rate.  Such interest rate
                           shall be adjusted  automatically from time to time to
                           reflect  in  full  any  changes  in the  Prime  Rate,
                           effective as of the date of each such change.

         (ii)     "LIBOR  Rate  Option"  shall mean an  interest  rate per annum
                  (computed  for the actual  number of days elapsed on the basis
                  of a 360-day  year)  which  shall be equal to the  LIBOR-Based
                  Rate in  effect  on the  date  the Bank  quotes  such  rate to
                  Borrowers. Borrowers' acceptance of any LIBOR-Based Rate shall
                  be final and  conclusive as to all matters with respect to the
                  determination  thereof.  Except as otherwise  provided herein,
                  Borrowers may select the LIBOR Rate Option with respect to all
                  or any portion of the Loans then outstanding;  provided,  that
                  Borrowers  shall not have the right to select  any LIBOR  Rate
                  Option  at any time that an Event of  Default,  or an event or
                  occurrence  which, with the giving of notice or the passage of
                  time, or both, could mature into an Event of Default, exists.

         2.6(c)   Borrowing Periods.  At any time when Borrowers shall select or
                  renew the LIBOR  Rate  Option to apply to any  portion  of the
                  Loans, they shall fix the Interest Period for such LIBOR Loan.

         2.6(d)   Default  Rate.  All  Obligations  shall bear interest from and
                  after the occurrence of an Event of Default and for so long as
                  an  Event  of  Default  shall  be   continuing,   and  without
                  constituting  a waiver of any such  Event of  Default,  on the
                  unpaid principal balance thereof at the Default Rate.

         2.6(e)   Maximum Rate.  In no event shall any rate of interest  charged
                  hereunder exceed the highest  applicable rate permitted by law
                  ("Maximum Rate"). If, in any month, the applicable rate absent
                  such  limitation,  would have exceeded the Maximum Rate,  then
                  the rate for that month shall be the Maximum  Rate,  and if in
                  future  months,  the rate  would  otherwise  be less  than the
                  Maximum Rate, then to the extent  permitted by applicable law,
                  the rate shall  remain at the Maximum  Rate until such time as
                  the amount of  interest  paid  hereunder  equals the amount of
                  interest  which  would have been paid if the same had not been
                  limited by the  Maximum  Rate.  The Bank may,  at its  option,
                  charge any interest  payable by Borrowers to  Borrowers'  Loan
                  Account,  which amounts shall thereupon constitute Obligations
                  hereunder and shall thereafter accrue interest as provided for
                  in this Agreement.

         2.6(f)   LIBOR Rate Unascertainable;  Impracticability.  The Bank shall
                  promptly  notify  Borrowers in the event that: (i) on any date
                  on which a LIBOR Rate Option  selected by  Borrowers by notice
                  to the Bank would  otherwise be set  (including any conversion
                  to or renewal thereof), the Bank shall have determined in good
                  faith (which determination shall be final and conclusive) that
                  adequate and reasonable means do not exist for determining the
                  LIBOR Rate; or (ii) at any time the Bank shall have determined
                  in  good  faith  (which   determination  shall  be  final  and
                  conclusive)  that the  selection of a LIBOR Rate Option or the
                  continuation  of or the  conversion or renewal of a LIBOR Rate
                  Option has been made impossible or  impracticable  or unlawful
                  by  compliance  by  the  Bank  with  any   applicable  law  or
                  governmental regulation,  guideline or order or interpretation
                  thereof  by  any  governmental   authority  charged  with  the
                  interpretation or  administration  thereof or with any request
                  or directive of any such  governmental  authority  (whether or
                  not   having   the   force   of   law).   

         2.6(g)   Effect of Unascertainability or Impractibility.  Once the Bank
                  has given notice of its  determination  under  Section  2.6(f)
                  above,  the  obligation of the Bank to allow  conversion to or
                  selection  or renewal of the LIBOR  Rate  Option by  Borrowers
                  with  respect to any portion of the Loans  shall be  suspended
                  until the Bank  gives  further  notice to  Borrowers  that the
                  circumstances  specified  in such  original  notice  no longer
                  apply.  If the Bank has determined in accordance  with (f)(ii)
                  above that it may no longer continue any LIBOR Loan, then upon
                  the  date  specified  in any  notice  of  determination  under
                  (f)(ii)  above  (which shall not be earlier than the date such
                  notice is given),  (x) the LIBOR Rate  Option  shall  cease to
                  apply and any LIBOR Loan shall  automatically  be converted to
                  the Prime Rate  Option and (y)  Borrowers  shall  jointly  and
                  severally pay to Lender the accrued and unpaid interest on any
                  LIBOR Loans (to but not including) such specified date and any
                  premium  pursuant  to Sec tion  2.6(h)  hereof as if the LIBOR
                  Loans were being prepaid at such time.  If, at the time notice
                  of a  determination  is given pursuant to this Section 2.6(g),
                  Borrowers have  previously  been offered the LIBOR Rate Option
                  by the Bank and has  previously  notified  the Bank  that they
                  wish to convert  to or select or renew the LIBOR Rate  Option,
                  but such Option has not yet been set, such notification  shall
                  be of no force and effect, and Borrower shall, with respect to
                  any of the Loans  subject to such  notice,  either (i) convert
                  all of such Loans to the Prime Rate Option either  pursuant to
                  Section  2.6(i) or by failing to give notice of  conversion or
                  renewal as provided in Section  2.6(j) or (ii) if such Loan is
                  a Prime  Rate Loan,  retain  the Prime Rate  Option as to such
                  Loan.

         2.6(h)   Indemnity.  Without  prejudice to any other  provision of this
                  Agreement,  Borrowers  shall jointly and severally  compensate
                  the Bank upon  written  request for all losses and expenses in
                  respect of any  interest  paid by the Bank to lenders of funds
                  borrowed  by the  Bank or  deposited  with the Bank to make or
                  maintain any of the Loans which  accrue  interest at the LIBOR
                  Rate Option,  which the Bank may sustain (i) if for any reason
                  a  borrowing  to which the LIBOR Rate  Option is to apply does
                  not occur on a date  specified  therefor  in a Loan  Borrowing
                  Notice under Section 2.1 or 2.3 hereof; (ii) if any prepayment
                  or repayment of any of the Loans occurs on a date which is not
                  the last  date of the  relevant  Interest  Period;  (iii) as a
                  consequence  of any Event of  Default or any  acceleration  or
                  mandatory prepayment or principal reduction. Such compensation
                  shall  include lost profits of the Bank in all  instances of a
                  LIBOR Loan.  Without limiting the generality of the foregoing,
                  Borrowers  shall  jointly  and  severally  indemnify  the Bank
                  against  any loss or  expense  which the Bank may  sustain  or
                  incur as a  consequence  of the  default  by any  Borrower  in
                  payment  of  principal  of or  interest  on  any  LIBOR  Loan,
                  including, but not limited to, any premium or penalty incurred
                  by the Bank in respect of funds  borrowed  by it or  deposited
                  with it for the  purpose of making or  maintaining  any of the
                  LIBOR Loans, as reasonably determined by the Bank.

         2.6(i)   Conversion  of  Interest  Rate  Options.  Subject to the other
                  provisions of this  Agreement,  Borrowers  may select,  at any
                  time with respect to  conversions  from all or any part of the
                  Prime Rate Loans or at the  expiration of the Interest  Period
                  relating to any LIBOR Loan,  a new option  pursuant to Section
                  2.1,  2.2 or 2.3 hereof and (in the case of the  selection  of
                  the  LIBOR  Rate  Option)  one or more new  Interest  Periods;
                  provided that any conversion, whether to the LIBOR Rate Option
                  or to  the  Prime  Rate  Option,  shall  be  in  an  aggregate
                  principal  amount  which is equal to  $100,000  or an integral
                  multiple  thereof.  Unless the Bank shall have  consented to a
                  shorter  period of notice,  Borrowers  shall give the Bank, in
                  the case of any conversion whether to the LIBOR Rate Option or
                  to the Prime Rate Option,  notice of each such  conversion  in
                  accordance  with the  provisions  of Section 2.1,  2.2, or 2.3
                  hereof.

         2.6(j)   Renewal of Interest  Rate Option.  Upon the  expiration of any
                  Interest  Period with respect to a LIBOR Loan,  Borrowers  may
                  renew  the  LIBOR  Rate  Option  for  one or  more  additional
                  Interest  Periods;  provided that (i) any renewal of any LIBOR
                  Rate Portion for each  Interest  Period  selected by Borrowers
                  shall be in an  aggregate  principal  amount which is equal to
                  $100,000  or an  integral  multiple  thereof  and (ii) if with
                  respect to a Revolving Loan, the outstanding principal balance
                  of the  Revolving  Loans on the  renewal  date,  after  giving
                  effect to the  renewal,  shall not exceed the  Revolving  Loan
                  Commitment.  Borrowers  shall  give to the Bank  notice of the
                  renewal date in accordance with the provisions of Section 2.1,
                  2.2, or 2.3 hereof.  In the absence of the receipt of a notice
                  from  Borrowers  of renewal in  accordance  with this  Section
                  2.6(j) or of conversion in accordance with Section 2.6(i), the
                  option  with  respect to any such  LIBOR  Rate  Portion of the
                  Loans as to which such notice is not properly  received  shall
                  automatically  be  converted  to the Prime Rate  Option on the
                  last day of the expiring Interest Period.

         2.7      Fees and Expenses.

         2.7      (a) Unused Line Fee.  The  Borrowers  shall pay to the Bank an
                  unused line fee as provided hereunder of 1/4% (computed on the
                  basis  of a year of three  hundred  sixty  (360)  days for the
                  actual  number  of days  elapsed)  of the  amount by which the
                  Revolving  Loan  Commitment   exceeds  the  average  quarterly
                  balance of the Revolving Loans plus the average quarterly face
                  amount of outstanding  Letters of Credit,  payable  monthly in
                  arrears,  on  the  last  day of  each  quarter  commencing  on
                  November  30,  1998  and  continuing  on the  last day of each
                  February,  May, August, and November thereafter.  Prior to the
                  Equipment Loan Advance  Termination  Date, the Borrowers shall
                  pay to the Bank an unused  line fee of 1/4%  (computed  on the
                  basis  of a year of 360  days for the  actual  number  of days
                  elapsed)  of the amount by which the  Equipment  Loan  Advance
                  Commitment  exceeds  the  quarterly  monthly  balance  of  the
                  Equipment Loan Advances,  payable quarterly in arrears, on the
                  last day of each quarter  commencing  on November 30, 1998 and
                  continuing on the last day of each February,  May, August, and
                  November thereafter.

         2.7      (b) Expenses.  The Borrowers  shall reimburse the Bank for all
                  its  reasonable  expenses  incurred  in  connection  with  the
                  preparation    (including   due    diligence),    negotiation,
                  documentation,  amendment,  modification,   administration  or
                  enforcement  of  this   Agreement,   the  Notes  or  any  Loan
                  Documents,  including reasonable attorney, paralegal and other
                  professional fees.

         2.8      Optional  Prepayment.  Subject  to the  provisions  of Section
                  2.6(h)  hereof,  the Borrowers may prepay in whole or in part,
                  at any time and from time to time without  premium or penalty,
                  the principal,  accrued  interest and any other amounts of the
                  Loans;  provided  that  all such  prepayments  shall be in the
                  minimum amount of Ten Thousand  Dollars  ($10,000) (or less if
                  less is due).

         2.9      Application of Payments and Prepayments.  Any payments made by
                  the Borrowers  under this  Agreement,  the Notes or any of the
                  other Loan Documents shall be applied to Obligations  owing as
                  of the date of  payment  in the  following  order:  (i) to any
                  amounts owing to the Bank pursuant to Sections 2.10 and 6.1(k)
                  of this Agreement;  (ii) to interest  accrued  pursuant to the
                  terms of the Notes;  (iii) to any  principal  payment then due
                  under the Term Loan;  (iv) to any  principal  amount  then due
                  under the Equipment Loan; and (v) to the principal  balance of
                  the Revolving Loans;  provided that any prepayment of the Term
                  Loan or the Equipment Loan shall be applied to installments of
                  principal  due  thereunder  in  the  inverse  order  of  their
                  maturity.

         2.10     Default  Interest.  In the event any  amount of  principal  or
                  interest  due  hereunder  or any other  payment due under this
                  Agreement or any of the other Loan Documents  becomes overdue,
                  such  overdue  amount  shall  accrue  interest  at the Default
                  Interest Rate from the due date through the date of payment.

         2.11     Loans  Constitute One Financing  Transaction.  Notwithstanding
                  anything to the contrary contained in this Agreement or in any
                  of the Loan Documents, the Revolving Loans, the Equipment Loan
                  and the Term  Loan  shall be  deemed  to  constitute  one loan
                  transaction.  In addition,  the Collateral  supporting each of
                  the  Revolving  Loans  and  the  Term  Loan  shall  be  deemed
                  Collateral for all Loans made under this Agreement or any Loan
                  Documents  and any Event of  Default  or event  which with the
                  passage of time or giving of notice or both  would  constitute
                  an Event  of  Default  with  respect  to any of the  Revolving
                  Loans,  the Equipment Loan, or the Term Loan shall be deemed a
                  default or Event of Default,  as  applicable,  with respect to
                  all Loans and shall give rise to all remedies therefor.


                                   ARTICLE III

                              CONDITIONS PRECEDENT

         3.1      Delivery of Documents as Conditions Precedent. The delivery of
                  each of the following  documents (the "Loan Documents") by the
                  Borrowers to the Bank shall  constitute  separate and distinct
                  conditions precedent to the making of the initial Loans by the
                  Bank to the Borrowers:


                  3.1 (a) A duly executed copy of this Agreement;

         3.1 (b) The duly issued and executed  Revolving  Note,  dated as of the
date hereof;

         3.1 (c) The duly issued and  executed  Term Note,  dated as of the date
hereof;

         3.1 (d) The duly issued and executed  Equipment  Note,  dated as of the
date hereof;

         3.1      (e)  UCC-1  financing  statements  executed  by each  Borrower
                  recorded  in the Office of the  Illinois  Secretary  of State,
                  Florida   Secretary  of  State,   and  such  other   financing
                  statements  or  fixture  filings  as the  Bank in its sole and
                  complete  discretion may request from the  Borrowers,  in form
                  and  substance  satisfactory  to  the  Bank  in its  sole  and
                  complete discretion;

         3.1      (f)   Assignments,   Security   Agreements   and  Mortgages  -
                  Trademarks   and   Patents,   executed  by  Westell  and  WTI,
                  satisfactory to Bank in form and substance;

         3.1      (g) Uniform Commercial Code financing statement,  judgment and
                  tax lien search  results for  Borrowers  from the Secretary of
                  State of  Illinois,  Secretary  of State of Florida,  and Cook
                  County,  Illinois, and from such other offices or governmental
                  agencies or bodies as the Bank,  in its sole  discretion,  may
                  request from the Borrowers, indicating that there are no other
                  licensors or creditors claiming any interest in the Collateral
                  of the Borrowers except holders of Permitted Liens;

         3.1      (h) A certificate  of the President of each  Borrower,  in the
                  form of Exhibit E hereto and dated as of the date hereof;

         3.1      (i)  Copies,  certified  no earlier  than ten days  before the
                  Closing,  by the  Secretary of State of  Delaware,  as to WTI,
                  International,   and  CPI,  and  the  Secretary  of  State  of
                  Illinois, as to Westell, of the Articles of Incorporation, and
                  any amendments thereto, for Borrowers;

         3.1      (j)  Certificate of the Secretary of State of Illinois,  dated
                  no earlier  than ten days before the  Closing,  as to the good
                  standing of Westell in the State of Illinois  and  certificate
                  of the  Secretary of State of Delaware,  dated no earlier than
                  ten days before the Closing,  as to the good  standing of WTI,
                  CPI,  and   International  in  the  State  of  Delaware,   and
                  certificates  of  qualification  as a foreign  corporation for
                  each  Borrower  in each  jurisdiction  where any  Borrower  is
                  qualified to transact business as a foreign corporation;

         3.1      (k) The  written  opinion  of  McDermott,  Will,  & Emery,  as
                  counsel  for the  Borrowers,  dated as of the date  hereof and
                  addressed to the Bank,  in the substance and form set forth on
                  Exhibit F hereto;

         3.1      (l)  Certificates or other evidence from an insurance  company
                  or  companies  acceptable  to the Bank as to the  policies  of
                  insurance,  binders  and  endorsements  thereto and such other
                  insurance  coverage to be maintained by the Borrowers pursuant
                  to Section 6.1(f) hereof;

         3.1(m)   All  information,  Financial  Statements,  or  notices  to  be
                  delivered to the Bank pursuant to Section 6.1(c) hereof;

         3.1(n)   Certified  copies  of  the  unanimous  written  consents,   or
                  resolutions  duly  adopted  at  meetings,  of  the  Boards  of
                  Directors  of the  Borrowers  in the form  attached  hereto as
                  Exhibit  G hereto  authorizing  the  execution,  delivery  and
                  performance by the Borrowers of this Agreement,  the Notes and
                  the other Loan Documents;

         3.1      (o) Copies of a letter of  direction  with wire  transfers  or
                  other appropriate  instructions directing the Bank to disburse
                  funds in appropriate amounts to specific accounts;

         3.1 (p) An initial  Borrowing Base Certificate in the form of Exhibit A
hereto;

         3.1      (q) A written  agreement in form  acceptable to Bank,  whereby
                  Bank One, Illinois,  NA ("Bank One") agrees (i) to release its
                  lien on the Collateral upon payment of Borrowers'  obligations
                  to Bank  One out of the  proceeds  of the  Loans,  and (ii) to
                  deliver UCC  termination  statements and release deeds,  which
                  statements terminate any and all Liens,  security interests or
                  encumbrances held by Bank One with respect to Borrowers;

         3.1      (r) In form and substance  satisfactory  to the Bank, each and
                  every   agreement,    document,   note,   release,   guaranty,
                  certificate, notice, affidavit, exhibit, schedule, resolution,
                  legal opinion,  assignment,  security agreement,  or financing
                  statement,  which  the Bank may  reasonably  request  from the
                  Borrowers to effect the intent of this Agreement.

         3.2      Conditions  Precedent  to Each  Loan.  Each of the  following,
                  which shall be true as of the date of each disbursement of the
                  Revolving  Loans and Equipment  Loan  Advances are  conditions
                  precedent  to the  making of each of the  Revolving  Loans and
                  Equipment Loan Advances.  Each request for a Revolving Loan or
                  Equipment   Loan   Advance   shall    constitute    Borrowers'
                  representation and warranty that each of the following is true
                  and correct as of such date.

         3.2      (a) Material Adverse Change. No material adverse change in the
                  financial  condition or operation of the Borrowers  shall have
                  occurred,   as  determined  by  the  Bank  in  its  sole,  but
                  reasonable  discretion,  since  the  date of the  most  recent
                  Fiscal Year end for which the Borrowers'  Financial Statements
                  have  been   delivered  to  the  Bank,   pursuant  to  Section
                  6.1(c)(iv) hereof, and received thereby.

         3.2      (b)  Representations  and Warranties.  The representations and
                  warranties  set forth in  Article  V hereof  shall be true and
                  correct in all  material  respects as of the date on which the
                  Borrowers have requested the Revolving Loans or Equipment Loan
                  Advance to be made available thereto.

         3.2      (c)  Covenants.  The  affirmative  and negative  covenants set
                  forth in Article VI are not being  breached  as of the date of
                  the request.

         3.2      (d) Events of Default.  No Event of Default hereunder,  or any
                  event which,  with the passage of time or the giving of notice
                  or both, would constitute an Event of Default hereunder, shall
                  have occurred and be continuing.

         3.2      (e) Loan  Commitment.  After  giving  effect to the  requested
                  borrowing,  the Revolving Loans shall not exceed the Revolving
                  Loan Commitment on such date.


                                   ARTICLE IV

                               COLLATERAL SECURITY

         4.1      Grant of Security  Interest.  As  continuing  security for the
                  prompt  payment  and   performance  of  the   Obligations  and
                  indebtedness  of the  Borrowers  to the  Bank,  including  all
                  refinancings,    renewals,   extensions,   modifications   and
                  substitutions thereof or therefor, to be retained by the Bank,
                  until the  Obligations  and  indebtedness of the Borrowers are
                  fully  satisfied,   the  Borrowers   hereby  pledge,   assign,
                  transfer,  deliver  and  set  over  to  the  Bank  all  of the
                  Borrowers' right,  title and interest in and to, and grant the
                  Bank a Lien on and security interest in, all of the Collateral
                  and any and all  amounts  which may be owing from time to time
                  by  the  Bank  or  any  other  financial  institution  to  the
                  Borrowers in any capacity,  including without limitation,  any
                  balance or share  belonging to the  Borrowers,  or any monies,
                  deposits,  credits,  accounts (including,  without limitation,
                  the Lockbox  Account) or other  Property in the  possession of
                  the  Bank.  Except  for the  Permitted  Liens,  the  Liens and
                  security  interests under this  subsection  shall be first and
                  prior to any other Liens and security  interests in and on the
                  Collateral,  and the Borrowers  shall permit no Liens,  except
                  for Permitted  Liens, to attach to the  Collateral;  provided,
                  however,   the  Bank   acknowldges  that  it  shall  not  have
                  possession of the Intercompany Notes.

         4.2      Perfection of Security  Interests.  The Borrowers hereby agree
                  to, and shall,  complete,  execute and deliver to the Bank, in
                  form and  substance  satisfactory  to the Bank,  all financing
                  statements,   including,  without  limitation,  the  financing
                  statements  described in Section 3.1(e) hereof, all amendments
                  to  and  continuation   statements  for  the  foregoing,   any
                  schedules to be attached to the  foregoing  and forms or other
                  documents to be completed in  connection  with the  foregoing,
                  and  hereby  agree to and shall  take all such  other  action,
                  including  noting  the  Bank's  security   interest  and  lien
                  directly onto the Collateral,  which the Bank may request from
                  time to time and  which  the  Bank,  in its sole and  complete
                  discretion,  deems  necessary for the  perfection or continued
                  perfection of the security interests granted under Section 4.1
                  above; provided,  however, Bank acknowledges that it shall not
                  have  possession  of the  Intercompany  Notes.  The  Borrowers
                  hereby  agree  with the Bank  that a carbon,  photographic  or
                  other  reproduction of this Agreement may be filed in lieu of,
                  and  shall  be  sufficient  as,  a  financing  statement.  The
                  Borrowers hereby  authorize,  without  requiring,  the Bank to
                  execute and file any such  financing  statements,  amendments,
                  continuation statements,  schedules,  forms or other documents
                  on behalf of and as the attorneys-in-fact for the Borrowers in
                  order to perfect the security  interests granted under Section
                  4.1 above.  The Borrowers hereby agree to, and shall, pay upon
                  demand,  all costs,  taxes and expenses of filing or recording
                  the  same  in all  public  offices,  including  those  offices
                  described in Section  3.1(e)  hereof,  which the Bank,  in its
                  reasonable discretion, deems necessary in order to perfect the
                  security interests granted under Section 4.1 above.

         4.3      Notice to Account Debtors and Instrument Obligors. At any time
                  and from time to time,  after the occurrence of and during the
                  continuance  of an Event of  Default,  the Bank shall have the
                  right to and may,  in its sole and  complete  discretion,  (i)
                  contact any Account  Debtor of the  Borrowers or obligor under
                  any of the  Borrowers'  Instruments  in  order to  verify  the
                  validity or amount or any other matter relating to any Account
                  or any Instrument;  and (ii) notify all Account Debtors of the
                  Borrowers  and  all  obligors  under  any  of  the  Borrowers'
                  Instruments  that  all  Accounts  and all  Instruments  of the
                  Borrowers  have been  assigned  to the Bank and the Bank has a
                  security interest therein.

         4.4      Appointment   as   Attorney-in-Fact.   The  Borrowers   hereby
                  irrevocably  designate,  make, constitute and appoint the Bank
                  as the  Borrowers'  true and  lawful  attorney-in-fact,  which
                  appointment  is coupled with an interest,  and  authorize  and
                  empower the Bank, in either the Borrowers' or the Bank's name,
                  except  as  hereinafter   provided,   upon  the  happening  or
                  occurrence and during the  continuation of an Event of Default
                  hereunder,  upon simultaneous written notice to the Borrowers,
                  (i) to demand payment of the Accounts and overdue  Instruments
                  of any Borrower and direct all applicable  Account Debtors and
                  Instrument  obligors to make payment  thereon  directly to the
                  Bank; (ii) to enforce payment and collection of the Borrowers'
                  Accounts  and  overdue  Instruments  by legal  proceedings  or
                  otherwise;  (iii) to exercise all of the Borrowers' rights and
                  remedies with respect to the collection or any  proceedings to
                  collect the Accounts and overdue  Instruments of the Borrowers
                  in accordance  with the  applicable  provisions of the Uniform
                  Commercial  Code  then  currently  in  effect  in the State of
                  Illinois;  (iv) to sell or assign any Account or Instrument of
                  the Borrowers  upon such terms,  for such amount,  and at such
                  time or  times  as the Bank  deems  advisable  in its sole and
                  complete  discretion,  reasonably  exercised;  (v) to  settle,
                  adjust  or  compromise   any  Account  or  Instrument  of  the
                  Borrowers or any legal proceedings  brought to collect such an
                  Account  or  Instrument;  (vi) to  discharge  or  release  any
                  Account or Instrument of the Borrowers; (vii) to prepare, file
                  and sign the Borrowers'  names on and to any bankruptcy  proof
                  of claim  form or other  similar  document  against an Account
                  Debtor  or  Instrument  obligor  of the  Borrowers;  (viii) to
                  prepare,  file and sign the Borrowers'  names on any notice of
                  lien, claim or mechanic's lien,  assignment or satisfaction or
                  lien,  or  mechanic's  lien or similar  document in connection
                  with an Account or any Instrument of the  Borrowers;  and (ix)
                  to take control in any manner of any cash or non-cash  item of
                  payment  or  proceeds  of any  Account  or  Instrument  of the
                  Borrowers,   including   without   limitation   any  rejected,
                  returned,  stopped-in-transit or repossessed goods relating to
                  such Accounts or Instruments,  and endorse any Borrower's name
                  upon  any  of  such  Borrower's   Chattel  Paper,   Documents,
                  Instruments, invoice or similar document or agreement relating
                  to any such  Account  or  Instrument  or any goods  pertaining
                  thereto;  and (x) to notify  the Post  Office  authorities  to
                  change the  address  for  delivery  of  Borrowers'  mail to an
                  address  designated by the Bank,  access any lockbox or postal
                  box into which any of the  Borrowers'  mail is deposited,  and
                  open and dispose of all mail addressed to Borrowers.


                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

                  As further inducement to the Bank to enter into this Agreement
and make the Loans  hereunder,  the Borrowers  represent and warrant,  as of the
date hereof and as of the date of each  disbursement  of the Revolving Loans and
Equipment  Loan  Advances  (except as such  representation  or warranty  relates
solely to another date), the following, which shall survive the execution and
delivery of this Agreement,  the Notes and the Loan Documents and continue until
all of the  Obligations  and  indebtedness  of the  Borrowers  have  been  paid,
satisfied or discharged in full,  regardless of any investigation by the Bank of
the Borrowers' financial condition or assets:

         5.1      Organization of Borrowers. WTI, International and CPI are each
                  corporations  duly  organized,  validly  existing  and in good
                  standing  under the Laws of the State of Delaware and are duly
                  qualified to do and transact  business and in good standing as
                  foreign  corporations in each and every jurisdiction where its
                  failure to do so would have a material adverse effect on their
                  business.  Westell is a corporation  duly  organized,  validly
                  existing and in good  standing  under the Laws of the State of
                  Illinois and is duly qualified to do and transact business and
                  in good  standing as a foreign  corporation  in each and every
                  jurisdiction  where its failure to do so would have a material
                  adverse effect on its business.

         5.2      Authority and Consents.  Each Borrower has all corporate power
                  and  authority  to own its property and assets and to carry on
                  and engage in its  business as it is now  conducted  and as is
                  presently proposed to be conducted,  and each Borrower has all
                  material licenses, permits,  franchises,  consents,  approvals
                  and  authorizations  (collectively,  "Licenses")  required  in
                  connection  with the  foregoing,  all of which Licenses are in
                  full force and effect and no action or claim is pending,  nor,
                  to Borrowers' knowledge, is threatened, to revoke or terminate
                  any of  the  Licenses  or  declare  any  License  invalid.  No
                  consent, approval or authorization of, or filing, registration
                  or qualification with, any Person,  governmental,  regulatory,
                  or  otherwise,  is  required to be obtained or effected by any
                  Borrower or any  Affiliates in connection  with the execution,
                  issuance,  delivery and  performance  of this  Agreement,  the
                  Notes and the Loan  Documents  to which the  Borrowers  or any
                  Affiliates  are a party  or  signatory  or the  incurrence  or
                  performance  of  the  Obligations  of  the  Borrowers  or  any
                  Affiliates  or, if so required,  it has been duly  obtained or
                  effected  before the date  hereof.  The  execution,  issuance,
                  delivery and performance of this Agreement,  the Notes and the
                  Loan  Documents  to  which  any  Borrower  is a party  or is a
                  signatory and the incurrence or performance of the Obligations
                  and indebtedness of the Borrowers  hereunder (a) has been duly
                  and properly authorized by all necessary corporate,  director,
                  shareholder  and other action of each Borrower and (b) has not
                  resulted in and will not result in:

                           (i)      the  creation  or  imposition  of any  Lien,
                                    security interest,  mortgage,  charge or any
                                    encumbrance of any nature whatsoever (except
                                    in  favor  of  the  Bank)  upon  any  of any
                                    Borrower's property or assets, or

                           (ii)     the  violation  or  contravention   of,  the
                                    occurrence of a default, Event of Default or
                                    event,  which  with the  passage  of time or
                                    giving of notice or both, would constitute a
                                    default or event of default under,  any term
                                    or provision of its articles or  certificate
                                    of   incorporation,   any   certificates  of
                                    authority  to do or transact  business,  any
                                    order  of  any  court,   or  any   contract,
                                    agreement,   mortgage,  indenture,  material
                                    instrument,  judgment  or Laws to which  any
                                    Borrower  or any  Affiliates  are parties or
                                    signatories  or by which any Borrower or any
                                    Affiliates are bound.

          5.3     Binding Effect and Enforceability. Upon execution and delivery
                  hereof and  thereof,  this  Agreement,  the Notes and the Loan
                  Documents  to which any  Borrower is a party or is a signatory
                  will  be the  legal,  valid  and  binding  obligations  of the
                  Borrowers  enforceable  in  accordance  with  their  terms and
                  provisions,  except as the same may be limited  by  bankruptcy
                  and  moratorium  laws and all other similar laws affecting the
                  rights of creditors  generally and the  application of general
                  principles   of  equity  and  to  the  extent  that   specific
                  performance  may be granted or denied in a court's  discretion
                  and, on the date of  delivery,  the  Borrowers  will not be in
                  violation  or  contravention  of, and no Event of Default will
                  exist under, any of the foregoing.

         5.4      Default of  Indebtedness.  None of the Borrowers is in default
                  and no event of default or event,  which after the  expiration
                  of any  applicable  grace or cure  periods  or the  giving  of
                  notice  or  both,  would  constitute  a  default  or  event of
                  default,  has occurred and is  continuing  with respect to any
                  indebtedness  in excess of $50,000  singly or in the aggregate
                  of any  kind or  nature  including,  without  limitation,  any
                  mortgage,  deed, loan agreement or other agreement relating to
                  the borrowing of monies.

         5.5      Financial Condition and Litigation.  The Financial  Statements
                  of the  Borrowers  heretofore  delivered  to the  Bank for the
                  Fiscal Years ended March 31, 1995,  March 31, 1996,  March 31,
                  1997, and March 31, 1998 have been prepared in accordance with
                  GAAP  and  fairly  present  the  financial  condition  of  the
                  Borrowers  as  at  the  dates   thereof  and  the  results  of
                  operations  for the periods  covered  thereby.  Since the most
                  recent  Fiscal  Year-end  for which the  Borrowers'  Financial
                  Statements  have  been  delivered  to the  Bank  and  received
                  thereby,   no  material   adverse  change  in  the  Borrowers'
                  financial  condition  or affairs has occurred and no dividends
                  on or  redemptions  of the  Borrowers'  common stock have been
                  made.  Except  as set  forth  on  the  most  recent  Financial
                  Statements   delivered   to  the  Bank   pursuant  to  Section
                  6.1(c)(iv)  hereof  and  received  thereby:  (a)  none  of the
                  Borrowers has Indebtedness, except as permitted hereunder; and
                  (b)  except  as  set  forth  on  Schedule  5.5(b)  hereto,  no
                  proceedings,  suits, orders, claims, investigations,  or other
                  actions are pending before any court or governmental authority
                  or,  to the  best  knowledge  of  Borrowers  or  any of  their
                  Affiliates,  after diligent  inquiry,  threatened  against any
                  Borrower or any Affiliates,  which could materially  adversely
                  affect  the  assets,   properties,   business  or   condition,
                  financial  or  otherwise,   of  the  Borrowers  or  materially
                  adversely  affect the ability of the  Borrowers to perform any
                  Obligations.

         5.6      Title and Liens. Except for the Permitted Liens, each Borrower
                  has  good  and  transferable  title  to all of its  respective
                  Property, assets and the Collateral, and the Collateral is not
                  subject to any Liens, claims,  security interests,  mortgages,
                  pledges,  charges or other encumbrance of any Person,  except,
                  with  respect to the  Collateral,  the Bank and holders of the
                  Permitted  Liens.  Borrowers,  as lessees of any real or other
                  Property  have the right  under valid  leases to occupy,  use,
                  possess and control all such Property as now  occupied,  used,
                  possessed or controlled by Borrowers.

         5.7      Account  Warranties.  With  respect  to  the  Accounts  of the
                  Borrowers  scheduled,  listed or referred to from time to time
                  on  any  Accounts   Receivable   Aging  Reports  or  Financial
                  Statement,  each Borrower  warrants and represents to the Bank
                  that: (a) such Accounts are genuine,  are in all respects what
                  they purport to be, and are not  evidenced by a judgment;  (b)
                  such Accounts are  assignable  and a security  interest may be
                  granted therein and such Accounts are subject to the first and
                  prior  perfected  Lien and security  interest of the Bank; (c)
                  such Accounts  represent  undisputed,  bona fide  transactions
                  completed in material compliance with the terms and provisions
                  of the documents  related  thereto as delivered to the Bank if
                  so requested;  (d) the  Equipment,  Goods or Inventory sold or
                  leased,  or  the  services  rendered,  which  resulted  in the
                  creation of such Accounts  have been  delivered or rendered to
                  the applicable  Account  Debtor;  (e) the amounts shown on the
                  Borrowers'  books and records and all invoices and  statements
                  delivered to the Bank, when and if so requested,  with respect
                  to such  Accounts  are actually  and  absolutely  owing to the
                  applicable Borrower and are not in any way contingent;  (f) no
                  payments have been made upon such  Accounts;  (g) there are no
                  set-offs, counterclaims or disputes existing or, to Borrowers'
                  knowledge,  asserted  with  respect to such  Accounts  and the
                  Borrowers  have  not made any  agreement  with any  applicable
                  Account  Debtor for any  deduction  or discount  from any such
                  Account,  except  discounts  allowed by the  Borrowers  in the
                  ordinary course of their business for prompt  payment;  (h) to
                  the knowledge of the Borrowers,  there are no facts, events or
                  occurrences  which  in any  way  impair  the  validity  or the
                  enforceability  of such Accounts or tend to reduce the amounts
                  payable  under such Accounts as shown on the books and records
                  of the Borrowers and the invoices and statements  delivered to
                  the Bank, when and if so requested,  with respect thereto; (i)
                  to the best  knowledge of the  Borrowers  without  independent
                  inquiry, all of the applicable Account Debtors with respect to
                  such  Accounts  have the capacity to contract and are solvent;
                  (j) such Accounts and the Equipment,  Goods, Inventory sold or
                  leased or the services  rendered  giving rise to said Accounts
                  are not subject to any lien, security interest,  claim, charge
                  or any  other  encumbrance,  except  for the  first  and prior
                  perfected  security  interest of the Bank and except  those of
                  holders of the  Permitted  Liens;  and (k) to the knowledge of
                  the  Borrowers,  there are no proceedings or actions which are
                  threatened or pending  against any of the  applicable  Account
                  Debtors which might result in any material  adverse  change in
                  such Account Debtor's financial condition.

         5.8      Inventory  Warranties.  (a) The current  address for the chief
                  executive  offices of each  Borrower  is set forth on Schedule
                  5.8  hereof  ("Chief   Executive  Office  Location")  and  the
                  Inventory of each Borrower used in such Borrower's business is
                  located  at its Chief  Executive  Office  Location  and at the
                  locations  set forth on Schedule  5.8 hereof (the  "Additional
                  Inventory  Locations");  (b) no Inventory will ever be located
                  in  any  locations  other  than  the  Chief  Executive  Office
                  Locations or the Additional  Inventory  Locations,  without at
                  least five (5) Banking Days' prior written notice to the Bank;
                  (c) all  Inventory is presently  owned and will continue to be
                  owned by the Borrowers, except as otherwise permitted pursuant
                  to the  terms of this  Agreement,  free and clear of all liens
                  and  encumbrances,  other  than the Bank's  security  interest
                  hereunder and any Permitted  Liens;  (d) no Inventory has been
                  consigned to any Person, except with respect to that Inventory
                  as to which Borrowers have notified Bank; and (e) no Inventory
                  is presently or at any time or times hereafter, will be stored
                  with a bailee,  warehouseman  or  similar  party  without  the
                  Bank's  prior  written  consent,  and,  if the Bank gives such
                  consent,  the applicable Borrower will concurrently  therewith
                  cause any such bailee or  warehouseman to issue and deliver to
                  the Bank,  warehouse  receipts therefor in the Bank's name, in
                  form acceptable to the Bank.

         5.9      Employee Plans. All of the Borrowers'  Employee Plans meet the
                  minimum  funding  standards  of  Section  302 of  ERISA  where
                  applicable.  No withdrawal  liability has been incurred  under
                  any  such  Employee  Plans  and no  notice  of any  Prohibited
                  Transaction or Reportable  Event as defined in ERISA, has been
                  received by Borrowers with respect to any such Employee Plans,
                  unless approved by the appropriate  governmental  agencies. No
                  Employee Plan is a  multi-employer  plan within the meaning of
                  Section  3(37) of ERISA.  All  payments  and/or  contributions
                  required  to  have  been  made  under  the  provisions  of any
                  Employee Plan or by law have been timely made.

         5.10     Taxes.  To the best of its knowledge,  each Borrower has filed
                  all federal, state, county,  municipal, and other tax returns,
                  reports and declarations required to be filed by all Laws, has
                  paid  all  taxes,   including   excise   taxes,   assessments,
                  penalties,  interest and any other governmental  charges which
                  are  or  were  due  and  payable,   unless  such  Borrower  is
                  contesting in good faith,  by an appropriate  proceeding,  the
                  validity,  amount or imposition of the above while maintaining
                  adequate  reserves to cover the above,  and such  contest does
                  not have or cause a material adverse change in such Borrower's
                  financial  condition  or  operations  and does not impair such
                  Borrower's  ability  to  perform  its  Obligations,  has  made
                  adequate provision for the payment of all taxes,  assessments,
                  penalties,  interest and other governmental  charges which are
                  accruing but are not yet due and payable, and has no knowledge
                  and is not aware of any  deficiency or  additional  assessment
                  which may have or has arisen in connection with the foregoing.

         5.11     Compliance  with  Laws.  Each  Borrower  has  complied  in all
                  material  respects with all  applicable  Laws with respect to:
                  (a) any  restrictions,  specifications  or other  requirements
                  pertaining  to products that such  Borrower  leases,  sells or
                  distributes or to the services it performs; (b) the conduct of
                  its business;  and (c) the use,  maintenance  and operation of
                  the real and personal  properties owned or leased by it in the
                  conduct of its business.

         5.12     Subsidiaries  and Affiliates.  WTI has no Subsidiaries  except
                  Westell,  International,  and  CPI.  CPI  has no  Subsidiaries
                  except  Conference Plus Global  Services,  organized under the
                  laws of the Republic of Ireland.  Westell has no  Subsidiaries
                  except Westell Worldwide Services, Inc., and International has
                  no  Subsidiaries  except  Westell  Europe,  Ltd.  and  Westell
                  Canada,  Ltd. WTI owns all of the capital stock of CPI, except
                  for 11.8%  owned by CPI's  management  personnel.  None of the
                  Borrowers has any  Affiliates  except the officers,  directors
                  and shareholders of such Borrower.

          5.13    Assumed Names.  None of the Borrowers has any assumed names or
                  is  doing   business   under  any  name  other  than   Westell
                  Technologies,  Inc.  Westell,  Inc.,  Westell,  International,
                  Inc., and Conference Plus, Incorporated.

         5.14     Solvency.  Each  Borrower (i) is currently  and,  after giving
                  effect to the transactions contemplated by this Agreement, the
                  Notes,  and any Loan  Documents  to which such  Borrower  is a
                  party or signatory, will be able to pay its debts as they come
                  due and will not incur  debts  beyond its  ability to pay such
                  debts as they mature or come due, (ii) has capital  sufficient
                  to carry on its  business and any business in which it intends
                  or is about to  engage,  and (iii)  owns  property  and assets
                  having  a  value  (as  a  going  concern)  in  excess  of  its
                  liabilities  and debts.  No transfer of property is being made
                  and no  Obligation is being  incurred in  connection  with the
                  transactions contemplated by this Agreement with the intent to
                  hinder,  delay or defraud  creditors  of the  Borrowers or any
                  Affiliate.

         5.15     Regulation U. None of the Borrowers is engaged in the business
                  of extending  credit for the purpose of purchasing or carrying
                  margin stock  (within the meaning of Regulation U of the Board
                  of Governors of the Federal  Reserve  System),  and no part of
                  the proceeds of any of the Loans made  hereunder  will be used
                  to purchase or carry any margin  stock or to extend  credit to
                  others for the  purpose of  purchasing  or  carrying  any such
                  margin stock.

          5.16    Capital Stock.  The  authorized  capital stock of Borrowers is
                  set  forth on  Schedule  5.16  hereof.  There are no shares of
                  common  stock  held  as  treasury  shares.  The  designations,
                  powers, preferences,  rights, qualifications,  limitations and
                  restrictions in respect of each class and series of authorized
                  capital  stock  of  each  Borrower  is as  set  forth  in  its
                  respective   Articles   of   Incorporation,   and   all   such
                  designations,  powers,  preferences,  rights,  qualifications,
                  limitations,   and   restrictions   are  valid,   binding  and
                  enforceable  and in accordance  with all applicable  laws. All
                  outstanding shares of capital stock of the Borrowers have been
                  duly  authorized  and  validly  issued  and are fully paid and
                  non-assessable. All of the outstanding securities of Borrowers
                  were  issued in  compliance  with all  applicable  federal and
                  state securities  laws. None of the outstanding  securities of
                  Borrowers  have been  issued in  violation  of any  preemptive
                  rights,  rights of first refusal or similar rights.  Except as
                  set forth on Schedule 5.16, there are no outstanding  options,
                  warrants,  convertible securities, calls, rights, commitments,
                  preemptive    rights   or   agreements   or   instruments   or
                  understandings  of any  character,  to which any Borrower is a
                  party  or by which  any  Borrower  is  bound,  obligating  any
                  Borrower  to issue,  deliver  or sell,  or cause to be issued,
                  delivered  or  sold,  contingently  or  otherwise,  additional
                  shares of capital stock of such Borrower or any  securities or
                  obligations  convertible  into or exchangeable for such shares
                  or to grant, extend or enter into any such preemptive right or
                  agreement. There are no outstanding obligations, contingent or
                  otherwise,  of any Borrower to  purchase,  redeem or otherwise
                  acquire  any  capital  stock of such  Borrower.  Except as set
                  forth on Schedule 5.16,  there are no voting trust  agreements
                  or  other  contract,  agreements,  arrangements,  commitments,
                  plans or understandings  restricting or otherwise  relating to
                  voting,   dividend  or  other   rights  with  respect  to  any
                  Borrower's capital stock.

         5.17     Occupational  Safety and Health.  None of the  Borrowers  has,
                  nor, to the Borrowers'  knowledge,  has any Affiliate received
                  any notice, citation, claim, assessment or proposed assessment
                  as to or alleging  any  material  violation by any Borrower or
                  any such  Affiliate  from any division of any Federal or state
                  occupational safety and health administrations or agencies and
                  no such violation  presently exists. None of the Borrowers is,
                  nor, to the best of the Borrowers' knowledge,  no Affiliate is
                  a party to any pending  dispute with respect to the Borrowers'
                  or any  Affiliate's  compliance  with  any  Federal  or  state
                  occupational safety and health laws.

          5.18    No Options.  No Person has any option to acquire  ownership of
                  the Collateral or any portion thereof.

         5.19     Environmental Protection.

          5.19    (a) Borrowers are in compliance in all material  respects with
                  all applicable Environmental Laws and regulations. Neither the
                  Collateral  nor any  real  property  owned  or  leased  by the
                  Borrowers  in  connection  with the conduct of their  business
                  (the  "Applicable  Environmental  Property") has been used for
                  the handling,  treatment, storage or disposal of any Hazardous
                  Materials in violation of applicable Environmental Laws;

          5.19    (b) None of the  Borrowers  nor to the knowledge of Borrowers,
                  any of their  Affiliates  has  received  any order,  letter or
                  other written  communication,  from any  governmental  unit or
                  agency,  concerning the violation of any Environmental Laws or
                  concerning any releasing, spilling, leaking, pumping, pouring,
                  emitting,  emptying,  discharging  or dumping of any Hazardous
                  Materials,  or with respect to any air or water  discharges or
                  emissions, on the Applicable Environmental Property; and

          5.19    (c) To the knowledge of Borrowers,  (i) no underground storage
                  tanks are present on the Applicable Environmental Property and
                  (ii) no such tanks were previously removed; and

         5.20     Compliance with Zoning and Other Regulations;  Assessments. To
                  the knowledge of  Borrowers,  neither the  Collateral  nor any
                  other real  property  owned,  leased or otherwise  used by the
                  Borrowers in connection  with the conduct of their  businesses
                  (the "Real  Property")  is in violation of any material law or
                  any zoning,  or other  ordinance,  code, rule or regulation of
                  any governmental  body or other authority having  jurisdiction
                  thereof,   including   provisions   relating  to   permissible
                  non-conforming  uses, if any. No notice from any  governmental
                  body or other party has been served upon any  Borrower  or, to
                  the knowledge of the Borrowers,  upon any of their Affiliates,
                  claiming any violation of any such law, ordinance,  code, rule
                  or regulation or requiring,  or calling  attention to the need
                  for   any   work,   repairs,   construction,   alteration   or
                  installation on or in connection with the Real Property.  None
                  of the  Borrowers  has  received  notice  of any  special  tax
                  assessment   affecting   the  Real  Property  or  any  of  the
                  Collateral.

         5.21     Disclosure.  No representation or warranty by the Borrowers or
                  any of their  Affiliates in this Agreement or any of the other
                  Loan Documents, nor any statement furnished to the Bank by the
                  Borrowers or any of their Affiliates or agents pursuant hereto
                  or thereto, contains or will contain any untrue statement of a
                  material fact, or omits or will omit to state a material fact,
                  necessary when made or while the representation or warranty is
                  continuing, to make the statements contained herein or therein
                  not misleading.

         5.22     Labor  Relations.  Each  Borrower  has  withheld  all  amounts
                  required  by law or  agreement  to be  withheld by it from the
                  wages,  salaries and other payments to its  employees,  and is
                  not liable for any arrears or wages or any taxes or  penalties
                  for failure to comply with the foregoing.  Except as set forth
                  on Schedule  5.22 hereto,  none of the Borrowers is a party to
                  any collective  bargaining  agreements.  There are no pending,
                  threatened or  anticipated  (i) employment  discrimination  or
                  unfair  labor  practice  charges  or  complaints   against  or
                  involving  any  Borrower  before any  federal,  state or local
                  board,   department,   commission  or  agency,  (ii)  material
                  grievances,  disputes or  controversies  with any union or any
                  other organization of any Borrower's employees,  (iii) pending
                  or threatened strikes,  slowdowns,  work stoppages or lockouts
                  or (iv) any asserted pending demands for collective bargaining
                  by any union or organization or efforts to organize any of the
                  employees of any Borrower.

         5.23     Patents and Trademarks.  The Borrowers possess,  those patents
                  and trademarks  listed on Schedule 5.23 hereto,  which, to its
                  best  knowledge,  are  all of the  necessary  patents,  patent
                  rights, trademarks,  trademark rights, trade names, trade name
                  rights and copyrights to conduct the business of the Borrowers
                  as now  operated.  Except as listed on Schedule  5.23A hereto,
                  the Borrowers' patents, patent rights,  trademarks,  trademark
                  rights,  trade names, trade name rights and copyrights do not,
                  to the best of Borrowers' knowledge,  infringe on the property
                  rights of any other Person.

         5.24     Year 2000  Compliance The Borrower and its  Subsidiaries  have
                  reviewed the areas within their business and operations  which
                  could be  adversely  affected  by, and have  developed  or are
                  developing a program to address on a timely  basis,  the "Year
                  2000 Problem"  (that is, the risk that  computer  applications
                  used by the  Borrower  and its  Subsidiaries  may be unable to
                  recognize  and  perform  properly   date-sensitive   functions
                  involving  certain dates prior to and any date after  December
                  31,  1999),  and have  made  related  appropriate  inquiry  of
                  material  suppliers  and  vendors.  Based on such  review  and
                  program,  the Borrower  believes  that the "Year 2000 Problem"
                  will not have a material  adverse effect on the Borrower,  its
                  financial condition,  business and operations, and its ability
                  to pay and perform the Obligations.  From time to time, at the
                  request of the Bank, the Borrower and its  Subsidiaries  shall
                  provide to the Bank such updated  information or documentation
                  as is  requested  regarding  the  status of their  efforts  to
                  address the "Year 2000 Problem".


                                   ARTICLE VI

                                    COVENANTS

                  The  Borrowers  hereby  covenant and agree with the Bank that,
until the  Obligations  and  indebtedness of the Borrowers to the Bank have been
satisfied and  discharged in full,  the Borrowers will comply with the following
covenants, unless the Bank shall give its prior written consent to the contrary:

         6.1      Affirmative Covenants.

         6.1      (a) Payments.  The  Borrowers  shall pay, or cause to be paid,
                  when due all  principal  and interest  under the Notes and all
                  other Obligations in respect of this Agreement,  the Notes and
                  the Loan Documents.

         6.1 (b) Financial Covenants. The Borrowers shall maintain:

                  (i) a maximum  aggregate  year-to-date (net loss)/ minimum net
                  income (exclusive of extraordinary  income and losses) for the
                  interim  periods  ending on the  dates set forth  below in the
                  amounts set forth below;



                           End of Period                  (Net Loss)/Net Income
                           6/30/98                        ($10,000,000)
                           9/30/98                        ($18,000,000)
                           12/31/98                       ($24,000,000)
                           3/31/99                        ($28,000,000)
                           6/30/99                        ($5,000,000)
                           9/30/99                        ($5,000,000)
                           12/31/99                       ($3,000,000)
                           3/31/00                         $1,000,000
                           6/30/00                         $1,000,000
                           9/30/00                         $2,000,000
                           12/31/00                        $3,000,000
                           3/31/01                         $4,000,000
                           6/30/01                         $1,000,000
                           9/30/01                         $2,000,000
                           12/31/01                        $3,000,000
                           3/31/02                         $4,000,000
                           6/30/02                         $1,000,000

                  (ii) at all times,  a Leverage Ratio of not more than 1.2:1.0,
                  measured on a monthly basis; and (iii) at all times, a Current
                  Ratio of not less than 1.8:1, measured on a monthly basis.

          6.1     (c) Financial  Information and Reporting.  The Borrowers shall
                  prepare the Accounts  Receivable  Aging Reports as of the last
                  day of  each  calendar  month  (collectively,  the  "Effective
                  Dates" and each an  "Effective  Date")  and shall keep  proper
                  books and records with respect to their Accounts and Inventory
                  in which full and true entries will be made of all dealings or
                  transactions  relating  to the  business  and  affairs  of the
                  Borrowers,  in accordance  with GAAP, and the Borrowers  shall
                  cause to be furnished to the Bank:

                           i)       As  soon  as  practicable  and in any  event
                                    within thirty (30) days after each Effective
                                    Date,  beginning  with  the  calendar  month
                                    ending October 31, 1998, or at such times as
                                    the  Bank  shall  reasonably  request,   the
                                    Accounts   Receivable  Aging  Reports,   the
                                    Inventory   Reports  and  a  Borrowing  Base
                                    Certificate;

                           (ii)     Beginning  with the month ending October 31,
                                    1998,  as  soon as  practicable,  and in any
                                    event within  forty-five (45) days after the
                                    end   of   each   month,    the   Borrowers'
                                    consolidated   statement   of   income   and
                                    retained  earnings  and a statement  of cash
                                    flow  for  the  month  then  ended  and  the
                                    portion  of  Borrowers'   fiscal  year  then
                                    elapsed and a balance sheet of the Borrowers
                                    as of the end of such month and the
                                    portion  of  Borrowers'   fiscal  year  then
                                    elapsed,   all  in  reasonable  detail,  and
                                    certified by an authorized officer of WTI as
                                    being accurate in all material  respects and
                                    having  been  prepared  in  accordance  with
                                    GAAP, other than normal year-end adjustments
                                    and  footnotes,  and on a  basis  consistent
                                    with that applied in the  preparation of the
                                    Borrowers'    previous   monthly   Financial
                                    Statements, and a certificate in the form of
                                    Exhibit  I  hereto  showing   compliance  by
                                    Borrowers  with the financial  covenants set
                                    forth in Section 6.1 (b) hereof;

                           (iii)    As soon as  practicable  and,  in any event,
                                    within forty-five (45) days after the end of
                                    each calendar  quarter,  beginning  with the
                                    quarter  ended  June  30,  1998,  a copy  of
                                    Borrowers'   10-Q,   as   filed   with   the
                                    Securities and Exchange Commission;

                            (iv)    As soon as  practicable  and,  in any event,
                                    within  ninety  (90)  days  after the end of
                                    each Fiscal Year,  beginning with the Fiscal
                                    Year ended March 31,  1999,  the  Borrowers'
                                    consolidated   statements   of  income   and
                                    retained  earnings  and a statement  of cash
                                    flow for the  Fiscal  Year then  ended and a
                                    balance sheet of the Borrowers as of the end
                                    of  such  Fiscal  Year,   setting  forth  in
                                    comparative form, the corresponding  figures
                                    for the  corresponding  period  of the prior
                                    Fiscal  Year,  all  in  reasonable   detail,
                                    audited by an independent  certified  public
                                    accountant  selected  by the  Borrowers  and
                                    acceptable  to  the  Bank  and  prepared  in
                                    accordance  with  GAAP,  together  with  the
                                    written  statement  of such  accountant  (i)
                                    that in performing the audit such accountant
                                    has not  obtained  knowledge of any Event of
                                    Default, or disclosing all Events of Default
                                    of which it has obtained  knowledge and (ii)
                                    that he is aware  that  Bank is  relying  on
                                    such Financial  Statements,  together with a
                                    copy of  Borrowers'  10-K, as filed with the
                                    Securities and Exchange Commission;

                           (v)      Promptly  upon  receipt  and,  in any event,
                                    within   fifteen  (15)  days  after  receipt
                                    thereof,   copies   of   all   interim   and
                                    supplemental  financial reports submitted to
                                    the  Borrowers  by   independent   certified
                                    public  accountants  in connection  with any
                                    interim  review of the books and  records of
                                    the Borrowers made by such  accountants,  if
                                    any;

                            (vi)    Together with the Financial  Statements  for
                                    each Fiscal Year, a certificate of Borrowers
                                    executed   by  an   authorized   officer  of
                                    Borrowers   stating  whether  any  Event  of
                                    Default, or event which, with the passage of
                                    time or  giving  of  notice  or both,  would
                                    constitute   such  an  Event   of   Default,
                                    currently  exists and is continuing and what
                                    action,  if any, the Borrowers are taking or
                                    propose to take with respect thereto;

                           (vii)    As soon as  practicable  and,  in any event,
                                    prior  to  Borrowers'  Fiscal  Year-end,   a
                                    budget for the following Fiscal Year;

                           (viii)   Promptly after notice to any Borrower or any
                                    Affiliate   of   the    Borrowers   of   the
                                    commencement thereof, notice, in writing, of
                                    any  actions,  suits,  arbitration  or other
                                    proceedings    in   excess   of    $100,000,
                                    instituted,  commenced or to the  Borrowers'
                                    knowledge,  threatened  against or affecting
                                    the  Borrowers  of  the  type  described  in
                                    Section 5.5 of this Agreement;

                           (ix)     Promptly  after  the   occurrence   thereof,
                                    notice, in writing, of any Event of Default,
                                    or any event which, with the passage of time
                                    or  giving   of   notice   or  both,   would
                                    constitute such an Event of Default and what
                                    action,  if any, the Borrowers are taking or
                                    propose to take with respect thereto;

                           (x)      Notice  of any  change  in  location  of any
                                    places of  business  or the Chief  Executive
                                    Office  Location of the  Borrowers or of the
                                    Additional   Inventory   Locations   of  the
                                    Borrowers  at least  five (5)  Banking  Days
                                    days prior to such change;

                             (xi)   Promptly  after  the   occurrence   thereof,
                                    notice,  in  writing,  of any  other  matter
                                    which has resulted in, or might result in, a
                                    materially  adverse  change in the financial
                                    or  other  condition  or  operations  of any
                                    Borrower or its ability to fully perform its
                                    Obligations  under the terms and  conditions
                                    of this  Agreement and the Loan Documents or
                                    its ability to repay the Notes;

                           (xii)    With  reasonable   promptness,   such  other
                                    information    respecting    the   business,
                                    properties or the  condition or  operations,
                                    financial or otherwise, of the Borrowers, as
                                    the Bank may  from  time to time  reasonably
                                    request in writing;

                           (xiii)   Promptly  after  the   occurrence   thereof,
                                    notice, in writing,  of any material default
                                    under any obligation of any Borrower secured
                                    by a Permitted Lien and what action, if any,
                                    the  Borrowers are taking or propose to take
                                    with respect thereto;

                            (xiv)   Promptly  after  the   occurrence   thereof,
                                    notice,  in writing,  of any material  labor
                                    dispute to which any Borrower might become a
                                    party,  any  material  strikes  or  walkouts
                                    relating to the  Borrowers'  facilities,  or
                                    the  expiration  of any  labor  contract  to
                                    which  any  Borrower  is a party or by which
                                    any Borrower is bound; and

          6.1     (d) Account Covenants.  Each Borrower agrees to promptly:  (i)
                  inform  the Bank in  writing,  of any  material  delay in such
                  Borrower's  performance  of  any  of  its  Obligations  to its
                  Account  Debtors  or any  assertion  of any  material  claims,
                  offsets or counterclaims  by any of its Account Debtors;  (ii)
                  furnish  to  or  inform  the  Bank  of  all  material  adverse
                  information  relating to the financial condition of any of its
                  Account   Debtors  upon  obtaining   actual  or   constructive
                  knowledge  of such  information;  and (iii)  provide the Bank,
                  upon the  reasonable  request of the Bank,  with any invoices,
                  statements  or other  documents or records with respect to its
                  Accounts.

          6.1     (e)  Inventory and Equipment  Covenants.  Each Borrower  shall
                  maintain its  Inventory  and  Equipment on the premises at the
                  locations  described  in  Section  5.8 hereof or at such other
                  addresses  as the Bank shall be  informed  pursuant to Section
                  9.8  hereof.  The  Borrowers  shall  at  all  times  hereafter
                  maintain a perpetual  inventory,  keeping correct and accurate
                  records   itemizing  and  describing  the  cost,  kind,  type,
                  quality,  and quantity of the Inventory  and  Equipment  which
                  records shall be available  during  Borrowers'  usual business
                  hours for the review of the Bank or its officers, employees or
                  agents at their request.

          6.1     (f)  Insurance.  The  Borrowers  shall,  at their own expense,
                  maintain and provide satisfactory  evidence to the Bank as to,
                  insurance on the Collateral and other business Properties, all
                  in such form,  substance  and amounts and with such  insurance
                  companies  or  associations  acceptable  to  the  Bank  in its
                  discretion,  reasonably exercised,  and any insurance policies
                  issued in connection with the above shall contain endorsements
                  which name the Bank as  additional  insured  and  lender  loss
                  payee, as its interest may appear,  with respect to all of the
                  Collateral  and which provide that said policies  shall not be
                  cancelled, terminated, amended or modified without thirty (30)
                  days'  prior  written  notice  to the  Bank and that no act or
                  default of the  Borrowers or any Person shall affect the right
                  of the Bank to recover  under such policies in case of loss or
                  damage.  Bank hereby approves of Borrowers'  current insurance
                  coverage.  The  Borrowers  shall deliver to the Bank a copy of
                  the insurance  policies and  certificates for each such policy
                  of  insurance.  The  Borrowers  shall  notify the Bank  within
                  thirty  (30) days of  obtaining  any new policy or increase of
                  coverage  under any  existing  policy.  The  Borrowers  hereby
                  irrevocably appoint, designate and constitute the Bank and its
                  officers,    employees   and   agents,   as   the   Borrowers'
                  attorney-in-fact  for the  purpose  of  making,  settling  and
                  adjusting,  in good faith,  claims in excess of $100,000 under
                  any and all  such  insurance  policies  and of  endorsing  the
                  Borrowers' names on any checks,  drafts,  instruments or other
                  items of payment received by any Borrower or the Bank pursuant
                  to such insurance policies.  If the Borrowers fail to maintain
                  any insurance or policies of insurance as required  above,  or
                  fail to pay any premium related  thereto,  the Bank may obtain
                  or pay the same, but shall be under no obligation to do so. In
                  the event the Bank  obtains such  insurance,  all sums so paid
                  and any expenses  incurred in  connection  therewith  shall be
                  part of the  Obligations  payable by the Borrowers to the Bank
                  on demand  pursuant to Section  6.1(k)  hereof.  The Borrowers
                  shall  also  maintain  in  effect,  in  addition  to the above
                  mentioned  insurance  covering  the  Collateral,   such  other
                  insurance in such amounts with such insurers and covering such
                  risks as now  maintained  by the  Borrowers  and  shall,  upon
                  request by the Bank,  provide  the Bank with  certificates  or
                  policies  evidencing  such  insurance.  In the event  that any
                  insurance  proceeds  received  by the  Bank  pursuant  to this
                  Section  6.1(f)  exceed  the  amounts  necessary  to repay all
                  Indebtedness  of the Bank with  respect to the  Collateral  to
                  which such insurance proceeds relate, the Bank shall reimburse
                  the Borrowers in the amount of such excess.

          6.1     (g) Corporate Existence. Borrowers shall maintain and preserve
                  their  corporate  existence,  good standing,  certificates  of
                  authority, licenses, permits, franchises, patents, trademarks,
                  trade names, service marks,  copyrights,  leases and all other
                  contracts and rights  necessary or desirable to continue their
                  operations  and business as now conducted  and will  generally
                  continue  the  substantially  same lines of  business as those
                  being  presently  conducted  and  related  businesses  in  the
                  telecommunications area.

          6.1     (h)  Taxes and Laws.  Borrowers  will pay when due all  taxes,
                  including  excise  taxes and duty,  assessments,  charges  and
                  levies  imposed  on  any  Borrower  or any  of  their  income,
                  profits,  Property  or assets,  or which they are  required to
                  withhold  and pay out,  and will  comply  with all  applicable
                  present and future Laws unless any Borrower is  contesting  in
                  good faith, by an appropriate proceeding, the validity, amount
                  or imposition of the above, while maintaining reserves, deemed
                  adequate by the Bank in its sole, but reasonable discretion to
                  cover the  above,  and such  contest  does not have or cause a
                  material adverse change in any Borrower's  financial condition
                  or operations  and does not impair any  Borrower's  ability to
                  perform the  Obligations.  In the event any Borrower  fails to
                  pay any such taxes,  assessments,  charges or levies, the Bank
                  may,  without waiving or releasing the Borrowers'  Obligations
                  or any Event of Default hereunder,  pay the same, but shall be
                  under no  obligation  to do so. All sums so expended  shall be
                  part of the  Obligations  payable by the Borrowers to the Bank
                  on demand pursuant to Section 6.1(k) hereof.

          6.1     (i) Repair and Maintenance. The Borrowers will maintain all of
                  the  Collateral  and assets,  including,  without  limitation,
                  their Equipment,  Inventory,  Property, and the Collateral, in
                  good condition and repair and in proper working order,  normal
                  wear and tear excepted,  and will pay and discharge,  or cause
                  to be paid and  discharged,  when  due,  the cost of  repairs,
                  replacement or maintenance to the foregoing and all rentals or
                  mortgage  payments  on the  foregoing,  and in the  event  the
                  Borrowers  fail  in  the  foregoing,   the  Borrowers   hereby
                  authorize, without requiring the Bank, to perform the same and
                  to  incur  such  reasonable   costs,   fees  and  expenses  in
                  connection  therewith  which shall be payable on demand by the
                  Borrowers pursuant to Section 6.1(k) hereof.

          6.1     (j)  Inspection.  The  Borrowers  will  maintain  complete and
                  accurate books and records.  Upon three (3) days prior notice,
                  the Borrowers,  during normal business  hours,  will allow the
                  Bank, and any of its officers,  employees or agents, to visit,
                  for  inspection  and review,  any and all  premises  where the
                  Borrowers'  Collateral is located,  and to make  available and
                  furnish to the Bank the Borrowers'  books and records and such
                  financial  information  concerning the Borrowers'  Collateral,
                  other  Property or assets,  business,  affairs,  operations or
                  financial condition as reasonably requested by the Bank. Prior
                  to the  occurrence  of any Event of Default,  Bank shall treat
                  such  information as confidential  and shall not disclose such
                  information  unless required by law,  banking  regulation,  or
                  court order, or to any potential participant.  No notice shall
                  be required  hereunder if an Event of Default has occurred and
                  is  continuing.  The Bank shall be permitted to perform annual
                  field audits of any of the  Borrowers'  premises  where any of
                  the Collateral is located at the Borrowers' cost and expense.

          6.1     (k) Bank  Costs.  The  Borrowers  shall  pay to the Bank  upon
                  demand, all reasonable out- of-pocket fees, costs and expenses
                  incurred  or paid  by the  Bank  (i) in  connection  with  the
                  insurance to be maintained  under Section 6.1(f) hereof;  (ii)
                  in connection  with the enforcement of its rights and remedies
                  hereunder including,  without limitation, the reasonable costs
                  of attorney  and  paralegal  fees and costs of field audits as
                  provided in Section  6.1(j) hereof;  (iii) in connection  with
                  the  inspection,   sale,   disposition  or  collection  of  or
                  execution  upon  the   Collateral;   (iv)  in  the  repair  or
                  maintenance  of  the  Collateral  of  the  Borrowers;  (v)  in
                  notifying  Account  Debtors of the  Borrowers or verifying the
                  Accounts of the  Borrowers;  (vi) in  perfecting or protecting
                  the   Collateral   security  or  security   interest   granted
                  hereunder;  and  (vii)  in  connection  with  any  litigation,
                  contest,  suit or proceeding  (whether instituted by the Bank,
                  the  Borrowers  or where  payment  of the  Obligations  or the
                  Collateral  might be  materially  adversely  affected,  by any
                  other  Person) in any way  relating  to the  Collateral,  this
                  Agreement  and  the  Loan   Documents,   except  where  it  is
                  determined  that Bank's  action or failure to act  constituted
                  gross negligence or willful misconduct.

          6.1     (l) Indemnity and Release. The Borrowers agree that they shall
                  bear the risks of loss with respect to the Collateral and they
                  will  indemnify  the Bank and hold the Bank  harmless from any
                  and  all  claims,  demands,   liabilities,   losses,  damages,
                  diminutions of value, costs and expenses relating to or in any
                  way arising  out of or from any  possession,  use,  operation,
                  control,  sale,  disposition,  or  collection  of  any  of the
                  Borrowers'  Collateral,  except as the foregoing relate to the
                  Bank's gross negligence or willful  misconduct.  The Borrowers
                  hereby  release  the Bank from any and all claims or causes of
                  action which any Borrower may have, now or hereafter, relating
                  to the  foregoing,  except those arising from the Bank's gross
                  negligence or willful misconduct.

          6.1(m)  Instruments  and Chattel  Paper.  Upon the written  request of
                  Bank,  the Borrowers  will stamp or otherwise mark all Chattel
                  Paper and  Instruments  now  owned or  hereafter  acquired  by
                  either  of them,  in which  the  Bank  has a first  and  prior
                  perfected  security  interest,  to  reflect  that the same are
                  subject to the Bank's security  interest and will  immediately
                  thereafter deliver or cause such Chattel Paper and Instruments
                  (other than the  Intercompany  Notes) to be  delivered  to the
                  Bank, with appropriate endorsement,  assignment or stock power
                  transfer or  assignment,  with full recourse to the Borrowers,
                  to vest title and possession in the Bank.

          6.1     (n) Employee Plans. The Borrowers shall (i) keep in full force
                  and effect any and all Employee  Plans which are  presently in
                  existence or may, from time to time, come into existence under
                  ERISA,  and not withdraw from any such Employee Plans,  unless
                  such  withdrawal can be effected or such Employee Plans can be
                  terminated without material  liability to the Borrowers;  (ii)
                  make  contributions  to all of such Employee Plans in a timely
                  manner  and  in  a  sufficient   amount  to  comply  with  the
                  requirements of ERISA, including the minimum funding standards
                  of  Section  302 of  ERISA;  (iii)  comply  with all  material
                  requirements  of ERISA which  relate to such  Employee  Plans;
                  (iv) notify the Bank  immediately upon receipt by any Borrower
                  of any notice  concerning  the  imposition  of any  withdrawal
                  liability or of the  institution  of any  proceeding  or other
                  action  which  may  result  in the  termination  of  any  such
                  Employee  Plans or the  appointment of a trustee to administer
                  such Employee  Plans;  and (v) promptly advise the Bank of the
                  occurrence of any Reportable  Event or Prohibited  Transaction
                  that is not  exempt by  statute,  as  defined  in ERISA,  with
                  respect to any such Employee Plans.

          6.1     (o) Leases.  Each  Borrower  shall  maintain and comply in all
                  material  respects with all leases  covering the Property used
                  by such  Borrower  in  accordance  with  their  terms so as to
                  prevent  any  default  thereunder  which  may  result  in  the
                  exercise  or  enforcement  of any  landlord's  or  other  lien
                  against such  Borrower  unless such  Borrower is contesting in
                  good faith, by an appropriate proceeding, the validity, amount
                  or  imposition   of  any  lease  charges  or  expenses   while
                  maintaining reserves,  deemed adequate by the Bank in its sole
                  and complete  discretion to cover the above,  and such contest
                  does  not  have  or  cause  material  adverse  changes  in any
                  Borrower's  financial  condition  or  operations  and does not
                  impair any Borrower's ability to perform the Obligations.

         6.1 (p)  Bank Deposits.

                  (i)      The Borrowers shall maintain a lockbox account in the
                           Borrowers' name with the Bank, into which all monies,
                           checks,  notes,  drafts  and all other  payments  for
                           and/or proceeds of the Collateral (the "Funds") shall
                           be deposited (the "Lockbox Account"). Borrowers agree
                           to  cooperate  fully  with Bank in  taking  all steps
                           which  the Bank  deems  appropriate  to  ensure  that
                           substantially all of
                           Borrowers'  Account Debtors  properly direct payments
                           on the Accounts to the Lockbox Account. The Borrowers
                           agree to pay all fees,  costs and expenses  which the
                           Bank   incurs  in   connection   with   opening   and
                           maintaining  the Lockbox  Account and  depositing for
                           collection  by the  Bank any  check or other  item of
                           payment  received  by  the  Bank  on  account  of the
                           Borrowers'  Obligations.  All of such fees, costs and
                           expenses   shall  be  payable  to  the  Bank  by  the
                           Borrowers monthly.

                  (ii)     The  Borrowers  will also  transfer and establish all
                           their   primary   operating    accounts,    including
                           depository and disbursement banking accounts,  at the
                           Bank  and   shall  be   responsible   for  all  costs
                           associated  with  such  accounts  as are  customarily
                           charged  by the Bank and as  previously  outlined  by
                           Bank to Borrower.  The Borrowers  agree that its bank
                           accounts at the Bank shall contain  sufficient  funds
                           to make each payment  under the Loan  Documents  when
                           due after applying any applicable cure periods.

          6.1     (q) Defense of Collateral.  The Borrowers  shall pay, or cause
                  to be paid, when due, all material Indebtedness, lawful claims
                  or demands with respect to the  Collateral  which,  if unpaid,
                  might  result  in,  or permit  the  creation  of,  any Lien or
                  encumbrance on the Collateral,  including, without limitation,
                  all lawful claims for labor,  materials and supplies,  and, in
                  general,  do  and  cause  to be  done,  everything  reasonably
                  necessary to fully  preserve the rights and  interests of Bank
                  under  this  Agreement  and  the  other  Loan  Documents.   In
                  addition,  the  Borrowers  shall at all  times  defend  Bank's
                  rights  and  interests  in  and  to the  Collateral,  and  the
                  priority position of said rights and interests against any and
                  all  claims  of any  person  adverse  to  Bank  and  take  all
                  necessary  or  appropriate  actions  to give  effect to Bank's
                  priority  of  rights  and  interests   contemplated   by  this
                  Agreement and the other Loan Documents.

          6.1     (r) Environmental  Matters - Indemnification.  Borrowers shall
                  take or cause to be taken all  actions  which  are  reasonably
                  necessary,  in the  judgment  of the  Bank,  to  comply in all
                  material  respects with the requirements of all  Environmental
                  Laws including,  without limitation,  all filing and reporting
                  requirements  thereof.  Borrowers  hereby agree to  indemnify,
                  hold harmless and reimburse Bank for any and all loss, damage,
                  expenses  or  costs of any kind or  nature  arising  out of or
                  incurred  in  connection  with any prior,  existing  or future
                  violations by Borrowers of any Environmental Laws.

         6.2      Negative Covenants.

          6.2     (a) Liens.  The  Borrowers  shall not  create,  incur,  grant,
                  pledge,  permit or suffer to exist, any Lien upon any of their
                  Property,  including  the  Collateral,  except  the  Permitted
                  Liens.


          6.2     (b) Debt.  The Borrowers  shall not,  directly or  indirectly,
                  create, assume, incur, become or be liable for or with respect
                  to any  manner of  obligations,  liabilities  or  Indebtedness
                  whatsoever to any Person, or by way of any guaranties,  except
                  with  respect  to  (i)  the   Obligations   of  the  Borrowers
                  hereunder;  (ii)  additional  Indebtedness  shown on  Schedule
                  6.2(b) hereto;  (iii) Indebtedness  arising or accruing in the
                  ordinary course of business which  indebtedness  does not give
                  rise  to a Lien  or  other  security  interest,  other  than a
                  Permitted Lien; and (iv) the Subordinated Debt, if any.

          6.2     (c) Name  Changes,  Mergers  and  Acquisitions.  Except as set
                  forth in Section 6.2(g) hereof,  none of the Borrowers  shall,
                  without  the  Bank's  prior  written  consent  (i)  change its
                  corporate name or adopt an assumed  corporate name without the
                  prior  written  consent of the Bank which consent shall not be
                  unreasonably  withheld,  (ii)  consolidate  or merge  with any
                  Person,  or  (iii)  acquire  all or  substantially  all of the
                  assets or properties of, any Person.

          6.2     (d) Payments under Subordinated Debt. Borrowers shall not make
                  any payments on any  Subordinated  Debt,  except in accordance
                  with the terms of any subordination agreements with respect to
                  such Subordinated Debt.

          6.2     (e)  Redemption  and  Dividends.   The  Borrowers   shall  not
                  purchase,  redeem,  retire, or otherwise acquire any shares of
                  their capital stock, or declare or pay any dividends  thereon,
                  make any  distribution  or payment to their  stockholders  (in
                  their  capacity  as  such) or set  aside  any  funds  for such
                  purpose,  except for redemptions which are legally permissible
                  and to which the Bank  shall  have  given  its  prior  written
                  approval.

          6.2     (f) Transfer of Assets.  The Borrowers shall not sell,  lease,
                  transfer  or  otherwise  dispose  of any of their  Collateral,
                  Property,  assets or rights without the prior written  consent
                  of the Bank, except for sales or rentals of their Inventory to
                  customers in the ordinary  course of business and with respect
                  to obsolete,  damaged or worn out property, Goods or Equipment
                  no  longer  useful  or  being   replaced  in  the   Borrowers'
                  businesses,  and the proceeds of any  permitted  sale shall be
                  applied  to  the  Obligations  or to  the  replacement  of the
                  Equipment  being  disposed  of  with   substantially   similar
                  Equipment having a comparable value.

          6.2     (g)  Investments  and Loans.  The Borrowers shall not (i) make
                  any  investments  in any  Person,  except in  accordance  with
                  Borrowers'  investment  guidelines  which have been previously
                  reviewed and approved by Bank;  (ii)  hereafter make any loans
                  or advances to any Affiliate, director,  shareholder,  officer
                  or employee of the  Borrowers,  or any Person except for loans
                  or advances in the ordinary course of business;  or (iii) make
                  Acquisitions in an amount in excess that: (a) the Person whose
                  stock or assets is being  acquired  shall be in  substantially
                  the same line of business as  Borrowers,  and (b) after giving
                  effect to the  acquisition,  there  shall  exist no default or
                  Event of Default.  Any  Acquisitions in an amount in excess of
                  $4,000,000  shall  require the prior  written  approval of the
                  Bank.

          6.2     (h) Prepayment or Modification of Indebtedness.  The Borrowers
                  will not (i) prepay any Indebtedness for money borrowed by any
                  Borrower or any  Indebtedness  secured by any of their  assets
                  (except  for the  Obligations),  (ii) enter into or modify any
                  agreement  as a result of which the terms of payment of any of
                  the foregoing Indebtedness are amended or modified in a manner
                  which would accelerate its payment.

          6.2     (i) False Statements.  The Borrowers will not furnish the Bank
                  any certificate or other document that will contain any untrue
                  statement  of  material  fact or  that  will  omit to  state a
                  material fact  necessary to make it not misleading in light of
                  the circumstances under which it was furnished.

          6.2     (j) Transactions with Affiliates. The Borrowers will not enter
                  into any agreement or arrangement,  written or oral,  directly
                  or indirectly,  with an Affiliate, or provide services or sell
                  goods  to,  or  for  the  benefit  of,  or  pay  or  otherwise
                  distribute monies,  goods or other valuable  consideration to,
                  an Affiliate,  except upon fair and  reasonable  terms no less
                  favorable to the  Borrowers  than terms in a comparable  arm's
                  length transaction with an unaffiliated  Person and except for
                  existing intercompany debt.

          6.2     (k)  Guarantees.  The Borrowers  shall not guarantee,  assume,
                  endorse  or  otherwise,   in  any  way,   become  directly  or
                  contingently   liable  in  any  manner  with  respect  to  the
                  obligations   or   liabilities   of  any  Person,   except  by
                  endorsement  of instruments or items for payment or deposit or
                  collection.

          6.2     (l) Capital  Structure.  Without the prior written  consent of
                  the Bank, the Borrowers  shall not make any material change in
                  their capital structures,  enter into any new business or make
                  any material change in their business objectives, purposes and
                  operations,  any of which would  materially  adversely  affect
                  their business,  profits, prospects, any of their Property, or
                  their ability to repay the Obligations.

          6.2     (m)  Locations.  The  Borrowers  shall not  transfer the Chief
                  Executive Office Location or Additional Inventory Locations or
                  transfer existing locations, or maintain warehouses or records
                  with  respect to the  Accounts,  at any  locations  other than
                  those at  which  the same  are  presently  kept or  maintained
                  without  providing the Bank at least 30 days' advance  written
                  notice.

          6.2     (n) Leases.  The Borrowers  shall not incur or permit to exist
                  (i) any  obligations  under any  operating  leases  other than
                  leases  having an aggregate  rent not in excess of  $3,500,000
                  per Fiscal  Year,  and (ii) any  indebtedness  with respect to
                  permitted  purchase money  indebtedness  and obligations  with
                  respect  to leases  which have been,  or, in  accordance  with
                  GAAP,  should be,  recorded as capitalized  leases,  for which
                  Borrowers  are obligated to pay in excess of $1,000,000 in the
                  aggregate at any time.

          6.2     (o)  Capital  Expenditures.  The  Borrowers  shall not make or
                  incur any Capital  Expenditures in excess of $7,000,000 in any
                  Fiscal Year.


                                   ARTICLE VII

                                EVENTS OF DEFAULT

                  The following shall constitute and be deemed Events of Default
hereunder:

         7.1      Payment  Obligations.  Failure  by the  Borrowers  to make any
                  payment of the Obligations within five (5) days of when due or
                  payable.

         7.2      Performance Obligations. Failure by Borrowers to perform, keep
                  or observe any  covenant,  condition,  agreement  or provision
                  hereunder or under the Notes or any other Loan  Documents  and
                  such failure  shall  continue for a period of thirty (30) days
                  after the  occurrence  thereof;  provided,  however,  that the
                  thirty (30) day cure period provided by this Section 7.2 shall
                  not apply to the  specific  Events of Default set forth in the
                  remainder of this Section 7.

         7.3      Representation and Warranties.  Any warranty or representation
                  now or  hereafter  made by any  Borrower  hereunder  or by any
                  other party to the Loan Documents under the Loan Documents, is
                  untrue or incorrect in any material  respect or fails to state
                  a  material   fact   necessary   to  make  such   warranty  or
                  representation not misleading in light of the circumstances in
                  which it was made,  or any schedule,  certificate,  statement,
                  report,  financial  data,  notice or writing  furnished to the
                  Bank at any time by the  Borrowers  or by a party or signatory
                  to the Loan  Documents  is untrue or incorrect in any material
                  respect or fails to state a material  fact  needed to make the
                  foregoing  not  misleading  in light of the  circumstances  in
                  which the foregoing  were  furnished,  on the date as of which
                  the facts set forth therein are stated or certified.

          7.4     Judgments.  Any judgment or order requiring  payment of monies
                  in excess of $250,000 which is not covered by insurance, shall
                  be rendered  against any Borrower,  and such judgment or order
                  shall remain  unsatisfied  or  undischarged  and in effect for
                  thirty (30)  consecutive days without a stay of enforcement or
                  execution thereof or posting of a bond pending appeal.

         7.5      Insolvency  and  Related  Proceedings.  If  any  Borrower  (i)
                  authorizes  or  makes  an   assignment   for  the  benefit  of
                  creditors;  (ii)  generally  shall  not pay its  debts as they
                  become due;  (iii) shall admit in writing its inability to pay
                  its debts  generally as they come due; or (iv) shall authorize
                  or  commence  (whether  by the entry of an order for relief or
                  the appointment of a receiver, trustee, examiner, custodian or
                  other  similar  official  therefor  or  for  any  part  of its
                  property)  any   proceeding   or  voluntary   case  under  any
                  bankruptcy,    reorganization,     insolvency,    dissolution,
                  liquidation,  adjustment or arrangement of debt,  receivership
                  or  similar  Laws  or if such  proceedings  are  commenced  or
                  instituted,  or an order for relief or approving  any petition
                  commencing such  proceedings is entered against such Borrower,
                  and  such   Borrower,   by  any  action  or  failure  to  act,
                  authorizes,   approves,   acquiesces,   or   consents  to  the
                  commencement  or  institution  of such  proceedings,  and such
                  proceedings  are not  dismissed  within  forty-five  (45) days
                  after the date of filing, commencement or institution.

         7.6      Material Agreements. If any Borrower defaults, or a default or
                  an event of default occurs, under or in the performance of any
                  material  agreement,  document  or  instruments,  whether  for
                  borrowed  money or  otherwise,  and such default,  breach,  or
                  event of default  continues beyond any applicable grace period
                  thereunder  and the  effect  of which  shall  be to cause  the
                  holder of such obligation,  agreement, document or instrument,
                  or the  person to whom such  obligation  is owed to cause such
                  obligation  to become  due  prior to its  stated  maturity  or
                  otherwise accelerated.

         7.7      State Action.  If any proceeding is instituted or commenced by
                  any state or officer thereof, including the States of Illinois
                  or Delaware,  the  Secretary of State of Illinois or the State
                  of Delaware, or the Secretary of State of or any commission or
                  other  instrumentality  of the State of Illinois or  Delaware,
                  seeking  a   forfeiture   of  any   Borrower's   Articles   of
                  Incorporation or certificate of authority to transact business
                  as a foreign corporation or of a license or permit held by any
                  Borrower  necessary to the conduct of its  business,  and such
                  Borrower  shall  fail to  vacate  any  order  entered  in such
                  proceeding  within thirty (30) days; or if any Borrower ceases
                  to conduct  its  business  as now  conducted  or is  enjoined,
                  restrained or in any way prevented by court,  governmental  or
                  administrative  order from conducting all or any material part
                  of its business affairs.

          7.8     Tax Liens. If a notice of lien, levy or assessment  other than
                  a Permitted  Lien, is filed or recorded with respect to all or
                  a substantial  part of the Collateral owned by any Borrower by
                  the   United   States,   or   any   department,    agency   or
                  instrumentality thereof, or by any state, county, municipality
                  or other  governmental  agency, or any taxes or debts owing at
                  any  time  or  times  hereafter  to  any  one or  more  of the
                  foregoing  become a lien other than a Permitted Lien, upon all
                  or a substantial  part of the Collateral owned by any Borrower
                  unless such notice or lien is removed  within thirty (30) days
                  after  filing or  recording  of such notice or  becoming  such
                  lien.

         7.9      Insurance.   If  any  insurer  of  any  policy  of   insurance
                  respecting  a material  portion of the  Collateral  issues any
                  notice of cancellation of such a policy, or any such policy is
                  allowed to lapse,  and in either  case,  is not  replaced by a
                  substitute  policy  having  an  effective  date  prior  to  or
                  contemporaneous with such cancellation or lapse.

         7.10     Change of Control.  If (a) during any period of 24 consecutive
                  months  individuals  who  at  the  beginning  of  such  period
                  constituted  the Boards of Directors  of  Borrowers  (together
                  with any new directors  whose election to such Boards or whose
                  nomination for election by the  stockholders  of the Borrowers
                  was  approved  by a vote of a majority of the  directors  then
                  still in office who were either  directors at the beginning of
                  such period or whose  election or nomination  for election was
                  previously so approved)  cease to constitute a majority of the
                  Boards of Directors of Borrowers  then in office or (b) if the
                  Voting Trust ceases to own, both legally and beneficially,  at
                  least  fifty-one  percent (51%) of the issued and  outstanding
                  voting stock of WTI.

                                  ARTICLE VIII

                         RIGHTS AND REMEDIES OF THE BANK

         8.1      Termination of Commitment and Acceleration. Upon the Revolving
                  Loan Termination Date, Equipment Loan Termination Date, or the
                  Term Loan Termination Date or upon the happening or occurrence
                  of an Event of Default  described  in Section  7.5 above,  the
                  Bank's  commitment to make the Loans, if such commitments have
                  not  yet  terminated,  shall  immediately  terminate  and  the
                  applicable  Obligations shall be automatically due and payable
                  without any action, presentment, demand , protest or notice of
                  any kind.  Upon the happening or occurrence of any other Event
                  of Default set forth in Article VII, such Event of Default not
                  having been previously cured or waived in writing by the Bank,
                  the Bank, may, at its sole and complete discretion and option,
                  declare  the Notes due and payable  without  any  presentment,
                  demand,  protest,  notice  of any of the  foregoing  or  other
                  notice of any kind, all of which are hereby  expressly  waived
                  notwithstanding  anything  contained herein or in the Notes to
                  the contrary,  and the Bank shall have all rights and remedies
                  now or  hereafter  provided  by  applicable  Laws and  without
                  limiting the generality of the foregoing,  may, at its option,
                  also  appropriate  and apply  toward the payment of the Notes,
                  any  indebtedness  of the  Bank to the  Borrowers,  howsoever,
                  created or arising,  and may also  exercise any and all rights
                  and remedies hereunder,  under the Loan Documents or in and to
                  the  collateral  security  referred  to in  Article IV hereof,
                  including,   without   limitation,   the   Collateral  of  the
                  Borrowers.

         8.2      Rights of Secured  Creditor.  The Bank shall have, in addition
                  to the rights and remedies  given to it under this  Agreement,
                  the  Notes  and the  Loan  Documents,  all of the  rights  and
                  remedies of a secured party under the Uniform  Commercial Code
                  as enacted in any  jurisdiction in which any of the Collateral
                  of the Borrowers  may be located,  and all rights and remedies
                  allowed  by all  applicable  Laws,  all of  which  rights  and
                  remedies shall be cumulative and non-exclusive,  to the extent
                  permitted by said Laws. All risk of loss, damage or diminution
                  of value with respect to any  Borrower's  Collateral  shall be
                  borne by the Borrowers at all times and the Bank shall have no
                  responsibility,  liability  or  obligation  to  the  Borrowers
                  therefor except as a result of the Bank's gross  negligence or
                  willful misconduct.

          8.3     Sale  of  Collateral.   Upon  an  Event  of  Default  and  the
                  declaration  that the Notes are due and payable  under Section
                  8.1.,  the Bank may  immediately,  with  only  such  demand or
                  notice to the  Borrowers  as may be required by the version of
                  the Uniform Commercial Code currently enacted in Illinois, all
                  of such other or  further  demand or notice  hereby  expressly
                  waived by the  Borrowers  to the extent  permitted by law, and
                  without advertisement except as may be required by the version
                  of the Uniform  Commercial Code currently  enacted in Illinois
                  (or other applicable  jurisdiction),  lease, sell or otherwise
                  dispose of or realize  upon,  at public or private  auction or
                  sale in  Chicago,  Illinois or  elsewhere,  the whole or, from
                  time to time,  any part of the  Collateral of the Borrowers or
                  any  interest  which  any  Borrower  may  have  therein.  Each
                  Borrower agrees to assemble, or cause to be assembled,  at its
                  own  expense,  its  Collateral  at such place or places as the
                  Bank shall reasonably  designate and the Bank may, in its sole
                  and  complete  discretion,  reasonably  exercised,  cause  the
                  Collateral  of any  Borrower  to  remain  on  such  Borrower's
                  premises at the  Borrowers'  expense,  pending sale,  lease or
                  other disposition of said Collateral.  The Bank shall have the
                  right to conduct such sales on the Borrowers'  premises at the
                  Borrowers'  expense  or  elsewhere.  Any sale,  lease or other
                  disposition  of the  Collateral  of the  Borrowers  may be for
                  cash,  credit  or any  combination  thereof  and the  Bank may
                  purchase  all or any  part  of the  Collateral  and in lieu of
                  actual payment of such purchase price,  may set off the amount
                  of  such  purchase  price  against  the   Obligations  of  the
                  Borrowers,  free from any right of  redemption  on the part of
                  the  Borrowers,  which  right is hereby  waived and  released.
                  After deducting from the proceeds of the sale,  lease or other
                  disposition of said  Collateral  all expenses  incurred by the
                  Bank in connection therewith  (including  reasonable attorneys
                  fees),   the  Bank  shall  apply  such  proceeds  towards  the
                  satisfaction  of the  Obligations of the Borrowers,  and shall
                  account to the Borrowers for any surplus of such proceeds. The
                  Borrowers shall remain liable for any deficiencies. Any notice
                  required  to be given  by the  Bank of a sale,  lease or other
                  disposition or other intended  action by the Bank with respect
                  to any of the  Collateral of the Borrowers  shall be mailed by
                  the Bank,  ten (10) days  prior to such  sale,  lease or other
                  disposition or other intended action by depositing such notice
                  in the United States mail,  postage prepaid and duly addressed
                  to the  Borrowers  at the  address  specified  in Section  9.8
                  hereof and such notice  shall  constitute,  and the  Borrowers
                  agree that such notice  constitutes  reasonable and seasonable
                  notice  of such  sale,  lease  or other  disposition  or other
                  intended action.

         8.4      Entry on Premises. Upon the occurrence of an Event of Default,
                  the Bank shall have the right to enter  upon the  premises  of
                  the Borrowers  where the Collateral of any Borrower is located
                  or believed to be located in  accordance  with any  applicable
                  laws,  without any  obligation to pay rent to the Borrowers or
                  any   responsibility   or  liability  to  the   Borrowers  for
                  safeguarding said Collateral from loss or damage or diminution
                  in value,  except if caused by the Bank's gross  negligence or
                  willful  misconduct,  and render said  Collateral  unusable or
                  remove said  Collateral  therefrom to the premises of the Bank
                  or any agent of the Bank, for such time as the Bank may desire
                  in order to effectively collect or liquidate said Collateral.

         8.5      Access to Records.  Upon the occurrence of an Event of Default
                  or under the conditions set forth herein,  the Bank shall have
                  the right to attain access to the Borrowers'  books,  records,
                  files,   journals  or  invoices  relating  to  any  Borrower's
                  Collateral or business  affairs during the  Borrowers'  normal
                  business  hours in order to copy,  extract,  verify,  audit or
                  review the same.


                                   ARTICLE IX

                                  MISCELLANEOUS

         9.1      Waiver.  The Bank's failure,  at any time or times  hereafter,
                  either to require  strict  performance by the Borrowers of any
                  provisions of this Agreement, the Notes or any Loan Documents,
                  or  to  enforce  the  Bank's   rights   under  such  terms  or
                  provisions, shall not waive, effect or diminish or modify such
                  terms or  provisions,  notwithstanding  any conduct or custom,
                  actual  or  implied,  of  the  Bank  to  the  contrary  or  in
                  refraining from so doing at any time or times.  Any suspension
                  or  waiver  by the Bank of an Event of  Default  hereunder  or
                  under any Loan Documents or right or remedy hereunder or under
                  any Loan Document shall not suspend,  waive, release or affect
                  any other  Event of  Default or right or remedy  hereunder  or
                  under any Loan  Documents.  No  Obligations  of the Borrowers,
                  Events of  Default or right or remedy  hereunder  or under any
                  Loan Documents shall be deemed suspended or waived by the Bank
                  unless  such  suspension  or waiver is in writing  signed by a
                  duly  authorized  officer  of the  Bank  and  directed  to the
                  Borrowers detailing such suspension or waiver.

         9.2      Applicable  Law.  This  Agreement,  the  Notes  and  the  Loan
                  Documents  have been  issued,  delivered  and  accepted in and
                  shall be deemed to have been made under and shall be  governed
                  by and construed in  accordance  with the internal law and not
                  the conflict of law rules of the State of Illinois.

         9.3      Severability.  This  Agreement,  the Notes and Loan  Documents
                  shall be  construed  and  interpreted  in such manner as to be
                  effective, enforceable and valid under all applicable Laws. If
                  any  provision  of  this  Agreement,  the  Notes  or the  Loan
                  Documents shall be held invalid,  prohibited or  unenforceable
                  under any applicable Laws of any applicable jurisdiction, such
                  invalidity,  prohibition or unenforceability  shall be limited
                  to such provision and shall not affect or invalidate the other
                  provisions  hereof  or  thereof  or  affect  the  validity  or
                  enforceability  of such  provision in any other  jurisdiction,
                  and to the  extent  the  provisions  hereof  and  thereof  are
                  severable.

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

         9.5      Section Headings.  Section headings used in this Agreement are
                  for convenience  only and shall not effect the construction or
                  interpretation of this Agreement.

         9.6      Binding Effect. This Agreement shall be binding upon and inure
                  to the  benefit  of the  Bank  and the  Borrowers,  and  their
                  respective successors and assigns; provided, however, that the
                  Borrowers  have no right to  assign  any of  their  rights  or
                  Obligations hereunder without the prior written consent of the
                  Bank.

         9.7      Merger  Clause.  This  Agreement,   the  Notes  and  the  Loan
                  Documents  constitute the entire agreement between the parties
                  hereto  and  thereto  with  respect  to the  Loans  and may be
                  amended only by a writing signed on behalf of each such party.
                  If any  provision  contained in this  Agreement is in conflict
                  with, or inconsistent  with, any provision in the Notes or the
                  Loan  Documents,  the  provision  contained in this  Agreement
                  shall govern and control.

         9.8      Notices. Any notices or consents required or permitted by this
                  Agreement  shall  be (i) in  writing  and  (ii)  delivered  in
                  person,  telecopied or sent by certified or  registered  mail,
                  postage prepaid,  return receipt requested, to the address set
                  forth below,  unless such address is changed by written notice
                  hereunder,  and (iii) deemed duly given upon  compliance  with
                  the above.

                  (i)               If to the Borrowers:

                                    Westell Technologies, Inc.
                                    750 North Commons Drive
                                    Aurora, Illinois 60504
                                    Attn: Steve Hawrysz
                                    Telephone: 630-375-4113
                                    Telecopy: 630-375-4940


                                    With a copy to:
                                    McDermott, Will & Emery
                                    227 West Monroe Street
                                    Chicago, Illinois 60606
                                    Attn: Neal J. White and Lauretta Moran
                                    Telephone: 312-984-7579 (White)
                                    Telephone: 312-984-6933 (Moran)
                                    Telecopy: 312-984-3651

                  (ii)              If to the Bank:
                                    LaSalle National Bank
                                    135 South LaSalle Street
                                    Chicago, Illinois  60603
                                    Attention: Jason Williams
                                    Telephone: 312-904-4623
                                    Telecopy: 312-904-6546

                                    With a copy to:
                                    Rochelle P. Slater
                                    Jenner & Block
                                    One IBM Plaza
                                    Chicago, Illinois  60611
                                    Telephone: 312-923-2722
                                    Telecopy: 312-840-7722

         9.9      Consent to Service. The Borrowers expressly submit and consent
                  to the  jurisdiction  of any state or  federal  court  located
                  within Cook County, Illinois in any action, suit or proceeding
                  commenced  therein in  connection  with or with respect to the
                  Obligations,  this Agreement,  the Notes or any Loan Documents
                  and waive any right to jury  trial and  objection  to venue in
                  connection  therewith.  The  Borrowers  hereby waive  personal
                  service of any and all  process or papers  issued or served in
                  connection  with the  foregoing and agree that service of such
                  process or papers may be made by registered or certified mail,
                  postage  prepaid,  return receipt  requested,  directed to the
                  Borrowers as set forth in Section 9.8 above.

         9.10     Waiver of Jury Trial.  THE BANK AND THE BORROWERS HEREBY
                  KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE ANY
                  RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
                  LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, IN
                  CONNECTION WITH, OR RELATING TO THIS AGREEMENT, THE NOTES,
                  OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT,
                  COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN),
                  OR ACTIONS OF SUCH BANK OR SUCH BORROWERS.  THIS PROVISION
                  IS A MATERIAL INDUCEMENT FOR THE BANK TO ENTER INTO THIS
                  AGREEMENT.

         9.11     Participations.  The  Borrowers  hereby  consent to the Bank's
                  participation,  sale,  assignment or transfer,  at any time or
                  times  hereafter of this Agreement or the Loan  Documents,  or
                  any portion hereof or thereof, without affecting the liability
                  of the Borrowers hereunder;  provided, however, the Bank shall
                  at all  times act as sole  agent on  behalf of itself  and any
                  participant  that  acquires any interest in this  Agreement or
                  the Loan Documents and shall at all times service the Loans on
                  behalf of itself and any participant.


                  IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

                                  WESTELL TECHNOLOGIES, INC.


                                  By______________________________
                                  Title:____________________________


                                  WESTELL, INC.

                                  By______________________________
                                  Title:____________________________



                                  WESTELL INTERNATIONAL, INC.

                                  By______________________________
                                  Title:____________________________



                                  CONFERENCE PLUS, INCORPORATED

                                  By______________________________
                                  Title:____________________________


                                  LASALLE NATIONAL BANK


                                  By______________________________
                                  Title:____________________________




                                    EXHIBITS

Exhibit A                  Borrowing Base Certificate

Exhibit B                  Revolving Note

Exhibit C                  Term Note

Exhibit D                  Equipment Note

Exhibit E                  President's Certificate

Exhibit F                  Opinion of McDermott, Will & Emery

Exhibit G                  Secretary's Certificate

Exhibit I                  Compliance Certificate




                                    SCHEDULES

Schedule 1                 Foreign Eligible Accounts Receivable

Schedule 2                 Intercompany Notes

Schedule 5.8               Chief Executive Offices and Inventory Locations

Schedule 5.16              Capitalization

Schedule 5.22              Labor Relations

Schedule 5.23              Patents and Trademarks

Schedule 6.2(b)            Debt; Leases