AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
            --------------------------------------------------------
                                       OF
                                       --
                             ALLEGIANCE CAPITAL, LLC
                             ------------------------

         This AMENDED AND RESTATED  LIMITED  LIABILITY  COMPANY  AGREEMENT (this
"Agreement"),  dated as of January 1, 1998,  is entered  into among the  parties
 ---------
listed on the signature pages hereof.

                                    RECITALS
                                    --------

         A. Point West Capital  Corporation,  Michael W. McDermitt and Daniel M.
Isard have  previously  entered  into that  certain  Limited  Liability  Company
Agreement of Allegiance Capital,  LLC, dated as of September 5, 1997 (as amended
or modified to the date hereof, the "Original Agreement"); and
                                     ------------------
         B. The parties to the  Original  Agreement  desire to amend and restate
the Original  Agreement in its  entirety on the terms and  conditions  contained
herein;

         NOW,  THEREFORE,  in consideration of the mutual  agreements  contained
herein, and for other good and valuable  consideration (the receipt and adequacy
of which are hereby  acknowledged),  the parties hereto, by this Agreement,  set
forth the limited  liability company agreement for the Company under the laws of
the State of Delaware.

                                    ARTICLE 1
                                    =========
              Certain Defined Terms; Certain Rules of Construction
              ====================================================

         1.1      Certain Defined Terms.  As used herein:
                  ---------------------

         "Act" means the Delaware  Limited  Liability  Company Act,  codified at
          --- 
Delaware code Title 6, Sections 18.101 et seq.
                                       -- ---
 
         "Adjusted Capital Contribution" means, with respect to Point West as of
          -----------------------------
any date of determination, the Capital Contributions of Point West made pursuant
to Section  3.1.1,  increased by the amount of the Point West Primary  Preferred
                    ---------
Return accrued thereon  (computed without regard to the limits on allocation set
forth in Section 6.1.2(a)),  by the amount of the Point West Secondary Preferred
Return accrued thereon  (computed without regard to the limits on allocation set
forth  in  Section  6.1.2(b),  and by the  amount  of the  Point  West  Tertiary
Preferred  Return  accrued  thereon  (computed  with  regard  to the  limits  on
allocation set forth in Section 6.1.2(c)) and reduced by the cumulative  amounts
                                              -------
distributed to Point West pursuant to Section 6.5.1.

         "Affiliate"  means,  as to any  Person,  any other  Person  directly or
          ---------
indirectly controlling, controlled by, or under common control with such Person.
The term "control," as used in the  immediately  preceding  sentence,  means the
          -------
possession,  whether  direct  or  indirect,  of the power to direct or cause the
direction of the management and policies of another Person.


<PAGE>




         "Agreement" has the meaning set forth in the introduction hereto.
          ---------

         "Approved Appraiser" has the meaning set forth in Section 7.6.1.
          ------------------

         "Bankruptcy"  means:  (a) the filing of an application by a Member for,
          ----------
or such  Person's  consent  to,  the  appointment  of a  trustee,  receiver,  or
custodian  of such  Person's  assets;  (b) the entry of an order for relief with
respect to a Member in proceedings under the federal bankruptcy code, as amended
or  superseded  from  time to time;  (c) the  making  by a Member  of a  general
assignment for the benefit of creditors; (d) the entry of an order, judgment, or
decree by any court of competent jurisdiction appointing a trustee, receiver, or
custodian  of the  assets of a Member  unless  the  proceedings  and the  Person
appointed are dismissed  within ninety (90) days; or (e) the failure by a Member
generally to pay such Person's debts as such debts become due within the meaning
of the federal bankruptcy code, as determined by the relevant  bankruptcy court,
or by the admission in writing of such  Person's  inability to pay such Person's
debts as they become due.

         "Capital  Account" means,  as to any Member,  the capital account which
          ----------------
the Company establishes and maintains for such Member pursuant to Section 3.4.

         "Capital Contribution" means as to any Member, the total amount of cash
          --------------------
and the fair  market  value of  property  (including  promissory  notes or other
obligations to contribute  cash or property)  contributed to the Company by such
Member pursuant to Section 3.1 or 3.2.

         "Certificate" means the Certificate of Formation for the Company.
          -----------

         "Code" means the Internal Revenue Code of 1986 and any applicable 
          ----
Regulations thereunder.
          
         "Company" has the meaning set forth in the recitals hereto.
          -------

         "Company   Minimum   Gain"  has  the  meaning   ascribed  to  the  term
          ------------------------
"Partnership Minimum Gain" in Regulations Section 1.704-2(d).

         "Dissolution  Event"  means,  with  respect  to any  Member,  one or 
          ------------------
more of the following: the death, insanity, withdrawal, resignation, Bankruptcy,
dissolution, or liquidation of any Member.

         "Fair Market Value" has the meaning set forth in Section 7.6.1.
          -----------------

         "Fiscal Year" means the Company's fiscal year, which is the calendar 
          -----------
year.

         "Forfeiture  Event"  means the  disability,  voluntary  resignation  or
          -----------------
termination  for  cause of a  Specified  Member,  as  provided  under  the Isard
Employment Agreement or the McDermitt Employment Agreement, as applicable.

         "Indemnified Person" has the meaning set forth in Section 10.1.
          ------------------
         "Initial  Financing Date" means the date of the first funding under the
          -----------------------
initial warehouse or


                                       2
<PAGE>



securitization facility of the Company.

         "Initial  Membership  Interest" means with respect to any Member,  such
          -----------------------------
Member's Membership Interest as of the effective date hereof.

         "Isard" means Daniel M. Isard, an individual.
          -----
 
         "Isard Employment  Agreement" means that certain Employment  Agreement,
          ---------------------------
dated as of September 5, 1997, between Isard and the Company.

         "Majority  Voting  Interest" means more than fifty percent (50%) of all
          --------------------------
Voting Interests.

         "Manager" has the meaning set forth in Section 5.1.2.
          -------

         "McDermitt" means Michael W. McDermitt, an individual.
          ---------

         "McDermitt   Employment   Agreement"  means  that  certain   Employment
          ----------------------------------
Agreement, dated as of September 5, 1997, between McDermitt and the Company.

         "Member"  means each Person who:  (a) is an initial  signatory  to thi
          ------
Agreement,  has been admitted to the Company as a Member in accordance  with the
Certificate and this Agreement,  or is an assignee who has been substituted as a
Member in accordance with Article 7; and (b) is not the subject of a Dissolution
Event.

         "Member Nonrecourse Debt" has the meaning ascribed to the term "Partner
          -----------------------
Nonrecourse Debt" in Regulations Section 1.704-2(b)(4).

         "Member Nonrecourse Deductions" means items of Company loss, deduction
          -----------------------------
or Code  Section  705(a)(2)(B)  expenditures  which are  attributable  to Member
Nonrecourse Debt.

         "Membership  Interest" means, as to any Member, the percentage interest
          --------------------
set forth opposite the name of such Member under the column "Member's Percentage
Interest" on Schedule I attached hereto, as such percentage may be adjusted from
             ----------
time to time pursuant to the terms hereof.

         "Membership Interest Option" has the meaning set forth in Section 4.4.2
          --------------------------
(a).
          

         "Membership  Interest  Option  Date"  means  the  date  of a  Specified
          ----------------------------------
Member's  timely and  complete  exercise of his  Membership  Interest  Option in
accordance with Section 4.4.2(b).

         "Membership Interest Option Period" means the period from and including
the  Initial  Financing  Date to and  including  the date that is three  hundred
ninety (390) days thereafter.

         "Net  Profits"  and  "Net  Losses"  means  the  income,   gain,   loss,
          ------------         ------------
deductions, and credits of the Company in the aggregate or separately stated, as
appropriate,  determined in accordance with the method of accounting used in the
preparation of the Company's partnership tax return filed for federal income tax
purposes.


                                       3

<PAGE>



         "Nonrecourse Liability" has the meaning set forth in Regulations
          ---------------------
Section 1.752-l(a)(2).

         "Option Condition" means the Company's financial  performance achievin
          ----------------
net  income,  calculated  on a cash  basis  utilizing  the  principles  used  to
calculate  the items of income and  expense  set forth in the  Company's  Year 1
Projected  Income Statement (a copy of which is attached hereto as Exhibit O-1),
                                                                   -----------
of at least $633,660 for the one year period ending on the first  anniversary of
the Initial Financing Date.

         "Person" means an individual, general partnership, limited partnership,
          ------
limited liability company,  corporation,  trust,  estate, real estate investment
trust,   association,   organization,   including  a  government   or  political
subdivision or an agency or instrumentality thereof, or any other entity.

         "Point West" means Point West Capital Corporation.
          ----------

         "Point West Primary Carryforwards" has the meaning set forth in Section
           --------------------------------
6.1.2(a).
         
         "Point West Primary  Preferred  Return" means, for any taxable year (or
portion  thereof)  during the term hereof:  (a)  occurring  prior to the Initial
Financing Date, an amount equal to ninety-nine and one-half  percent (99.50%) of
all interest accruing to the Company during such period on all loans made by the
Company that were outstanding  during such period; and (b) occurring on or after
the Initial  Financing  Date, an amount equal to the product of (i) the positive
difference,  if any, by which (A) the average  outstanding  daily  amount of the
Adjusted  Capital  Contribution  during  such period  exceeds (B) Three  Million
Dollars  ($3,000,000)  and (ii) a per annum  interest rate equal to the weighted
average  interest  rate  charged by the Company on all loans made by the Company
that were outstanding during such period.

         "Point West Purchase Right" has the meaning set forth in Section 7.6.
          -------------------------
2.1.
         "Point West Secondary Carryforwards" has the meaning set forth in
          ----------------------------------
Section 6.1.2(b).

         "Point West Secondary Preferred Return" means, for any taxable year (or
          -------------------------------------
portion  thereof)  during the term  hereof,  an amount  equal to a return of ten
percent  (10%) per annum,  compounded  monthly,  on the  amount of the  Adjusted
Capital Contribution as of the close of each month.

         "Point West Tertiary  Preferred Return" means, for any taxable year (or
          -------------------------------------
portion  thereof)  during the term  hereof,  an amount equal to a return of five
percent  (5%) per  annum,  compounded  monthly,  on the  amount of the  Adjusted
Capital Contribution as of the close of each month.

         "Regulations"  means,  unless the context clearly indicates  otherwise,
          -----------
the federal income tax code regulations currently in force as final or temporary
that have  been  issued  by the U.S.  Department  of  Treasury  pursuant  to its
authority under the Code.

         "Securities Act" means the Securities Act of 1933.
          --------------
 
         "Specified  Member" means each of McDermitt and Isard;  provided  that,
          -----------------                                      --------
from and after the date 

                                       4

<PAGE>


a Forfeiture  Event has occurred  with respect to either
such Person, such Person shall no longer constitute a "Specified Member."
                                                       ----------------

         "Specified Member Carryforwards" has the meaning set forth in Section 
          ------------------------------  
6.1.2(b).

         "Specified  Member  Return"  means,  for any  taxable  year (or portion
          -------------------------
thereof) during the term hereof  occurring prior to the Initial  Financing Date,
an amount equal to one-half of one percent (0.5%) of all interest charged by the
Company on all loans  made by the  Company  that were  outstanding  during  such
period.

         "Specified Members' Purchase Right" has the meaning set forth in
          ---------------------------------
Section 7.6.2.2.

         "Threshold Date" means September 30, 1998.
          --------------

         "Trigger Event" has the meaning set forth in Section 7.6.2.2.
          -------------

         "Valuation  Date" means the date that is the fifth  anniversary  of the
          ---------------
Initial  Financing Date;  provided that, if such day is not a business day, then
the "Valuation Date" shall be the next succeeding business day.
     --------------

         "Valuation  Period" means the period commencing on the date that is six
          -----------------
(6) months prior to the  Valuation  Date and ending on the date that is five (5)
months prior to the Valuation Date.

         "Voting  Interest"  means:  (a) in the case of Isard, the lesser of (i)
          ----------------
2-1/2% and (ii) Isard's Membership Interest;  (b) in the case of McDermitt,  the
lesser of (i) 2-1/2% and (ii) McDermitt's  Membership  Interest;  and (c) in the
case of Point  West,  the  greater of (i) 95% and (ii) Point  West's  Membership
Interest;  provided  that each  Member's  Voting  Interest  shall equal the same
           --------
percentage  as its  Membership  Interest  from and after the earlier of: (A) the
consummation of an initial public offering for interests of the Company or (B) a
sale,  in  accordance  with  Article  7, by Point West of all or any part of its
interest in the Company to any party other than Isard or McDermitt.

         1.2 Certain Rules of Construction. References to the plural include the
             -----------------------------
singular  and to the  singular  include  the  plural.  References  to any gender
include any other gender.  The part includes the whole.  The term "including" is
not  limiting,  and the term "or" has,  except where  otherwise  indicated,  the
inclusive  meaning  represented  by the  phrase  "and/or."  The words  "hereof,"
"herein,"  "hereby," and "hereunder," and any other similar words, refer to this
Note as a whole and not to any particular provision of this Agreement.  Section,
subsection,  clause,  exhibit,  and schedule  references  are to this  Agreement
unless otherwise indicated.  Section, subsection,  clause, exhibit, and schedule
headings are for convenience of reference  only,  shall not constitute a part of
this Agreement for any other purpose,  and shall not affect the  construction of
this  Agreement.  Any  reference  to  this  Agreement  or any  other  agreement,
document,  or  instrument  (including  the  Certificate)  includes all permitted
alterations,  amendments,  changes,  extensions,  modifications,   renewals,  or
supplements thereto or thereof, as applicable. Any reference herein to the Code,
the Regulations,  the Act, the Corporations  Code or other statutes or laws will
include all amendments,  modifications, or replacements of the specific sections
and  provisions  concerned.   Each  exhibit  and  schedule  attached  hereto  is
incorporated herein by this reference.


                                       5

<PAGE>


                                    ARTICLE 2
                                    ----------
                           Organization of the Company
                           ---------------------------   

         2.1  Formation.  Pursuant to the Act, the Members have formed a limited
              ----------
liability  company  under  the  laws of the  State of  Delaware  by  filing  the
Certificate  with  the  Delaware  Secretary  of State  and  entering  into  this
Agreement. The rights and liabilities of the Members shall be as provided in the
Act,  except  as  specifically  modified  by this  Agreement.  If the  rights or
obligations  of any  Member are  different  by reason of any  provision  of this
Agreement  than  they  would be in the  absence  of such  provision,  then  this
Agreement shall, to the extent permitted by the Act, control.

         2.2 Name.  The name of the Company shall be "Allegiance Capital, LLC."
             ----

         2.3 Term.  The term of this  Agreement  shall be  co-terminus  with the
             ----
period of duration of the Company provided in the  Certificate,  unless extended
or sooner terminated as hereinafter provided.

         2.4 Office and Agent.  The  principal  executive  office of the Company
             ----------------
shall be located at 1700 Montgomery Street, Suite 250, San Francisco,  CA 94111.
The Manager may, from time to time,  upon 30-days advance written notice to each
Member,  change the principal  place of business of the Company or, without such
notice,  establish  additional places of business of the Company. The registered
agent shall be as stated in the  Certificate  or as otherwise  determined by the
Manager,  and the Manager,  may, from time to time,  change the registered agent
(or its office)  through  appropriate  filings  with the  Delaware  Secretary of
State.

         2.5 Addresses of the Members and the Manager.  The respective addresses
             ----------------------------------------
for each Member and for the Manager are set forth on Schedule I attached hereto.
                                                     ----------

         2.6 Purpose of Company.  The purpose of the Company is to engage in any
             ------------------ 
lawful activity for which a limited liability company may be organized under the
Act. Notwithstanding the foregoing,  without the prior written consent of all of
the  Members,  the  Company  shall not  engage in any  business  other  than (i)
conducting  a lending  business  focused on the death care  industry,  including
originating,  acquiring,  holding,  servicing  and  disposing of loans and other
forms of financing for funeral  homes,  cemeteries  and other  businesses in the
death care industry and (ii) other activities  directly related to the foregoing
business as may be necessary, advisable, or appropriate to further the foregoing
business.


                                       6

<PAGE>


                                    ARTICLE 3 
                                    ---------
                            Contributions to Capital
                            ------------------------
  
         3.1  Initial   Capital   Contributions.   Members  shall  make  initial
              ---------------------------------
contributions as follows and shall receive in exchange  therefore the Membership
Interest set forth opposite such Member's name on Schedule I attached hereto:

                  3.1.1    Initial Point West Contributions.  Point West shall 
                           --------------------------------
contribute:

                           (a)  $50,000  at  the  time  of   execution  of  this
         Agreement  and  from  time  to time  thereafter,  as  needed,  up to an
         additional $450,000 to be used as working capital for the Company,

                           (b) approximately  $1,500,000, as needed from time to
         time to support the  warehousing  and equity  components of loans to be
         funded in connection with an initial securitization, and

                           (c) at Point West's  discretion,  after completion of
         an  initial   securitization  by  the  Company,   up  to  approximately
         $1,500,000 to be used to support the warehousing and equity  components
         of a second securitization.

All  such  Capital  Contributions  shall be  entitled  to earn  the  Point  West
Secondary Preferred Return and the Point West Tertiary Preferred Return pursuant
to the terms of this Agreement.

                  3.1.2 Initial Contributions by Isard and McDermitt.  Isard and
                        --------------------------------------------
McDermitt shall  contribute to the Company all their interest in any agreements,
rights,  intellectual  property,  written  presentations  or  other  written  or
electronic materials previously developed or collected by them in respect of the
business of the Company.  It is agreed by the parties that such property will be
deemed to have no value for purposes of Capital Account computations hereunder.

         3.2 Additional Contributions. If the Manager determines that additional
             ------------------------
funds are  required  or  advisable  for the  operation  of the  business  of the
Company, it may request additional Capital  Contributions from the Members. Such
request shall be in writing and shall indicate the purpose,  amount,  timing and
terms of the additional  Capital  Contributions  being  requested and such other
information  as the Members may reasonably  request.  All Members shall have the
opportunity  but not the obligation to participate in the making of such Capital
Contributions on a pro rata basis in accordance with their Membership Interests.
No Capital  Contributions in addition to those provided for in Section 3.1 shall
be accepted  absent approval of the terms thereof by the Members holding 100% of
the Voting  Interests.  Each Member's Capital Account shall be credited for such
contribution  in accordance  with Section 3.4 and the Membership  Interests,  as
reflected on Schedule I shall be adjusted, if and as agreed upon by the Members,
             ----------
to reflect the new relative Membership  Interests of the Members. If the Members
do not consent to the additional Capital Contributions  proposed by the Manager,
the  Manager may lend or  contribute  capital to the Company on such terms as it
deems  appropriate;  provided  however,  that the Members  shall have a right of
first refusal to cause the Company to obtain funds from another source on better
terms, using procedures similar to those provided for in Section 7.6.

                                       7


<PAGE>

         3.3 Liability for Promised Contributions. A Member is obligated for any
             ------------------------------------
promise to make a Capital Contribution,  even if the Member is unable to perform
for any reason (including death or disability).

         3.4 Capital Accounts. The Company shall establish an individual Capital
             ---------------- 
Account for each Member.  If a Member  transfers  all or a part of such Member's
Membership  Interest  in  accordance  with this  Agreement,  then such  Member's
Capital Account attributable to the transferred  Membership Interest shall carry
over to the new  owner  of such  Membership  Interest  pursuant  to  Regulations
Section  1.704-1(b)(2)(iv).  Each Member's Capital Account shall equal the value
of the  Capital  Contribution  initially  made by it pursuant to Section 3.1 and
shall be (a) increased by the amount of (i) Net Profits  allocated to the Member
             ---------
and (ii) any subsequent  Capital  Contributions  by the Member to the Company in
accordance  with Section 3.2, and (b)  decreased by the amount of (i) Net Losses
                                       ---------
allocated  to the  Member  and (ii) all cash  and  property  distributed  to the
Member.  Each Capital  Account shall  otherwise be kept in  accordance  with the
applicable  Regulations  promulgated under Section 704(b) of the Code. No Member
has any obligation to restore,  or make contributions to the Company to restore,
a deficit balance in such Member's Capital Account.

         3.5 No Interest;  Return of Contributions.  No Member shall be entitled
             -----------
to receive  any  interest  on such  Member's  Capital  Contributions.  Except as
otherwise provided in this Agreement,  no Member shall have the right to receive
the return of any  Capital  Contribution  or any  withdrawal  from the  Company,
except upon a dissolution of the Company.

         3.6 Organizational Costs. Upon receipt of reasonable documentation, the
             --------------------
Company shall  reimburse each Member for its reasonable  out-of-pocket  expenses
incurred on or after August 6, 1997 in connection  with the  organization of the
Company  or  advanced  with  respect  to the  Company  on or before  the date of
execution of this Agreement.

                                       8
<PAGE>


                                    ARTICLE 4
                                    ==========
                    Certain Rights and Liabilities of Members
                    ==========================================

         4.1 Limited Liability. Except as required under the Act or as expressly
             -----------------
set forth in this Agreement,  no Member shall be personally liable for any debt,
obligation,  or liability of the Company,  whether that  liability or obligation
arises in contract, tort, or otherwise.

         4.2 Admission of Additional Members. The Manager,  with the approval of
             -------------------------------
all of the Members,  may admit additional members to the Company. Any additional
Members  shall  obtain   Membership   Interests  and  will  participate  in  the
management,  Net Profits,  Net Losses,  and distributions of the Company on such
terms  as  are  provided   herein  and  as  may  be  approved  by  the  Members.
Notwithstanding  the  foregoing,  substitute  members  may only be  admitted  in
accordance with Article 7.

         4.3  Withdrawals  or  Resignations.  Except as  otherwise  specifically
              ------------------------------
provided herein, no Member may withdraw or resign from the Company.

         4.4  Forfeiture or Reduction of Membership Interests; Membership
              ----------------------------------------------------------
Interest Option.
---------------
                  4.4.1   Forfeiture  or  Reduction  of  Membership   Interests.
                          -----------------------------------------------------
Notwithstanding anything to the contrary contained in Section 7.5:

                           (a) If the Initial  Financing  Date does not occur on
         or before the Threshold Date, then the Initial Membership  Interests of
         each of the Specified  Members shall  automatically be forfeited on and
         as of such  date.  In the  event  of  such  forfeiture,  the  forfeited
         Membership Interest of such Persons shall automatically be allocated to
         Point West.

                           (b)  If,  on  or  prior  to  the  Threshold  Date,  a
         Forfeiture Event occurs with respect to either or both of the Specified
         Members  and the  Initial  Financing  Date has not  occurred,  then the
         Initial  Membership  Interest of such Person(s) shall  automatically be
         forfeited on and as of the date of the  occurrence  of such  Forfeiture
         Event.  In the  event  of such  forfeiture,  the  forfeited  Membership
         Interest  of  such  Person  shall  automatically  be  allocated  to the
         remaining  Specified  Member (if any) and Point West in the  proportion
         that their  respective  Membership  Interests bears to the sum of their
         Membership Interests.

                           (c) If the Initial Financing Date occurs on or before
         the  Threshold  Date,  and,  following  the Initial  Financing  Date, a
         Forfeiture Event occurs with respect to a Specified Member, then:

                                    (i) (A) if such Forfeiture  Event relates to
                  McDermitt  and occurs  prior to the first  anniversary  of the
                  Initial Financing Date, then McDermitt's  Membership  Interest
                  shall  automatically  be reduced by that number of  percentage
                  points  equal to the excess of (1) 15 over (2) the  product of
                  the length of time in  quarters  since the  Initial  Financing
                  Date and 1.25;  or (B) if such  Forfeiture  Event  relates  to
                  McDermitt and occurs on or after the first  anniversary of the
                  Initial Financing Date, then McDermitt's  Membership  Interest
                  shall  automatically  be reduced by that number of  percentage
                  points  equal to the excess of (1) 10 over (2) the  product of
                  (y) a fraction,  the  numerator of 

                                       9

<PAGE>


                  which  is the  length  of  time  in  months  since  the  first
                  anniversary of the Initial  Financing Date and the denominator
                  of which is 48 and (z) ten (10).
                                   (ii) if such  Forfeiture  Event  relates  to
                  Isard, then Isard's Membership Interest shall automatically be
                  reduced  by that  number  of  percentage  points  equal to the
                  excess of (A) 20 over (B) the product of (1) a  fraction,  the
                  numerator  of which is the length of time in months  since the
                  Initial  Financing Date and the  denominator of which is sixty
                  (60) and (2) 20.

                           The  amount  by  which  either   Specified   Member's
         Membership  Interest is reduced pursuant to this Section 4.4.1(c) shall
         automatically  be allocated to the remaining  Specified Member (if any)
         and Point  West in the  proportion  that  their  respective  Membership
         Interests bears to the sum of their Membership Interests.

                  4.4.2  Membership Interest  Option.  Notwithstanding  anything
                         --------------------------- 
to the  contrary  contained  in Section 7.5:

                           (a) During the Membership Interest Option Period, but
         only so long as the Initial  Financing Date shall have occurred and the
         Option  Condition has been  satisfied,  each of the  Specified  Members
         shall have the option to acquire an additional 2.5% Membership Interest
         in  the  Company  from  Point  West  (each  such  Person's   option,  a
         "Membership  Interest  Option");  provided  that if, on or prior to the
          ----------------------------     --------
         exercise by a Specified  Member of such  Person's  Membership  Interest
         Option,  a Forfeiture  Event has occurred  with respect to such Person,
         then such  Person  shall not be entitled  to  exercise  his  Membership
         Interest Option and his Membership  Interest Option shall automatically
         be  transferred  to the  remaining  Specified  Member or if there is no
         remaining Specified Member, to Point West.

                           (b) Subject to Section  4.4.2(a),  a Specified Member
         may exercise his  Membership  Interest  Option  solely by (i) providing
         written  notice of such  exercise to Point West  during the  Membership
         Interest  Option  Period  and (ii)  simultaneously  paying  Point  West
         consideration in an amount equal to One Dollar ($1.00). If such written
         notice and payment are not timely  delivered  by a Specified  Member to
         Point West,  then such Specified  Member's  Membership  Interest Option
         shall  automatically  terminate.  If  such  written  notice  is  timely
         delivered,  then Point West and the  Company  shall take all steps that
         are reasonably  necessary to effect, and reflect on the Company's books
         and  records,  the transfer of the  appropriate  amount of Point West's
         Membership  Interest to such  Specified  Member (with respect to either
         Specified Member, the "Specified  Membership  Interest  Amount"),  such
                                ---------------------------------------
         transfer to be effective as of the Membership Interest Option Date.

                           (c) If,  following the proper exercise by a Specified
         Member of such Person's  Membership Interest Option, a Forfeiture Event
         occurs with respect to a Specified Person, then such Person's Specified
         Membership  Interest Amount shall automatically be reduced to an amount
         equal to the product of (i) a fraction,  the  numerator of which is the
         length  of time in  months  since the  Initial  Financing  Date and the
         denominator  of which  is the  length  of time in  months  between  the
         Initial  Financing  Date and the Valuation  Date and (ii) his Specified
         Membership Interest Amount.


                                       10

<PAGE>

                           (d) The  amount by which  either  Specified  Member's
         Specified  Membership  Interest  Amount is reduced  pursuant to Section
         4.4.2(c) shall  automatically  be allocated to the remaining  Specified
         Member  (if  applicable)  and Point West in the  proportion  that their
         respective  Membership  Interests bears to the sum of their  Membership
         Interests.

                  4.4.3 Adjustment of Capital Accounts.  The Capital Accounts of
                  ------------------------------------
all  Members  shall be adjusted in  accordance  with  Section 3.4 to reflect the
transfers effected in accordance with Sections 4.4.1 or 4.4.2.

         4.5  Repurchase  of a  Membership  Interest.  Upon  the  transfer  of a
              --------------------------------------
Member's Membership Interest in violation of this Agreement or the occurrence of
a Dissolution  Event as to a Member that does not result in the  dissolution  of
the Company, such Member's Voting Interest shall terminate and the Company shall
have the right to purchase  the  Membership  Interest of such Member at the fair
value of such  interest,  and if the  Company  does not  exercise  such right to
purchase the remaining Members shall have such right on the same terms.  Failure
to exercise  such right of purchase  shall not limit any right of first  refusal
otherwise  available under this Agreement.  Each Member  acknowledges and agrees
that this provision is not unreasonable  under the circumstances  existing as of
the date hereof.

         4.6  Transactions  with  the  Company.   Notwithstanding  that  it  may
              --------------------------------
constitute  a  conflict  of  interest,  any  Member,  or  any of  such  Member's
Affiliates,  may engage in any transaction  with the Company  (including  making
loans  or  causing  loans  to be  made to the  Company)  so long  as:  (a)  such
transaction  is not expressly  prohibited by this  Agreement;  (b) the terms and
conditions of such transaction,  on an overall basis, are fair and reasonable to
the  Company  and are at least as  favorable  to the  Company  as those that are
generally  available from Persons,  not Members (or their  Affiliates),  dealing
with the Company on an arms-length  basis; (c) the nature of such transaction is
fully  disclosed to the Manager;  and (d) any such  transaction  that involves a
contract  for  services  is  approved  by  Members  holding  100% of the  Voting
Interests and not otherwise the subject of Section 4.5.

         4.7 Remuneration to Members.  Except as otherwise specifically provided
             -----------------------
herein,  no  Member is  entitled  to  remuneration  for  acting  in the  Company
business,  subject to the  entitlement of Members  winding up the affairs of the
Company to reasonable compensation pursuant to Section 9.3.

         4.8 Members Are Not Agents.  The management of the Company is vested in
             ----------------------
the Manager. The Members shall have no power to participate in the management of
the Company except as expressly  authorized by this Agreement or the Certificate
and  except  as  expressly  required  by the  Act.  Unless  expressly  and  duly
authorized in writing to do so by the Manager, no Member shall have any power or
authority  to bind or act on  behalf  of the  Company  in any way (as  agent  or
otherwise).

         4.9 Voting Rights.  Except as otherwise  specifically  provided herein,
             -------------
Members shall have no voting,  approval,  or consent  rights.  A Member may vote
either in person or by  written  proxy or  consent  signed by the Member or such
Members  duly  authorized  attorney-in-fact.  Members  shall  have the right to
approve  or  disapprove  matters  as  specifically  stated  in  this  Agreement,
including the following:

                  4.9.1 Unanimous Approval.  The following matters shall require
                        ------------------
the vote,  approval or consent of Members  holding 100% of the Voting  Interests
and who are not  otherwise  the subject  Section 4.5: (a) a decision to continue
the business of the Company after the occurrence of a Dissolution Event;


                                       11

<PAGE>


(b) the  transfer of a Membership  Interest  except as permitted in Article 7 or
the admission of an assignee as a substitute Member of the Company; (c) a change
in the purpose of the Company  other than as  provided in Section  2.6;  (d) the
admission of a new member to the Company; (e) the merger or consolidation of the
Company or a sale of  substantially  all of its assets that is coupled  with the
granting of a noncompete; (f) any amendment of the Certificate or this Agreement
that could have a material adverse effect on the economic interests of a Member;
(g) a  decision  to  compromise  the  obligation  of a Member  to make a Capital
Contribution or return money or property paid or distributed in violation of the
Act;  (h)  the  declaration  or  making  of  any  payment  or  distribution  not
contemplated by Article 6; or (i) any other matter for which  unanimous  consent
is specifically provided for in this Agreement.

                  4.9.2 Approval by Point West and Members.  Except as set forth
                        ----------------------------------
in Section  4.9.1(f),  no amendment of Sections 4.4, 7.6.1 and 7.6.2 may be made
without the approval or consent of Point West and the other Members.

                  4.9.3 Approval by Members Holding a Majority Voting  Interest.
                        -------------------------------------------------------
Except as set forth in Sections 4.9.1 and 4.9.2, in all other matters in which a
vote,  approval or consent of the Members is  required,  the vote,  consent,  or
approval of Members  holding a Majority  Voting  Interest  (or, in  instances in
which  there  are   defaulting  or   interested   members,   non-defaulting   or
disinterested  Members,  as  applicable,  who  hold a  majority  of  the  Voting
Interests held by all non-defaulting or disinterested,  as applicable,  Members)
shall be  sufficient  to  authorize or approve  such act.  Without  limiting the
generality of the foregoing or any other provision to the contrary,  but subject
to Sections 4.9.1 and 4.9.2,  the affirmative vote or written consent of Members
holding a Majority  Voting  Interest  shall be required to approve the following
matters  (provided  that the  Members  shall not vote for or consent to any such
action if  prohibited  under any contract or agreement to which the Company is a
party):  (a) the  dissolution  or  winding  up of the  Company;  (b)  the  sale,
exchange, mortgage, pledge, encumbrance,  lease or other disposition or transfer
of all or  substantially  all of the assets of the  Company  that is not coupled
with the  granting of a  noncompete;  or (c) the  declaration  or payment of any
payment or  distribution  contemplated  by Article 6. Prior to taking any action
taken pursuant to an affirmative  vote under  subsections (a) or (b) above,  the
dissenting  Members shall have the right to propose,  within thirty (30) days of
such vote, a more economically  advantageous alternative to the proposed action.
If such a proposal is made, the Members shall hold a meeting in accordance  with
Section 4.10 to discuss and vote on it.

         4.10     Meetings.
                  --------

                  4.10.1 Meetings of Members. Meetings of Members for any proper
                         -------------------
purpose may be called at any time and from time to time by any  Member.  Members
may  participate  in any meeting  through the use of a  conference  telephone or
similar communications equipment by means of which all individuals participating
in the meeting  can hear each other,  and such  participation  shall  constitute
presence in person at the meeting.  The Company shall give written notice of the
date,  time,  place and  purpose of any meeting to all Members at least ten (10)
days and not more than sixty (60) days prior to the date fixed for the  meeting.
Notice may be waived by any Member, which waiver will be in writing.

                  4.10.2 Consent of Members. Any action required or permitted to
                         ------------------
be taken at any annual or special  meeting of Members  may be taken by a written
consent without a meeting,  without prior notice and without a vote. The written
consent  shall  set forth  the  action  so taken and shall be

                                       12
<PAGE>


signed by Members having not less than the minimum number of votes that would be
necessary  to  authorize  or take such  action at a meeting at which all Members
entitled to vote thereon were present and voting. Prompt notice of the taking of
action by written  consent  shall be given to all  Members  who did not sign the
written consent.

                                       13

<PAGE>


                                    ARTICLE 5
                                    =========
                      Management and Control of the Company
                      =====================================

         5.1      Management of the Company by the Manager.
                  ----------------------------------------

                  5.1.1  Exclusive   Management  by  the  Manager.   Except  for
                         ----------------------------------------
situations  in which the  approval of the Members is  expressly  required by the
Certificate  or this  Agreement,  the  business,  property,  and  affairs of the
Company shall be managed exclusively by, or under the authority of, the Manager.
The  Manager  may,  from time to time,  appoint  Persons to act on behalf of the
Company and may hire  employees and agents and appoint  officers to perform such
functions as from time to time shall be delegated to such employees, agents, and
officers by the  Manager.  The Manager  may,  from time to time,  determine  the
compensation  of any  employees,  agents,  or  officers  of the  Company  or may
delegate  some or all  compensation  decisions  to officers or  employees of the
Company.  Pursuant  and  subject to the terms and  conditions  of the  McDermitt
Employment  Agreement,  the Manager  hereby  appoints  McDermitt  as the initial
President of the Company.  Pursuant and subject to the terms and  conditions  of
the Isard Employment Agreement, the Manager hereby appoints Isard as the initial
Vice President of Marketing of the Company.

                  5.1.2  Initial  Manager;  Term.  The initial  Manager shall be
                         ----------------
Point  West.  The  Manager  shall hold office  until the  effective  date of the
earlier of its resignation or removal hereunder.  Any new or replacement Manager
shall be elected by the  affirmative  vote or written consent of Members holding
100% of the Voting Interest,  which consent shall not be unreasonably  withheld.
The  Manager  need not be a Member,  an  individual,  a resident of the State of
Delaware, or a citizen of the United States.

                  5.1.3  Resignation.  The  Manager  may  resign  at any time by
                         -----------
giving written notice to the Members without prejudice to the rights, if any, of
the Company under any contract to which the Manager is a party;  provided  that,
                                                                 --------
if the Manager is also a Member, then the Manager's resignation shall not affect
the  Manager's  rights as a Member or constitute a withdrawal of such Member and
provided,  further,  unless the  Manager  cannot act as a matter of law, no such
--------  -------
resignation  shall be effective until a replacement  manager has been appointed.
The Manager shall immediately tender its resignation upon any transfer for value
(other than by way of general encumbrance,  pledge, lien or the like or pursuant
to  Section  7.4) and upon any  admission  of a  substitute  Member as to all or
substantially  all of its  Membership  Interest  (other than pursuant to Section
7.4).

                  5.1.4  Removal.  The  Manager  may be removed  with or without
                         -------
cause by the affirmative  vote of Members  holding a Majority  Voting  Interest;
provided  that,  if the Manager is also a Member,  then such  removal  shall not
--------
affect the  Manager's  rights as a Member or  constitute  a  withdrawal  of such
Member and provided,  further, unless the Manager cannot act as a matter of law,
           --------   ------- 
no such  removal  shall  be  effective  until a  replacement  manager  has  been
appointed.

                  5.15 Standard of Operations.  The Manager shall, to the extent
                       ----------------------
practicable, consistent with its responsibilities and those of the Company under
this  Agreement,  and  adhering to  professional  lending and credit  standards,
manage the Company with a view  towards  maximizing  the  monetary  value to the
Members  (taken as a whole) of the Company as an  operating  entity  independent
from its  Members.  Notwithstanding  the  foregoing,  if the  Manager  is also a
Member, nothing in this provision shall be construed so as to impose an economic
obligation  on such Member  other than that imposed on Members  

                                       14
<PAGE>


generally  under this Agreement.

                  5.16 Executive Committee.  Prior to taking actions material to
                       -------------------
the  operations  of the  Company,  the Manager  shall  consult with an Executive
Committee which shall be comprised of Isard, McDermitt, Alan Perper, Brad Rotter
and Ward Rotter and shall make non-binding recommendations.

         5.2 Performance of Duties:  Liability of the Manager. The Manager shall
             ------------------------------------------------
carry out its duties hereunder in good faith and with reasonable  care.  Subject
to the  foregoing,  the  Manager  shall not be liable to the  Company  or to any
Member for any loss or damage sustained by the Company or any Member, unless the
loss or damage shall have been the result of fraud,  deceit,  gross  negligence,
willful or reckless misconduct, or a knowing violation of law by the Manager. In
performing  its duties,  the Manager  shall be entitled to rely on  information,
opinions,  reports,  or  statements,  including  financial  statements and other
financial data, from officers, agents, attorneys,  accountants, or other Persons
employed by the Company or the Manager,  unless it has knowledge  concerning the
matter in question that would cause such reliance to be unwarranted.

         5.3 Devotion of Time. The Manager is not obligated to devote all of its
             ---------------- 
time or business efforts to the affairs of the Company. The Manager shall devote
whatever time,  effort,  and skill as it reasonably  deems  appropriate  for the
operation of the Company.

         5.4  Competing  Activities.  While acting as Manager of the Company and
              ---------------------
for 18 months thereafter, the Manager and its officers, directors, shareholders,
partners,  members, managers, agents, employees, and Affiliates shall not engage
or invest in, independently or with others, any business activity of any type or
description  that might be the same as or similar to the  Company's  business as
described  in the second  sentence of Section 2.6 and that might be in direct or
indirect  competition  with  the  Company.  Notwithstanding  the  foregoing,  no
activity  involving  any of the following  shall be deemed to be in  competition
with the business of the Company: (i) the origination,  acquisition,  holding or
disposition  of  viatical   settlements,   (ii)  the  acquisition,   holding  or
disposition  of debt or equity  securities  of any public  company or investment
vehicle,  or (iii) any  transactions  or  programs  directly  by the  Manager or
indirectly  through a debtor of the Manager involving the extension of credit of
any type which  transactions  or programs do not describe or promote  activities
that are the same as or in competition with the Company's  business as described
in the second sentence of Section 2.6. The Members  acknowledge that the Manager
and its Affiliates own or manage other businesses, including businesses that may
compete with the Company for the Manager's  time.  Except as provided in Section
5.3 and this  Section,  the Members  hereby  waive any and all rights and claims
which they may otherwise  have against the Manager and its officers,  directors,
shareholders,  partners, members, managers, agents, employees, and Affiliates as
a result of any of such activities.

         5.5 Transactions  between the Company and the Manager.  Notwithstanding
             -------------------------------------------------
that it may  constitute a conflict of  interest,  the Manager may, and may cause
its Affiliates  to, engage in any  transaction  (including  the purchase,  sale,
lease,  or exchange of any  property or the  rendering  of any  service,  or the
establishment of any salary,  other compensation,  or other terms of employment)
with the Company so long as: (a) such transaction is not expressly prohibited by
this  Agreement;  and (b) the terms and  conditions of such  transaction,  on an
overall  basis,  are (i) fair and  reasonable to the Company and are at least as
favorable  to the Company as those that are  generally  available  from  Persons
capable of similarly performing them and in similar transactions between parties
operating  at arm's  length  and 

                                       15

<PAGE>

(ii)  approved  in writing by more than fifty  percent  (50%) of the  Membership
Interests of Members  having no interest in such  transaction  (other than their
interests as Members), which consent shall not be unreasonably withheld.

         5.6 Payments to the Manager.  The Manager  shall not be entitled to any
             -----------------------
compensation for its services as Manager, but shall be reimbursed by the Company
for any reasonable  out-of-pocket  expenses incurred by the Manager on behalf of
the Company.

         5.7 Limited Liability of the Manager.  Except as required under the Act
             --------------------------------
or as expressly set forth in this Agreement, no Person who is a Manager shall be
personally liable under any judgment of a court, or in any other manner, for any
debt,  obligation,  or  liability  of the  Company,  whether  that  liability or
obligation arises in contract, tort, or otherwise.

                                       16
<PAGE>


                                    ARTICLE 6
                                    =========
            Allocations of Net Profits, Net Losses and Distributions
            ========================================================

         6.1      Allocations of Net Profit and Net Loss.
                  --------------------------------------

                  6.1.1  Net  Loss.  Net  Loss for each  taxable  year  shall be
                         ---------
allocated as follows:

                           (a) First,  to the Members in  accordance  with their
         respective  Membership  Interests  until the  cumulative  amount of Net
         Losses  allocated  to the  Members  pursuant to this  Section  6.1.1(a)
         equals the  cumulative  amount of Net Profits  allocated to the Members
         pursuant to Section 6.1.2(e);

                           (b) Second, to Point West until the cumulative amount
         of Net Losses allocated to Point West pursuant to this Section 6.1.1(b)
         equals the sum of the cumulative  amount of Net Profits allocated to it
         pursuant   to  Section   6.1.2(a),   (b)  and  (c)  plus  its   Capital
         Contributions   included   for   purposes  of  the   Adjusted   Capital
         Contribution; and

                           (c) Third,  to the Members in  accordance  with their
respective Membership Interests.

         Notwithstanding  the foregoing,  loss  allocations to a Member shall be
made only to the  extent  that such loss  allocations  will not create a deficit
Capital Account balance for that Member in excess of an amount, if any, equal to
such  Member's  share of  Company  Minimum  Gain  that  would be  realized  on a
foreclosure  of the  Company's  property.  Any  loss not  allocated  to a Member
because of the foregoing  provision  shall be allocated to the other Members (to
the extent the other  Members  are not limited in respect of the  allocation  of
losses under this Section 6.1.1).  Any loss reallocated under this Section 6.1.1
shall be taken into account in computing  subsequent  allocations  of income and
losses  pursuant  to this  Article  6, so that  the net  amount  of any  item so
allocated  and the income and losses  allocated to each Member  pursuant to this
Article 6, to the extent  possible,  shall be equal to the net amount that would
have  been  allocated  to each  such  Member  pursuant  to this  Article 6 if no
reallocation of losses had occurred under this Section 6.1.1.

                  6.1.2    Net Profit.  Net Profit of the  Company  for each  
                           ----------
taxable  year shall be  allocated  as  follows:

                           (a) First,  pro rata,  (i) to Point West in an amount
         equal to the sum of the Point West  Primary  Preferred  Return plus any
         Point West Primary  Carryforwards;  provided  that, if the Company does
                                             -------- 
         not have sufficient Net Profits in a given year to make such allocation
         in full,  then any shortfall  (the "Point West Primary  Carryforwards")
                                        --------------------------------------
         shall be carried forward indefinitely to the next taxable year or years
         in which Net Profits are sufficient to make such allocation and (ii) to
         the Specified Members  (according to their Membership  Interests) in an
         aggregate  amount equal to the sum of the Specified  Member Return plus
         any Specified Member Carryforwards;  provided that, if the Company does
                                              --------
         not have sufficient Net Profits in a given year to make such allocation
         in full,  then any shortfall  (the  "Specified  Member  Carryforwards")
                                              --------------------------------
         shall be carried forward indefinitely to the next taxable year or years
         in which Net Profits are sufficient to make such allocation;



                                       17
<PAGE>


                           (b) Second,  to Point West in an amount  equal to the
         sum of the Point West  Secondary  Preferred  Return plus any Point West
         Secondary  Carryforwards;  provided  that, if the Company does not have
                                    --------
         sufficient Net Profits in a given year to make such allocation in full,
         then any shortfall (the "Point West Secondary  Carryforwards") shall be
                                  -----------------------------------
         carried forward indefinitely to the next taxable year or years in which
         Net Profits are sufficient to make such allocation;

                           (c) Third,  to Point  West in an amount  equal to the
         Point West Tertiary  Preferred  Return;  provided  that, if the Company
                                                  --------
         does not have  sufficient  Net  Profits  in a given  year to make  such
         allocation, then any shortfall shall not be carried forward;

                           (d)  Fourth,  to Point  West to the extent of any Net
         Losses allocated to Point West pursuant to Section 6.1.1(b); and

                           (e) Fifth,  to the Members in  accordance  with their
respective Membership Interests.

         6.2      Special Allocations.
                  -------------------

                  6.2.1 Minimum Gain Chargeback. Notwithstanding Section 6.1, if
                        ----------------------- 
there is a net decrease in Company  Minimum  Gain during any Fiscal  Year,  each
Member shall be specially  allocated  items of Company  income and gain for such
Fiscal Year (and, if necessary,  in subsequent  fiscal years) in an amount equal
to the portion of such  Member's  share of the net  decrease in Company  Minimum
Gain that is determined in accordance with  Regulations  Section  1.704-2(g)(2).
This  Section  6.2.1 is  intended to comply  with the  minimum  gain  chargeback
requirement contained in Regulations Section 1.704-2(f) and shall be interpreted
consistently therewith.

                  6.2.2  Chargeback  of  Minimum  Gain  Attributable  to  Member
                         -------------------------------------------------------
Nonrecourse Debt.  Notwithstanding  Section 6.1 of this Agreement, if there is a
----------------
net decrease in Company Minimum Gain attributable to a Member  Nonrecourse Debt,
during any Fiscal Year,  each Member who has a share of the Company Minimum Gain
attributable to such Member Nonrecourse Debt shall be specially  allocated items
of  Company  income  and  gain for such  Fiscal  Year  (and,  if  necessary,  in
subsequent  Fiscal  Years) in an amount equal to that  portion of such  Member's
share of the net decrease in Company  Minimum Gain  attributable  to such Member
Nonrecourse  Debt.  A Member's  share of net  decrease in Company  Minimum  Gain
attributable  to each Member  Nonrecourse  Debt shall be determined  pursuant to
Regulations Section 1.702-2(g)(2). This Section 6.2.2 is intended to comply with
the  minimum  gain  chargeback  requirement  contained  in  Regulations  Section
1.704-2(i)(4) and shall be interpreted consistently therewith.

                  6.2.3 Nonrecourse Deductions. Notwithstanding Section 6.1, any
                        ----------------------
nonrecourse deductions (as defined in Regulations Section 1.704-2(b)(1)) for any
Fiscal  Year or other  period  shall be  specially  allocated  to the Members in
proportion to their Membership Interests.

                  6.2.4 Member Nonrecourse  Deductions.  Notwithstanding Section
                        ------------------------------ 
6.1,  those  items of Company  loss,  deduction,  or Code  Section  705(a)(2)(B)
expenditures  which are  attributable to Member  


                                       18
<PAGE>


Nonrecourse  Debt  for any  Fiscal  Year or  other  period  shall  be  specially
allocated to the Member who bears the economic  risk of loss with respect to the
Member  Nonrecourse Debt to which such items are attributable in accordance with
Regulations Section l.704-2(i).

                  6.2.5 Qualified Income Offset. Notwithstanding Section 6.1, if
                        -----------------------
a Member unexpectedly  receives any adjustments,  allocations,  or distributions
described in  Regulations  Section  1.704-l(b)(2)(ii)(d)(4),  (5) or (6), or any
other event creates a deficit balance in such Member's Capital Account in excess
of such Member's share of Company Minimum Gain, items of Company income and gain
shall be specially  allocated to such Member in an amount and manner  sufficient
to eliminate  such excess  deficit  balance as quickly as possible.  Any special
allocations  of items of income and gain pursuant to this Section 6.2.5 shall be
taken  into  account  in  computing  subsequent  allocations  of income and gain
pursuant to this Article 6 so that the net amount of any item so  allocated  and
the income, gain, and losses allocated to each Member pursuant to this Article 6
to the extent  possible,  shall be equal to the net amount  that would have been
allocated to each such Member  pursuant to the  provisions of this Section 6.2.5
if such unexpected adjustments, allocations, or distributions had not occurred.

         6.3  Code  Section  704(c)   Allocations.   Notwithstanding  any  other
              -----------------------------------
provision in this  Article 6, in  accordance  with Code  Section  704(c) and the
Regulations  promulgated  thereunder,  income,  gain,  loss,  and deduction with
respect to any property contributed in-kind to the capital of the Company shall,
solely for tax purposes, be allocated among the Members so as to take account of
any  variation  between the adjusted  basis of such  property to the Company for
federal  income  tax  purposes  and  its  fair  market  value  on  the  date  of
contribution.  Allocations  pursuant to this Section 6.3 are solely for purposes
of federal,  state and local taxes. As such, they shall not affect or in any way
be taken  into  account in  computing  a  Member's  Capital  Account or share of
profits,  losses,  or other items of distributions  pursuant to any provision of
this Agreement.

         6.4 Allocation of Net Profits and Losses and  Distributions  in Respect
             -------------------------------------------------------------------
of a Transferred  Interest.  If any Membership  Interest is  transferred,  or is
--------------------------
increased or decreased by reason of the  admission of a new Member or otherwise,
during any Fiscal Year of the Company, unless the Members determine that another
method  permitted under the Code is more equitable,  each item of income,  gain,
loss, deduction, or credit of the Company for such Fiscal Year shall be assigned
pro rata to each day in the particular  period of such fiscal year to which such
item is  attributable  (i.e.,  the  day on or  during  which  it is  accrued  or
otherwise incurred) and the amount of each such item so assigned to any such day
shall be allocated to the Member based upon such Person's respective  Membership
Interest at the close of such day.

         However,  for purposes of accounting  convenience and  simplicity,  the
Company  shall treat a transfer  of, or an increase or decrease in, a Membership
Interest which occurs at any time during a semi-monthly  period (commencing with
the semi-monthly period including the date hereof) as having been consummated on
the  last  day of such  semi-monthly  period,  regardless  of when  during  such
semi-monthly period such transfer,  increase, of decrease actually occurs (i.e.,
sales and dispositions made during the first fifteen (15) days of any month will
be deemed to have been made on the fifteenth day of the month).

         Notwithstanding  any provision  above to the contrary,  gain or loss of
the Company  realized in connection  with a sale or other  disposition of any of
the  assets of the  Company  shall be  allocated  solely

                                       19
<PAGE>


to the parties  owning  Membership  Interests  as of the date such sale or other
disposition occurs.

         6.5  Distributions  by the Company.  Subject to applicable  law and any
              -----------------------------
limitations  contained  elsewhere in this  Agreement,  distributions  of cash or
other assets of the Company shall be made in the following order of priority:

                  6.5.1 first, to Point West an amount  sufficient to reduce the
Adjusted Capital Contribution to zero; and

                  6.5.2  Second,   to  the  Members  in  accordance  with  their
Membership Interests.

         Notwithstanding  the  foregoing,  to the  extent  that  cash  would  be
available  for  distribution  hereunder,  the Company shall first (i) advance to
each  Member an  amount  (a "Tax  Advance")  sufficient  to cover the  estimated
                             ------------    
federal and state taxes of such Member (based on the combined maximum  effective
federal  and state  income  tax  rates  then in  effect  for each  such  Member)
resulting  from  estimated  allocations  of Net Profits to such Member for prior
quarters  and for which no prior Tax Advance or  distribution  has been made and
(ii) upon  filing of the  Company's  federal  and state tax returns for a Fiscal
Year,  distribute  an amount to each Member at least equal to the amount of such
Member's  federal  and state  taxes  (based on the  combined  maximum  effective
federal and state  income tax rates then in effect for each such  Member) on the
Net Profits  actually  allocated to such Member for such Fiscal  Year,  computed
taking into account any prior allocations of Net Losses available to offset such
income  and other  distributions  to such  Member in such  Fiscal  Year and each
Member shall repay any outstanding Tax Advances related to such Fiscal Year.

         All distributions  shall be made only to the Persons who,  according to
the  books  and  records  of the  Company,  are the  holders  of  record  of the
Membership  Interests  in respect of which  such  distributions  are made on the
actual date of distribution.  Neither the Company nor any Member shall incur any
liability for making distributions in accordance with this Section 6.5.

         6.6 Form of  Distribution.  A Member,  regardless  of the nature of the
             ---------------------
Member's  Capital  Contribution,   has  no  right  to  demand  and  receive  any
distribution  from the  Company  in any form  other  than  cash.  Except  upon a
dissolution  and the  winding  up of the  Company,  or as agreed  to by  Members
holding 100% of the Voting Interests,  no Member may be compelled to accept, nor
shall it accept, a distribution in kind.

         6.7      Restriction on Distributions.
                  ----------------------------

                  6.7.1 No distribution shall be made if, after giving effect to
the  distribution:  (a) the  Company  would not be able to pay its debts as they
become due in the usual course of business;  (b) the Company's ability to effect
its business plan over the following twelve months would be impaired; or (c) the
Company's total assets would be less than the sum of its total liabilities plus,
unless this Agreement provides otherwise, the amount that would be needed if the
Company  were to be dissolved  at the time of the  distribution,  to satisfy the
preferential rights of other Members, if any, upon dissolution that are superior
to the rights of the Member receiving the distribution.

                  6.7.2 The Manager may base a determination that a distribution
is not prohibited on 

                                       20
<PAGE>


any of the  following:  (a)  financial  statements  prepared  on  the  basis  of
generally accepted  accounting  practices and principles then generally employed
by the  Company;  (b) a  determination  of  fair  market  value  by a  qualified
unrelated third party or, if agreed to by the Members holding 100% of the Voting
Interests,  by the Manager;  or (c) any other method that is  reasonable  in the
circumstances and agreed to by Members holding 100% of the Voting Interests.

         The  effect  of  a  distribution   is  measured  as  of  the  date  the
distribution  is authorized if the payment occurs within 120 days after the date
of authorization, or the date payment is made if it occurs more than 120 days of
the date of authorization.

                  6.7.3 A Member or  Manager  who votes  for a  distribution  in
violation of this  Agreement or the Act is personally  liable to the Company for
the amount of the  distribution  that exceeds  what could have been  distributed
without violating this Agreement or the Act if it is established that the Member
or Manager did not act in  compliance  with  Section  6.7.2 or Section  9.4. Any
Member or Manager  who is so liable  shall be  entitled  to compel  contribution
from:  (a) each  other  Member or Manager  who also is so  liable;  and (b) each
Member or Manager for the amount the Member  received  with  knowledge  of facts
indicating that the  distribution was made in violation of this Agreement or the
Act.

         6.8 Return of Distributions. Except for distributions made in violation
             -----------------------
of the Act or this  Agreement,  no  Member  shall be  obligated  to  return  any
distribution  to the  Company  or pay the  amount  of any  distribution  for the
account of the  Company or to any  creditor  of the  Company.  The amount of any
distribution  returned  to the  Company  by a Member or paid by a Member for the
account of the  Company or to a creditor  of the  Company  shall be added to the
account or accounts from which it was subtracted  when it was distributed to the
Member.

         6.9 Obligations of Members to Report Allocations. The Members are aware
             --------------------------------------------
of the income tax  consequences  of the  allocations  made by this Article 6 and
hereby agree to be bound by the provisions of this Article 6 in reporting  their
shares of Company income and loss for income tax purposes.

         6.10 Withholding.  Each of the Members hereby authorizes the Company to
              -----------
withhold  from  distributions  to be made to such  Member,  or with  respect  to
allocations  to be made to such Member,  and to pay over to a federal,  state or
local  government,  any amounts required to be withheld  pursuant to the Code or
any provisions of any other federal, state or local law. Any amounts so withheld
shall be treated as  distributed  to such Member  pursuant to this Article 6 for
all  purposes  of this  Agreement  and shall be offset  against  the net amounts
otherwise  distributable  to such  Member.  The Company may also  withhold  from
distributions  that would  otherwise  be made to such  Member,  and apply to the
obligations of such Member, any amounts that such Member owes to the Company. In
addition,  any tax  imposed  upon the  Company  resulting  from  the  Membership
Interest  of any Member  shall be treated as a  distribution  to such Member and
shall be offset against future distributions to such Member.

         6.11 Status of the Company. The Members acknowledge that this Agreement
              ---------------------
creates a  partnership  for federal and state income tax purposes  (and only for
such purposes) and hereby agree not to elect to be excluded from the application
of  Subchapter  K of Chapter 1 of  Subtitle A of the Code or any  similar  state
statute.

                                       21

<PAGE>


         6.12 Tax Elections.  The Manager shall, upon the written request of any
              -------------
ember benefitted  thereby,  cause the Company to file an election under Section
754 of the Code and the Treasury  Regulations  thereunder to adjust the basis of
the  Company   assets  under  Section  734(b)  or  743(b)  of  the  Code  and  a
corresponding election under the applicable sections of state and local law. The
Manager shall have the authority to make all other Company  elections  permitted
under the Code, including elections of methods of depreciation.

         6.13 Company Tax Returns. The Manager shall cause the necessary federal
              ------------------- 
income and other tax  returns  and  information  returns  for the  Company to be
prepared.  Each Member shall provide such information,  if any, as may be needed
by the  Company  for  purposes of  preparing  such tax  returns and  information
returns.  The Manager shall deliver to each Member within ninety (90) days after
the end of each  fiscal  year a copy of the  federal  income tax returns for the
Company as filed with the appropriate taxing  authorities,  and upon the written
request of any Member, a copy of any state and local income tax return as filed.

         6.14     Certain Tax Matters.
                  -------------------

                  6.14.1 The  Manager is hereby  appointed  as the  initial  tax
matters  partner of the  Company.  The tax  matters  partner  of the  Company is
authorized  to and shall (a)  maintain  Capital  Accounts  and make  partnership
allocations  and (b) file, if necessary,  a Form 8832 with the Internal  Revenue
Service and make the election  provided for to have the Company be classified as
a partnership for federal income tax purposes. If at any time the Manager cannot
or elects not to serve as the tax matters partner of the Company,  is removed by
the Members  from  acting in such  capacity,  or ceases to be a Member,  Members
holding a Majority  Voting  Interest  shall select  another Member to be the tax
matters partner of the Company.  The tax matters  partner of the Company,  as an
authorized representative of the Company, shall direct the defense of any claims
made by the Internal  Revenue  Service or other tax authority to the extent that
such claims relate to the adjustment of Company items at the Company level.

                  6.14.2 The  Manager  shall  promptly  deliver to each Member a
copy of all  notices,  communications,  reports  or  writings  of any kind  with
respect  to income or  similar  taxes  received  from any state or local  taxing
authority relating to the Company that might materially and adversely affect any
Member, and shall keep Members advised of all material developments with respect
to any proposed adjustment of Company items that come to its attention.

                  6.14.3 Each Member shall continue to have the rights described
in this Section 6.14 with respect to tax matters  relating to any period  during
which it was a  Member,  whether  or not it is a  Member  at the time of the tax
audit or contest.

                                       22
<PAGE>


                                    ARTICLE 7
                                    =========
             Transfers of Membership Interests; Admission of Members
             =======================================================

         7.1      Transfers of Member Interests Generally.
                  ---------------------------------------

                  7.1.1 No Member shall be entitled to transfer, assign, convey,
sell,  encumber  or in any  way  alienate  all  or any  part  of  such  Person's
Membership Interest or to cause any permitted transferee to become a substituted
Member except as provided in Section 7.2, 7.3 and 7.4 below.  The consent of any
Member that is  required  pursuant  to this  Article  may be given or  withheld,
conditioned or delayed (as allowed by this Agreement or the Act), as such Member
may determine in its sole discretion.  Notwithstanding  any transfer of any part
of a Membership Interest,  the Membership Interest so transferred shall continue
to be subject to the terms and  provisions  of this  Agreement  and any  further
transfers  shall be required to comply with all the terms and provisions of this
Agreement.

                  7.1.2  Notwithstanding  any  provision of this Article 7 other
than Section 7.6.3,  no admission (or purported  admission) of a Member,  and no
transfer  (or  purported  transfer)  of all or any part of a  Member's  interest
(economic or otherwise) in the Company, whether to another Member or to a Person
not a  Member,  shall be  effective,  and any such  admission  or  transfer  (or
purported  admission or transfer)  shall be void ab initio,  and no Person shall
                                                 ---------
otherwise  become a Member if (a) at the time of such  admission or transfer (or
purported  admission or transfer)  any interest  (economic or  otherwise) in the
Company is traded on an established  securities market or readily tradeable on a
secondary  market  or the  substantial  equivalent  thereof  or (b)  after  such
admission or transfer (or  purported  admission or transfer)  the Company  would
have more than 100  Members.  For  purposes  of  clause  (a) of the  immediately
preceding  sentence,  an established  securities market is a national securities
exchange that is either  registered  under Section 6 of the Securities  Exchange
Act of 1934 or exempt from registration  because of the existence or involvement
of a limited volume of transactions,  a foreign securities  exchange that, under
the  law  of  the  jurisdiction  where  it is  organized,  satisfies  regulatory
requirements that are analogous to the regulatory requirements of the Securities
Exchange Act of 1934, a regional or local exchange,  or an interdealer quotation
system that  regularly  disseminates  firm buy or sell  quotations by identified
brokers or dealers by electronic means or otherwise. For purposes of such clause
(a), any interest (economic or otherwise) in the Company is readily tradeable on
a  secondary  market or the  substantial  equivalent  thereof  if (i)  interests
(economic or otherwise) in the Company are regularly quoted by any Person,  such
as a broker  or  dealer,  making  a market  in the  interests,  (ii) any  Person
regularly makes available to the public (including customers or subscribers) bid
or offer quotes with respect to interests (economic or otherwise) in the Company
and stands  ready to effect buy or sell  transactions  at the quoted  prices for
itself or on behalf of others,  (iii) the  holder of an  interest  (economic  or
otherwise)  in  the  Company  has a  readily  available,  regular,  and  ongoing
opportunity  to sell or  exchange  such  interest  through  a  public  means  of
obtaining  or  providing  information  of offers to buy,  sell or exchange  such
interests, or (iv) prospective buyers and sellers otherwise have the opportunity
to buy, sell or exchange  interests  (economic or otherwise) in the Company in a
time frame and with the  regularity  and  continuity  that is comparable to that
described  in clauses  (i),  (ii) and (iii) of this  sentence.  For  purposes of
determining  whether the Company  will have more than 100  Members,  each Person
indirectly  owning an interest  (economic or otherwise) in the Company through a
partnership  (including any entity  treated as a partnership  for federal income
tax purposes),  a grantor trust or an S corporation shall be treated as a Member
unless the Manager determines in its sole and absolute discretion that less than
substantially  all of the value of the beneficial  owner's  interest in any such
entity is  attributable  to 


                                       23

<PAGE>


such entity's  interest  (direct or indirect) in the Company.


         7.2  Permitted  Transfers.  A Member  shall be  permitted  to transfer,
              --------------------
assign,  convey,  sell,  encumber or  otherwise  alienate  its  economic  rights
associated with its Membership  Interest without the consent of other Members so
long as such  transaction:  (a) is not  prohibited  by Section  7.1.2 or Section
11.9, (b) would not cause a material  adverse tax  consequence to the Company or
the other  Members,  and (c) has  complied  with  Section  7.5.  If a  permitted
transfer  of a  Membership  Interest  does not  comply  with  Section  7.3 as to
admissions,  the  transferee  shall have no right to vote or  participate in the
management of the  business,  property and affairs of the Company or to exercise
any rights of a Member other than the right to receive  proceeds of a Membership
Interest.

         7.3 Admission and Substitution of Members. A new Member may be admitted
             -------------------------------------
only  if (a)  Members  holding  100% of the  Voting  Interests  consent  to such
admission;  (b) such Person  becomes a party and agrees to be bound by the terms
and  provisions  of this  Agreement;  and (c) such  Person  pays any  reasonable
expenses in  connection  with such Person's  admission as a Member.  A permitted
transferee  of a  Membership  Interest  shall have the right to be admitted as a
substitute Member only if the requirements of Sections 7.1 and 7.2 have been met
and the  conditions set forth in the prior sentence have been met. The admission
of a  substitute  Member  shall not  result in the  release  of the  Member  who
assigned the Membership Interest from any liability of such Member accrued prior
to such date.

         7.4 Family and Affiliate Transfers.  Subject to compliance with Section
             ------------------------------       
7.1,  7.2 and  7.3(b)  and (c),  the  Membership  Interest  of any Member may be
transferred  as follows,  and the  transferee  thereof  admitted as a substitute
Member without the prior written  consent of all Members but with the consent of
the Manager,  which shall not be unreasonably  withheld: (a) by inter vivos gift
or by testamentary  transfer to any spouse,  parent,  sibling,  in-law, child or
grandchild  of the  Member,  or to a trust for the benefit of the Member or such
spouse,  parent,  sibling,  in-law, child or grandchild of the Member; or (b) to
any  Affiliate  of the Member so long as such  Affiliate  is majority  owned and
controlled by such Member;  it being agreed that, in executing  this  Agreement,
each Member has consented to such transfers.

         7.5 Right of First Refusal.  Subject to Section 7.6, each time a Member
             ----------------------
proposes to transfer, assign, convey, sell, encumber, or in any way alienate all
or any part of such Person's Membership Interest, including by operation of law,
by  foreclosure  or other  involuntary  transfer  but not  including  a transfer
pursuant  to Section 7.4 or the  granting by a Member of a security  interest in
its assets generally,  such Member shall first offer such Membership Interest to
the Company and the  non-transferring  Members in accordance  with the following
provisions:

                  7.5.1 Such Member shall deliver a written  notice (a "Transfer
                                                                        --------
Notice") to the Company and the other  Members  stating:  (a) such Member's bona
-----
fide intention to transfer such Membership Interest; (b) the name and address of
the proposed transferee; (c) the Membership Interest to be transferred;  and (d)
the terms of payment for which the Member  proposes to transfer such  Membership
Interest.

                  7.5.2  Within  thirty (30) days after  receipt of the Transfer
Notice, each  non-transferring  Member shall notify the other Members in writing
of such Person's  desire to purchase a portion of the


                                       24

<PAGE>


Membership Interest being so transferred.  The failure of any Member to submit a
notice within the applicable  period shall constitute an election on the part of
that  Member not to  purchase  any of the  Membership  Interest  which may be so
transferred. Each Member so electing to purchase shall be entitled to purchase a
portion of such  Membership  Interest in the same proportion that the Membership
Interest of such Member bears to the  aggregate of the  Membership  Interests of
all of the  Members  electing  to so  purchase  the  Membership  Interest  being
transferred. In the event any Member elects to purchase none or less than all of
such Person's pro rata share of such Membership Interest, then the other Members
can elect to purchase  more than their pro rata share.  If such  Members fail to
purchase the entire Membership Interest being transferred, the Company may, with
the consent of the  non-transferring  Members,  purchase any remaining  share of
such Membership Interest.

                  7.5.3  Within  sixty (60) days after  receipt of the  Transfer
Notice,  the  Company  and the Members  electing  to  purchase  such  Membership
Interest  shall  have the first  right to  purchase  or obtain  such  Membership
Interest upon the price and terms of payment  designated in such notice. If such
notice provides for the payment of non-cash consideration,  then the Company and
such purchasing  Members each shall pay the  consideration  in cash equal to the
good  faith   estimate  of  the  present   fair  market  value  of  the  noncash
consideration offered.

                  7.5.4  If  the  Company  or the  other  Members  elect  not to
purchase or obtain all of the  Membership  Interest  designated  in such notice,
then the transferring  Member may transfer the Membership  Interest described in
the notice to the proposed transferee, providing such transfer: (a) is completed
within  thirty (30) days after the  expiration  of the  Company's  and the other
Members' right to purchase such Membership  Interest;  (b) is made substantially
on the terms  designated in the Transfer  Notice;  and (c) the  requirements  of
Section  7.2  are  otherwise  met.  If  such  Membership   Interest  is  not  so
transferred,  then the  transferring  Member must give notice in accordance with
this  Section  prior to any  other or  subsequent  transfer  of such  Membership
Interest.

         7.6      Purchase Rights; Sale of Company.  Notwithstanding anything to
                  --------------------------------
the contrary contained herein:

                  7.6.1 Valuation of the Company.  During the Valuation  Period,
                        ------------------------
Point West and the  Specified  Members shall attempt to agree upon a fair market
value of the Company as of the Valuation Date (the "Fair Market Value").  If the
                                                    -----------------
Members  are unable to agree upon the Fair  Market  Value  during the  Valuation
Period,  then,  within ten (10)  business  days  after the end of the  Valuation
Period, each of Point West, on the one hand, and the other Members, on the other
hand,  shall  appoint,  at such party's sole cost and expense,  an appraiser (a)
with at least five (5) years of experience in  appraising  businesses,  (b) with
experience appraising finance companies,  and (c) who is independent,  i.e., has
not previously  acted in any capacity for any of Point West,  Isard or McDermitt
(all of  such  qualifications,  the  "Qualifications,"  and  each  appraiser  so
appointed, an "Approved Appraiser") to estimate, in its reasonable judgment, the
Fair Market Value (each such evaluation,  an "Appraisal").  Each Appraisal shall
be completed within twenty (20) business days following the end of the Valuation
Period,  and copies of each  Appraisal  shall be delivered to Point West and the
other Members  immediately upon completion  thereof.  If, pursuant to the second
sentence of this paragraph,  only one Approved Appraiser is appointed, then such
Approved  Appraiser's  Appraisal  shall  constitute the Fair Market Value. If an
Approved  Appraiser is appointed by each of the two eligible parties pursuant to
the second sentence of this paragraph,  then such Approved Appraisers shall meet
promptly after both  Appraisals have been 

                                       25

<PAGE>

completed and delivered and attempt to agree jointly upon the Fair Market Value.
If they are unable to agree upon the Fair Market  Value within five (5) business
days  following  the  completion  of both  Appraisals,  then within the five (5)
business days thereafter such Approved  Appraisers  shall jointly select a third
appraiser with the Qualifications (such appraiser, the "Determining Appraiser"),
and  the  Determining  Appraiser,  within  ten  (10)  Business  Days  after  its
selection,  shall determine the Fair Market Value by selecting the one Appraisal
that, in its reasonable  judgment,  most  accurately and truly reflects the Fair
Market Value. After determining the Fair Market Value, the Determining Appraiser
shall immediately notify Point West and the other Members.  The other Member(s),
on the one hand, and Point West, on the other hand,  shall each bear one-half of
the costs of appointing the Determining  Appraiser and of paying the Determining
Appraiser's fee.
                  7.6.2    Purchase Rights.
                           ---------------

                           7.6.2.1 Point West's  Purchase  Right.  Following the
                                   -----------------------------
determination  of the Fair Market Value in accordance with Section 7.6.1,  Point
West shall have the first and exclusive right (the "Point West Purchase  Right")
                                                    --------------------------
to purchase all, but not less than all, of the then Membership  Interests of the
other  Members for an aggregate  purchase  price equal to the product of (a) the
Fair  Market  Value  and (b) a  fraction,  the  numerator  of  which is the then
Membership  Interests of the other Members and the  denominator  of which is the
sum of the then  Membership  Interests  of all  Members.  Point  West shall give
written  notice to the other Members of its intention to exercise the Point West
Purchase Right within thirty (30) days following the  determination  of the Fair
Market  Value in  accordance  with  Section  7.6.1;  any failure to deliver such
written  notice within such period shall  constitute an election not to exercise
the Point West Purchase  Right.  If Point West provides timely written notice of
its intention to exercise the Point West Purchase  Right,  then Point West shall
consummate  the  purchase  of the other  Members=  Membership  Interests  within
forty-five  (45) days following the giving of such notice.  Point West shall pay
the purchase price for such Membership Interests,  and otherwise consummate such
purchase, in accordance with Section 7.6.2.3.

                           7.6.2.2  Specified  Members' Purchase Right. If Point
                                    ---------------------------------
West does not give  written  notice of its  intention to exercise the Point West
Purchase Right by the end of the time period  permitted under Section 7.6.2.1 or
if, during such period, Point West gives notice of its intention not to exercise
the Point West Purchase Right (the earlier of such dates, the "Trigger  Event"),
                                                               --------------
then the Specified  Members shall, and if more than one, shall jointly,  have an
exclusive right (the "Specified  Members'  Purchase Right") to purchase all, but
                      -----------------------------------   
not less than  all,  of the then  Membership  Interests  of all  other  Members,
including  Point West, for a purchase price equal to the product of (a) the Fair
Market Value and (b) a fraction,  the numerator of which is the then  Membership
Interest of all other  Members,  including  Point West,  and the  denominator of
which is the sum of the then Membership  Interests of all Members. The Specified
Members  shall give written  notice to the other  Members of their  intention to
exercise the Specified Members= Purchase Right within thirty (30) days following
the Trigger Event; any failure to deliver such written notice within such period
shall  constitute  an election not to exercise the Specified  Members'  Purchase
Right. If the Specified Members provide timely written notice of their intention
to exercise the Specified  Members=  Purchase Right,  then the Specified Members
shall  consummate the purchase of all other  Members',  including  Point West's,
Membership  Interest  within  forty-five  (45) days following the giving of such
notice.  The Specified  Members shall pay the purchase price for such Membership
Interests,  and otherwise  consummate such purchase,  in accordance with Section
7.6.2.3.

                                       26

<PAGE>

                           7.6.2.3 Consummation of Purchase; Payment of Purchase
                                   ---------------------------------------------
Price. Any purchase of another  Member's  Membership  Interest  pursuant to this
-----
Section  7.6.2  shall  be  consummated  pursuant  to  documentation   reasonably
satisfactory  to  the  parties  to  such  purchase.  The  Members  agree  to act
reasonably in good faith and to cooperate so as to  effectuate  the purchase and
sale of Membership  Interests  pursuant to this Section 7.6.2.  The  appropriate
purchase  price  shall be paid on or before the date  specified  for the payment
thereof in this Section 7.6.2 and shall be paid in full in immediately available
federal  funds  according to such written  instructions  as are specified by the
receiving party not less than two (2) business days prior to the consummation of
the purchase or as otherwise may be agreed upon between the parties.

                  7.6.3 Sale of the Company.  If neither the Point West Purchase
                        -------------------
Right nor the other  Members=  Purchase  Right is exercised and  consummated  in
accordance with the terms hereof, then the Manager shall use its best efforts to
effect a sale of the Company which  maximizes gross proceeds to the Members as a
whole,  whether a sale of the  Membership  Interests or a sale of the  Company's
assets.  The Company shall solicit bona fide offers from third parties and shall
promptly provide written notice of such offers to the Members. Such notice shall
contain: (a) the name(s) of the proposed purchaser;  (b) the type, structure and
form of transaction  contemplated;  (c) the offered  purchase price; and (d) the
terms of the payment of the purchase  price.  Upon receipt of such notice by the
Members,  the Members shall consider the proposed offer. The Members,  on behalf
of the Company,  shall have fourteen (14) calendar days from the date of receipt
of such notice to irrevocably  notify the Manager of their decision to accept or
reject such  offer;  if all of the  Members  shall not reject the third  party's
offer within such time period, the Members shall be deemed to have accepted such
offer.  If the Members shall have elected or be deemed to have elected to accept
an offer from a third party, then the Manager,  on behalf of the Company,  shall
take all steps  that are  reasonably  necessary  (including  the  execution  and
delivery of definitive purchase  documentation in form and substance  acceptable
to the Manager) to effect the purchase by such third party of the Company.

                                       27
<PAGE>


                                    ARTICLE 8
                                    =========    
                       Accounting, Records, and Reporting
                       ===================================


         8.1 Books and Records. The Company shall maintain complete and accurate
             -----------------
books and  records of the  Company's  business  and affairs in  accordance  with
generally accepted accounting  principles,  consistently  applied. The books and
records shall be  maintained  at the principal  place of business of the Company
and shall be accessible to the Members in accordance with the Act.

         8.2 Fiscal Year;  Accounting.  The  Company's  fiscal year shall be the
             -----------
calendar  year.  The  accounting  methods and  principles  to be followed by the
Company shall be those selected from time to time by the Manager and approved in
advance by Members holding 100% of the Voting Interests.

         8.3  Reports.   The  Company  shall  provide  to  the  Members  reports
              -------
concerning  the financial  condition and results of operation of the Company and
the  Members'  Capital  Accounts  within  ninety (90) days after the end of each
fiscal year and interim operating reports at least quarterly.

         8.4 Bank Accounts.  The Manager shall maintain the funds of the Company
             ------------       
in one or more  separate  bank accounts in the name of the Company and shall not
permit the funds of the Company to be  commingled  in any fashion with the funds
of any other Person. The funds of the Company shall be deposited in such bank or
other  financial   institution   account  or  accounts,   or  invested  in  such
interest-bearing or non-interest-bearing  investments, as shall be designated by
the  Manager in  investments  that are at least  rated  investment  grade by one
nationally  recognized  statistical rating agency. All withdrawals from any such
bank account(s) shall be made only by the Manager or by such Persons as are duly
appointed by the Manager.


                                       28
<PAGE>


                                    ARTICLE 9
                                    =========
                           Dissolution and Winding Up
                           --------------------------

         9.1  Dissolution.  The Company shall be dissolved,  its assets shall be
              -----------
disposed  of, and its affairs  wound up on the first to occur of the  following:
(a) upon the happening of any event of dissolution specified in the Certificate;
(b) 90 days after the  occurrence  of a  Dissolution  Event with  respect to any
Member  unless the  remaining  Members  vote within such 90 days to continue the
Company;  (c) upon the entry of a decree of judicial dissolution pursuant to the
Act; (d) 60 days after the vote of Members  holding a Majority in Interest or of
non-defaulting  Members  holding a majority of the Membership  Interests held by
all  non-defaulting  Members  (provided  that the Members  shall not vote for or
consent to a dissolution  or winding up of the Company if  prohibited  under any
agreement  or contract to which the Company is a party);  or (e) the sale of all
or substantially all of the assets of Company.

         9.2  Certificate  of  Dissolution.  As soon as possible  following  the
              ----------------------------
occurrence  of any of the events  specified in Section 9.1, the Manager,  to the
extent it has not wrongfully dissolved the Company, or, if so, then the Members,
shall execute a Certificate  of  Dissolution in such form as shall be prescribed
by the Delaware  Secretary of State and file such certificate as required by the
Act.

         9.3 Winding Up. Upon the  occurrence of any event  specified in Section
             ----------
9.1, the Company shall continue solely for the purpose of winding up its affairs
in an orderly manner,  liquidating its assets,  and satisfying the claims of its
creditors.  The  Manager,  to the  extent it has not  wrongfully  dissolved  the
Company,  or, if so, then the Members,  shall be responsible  for overseeing the
winding up and liquidation of Company. The Persons winding up the affairs of the
Company shall be entitled to such  reasonable  compensation as has been approved
by the Members.

         9.4 Distributions in Kind. Any noncash asset distributed to one or more
             ---------------------
Members  shall first be valued at its fair  market  value to  determine  the Net
Profit or Net Loss that  would  have  resulted  if such asset were sold for such
value,  such Net Profit or Net Loss shall then be allocated  pursuant to Article
6,  and the  Members'  Capital  Accounts  shall  be  adjusted  to  reflect  such
allocations.  The amount  distributed and charged to the Capital Account of each
Member receiving an interest in such distributed  asset shall be the fair market
value of such  interest  (net of any  liability  secured by such asset that such
Member  assumes or takes  subject to). The fair market value of such asset shall
be determined by a qualified  unrelated  third party, or if Members holding 100%
of the Voting Interest shall agree, the Manager.

         9.5  Distribution of Assets.  Upon the dissolution or winding up of the
              ----------------------
Company,  the Manager shall pay or make  reasonable  provision to pay all claims
and  obligations  of the  Company,  including  all  costs  and  expenses  of the
liquidation and all contingent, conditional, or unmatured claims and obligations
that are known to the  Manager  but for which the  identity  of the  claimant is
unknown.  If there are sufficient assets, then such claims and obligations shall
be paid in full and any such  provision  shall  be made in  full.  If there  are
insufficient  assets, then such claims and obligations shall be paid or provided
for  according to their  priority  and,  among claims and  obligations  of equal
priority,  ratably to the extent of assets  available  therefor.  Any  remaining
assets shall be distributed to the Members in accordance  with their  respective
positive  Capital  Accounts,  after giving effect to all Capital  Contributions,
distributions, and allocations for all periods.

         9.6  Limitations on Payments Made in  Dissolution.  Except as otherwise
              --------------------------------------------
specifically  

                                       29
<PAGE>

provided in this Agreement, each Member shall only be entitled to look solely at
the assets of Company for the return of such Member's  positive  Capital Account
balance and shall have no recourse for such  Member's  Capital  Contribution  or
share of Net Profits (upon dissolution or otherwise)  against the Manager or any
other Member except as provided in Article 10.



                                       30
<PAGE>


                                   ARTICLE 10
                                   ==========
                          Indemnification and Insurance
                          =============================

         10.1 Indemnification of Agents. To the fullest extent permitted by law,
              -------------------------
the Company  shall be permitted to indemnify any Person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit,  or  proceeding by reason of the fact that such Person is or was a Member,
Manager, officer, employee, attorney,  accountant, or other agent of the Company
or that,  being or  having  been  such a  Manager,  Member,  officer,  employee,
attorney,  accountant,  or other  agent of the  Company,  such  Person is or was
serving at the request of the Company as a manager, director, officer, employee,
attorney,  accountant,  or other  agent of another  limited  liability  company,
corporation,  partnership,  joint venture,  trust, or other enterprise (any such
Person being  referred to hereinafter as an  "Indemnified  Person")  against all
                                              -------------------
claims, damages, liabilities,  losses, expenses (including reasonable attorneys=
fees and  expenses  and other  costs and  expenses  incurred in  defending  such
action, suit, or proceeding),  judgments,  fines, and amounts paid in settlement
actually  incurred by such  Indemnified  Person in connection  with such action,
suit,  or  proceeding,   except  to  the  extent  that  such  claims,   damages,
liabilities,  losses, expenses,  judgments, fines, or amounts paid in settlement
arise by virtue of such Indemnified Person's fraud, deceit, gross negligence, or
willful  misconduct.  The Manager is  authorized,  on behalf of the Company,  to
enter into indemnity agreements from time to time with any Person entitled to be
indemnified  by the Company  hereunder  (i)  consistent  with the  foregoing (or
lesser) terms, or (ii) on such other terms as Members holding 100% of the Voting
Interests may approve.

         10.2  Expenses.  Expenses  (including  attorneys'  fees  and  expenses)
               -------
incurred   by  an   Indemnified   Person  in   defending   a  civil,   criminal,
administrative,  or investigative action, suit, or proceeding may be paid by the
Company in advance of the final disposition of such action,  suit, or proceeding
upon receipt of an undertaking, in form and substance acceptable to the Manager,
by or on  behalf of the  Indemnified  Person  to repay  such  amount if it shall
ultimately  be  determined  that such  Indemnified  Person is not entitled to be
indemnified  by the Company under this Article 10 or under any other contract or
agreement  between  such  Indemnified  Person  and the  Company.  Such  expenses
(including  attorneys' fees and expenses) incurred by employees or agents of the
Company may be so paid upon the receipt of the undertaking  previously  referred
to  and  such  other  terms  and  conditions,  if  any,  as  the  Manager  deems
appropriate.

         10.3 Not Exclusive.  The  indemnification  and  advancement of expenses
              -------------
provided by this Article 10 shall not be deemed exclusive of any other rights to
which those seeking  indemnification  or advancement of expenses may be entitled
under any by-law,  agreement, vote of Members or otherwise, both as to action in
such Indemnified Person's official capacity and as to action in another capacity
while holding such office,  and shall  continue as to a Person who has ceased to
be a Member, Manager, officer,  employee,  attorney,  accountant, or other agent
and shall inure to the benefit of the successors,  assigns, heirs, executors and
administrators of such a Person.

         10.4  Insurance.  The  Company  shall  have the power to  purchase  and
               ---------
maintain  insurance on behalf of any Person who is or was an Indemnified  Person
against any liability  asserted  against such Person and incurred by such Person
in any such capacity,  or arising out of such Person's  status as an Indemnified
Person, whether or not the Company would have the power to indemnify such Person
against such liability under the provisions of Section 10.1 or under  applicable
law.

                                       31
<PAGE>


                                   ARTICLE 11
                                   ==========
                           Investment Representations
                           ==========================

         Each Member  represents  and warrants  to, and agrees  with,  the other
Members and the Company as follows:

         11.1  Pre-existing  Relationship  or Experience.  (a) Such Member has a
               -----------------------------------------
preexisting personal or business relationship with the Company or one or more of
the other  Members;  or (b) by reason of such  Member's  business  or  financial
experience,  or by  reason  of the  business  or  financial  experience  of such
Member's  financial advisor who is unaffiliated with and who is not compensated,
directly or indirectly,  by the Company or any affiliate or selling agent of the
Company,  such  Member is  capable  of  evaluating  the risks and  merits of the
investment to be made by such Person  hereunder and of protecting  such Person's
interests in connection with such investment.

         11.2 No Advertising. Such Member has not seen, received, been presented
              --------------
with, or been solicited by any leaflet, public promotional meeting, newspaper or
magazine article or  advertisement,  radio or television  advertisement,  or any
other form of  advertising or general  solicitation  with respect to the sale of
the Membership Interests.

         11.3 Investment Intent.  Such Member is acquiring a Membership Interest
              -----------------
for  investment  purposes and for such  Person's own account only and not with a
view to, or for sale in connection  with, any distribution of all or any part of
the Membership  Interests,  and no other Person will have any direct or indirect
beneficial  interest in or right to the Membership  Interests  purchased by such
Person except as permitted hereby.

         11.4 Purpose of Entity.  If such Member is a corporation,  partnership,
              -----------------
limited liability company,  trust, or other entity, then (a) such Member was not
organized for the specific  purpose of acquiring any Membership  Interests,  and
(b) such Member may legally acquire, invest in and own Membership Interests, and
(c) such Member may legally act as Manager of the Company.

         11.5  Economic  Risk.  Such  Member  is  financially  able to bear  the
               --------------
economic risk of the investment  being made by such Member,  including the total
loss of such Person's Membership Interests.

         11.6 No Registration of Membership Interests.  Such Member acknowledges
              ---------------------------------------
that: (a) the sale of the Membership  Interests  referred to herein has not been
registered  under the  Securities  Act or qualified  under the Delaware  General
Corporation Law, as amended, or any other applicable securities or blue sky laws
of  any  state  or  jurisdiction   in  reliance,   in  part,  on  such  Member's
representations,  warranties,  and  agreements  contained  herein;  and  (b) the
Membership Interests may not be resold unless the resale is registered under the
Securities Act and qualified  under all  applicable  securities or blue sky laws
(or is exempt from these registration and qualification requirements).

         11.7  Membership  Interests  are  Restricted  Securities.  Such  Member
               --------------------------------------------------
understands  that the Membership  Interests are or may be restricted  securities
under the Securities Act in that the Membership  Interests will be acquired from
the  Company in a  transaction  not  involving a public  offering,  and that the
Membership Interests may be resold without registration under the Securities Act
only  in  certain  limited  circumstances  and  that  otherwise  the  Membership
Interests must be held indefinitely. In this connection, 

                                       32
<PAGE>


such Member understands the resale limitations imposed by the Securities Act and
is familiar with SEC Rule 144, as presently in effect,  and the conditions which
must be met in order  for that Rule to be  available  for  resale of  restricted
securities,  including the  requirement  that the securities must be held for at
least two (2) years after  purchase  thereof  from the  Company  prior to resale
(three (3) years in the  absence of  publicly  available  information  about the
Company)  and the  condition  that  there be  available  to the  public  current
information  about  the  Company  under  certain   circumstances.   Such  Member
understands  that the Company  has not made such  information  available  to the
public and has no present plans to do so.

         11.8 No Obligation to Register.  Such Member represents,  warrants, and
              --------------------------
agrees  that the  Company  and the  other  Members  are under no  obligation  to
register or qualify the Membership  Interests  under the Securities Act or under
any state  securities  or blue sky laws,  or to assist such Member in  complying
with any exemption from registration and qualification.

         11.9  No  Disposition  in  Violation  of  Law.   Without  limiting  the
               ---------------------------------------
representations set forth above or the other provisions of this Agreement,  such
Member  shall  not make  any  disposition  of all or any  part of such  Person's
Membership  Interests  which would result in the  violation by such Person or by
the Company of the Securities Act, the Act, Delaware General Corporation Law, as
amended,  or any other applicable  securities or blue sky laws. Without limiting
the generality of the foregoing,  such Member agrees not to make any disposition
of all or any part of the  Membership  Interests  acquired by such Person unless
and  until:  (a)  there is then in  effect a  registration  statement  under the
Securities Act covering such proposed  disposition and such  disposition is made
in accordance with such registration  statement and any applicable  requirements
of state  securities  laws;  or (b) such Person has  notified the Company of the
proposed  disposition and has furnished the Company with a detailed statement of
the  circumstances  surrounding  the proposed  disposition,  and, if  reasonably
requested by the other  Members,  such Person has  furnished  the Company with a
written opinion of counsel,  reasonably  satisfactory to the Company,  that such
disposition will not require registration of any securities under the Securities
Act or the  consent  of or a  permit  from  appropriate  authorities  under  any
applicable state securities law.

         In the  case of any  disposition  of all or any  part of such  Member's
Membership  Interests  pursuant to SEC Rule 144, such Person shall,  among other
things,  promptly  forward to the  Company a copy of any Form 144 filed with the
SEC with  respect to such  disposition  and a letter from the  executing  broker
satisfactory to the Company evidencing compliance with SEC Rule 144. If SEC Rule
144 is amended or if the SEC's interpretations  thereof in effect at the time of
any such disposition have changed from its present interpretations thereof, such
Member  shall  provide the Company with such  additional  documents as the other
Member or the Company may reasonably require.

         11.10 Legends.  Such Member  understands that the certificates (if any)
               -------
evidencing the Membership Interests may bear one or all of the following legends
or other legends as may be appropriate:

                  (a)  "THESE  SECURITIES  HAVE NOT BEEN  REGISTERED  UNDER  THE
SECURITIES  ACT OF 1933, AS AMENDED,  OR QUALIFIED  UNDER THE SECURITIES OR BLUE
SKY LAWS OF ANY STATE OR JURISDICTION, INCLUDING THE STATE OF DELAWARE, AND HAVE
BEEN TAKEN BY THE ISSUEE FOR SUCH  PERSON'S OR ENTITY'S OWN ACCOUNT AND NOT WITH
A VIEW TO THEIR  DISTRIBUTION.  NEITHER SUCH SECURITIES 

                                       33
<PAGE>


NOR ANY  INTEREST  THEREIN  MAY BE  SOLD,  ASSIGNED,  PLEDGED,  HYPOTHECATED  OR
OTHERWISE  DISPOSED OF UNLESS THEY ARE  REGISTERED  UNDER SUCH ACT AND QUALIFIED
UNDER ALL APPLICABLE  SECURITIES AND BLUE SKY LAWS, OR IN THE OPINION OF COUNSEL
TO THE COMPANY,  EXEMPTIONS FROM  REGISTRATION AND  QUALIFICATION ARE AVAILABLE.
THESE  SECURITIES  ARE ALSO  SUBJECT TO CERTAIN  RESTRICTIONS  DESCRIBED  IN THE
AMENDED AND RESTATED LIMITED  LIABILITY COMPANY AGREEMENT DATED AS OF JANUARY 1,
1998, AS AMENDED FROM TIME TO TIME."

                  (b) Any legend required by applicable state securities or blue
sky laws.

         11.11  Investment  Risk.  Such Member  acknowledges  that such Member's
                ----------------
investment  as provided for herein is a speculative  investment  that involves a
substantial  degree  of risk of loss by such  Member,  including  such  Person's
entire  investment in the Company,  that such Member  understands and takes full
cognizance  of the risk factors  related to such  Person's  investment  outlined
herein,  and that  the  Company  is  newly  organized  and has no  financial  or
operating history.

         11.12 Investment Experience. Unless otherwise disclosed, such Member is
               ---------------------
an  experienced   investor  in   unregistered   and  restricted   securities  of
corporations, limited liability companies, limited partnerships, or closely held
companies.

         11.13 Restrictions on  Transferability.  Such Member  acknowledges that
               --------------------------------
there are  substantial  restrictions  on the  transferability  of the Membership
Interests  pursuant to this  Agreement,  that there is no public  market for the
Membership Interests and none is expected to develop, and that, accordingly,  it
may not be possible for such Member to liquidate such Member's investment in the
Company.

         11.14 Information  Reviewed.  Such Member has received and reviewed all
               ---------------------
information such Person considers  necessary or appropriate for deciding whether
to make  the  investment  contemplated  hereby,  has had an  opportunity  to ask
questions and receive  answers from the Company and the other Members  regarding
the terms and conditions of the investments  contemplated  hereby (including the
purchase of the  Membership  Interests)  and regarding  the business,  financial
affairs, and other aspects of the Company, and has had the opportunity to obtain
all  information  (to the extent  the  Company  possesses  or can  acquire  such
information  without  unreasonable  effort or expense)  which such Person  deems
necessary to evaluate the  investment  and to verify the accuracy of information
otherwise provided to such Person.

         11.15 No Representations by the Company.  Neither any Manager,  nor any
               ---------------------------------
agent or employee of the Company or of any Manager,  nor any other Person has at
any time expressly or implicitly represented,  guaranteed,  or warranted to such
Member  that such Member may freely  transfer  any of the  Membership  Interests
acquired by such Member pursuant to the terms hereof,  that past  performance or
experience  on the part of any such  Person  or their  Affiliates  or any  other
Person in any way  indicates  the  predictable  results of the  ownership of the
Membership  Interests  or  of  the  overall  Company  business,  that  any  cash
distributions  from  Company  operations  or  otherwise  will  be  made  to  the
Membership  Interests by any  specific  date or will be made at all, or that any
specific tax benefits will accrue as a result of an investment in the Company.


                                       34

<PAGE>

         11.16  Consultation  with  Attorney.  Such  Member has been  advised to
                ----------------------------
consult with such Member's own attorney  regarding all legal matters  concerning
an  investment  in the  Company  and  the  tax  consequences  of  investing  and
participating in the Company and has either done so or voluntarily and knowingly
elected not to seek such advice.

         11.17 Tax  Consequences;  Consultation  with Tax Advisors.  Such Member
               ---------------------------------------------------
acknowledges  that  the tax  consequences  to such  Member  of the  transactions
contemplated hereby will depend on such Member's particular  circumstances,  and
neither the Company,  nor the Manager,  nor the other Members, nor the partners,
shareholders,   members,  managers,  agents,  officers,  directors,   employees,
Affiliates,  attorneys,  accountants  or  consultants  of any of  them  will  be
responsible or liable for the tax  consequences to such Member of its investment
or participation in the Company unless otherwise  expressly agreed.  Such Member
has and will look solely to, and rely upon,  such Member's own tax advisors with
respect to the tax  consequences  of its  investment  and  participation  in the
Company.

         11.18  Indemnity.  Such Member shall  indemnify  and hold  harmless the
                ---------
Company,  each and every Manager, each and every other Member, and any officers,
directors,   shareholders,   managers,  members,  employees,  partners,  agents,
attorneys, accountants,  registered representatives,  and control persons of any
such  entity  who was or is a party or is  threatened  to be made a party to any
threatened,  pending, or completed action,  suit, or proceeding,  whether civil,
criminal,  administrative,  or  investigative,  by reason of or arising from any
misrepresentation  or  misstatement  of facts or omission to  represent or state
facts made by such Member, including the information in this Agreement,  against
losses,  liabilities,  and expenses of the Company, each and every Manager, each
and every other Member,  and any officers,  directors,  shareholders,  managers,
members,  employees,  partners,  attorneys,   accountants,   agents,  registered
representatives,  and control persons of any such Person  (including  attorneys'
fees,  judgments,  fines,  and amounts paid in settlement,  payable as incurred)
incurred by such Person in connection with such action, suit, proceeding, or the
like.

                                       35

<PAGE>


                                   ARTICLE 12
                                   ==========
                               General Provisions
                               ==================

         12.1 Further Assurances. Each party to this Agreement shall perform any
              ------------------
further  acts and  execute  and deliver  any  additional  documents  that may be
reasonably necessary to carry out the provisions of this Agreement.

         12.2 Time.  Time is of the essence in the performance of all provisions
              ----
under this Agreement.

         12.3  Remedies  Cumulative.  The  remedies  under  this  Agreement  are
               --------------------
cumulative  and shall not exclude any other  remedies to which any person may be
lawfully entitled.

         12.4  Estoppel  Certificate.  Each Member  shall,  within ten (10) days
               ---------------------
after written request by any Manager or other Member,  deliver to the requesting
Person  a  certificate  stating,  to the  Member's  knowledge,  that:  (a)  this
Agreement is in full force and effect;  (b) this Agreement has not been modified
except by any instrument or instruments  identified in the certificate;  and (c)
there  is no  default  hereunder  by the  requesting  Person  or,  if there is a
default, the nature or extent thereof.

         12.5  Specific  Performance.  The parties  recognize  that  irreparable
               ---------------------
injury will result from a breach of any  provision  of this  Agreement  and that
money damages will be inadequate to fully remedy the injury. Accordingly, in the
event of a breach or threatened  breach of one or more of the provisions of this
Agreement, any party who may be injured (in addition to any other remedies which
may be available to that party) shall be entitled to one or more  preliminary or
permanent orders: (a) restraining and enjoining any act which would constitute a
breach;  or (b) compelling  the  performance  of any  obligation  which,  if not
performed, would constitute a breach.

         12.6 Authority of Persons Signing Agreement. Each Member represents and
              --------------------------------------
warrants  to the other  Members  that it is duly  authorized  to enter into this
Agreement and that the Agreement is valid,  binding and enforceable as to it. If
a Member is not a natural  person,  neither the Company nor any Member will: (a)
be required to determine the authority of the individual  signing this Agreement
to make any  commitment or  undertaking on behalf of such Person or to determine
any fact or  circumstance  bearing upon the  existence of the  authority of such
individual;  or (b) be  responsible  for  the  application  or  distribution  of
proceeds  paid or credited to  individuals  signing this  Agreement on behalf of
such Person.

         12.7  Parties in  Interest.  Except as  expressly  provided in the Act,
               --------------------
nothing in this Agreement shall confer any rights or remedies under or by reason
of this  Agreement  on any Persons  other than the Members and their  respective
successors and assigns nor shall anything in this Agreement relieve or discharge
the obligation or liability of any other Person to any party to this  Agreement,
nor shall any provision give any other Person any right of subrogation or action
over or against any party to this Agreement.

         12.8 Notices.  All notices  required to be given to any party hereunder
              -------
shall be deemed given upon the first to occur of: (a) either (i) five days after
deposit thereof in the United States mail,  certified mail,  First Class postage
prepaid or (ii)  forty-eight  (48) hours after  delivery to an aviation  express
delivery  service;  and  transmittal  by  electronic  means (with a copy sent by
regular United States mail) to a receiver under the control of the party to whom
notice is being  given;  or (b) actual  receipt  by the party 

                                       36

<PAGE>


to whom notice is being given, or an employee or agent of thereof.  For purposes
hereof, the addresses of the parties are as set forth on Schedule I hereof or as
                                                         -----------   
may  otherwise  be  specified  from time to time in a writing  sent to the other
parties in accordance with the provisions of this Section.
 

        12.9  Amendments  and Waivers.  The provisions of this Agreement may be
               ------------------------
waived, altered,  amended, or repealed in whole or in part only upon the written
consent of the  Members as  provided  in Section  4.9.  Any waiver of any of the
terms hereof shall only be valid and  effective in the instance  given and shall
not be valid or effective in any other  instance.  No waiver of any of the terms
hereof  shall  require  or imply  that a like  waiver  will be made in any other
instance(s).  Copies of all proposed  waivers or amendments to this Agreement or
the Certificate shall be delivered to all Members 3 days prior to their becoming
effective.

         12.10 Severability of Provisions.  If any one or more of the provisions
               --------------------------
contained in this Agreement is held to be invalid,  illegal, or unenforceable in
any respect,  then such provision(s)  shall be ineffective only to the extent of
such prohibition or invalidity,  and the validity,  legality, and enforceability
of the remaining provisions contained herein shall not in any way be affected or
impaired thereby.

         12.11 Successors and Assigns. Subject to the provisions hereof relating
               ----------------------
to  transferability,  this Agreement  shall be binding on and shall inure to the
benefit of the parties hereto and their respective heirs, legal representatives,
successors, and assigns.

         12.12  Counterparts;  Amendment and  Restatement;  Effectiveness.  This
                ---------------------------------------------------------
Agreement may be signed in any number of counterparts, each of which shall be an
original,  with  the  same  effect  as if all  signatures  were  upon  the  same
instrument.  Delivery of an original executed  counterpart of the signature page
to this Agreement by  telefacsimile  shall be effective as manual delivery of an
original  executed  original  counterpart  of  this  Agreement,  and  any  party
delivering such an original  executed  counterpart of the signature page to this
Agreement by  telefacsimile  to any other party shall  thereafter  also promptly
deliver an original  executed  counterpart of this Agreement to such other party
by mail or  personal  delivery,  provided  that the  failure to so deliver  such
                                 --------
original executed counterpart shall not affect the validity,  enforceability, or
binding  effect of this  Agreement.  This  Agreement  amends  and  restates  the
Original Agreement in its entirety.  This Agreement shall become effective as of
the date first  written  above upon the  execution and delivery of a counterpart
hereof by each of Point West, Isard, and McDermitt.

         12.13 Legal Counsel and Representation; Accountants. The parties hereto
               ---------------------------------------------
have agreed to the  preparation  of this  Agreement  by  Giancarlo  & Gnazzo,  A
Professional Corporation,  counsel for Point West, not withstanding any conflict
of  interest(s)  that may exist between or among any of the other parties hereto
or the  Company.  Each  Member  who is a party  hereto  and not  represented  by
Giancarlo & Gnazzo, A Professional  Corporation  further  acknowledges that such
Person has been advised to seek advice of such Person's own independent  counsel
regarding  the  transactions  contemplated  herein  and  has  either  done so or
voluntarily  and  knowingly  elected not to seek such  advice.  Each such Person
further  acknowledges that this Agreement and any other  agreements,  documents,
and instruments  referenced herein may have tax consequences for such Person and
that such Person has been advised to seek advice of  independent  accountants or
other tax advisors as to such matters and has either done so or voluntarily  and
knowingly elected not to seek such advice.
         12.14 Ambiguities.  The parties have carefully read all of the terms of
                -----------
  this  Agreement  and all                                     

                                       37

<PAGE>


              
of the agreements  attached  hereto and have had an opportunity to ask questions
regarding the language used therein and to suggest changes  thereto.  Therefore,
the parties waive any rule of construction  that ambiguities are to be construed
more harshly against any party as drafter.

         12.15 Fees, Costs, and Expenses;  Recovery. The prevailing party in any
               ------------------------------------
action, proceeding or arbitration arising out of or related to this Agreement or
any agreement,  document, or instrument referred to herein, shall be entitled to
reasonable fees,  costs,  and expenses  (including  reasonable  attorneys' fees,
costs, and expenses)  incurred by or on behalf of such Person in connection with
such action or proceeding, as determined by the court or arbitrator(s).

         12.16 Complete Agreement. This Agreement and the Certificate constitute
               ------------------
the complete and exclusive statement of agreement among the Members with respect
to the subject  matter  herein and therein and replace and  supersede  all prior
written and oral  agreements,  representations,  or  statements by and among the
Members or any of them. No representation,  statement, condition or warranty not
contained in this Agreement or the Certificate will be binding on the Members or
have any force or effect  whatsoever.  To the extent that any  provision  of the
Certificate  conflicts  with any provision of this  Agreement,  the  Certificate
shall control.

         12.17 Arbitration.  ANY CONTROVERSY OR CLAIM BETWEEN THE PARTIES HERETO
               -----------
ARISING OUT OF OR RELATING TO THIS  AGREEMENT  OR ANY  TRANSACTION  CONTEMPLATED
HEREUNDER, INCLUDING, WITHOUT LIMITATION, THE CONSTRUCTION OR APPLICATION OF ANY
OF THE TERMS,  COVENANTS,  OR CONDITIONS OF THIS  AGREEMENT,  SHALL,  ON WRITTEN
REQUEST OF ONE PARTY  SERVED UPON THE OTHER,  BE  SUBMITTED TO FINAL AND BINDING
ARBITRATION  GOVERNED  BY THE  COMMERCIAL  ARBITRATION  RULES  OF  THE  AMERICAN
ARBITRATION ASSOCIATION AND, TO THE EXTENT NOT INCONSISTENT, THE CALIFORNIA CODE
OF CIVIL PROCEDURE.  THE ARBITRATOR  SHALL MAKE THE  DETERMINATION AS TO WHETHER
THE  CONTROVERSY  IS SUBJECT TO THIS  ARBITRATION  PROVISION;  IN ADDITION,  THE
ARBITRATOR  SHALL HAVE THE POWER TO ISSUE  INJUNCTIVE  RELIEF.  THE  ARBITRATION
SHALL TAKE PLACE IN THE CITY OF SAN FRANCISCO, CALIFORNIA AND SHALL BE CONDUCTED
BY ONE (1) ARBITRATOR.  EACH OF THE PARTIES  SPECIFICALLY  ACKNOWLEDGES THAT THE
OTHER PARTY IN SUCH ARBITRATION  SHALL HAVE THE RIGHT TO DISCOVERY.  ARBITRATION
SHALL BE THE EXCLUSIVE REMEDY OF EACH OF THE PARTIES  HEREUNDER AND ANY AWARD OF
THE ARBITRATOR(S)  SHALL BE FINAL AND BINDING UPON THE PARTIES HERETO.  JUDGMENT
UPON THE ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.

         12.18 Governing Law.  EXCEPT AS  SPECIFICALLY  STATED IN SECTION 12.17,
               --------------
THIS AGREEMENT AND ALL TRANSACTIONS  CONTEMPLATED  HEREUNDER OR EVIDENCED HEREBY
SHALL BE GOVERNED  BY,  CONSTRUED  UNDER,  AND ENFORCED IN  ACCORDANCE  WITH THE
INTERNAL LAWS OF THE STATE OF DELAWARE.

                                       38

<PAGE>



         IN WITNESS  WHEREOF,  all of the Members of the Company  have  executed
this Agreement as of the date first written above.



                                           POINT WEST CAPITAL CORPORATION

                                           By: /s/ Alan B. Perper
                                               ---------------------------------
                                           Title: President
                                               ---------------------------------

                                             /s/ Michael W. McDermitt
                                             ----------------------------------
                                             MICHAEL W. McDERMITT, an individual



                                             /s/ Daniel M. Isard
                                             ----------------------------------
                                             DANIEL M. ISARD, an individual









<PAGE>



                  LIMITED LIABILITY COMPANY OPERATING AGREEMENT
                  ---------------------------------------------
                                       OF
                                       --
                             ALLEGIANCE CAPITAL, LLC
                             -----------------------


                                   SCHEDULE I
                                   ==========


Member Information                                 Member's Percentage Interest
==================                                 =============================
Point West Capital Corporation                            65%
         c/o Dignity Partners, Inc.                       
        1700 Montgomery Street, Suite 250
         San Francisco, CA  94111
         Attn:  Alan Perper

         TIN: 94-3165263
         Telephone Number:  (415) 394-9467
         Facsimile Number:  (415) 394-9471

Michael W. McDermitt                                      15%
         c/o Allegiance Capital, LLC
         1700 Montgomery Street, Suite 250
         San Francisco, CA  94111

         SSN: ###-##-####
         Telephone Number:  (415) 394-5180
         Facsimile Number:  (415) 394-9471

Daniel M. Isard                                           20%
         c/o Foresight Analysts, Inc.
         5353 N. 16th Street, Suite 370
         Phoenix, AZ  85016

         SSN: ###-##-####
         Telephone Number:  (602) 274-6464
         Facsimile Number:  (602) 277-6722

         with a copy to:
         Renee Gerstman, Esq.
         Gerstman & Associates, PC
         5353 N.  16th Street, Suite  320
         Phoenix, AZ 85016
         Facsimile Number: 602-265-9415