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                               FINANCING AGREEMENT

                       THE CIT GROUP/BUSINESS CREDIT, INC.

                                   (AS LENDER)

                                       AND

                           PENWEST PHARMACEUTICALS CO.

                                  (AS BORROWER)

                             DATED: JANUARY 17, 2001


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                                TABLE OF CONTENTS

<TABLE>
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                                                                          Page
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SECTION 1.   DEFINITIONS......................................................3

SECTION 2.   CONDITIONS PRECEDENT............................................12

SECTION 3.   REVOLVING LOANS.................................................15

SECTION 4.   INTENTIONALLY OMITTED...........................................19

SECTION 5.   INTENTIONALLY OMITTED...........................................19

SECTION 6.   COLLATERAL......................................................19

SECTION 7.   REPRESENTATIONS, WARRANTIES AND COVENANTS.......................32

SECTION 8.   INTEREST, FEES AND EXPENSES.....................................27

SECTION 9.   POWERS..........................................................30

SECTION 10.  EVENTS OF DEFAULT AND REMEDIES..................................30

SECTION 11.  TERMINATION.....................................................34

SECTION 12.   MISCELLANEOUS..................................................34
</TABLE>


EXHIBIT

SCHEDULES

Schedule 1 -Collateral Information


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         THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, with
offices located at 1211 Avenue of the Americas, 22nd Floor, New York, New York
10036 (hereinafter "CIT") is pleased to confirm the terms and conditions under
which CIT shall make revolving loans and other financial accommodations to
Penwest Pharmaceuticals Co., a Washington corporation with a principal place of
business at 2981 Route 22, Patterson, New York 12563-9970 (herein the
"Company").

SECTION 1. DEFINITIONS

ACCOUNTS shall mean all of the Company's now existing and future: (A) accounts
(as defined in the UCC) due from customers located in the United States or
Canada, and any and all other receivables (whether or not specifically listed on
schedules furnished to CIT), including, without limitation, all accounts created
by, or arising from, all of the Company's sales, leases, rentals of goods or
renditions of services to its customers located in the United States or Canada,
and further including but not limited to, those accounts arising under any of
the Company's trade names or styles, or through any of the Company's divisions
and further including remaining amounts due from Mylan Pharmaceuticals Inc.
pursuant to Section 7 of a Letter of Agreement of February 25, 2000 between
Mylan Pharmaceuticals Inc. and Company; (B) any and all instruments, documents,
chattel paper (including electronic chattel paper) (all as defined in the UCC)
arising from the sale of Inventory or the collection of Accounts; (C) unpaid
seller's or lessor's rights (including rescission, replevin, reclamation,
repossession and stoppage in transit) relating to the foregoing or arising
therefrom; (D) rights to any goods represented by any of the foregoing,
including rights to returned, reclaimed or repossessed goods; (E) reserves and
credit balances arising in connection with or pursuant hereto; (F) guarantees,
supporting obligations, payment intangibles and letter of credit rights (all as
defined in the UCC) arising from the sale of Inventory or the collection of
Accounts; (G) insurance policies or rights relating to any of the foregoing; (H)
general intangibles constituting rights to payment pertaining to any and all of
the foregoing (including all rights to payment, including those arising in
connection with bank and non-bank credit cards), and including books and records
and any electronic media and software relating thereto; (I) notes, deposits or
property of account debtors securing the obligations of any such account debtors
to the Company; and (J) cash and non-cash proceeds (as defined in the UCC) of
any and all of the foregoing.

ADMINISTRATIVE MANAGEMENT FEE shall mean the sum of $25,000.00 per year and be
paid to CIT in accordance with Section 8, paragraph 8.8 hereof to offset the
expenses and costs (excluding Out-of-Pocket Expenses and auditor fees) of CIT in
connection with administration, record keeping, analyzing and evaluating the
Collateral.

ANNIVERSARY DATE shall mean the date occurring three (3) years from the Closing
Date and the same date in every year thereafter.


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AVAILABILITY shall mean at any time the amount by which: (a) the Borrowing Base
exceeds (b) the sum of (i) the outstanding aggregate amount of all Obligations,
including without limitation, all Obligations with respect to Revolving Loans
and (ii) the Availability Reserve.

AVAILABILITY RESERVE shall be calculated as the sum of: (a) during such times as
there exists Availability of less than $1,000,000, (i) three (3) months rental
payments or similar charges for any of the Company's leased premises or other
Collateral locations for which the Company has not delivered to CIT a landlord's
waiver in form and substance reasonably satisfactory to CIT, plus (ii) three (3)
months estimated payments plus any other fees or charges owing by the Company to
any applicable warehousemen or third party processor (as determined by CIT in
its reasonable business judgement), provided that any of the foregoing amounts
shall be adjusted from time to time hereafter upon (x) delivery to CIT of any
such acceptable waiver, (y) the opening or closing of a Collateral location
and/or (z) any change in the amount of rental, storage or processor payments or
similar charges; plus (b) any reserve which CIT may reasonably require from time
to time pursuant to this Financing Agreement; and plus (c) such other reserves
as CIT deems necessary in its reasonable judgment as a result of negative
forecasts and/or trends in the Company's business, industry, prospects, profits,
operations or financial condition, or other issues, circumstances or facts that
could otherwise negatively impact the Company, its business, prospects, profits,
operations, industry, financial condition or assets.

BORROWING BASE shall mean the sum of (a) eighty-five percent (85%) of the US
Dollar value of the Company's aggregate outstanding Eligible Accounts
Receivable, provided, however, that if the then Dilution Percentage is greater
than five percent (5%), then the rate of advance herein shall be reduced by the
amount of such excess Dilution Percentage, plus (b) the lesser of (i)(a) sixty
percent (60%) of the aggregate value of the Company's Eligible Saleable
Inventory, valued at the lower of cost, market or orderly liquidation value, on
a first in, first out basis plus (i)(b) twenty percent (20%) of the aggregate
value of the Company's Eligible Other Inventory, valued at the lower of cost or
orderly liquidation value, on a first in, first out basis, or (ii) the Inventory
Loan Cap.

BUSINESS DAY shall mean any day on which CIT and The Chase Manhattan Bank are
open for business.

CHASE BANK RATE shall mean the rate of interest per annum announced by The Chase
Manhattan Bank from time to time as its prime rate in effect at its principal
office in New York City. (The prime rate is not intended to be the lowest rate
of interest charged by The Chase Manhattan Bank to its borrowers).

CLOSING DATE shall mean the date that this Financing Agreement has been duly
executed by the parties hereto and delivered to CIT.

COLLATERAL shall mean all present and future Accounts, Inventory, Documents of
Title, General Intangibles, all royalty payments due to Company from Mylan
Pharmaceuticals Inc., provided


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however, that the right to receive and collect such royalty payments shall not
be effective until after an Event of Default, and Other Collateral.

COMMITMENT LETTER shall mean the Commitment Letter, dated January 8, 2001,
issued by CIT to, and accepted by, the Company.

CONSOLIDATED BALANCE SHEET shall mean a consolidated or compiled, as applicable,
balance sheet for the Company and the consolidated subsidiaries of the Company
eliminating all inter-company transactions and prepared in accordance with GAAP.

CONSOLIDATING BALANCE SHEET shall mean a Consolidated Balance Sheet plus
individual balance sheets for the Company and the subsidiaries of the Company,
showing all eliminations of inter-company transactions, including a balance
sheet for the Company exclusively, all prepared in accordance with GAAP.

COPYRIGHTS shall mean all present and hereafter acquired copyrights, copyright
registrations, designs, styles, licenses, marks, prints and labels bearing any
of the foregoing, goodwill, any and all general intangibles, intellectual
property and rights pertaining thereto, and all cash and non-cash proceeds
thereof relating solely to the sale and disposition of the Inventory.

DEFAULT shall mean any event specified in Section 10 hereof, whether or not any
requirement for the giving of notice, the lapse of time, or both, or any other
condition, event or act, has been satisfied.

DEFAULT RATE OF INTEREST shall mean a rate of interest per annum on any
Obligations hereunder, equal to the sum of: (a) two percent (2%) and (b) the
applicable increment over the Chase Bank Rate (as set forth in Paragraph 8.1
hereof) plus the Chase Bank Rate, which CIT shall be entitled to charge the
Company on all Obligations due CIT by the Company, as further set forth in
Paragraph 10.2 of Section 10 of this Financing Agreement.

DEPOSITORY ACCOUNTS shall mean the collection accounts, which are subject to
CIT's instructions, as specified in Paragraph 3.4 of Section 3 of this Financing
Agreement.

DILUTION PERCENTAGE shall mean, as of the time of calculation, the then sum of
the Borrower's credits, claims, allowances, discounts, write-offs, contras,
off-sets and deductions divided by the then sum of Trade Accounts Receivable,
all calculated on a rolling ninety (90) day average, as determined and
calculated by CIT from time to time.

DOCUMENTATION FEE shall mean (A) the fees and expenses of Polivy & Taschner, LLC
of Six Central Row, Second Floor, Hartford, Connecticut 06103 in documenting the
transaction, and (B) subsequent to the Closing Date, CIT's standard fees
relating to any and all modifications, waivers, releases, amendments or
additional collateral with respect to this Financing Agreement, the Collateral
and/or the Obligations.


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DOCUMENTS OF TITLE shall mean all present and future documents (as defined in
the UCC), and any and all warehouse receipts, bills of lading, shipping
documents, chattel paper, instruments and similar documents, all whether
negotiable or not and all Inventory relating thereto and all cash and non-cash
proceeds of the foregoing.

EARLY TERMINATION DATE shall mean the date on which the Company terminates this
Financing Agreement or the Revolving Line of Credit which date is prior to an
Anniversary Date.

EARLY TERMINATION FEE shall: (A) mean the fee CIT is entitled to charge the
Company in the event the Company terminates the Revolving Line of Credit or this
Financing Agreement on a date prior to an Anniversary Date; and (B) be
determined by multiplying the Revolving Line of Credit by (x) three quarters of
one percent (0.75%) if the Early Termination Date occurs on or before two (2)
years from the Closing Date and (z) one half of one percent (0.50%) if the Early
Termination Date occurs after two (2) years from the Closing Date but prior to
January 17, 2004.

ELIGIBLE ACCOUNTS RECEIVABLE shall mean the gross amount of the Company's Trade
Accounts Receivable that are subject to a valid, exclusive, first priority and
fully perfected security interest in favor of CIT, which conform to the
warranties contained herein and which, at all times, continue to be acceptable
to CIT in the exercise of its reasonable judgment, less, without duplication,
the sum of: (a) any returns, discounts, claims, credits and allowances of any
nature (whether issued, owing, granted, claimed or outstanding), and (b)
reserves for any such Trade Accounts Receivable that arise from or are subject
to or include: (i) sales to the United States of America, the government, or any
governmental agency, department or division of the United States or Canada, or
any state, province or other governmental entity within the United States or
Canada, except for any such sales as to which the Company has complied with the
Assignment of Claims Act of 1940 or any other applicable statute, rules or
regulation, to CIT's satisfaction in the exercise of its reasonable business
judgment; (ii) Accounts that remain unpaid more than ninety (90) days from
invoice date; (iii) contra accounts; (iv) sales to any subsidiary, or to any
company affiliated with the Company in any way; (v) bill and hold (deferred
shipment) or consignment sales; (vi) sales to any customer which is: (A)
insolvent, (B) the debtor in any bankruptcy, insolvency, arrangement,
reorganization, receivership or similar proceedings under any federal or state
law, (C) negotiating, or has called a meeting of its creditors for purposes of
negotiating, a compromise of its debts, or (D) financially unacceptable to CIT
or has a credit rating unacceptable to CIT; (vii) all sales to any customer if
fifty percent (50%) or more of the aggregate dollar amount of all outstanding
invoices to such customer are unpaid more than ninety (90) days from invoice
date; (viii) sales to any customer and/or its affiliates to the extent such
sales exceed at any one time twenty percent (20%) or more of all Eligible
Accounts Receivable; (ix) pre-billed receivables and receivables arising from
progress billing; (x) an amount representing, historically, returns, discounts,
claims, credits, allowances and applicable terms; (xi) sales not payable in
United States currency; (xii) the remaining amount due to Company by Mylan
Pharmaceuticals Inc. under Section 7 of the Letter of Agreement of February 25,
2000 if in any month the scheduled monthly payment is not received by Company on
or before the 10th day of such month; and (xiii) any other reasons deemed
necessary by CIT in its reasonable judgment, including



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without limitation those which are customary either in the commercial finance
industry or in the lending practices of CIT.

ELIGIBLE SALEABLE INVENTORY shall mean the gross amount of the Company's
Inventory that is subject to a valid, exclusive, first priority and fully
perfected security interest in favor of CIT and which is not subject to
"quarantine", a hold on shipment for any reason, inspection, quality testing or
is in any other manner not available for immediate sale, shipment and
distribution in the normal course of the Company's business to customers of the
Company and which conforms to the warranties contained herein and which, at all
times continues to be acceptable to CIT in the exercise of its reasonable
judgment, less, without duplication, any (a) work-in-process or Inventory being
held prior to distribution and sale subject to testing and quality
determination, (b) supplies (other than raw materials), (c) Inventory not
present in the continental United States of America, (d) Inventory returned or
rejected by the Company's customers (other than goods that are undamaged and
re-salable in the normal course of business) and goods to be returned to the
Company's suppliers, (e) Inventory in transit to third parties (other than the
Company's agents or warehouses), or in the possession of a warehouseman, bailee,
third party processor, or other third party, unless such warehouseman, bailee or
third party has executed a notice of security interest agreement (in form and
substance satisfactory to CIT) and CIT shall have a first priority perfected
security interest in such Inventory, and (f) less any reserves required by CIT
in its reasonable discretion, including without limitation for special order
goods, discontinued, slow-moving and obsolete Inventory, market value declines,
bill and hold (deferred shipment), consignment sales, shrinkage and any
applicable customs, freight, duties and Taxes.

ELIGIBLE OTHER INVENTORY shall mean the gross amount of the Company's Inventory
that is subject to a valid, exclusive, first priority and fully perfected
security interest in favor of CIT and which is not Eligible Saleable Inventory
but is being held prior to sale, shipment or distribution subject to "release
from quarantine", a hold for any other reason, inspection or quality testing, in
the normal course of the Company's business, and which conforms to the
warranties contained herein and which, at all times continues to be acceptable
to CIT in the exercise of its reasonable judgment, less, without duplication,
any (a) work-in-process, (b) supplies (other than raw materials), (c) Inventory
not present in the continental United States of America, (d) Inventory returned
or rejected by the Company's customers (other than goods that are undamaged and
re-salable in the normal course of business) and goods to be returned to the
Company's suppliers, (e) Inventory in transit to third parties (other than the
Company's agents or warehouses), or in the possession of a warehouseman, bailee,
third party processor, or other third party, unless such warehouseman, bailee or
third party has executed a notice of security interest agreement (in form and
substance satisfactory to CIT) and CIT shall have a first priority perfected
security interest in such Inventory, and (f) less any reserves required by CIT
in its reasonable discretion, including without limitation for special order
goods, discontinued, slow-moving and obsolete Inventory, market value declines,
bill and hold (deferred shipment), consignment sales, shrinkage and any
applicable customs, freight, duties and Taxes. Eligible Other Inventory shall
not include that amount of "TIMERx" inventory which is otherwise reserved for by
CIT.


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EQUIPMENT shall mean all present and hereafter acquired equipment (as defined in
the UCC) including, without limitation, all machinery, equipment, furnishings
and fixtures, and all additions, substitutions and replacements thereof,
wherever located, together with all attachments, components, parts, equipment
and accessories installed thereon or affixed thereto and all proceeds thereof of
whatever sort.

ERISA shall mean the Employee Retirement Income Security Act or 1974, as amended
from time to time and the rules and regulations promulgated thereunder from time
to time.

EVENT(S) OF DEFAULT shall have the meaning provided for in Section 10 of this
Financing Agreement.

FISCAL QUARTER shall mean, with respect to the Company, each three (3) month
period ending on March 31, June 30, September 30 and December 31 of each Fiscal
Year.

FISCAL YEAR shall mean each twelve (12) month period commencing on January 1of
each year and ending on the following December 31.

GAAP shall mean generally accepted accounting principles in the United States of
America as in effect from time to time and for the period as to which such
accounting principles are to apply, provided that in the event the Company
modifies its accounting principles and procedures as applied as of the Closing
Date, the Company shall provide such statements of reconciliation as shall be in
form and substance acceptable to CIT.

GENERAL INTANGIBLES shall mean all present and hereafter acquired general
intangibles (as defined in the UCC) relating solely to the sale and distribution
of Inventory or as proceeds of Accounts, and shall include, without limitation,
all present and future right, title and interest in and to: (a) all Trademarks,
tradenames, corporate names, business names, logos and any other designs or
sources of business identities relating solely to the sale and distribution of
Inventory, (b) Patents, together with any improvements on said Patents relating
solely to the sale and distribution of Inventory, (c) Copyrights relating solely
to the sale and distribution of Inventory, (d) trade secrets relating solely to
the sale and distribution of Inventory, (e) licenses, permits and franchises
relating solely to the sale and distribution of Inventory, (f) all right, title
and interest in and to any and all extensions and renewals, (g) goodwill with
respect to any of the foregoing, (h) all customer lists, distribution
agreements, supply agreements, indemnification rights and all monies and claims
for monies now or hereafter due and payable in connection with any of the
foregoing or otherwise, and all cash and non-cash proceeds thereof, including,
without limitation, the proceeds or royalties of any licensing agreements
between the Company and any licensee of any of the Company's General
Intangibles.

INDEBTEDNESS shall mean, without duplication, all liabilities, contingent or
otherwise, which are any of the following: (a) obligations in respect of
borrowed money or for the deferred purchase price of property, services or
assets, other than Inventory, or (b) lease obligations which, in accordance with
GAAP, have been, or which should be capitalized.


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INSURANCE PROCEEDS shall mean proceeds or payments from an insurance carrier
with respect to any loss, casualty or damage to Collateral.

INVENTORY shall mean all of the Company's present and hereafter acquired
inventory (as defined in the UCC) and including, without limitation,
pharmaceutical excipients manufactured by the Company, pharmaceutical excipients
held for distribution including manufactured bulk TIMERx, all other merchandise,
inventory and goods, and all additions, substitutions and replacements thereof,
wherever located, together with all goods and materials used or usable in
manufacturing, processing, packaging or shipping same in all stages of
production from raw materials through work-in-process to finished goods and all
proceeds thereof of whatever sort.

INVENTORY LOAN CAP shall mean the amount of $5,000,000.

LINE OF CREDIT shall mean the aggregate commitment of CIT to make Revolving
Loans pursuant to Section 3 of this Financing Agreement in the aggregate amount
equal to $10,000,000.

LINE OF CREDIT FEE shall: (a) mean the fee due CIT at the end of each month for
the Line of Credit, and (b) be determined by multiplying the difference between
(i) the Revolving Line of Credit and (ii) for said month, the average daily
balance of Revolving Loans by one half of one percent (0.50%) per annum for the
number of days in said month.

LOAN DOCUMENTS shall mean this Financing Agreement, the other closing documents
and any other ancillary loan and security agreements executed from time to time
in connection with this Financing Agreement, all as may be renewed, amended,
extended, increased or supplemented from time to time.

LOAN FACILITY FEE shall mean the fee payable to CIT in accordance with, and
pursuant to, the provisions of Paragraph 8.7 of Section 8 of this Financing
Agreement.

NET WORTH shall mean, at any date of determination, an amount equal to (a) Total
Tangible Assets minus (b) Total Liabilities, and shall be determined in
accordance with GAAP and otherwise on a consistent basis with the latest audited
financial statements of the Company.

OBLIGATIONS shall mean all loans, advances and extensions of credit made or to
be made by CIT to the Company or to others for the Company's account (including,
without limitation, all Revolving Loans); any and all indebtedness and
obligations which may at any time be owing by the Company to CIT howsoever
arising, whether now in existence or incurred by the Company from time to time
hereafter; whether principal, interest, fees, costs, expenses or otherwise;
whether secured by pledge, lien upon or security interest in any of the
Company's Collateral, assets or property or the assets or property of any other
person, firm, entity or corporation; whether such indebtedness is absolute or
contingent, joint or several, matured or unmatured, direct or indirect and
whether the Company is liable to CIT for such indebtedness as principal, surety,
endorser, guarantor or otherwise. Obligations shall also include indebtedness
owing to CIT by the Company under any Loan


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Document or under any other agreement or arrangement now or hereafter entered
into between the Company and CIT; indebtedness or obligations incurred by, or
imposed on, CIT as a result of environmental claims arising out of the Company's
operations, premises or waste disposal practices or sites in accordance with
paragraph 7.7 hereof; the Company's liability to CIT as maker or endorser of any
promissory note or other instrument for the payment of money; the Company's
liability to CIT under any instrument of guaranty or indemnity, or arising under
any guaranty, endorsement or undertaking which CIT may make or issue to others
for the Company's account, CIT's acceptance of drafts or CIT's endorsement of
notes or other instruments for the Company's account and benefit; and any and
all indebtedness, liabilities or obligations of every kind, nature and
description owing by the Company to any affiliate of CIT.

OTHER COLLATERAL shall mean all now owned and hereafter acquired lockbox,
blocked account and any other deposit accounts maintained with any bank or
financial institutions into which the proceeds of Collateral are or may be
deposited; all cash and other monies and property in the possession or control
of CIT; all books, records, ledger cards, disks and related data processing
software at any time evidencing or containing information relating to any of the
Collateral described herein or otherwise necessary or helpful in the collection
thereof or realization thereon; and all cash and non-cash proceeds of the
foregoing.

OUT-OF-POCKET EXPENSES shall mean all of CIT's present and future expenses
incurred relative to this Financing Agreement or any other Loan Documents,
whether incurred heretofore or hereafter, which expenses shall include, without
being limited to: the cost of record searches, all costs and expenses incurred
by CIT in opening bank accounts, depositing checks, receiving and transferring
funds, and wire transfer charges, any charges imposed on CIT due to returned
items and "insufficient funds" of deposited checks and CIT's standard fees
relating thereto, and CIT's standard fees relating to travel, lodging and
similar expenses of CIT's personnel in connection with inspecting and monitoring
the Collateral from time to time hereunder and a per diem charge of $750.00 per
day (or such greater amount as is then currently the standard charge by CIT) per
employee or authorized agent of CIT in conducting audits, and Collateral
inspection and monitoring, any applicable counsel fees and disbursements, fees
and taxes relative to the filing of financing statements, all expenses, costs
and fees set forth in Paragraph 10.3 of Section 10 of this Financing Agreement.

OVERADVANCE RATE shall mean a rate equal to one-half of one percent (1/2%) per
annum in excess of the applicable contract rate of interest determined in
accordance with Section 8, Paragraph 8.1(a) of this Financing Agreement.

OVERADVANCES shall mean the amount by which (a) the sum of all outstanding
Revolving Loans and advances made hereunder exceed (b) the Borrowing Base.

PATENTS shall mean all of the Company's present and hereafter acquired patents,
patent applications, registrations, any reissues or renewals thereof, licenses,
any inventions and improvements claimed thereunder, relating solely to the sale
and distribution of Inventory and all income, royalties, cash and non-cash
proceeds thereof.



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PERMITTED ENCUMBRANCES shall mean: (a) liens of local or state authorities for
franchise or other like Taxes, provided that the aggregate amounts of such liens
shall not exceed $50,000.00 in the aggregate at any one time; (b) statutory
liens of landlords and liens of carriers, warehousemen, bailees, mechanics,
materialmen and other like liens imposed by law, created in the ordinary course
of business and for amounts not yet due (or which are being contested in good
faith, by appropriate proceedings or other appropriate actions which are
sufficient to prevent imminent foreclosure of such liens) and with respect to
which adequate reserves or other appropriate provisions are being maintained by
the Company in accordance with GAAP; (c) deposits made (and the liens thereon)
in the ordinary course of business of the Company (including, without
limitation, security deposits for leases, indemnity bonds, surety bonds and
appeal bonds) in connection with workers' compensation, unemployment insurance
and other types of social security benefits or to secure the performance of
tenders, bids, contracts (other than for the repayment or guarantee of borrowed
money or purchase money obligations), statutory obligations and other similar
obligations arising as a result of progress payments under government contracts;
(d) liens granted CIT by the Company; (e) liens of judgment creditors provided
such liens do not exceed, in the aggregate, at any time, $50,000.00 (other than
liens bonded or insured to the reasonable satisfaction of CIT); and (f) tax
liens which are not yet due and payable or which are being diligently contested
in good faith by the Company by appropriate proceedings, and which liens are not
(x) filed on any public records, or (y) for Taxes due the United States of
America or any state thereof having similar priority statutes, as further set
forth in paragraph 7.6 hereof.

PERMITTED INDEBTEDNESS shall mean: (A) current Indebtedness maturing in less
than one year and incurred in the ordinary course of business for raw materials,
supplies, equipment, services, Taxes or labor; (B) the Indebtedness secured by
Purchase Money Liens; (C) Indebtedness arising under this Financing Agreement;
(D) deferred Taxes and other expenses incurred in the ordinary course of
business; (E) other Indebtedness existing on the date of execution of this
Financing Agreement and listed in the most recent financial statement delivered
to CIT or otherwise disclosed to CIT in writing prior to the Closing Date; (F)
other Indebtedness up to $100,000 in the aggregate outstanding at any time; and
(G) other Indebtedness in excess of $100,000 in the aggregate provided that the
Company has provided written notice to CIT not less than ten (10) Business Days
prior to the incurrence of such Indebtedness.

PURCHASE MONEY LIENS shall mean liens on any item of Equipment acquired after
the date of this Financing Agreement provided that (A) each such lien shall
attach only to the property to be acquired and (B) a description of the
Equipment so acquired is furnished to CIT.

REVOLVING LINE OF CREDIT shall mean the aggregate commitment of CIT to make
loans and advances pursuant to Section 3 of this Financing to the Company, in
the aggregate amount equal to the sum of $10,000,000.

REVOLVING LOAN ACCOUNT shall mean the account on CIT's books, in the Company's
name, in which the Company will be charged with all Obligations under this
Financing Agreement.



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REVOLVING LOANS shall mean the loans and advances made, from time to time, to or
for the account of the Company by CIT pursuant to Section 3 of this Financing
Agreement.

TAXES shall mean all federal, state, municipal and other governmental taxes,
levies, charges, claims and assessments which are or may be due by the Company
with respect to its business, operations, Collateral or otherwise.

TOTAL TANGIBLE ASSETS shall mean the net book value of all tangible assets
consisting of cash, cash equivalents, Accounts (deemed at the time of
calculation to be collectible), Inventory (net of obsolete, slow moving or
otherwise unsaleable items), real estate, software, equipment and cash surrender
value of Company owned life insurance policies, but not including any intangible
assets such as patents, trademarks, copyrights, goodwill, amortized acquisition
costs or such similar items, as determined in accordance with GAAP, on a basis
consistent with the latest audited financial statements of the Company.

TOTAL LIABILITIES shall mean total liabilities determined in accordance with
GAAP, on a basis consistent with the latest audited financial statements of the
Company.

TRADE ACCOUNTS RECEIVABLE shall mean that portion of the Company's Accounts
which arises from the sale of Inventory or the rendition of services in the
ordinary course of the Company's business or arise under Section 7 of a Letter
of Agreement between Mylan Pharmaceuticals Inc. and Company of February 25,
2000.

TRADEMARKS shall mean all present and hereafter acquired trademarks, trademark
registrations, recordings, applications, tradenames, trade styles, service
marks, prints and labels (on which any of the foregoing may appear), licenses,
reissues, renewals relating solely to the sale and distribution of Inventory,
together with the goodwill associated therewith, and all cash and non-cash
proceeds thereof.

UCC shall mean the Uniform Commercial Code as the same may be amended and in
effect from time to time in the state of New York.

SECTION 2. CONDITIONS PRECEDENT

         2.1      CONDITIONS TO THE INITIAL EXTENSION OF CREDIT

         The obligation of CIT to make the initial loans hereunder is subject to
the satisfaction of, extension of or waiver of in writing, on or prior to, the
Closing Date, the following conditions precedent:

         (A) LIEN SEARCHES - CIT shall have received tax, judgment and Uniform
Commercial Code searches satisfactory to CIT for all locations presently
occupied or used by the Company.


                                                                              12

<PAGE>   13



         (B) CASUALTY INSURANCE - The Company shall have delivered to CIT
evidence satisfactory to CIT that casualty insurance policies listing CIT as
additional insured and loss payee are in full force and effect, all as set forth
in Paragraph 7.5 of Section 7 of this Financing Agreement.

         (C) UCC FILINGS - Any financing statements required to be filed in
order to create, in favor of CIT, a first perfected security interest in the
Collateral, subject only to the Permitted Encumbrances, shall have been properly
filed in each office in each jurisdiction required in order to create in favor
of CIT a perfected lien on the Collateral. CIT shall have received
acknowledgment copies of all such filings (or, in lieu thereof, CIT shall have
received other evidence satisfactory to CIT that all such filings have been
made) and CIT shall have received evidence that all necessary filing fees and
all taxes or other expenses related to such filings have been paid in full.

         (D) BOARD RESOLUTION - CIT shall have received a copy of the
resolutions of the Board of Directors of the Company authorizing the execution,
delivery and performance of (i) this Financing Agreement and (ii) any related
agreements, in each case certified by the Secretary or Assistant Secretary of
the Company as of the date hereof, together with a certificate of the Secretary
or Assistant Secretary of the Company as to the incumbency and signature of the
officers of the Company executing such Loan Documents and any certificate or
other documents to be delivered by them pursuant hereto, together with evidence
of the incumbency of such Secretary or Assistant Secretary.

         (E) CORPORATE ORGANIZATION - CIT shall have received (i) a copy of the
Certificate of Incorporation of the Company certified by the Secretary of State
of Washington, and (ii) a copy of the By-Laws of the Company certified by the
Secretary or Assistant Secretary thereof, all as amended through the date
hereof.

         (F) OFFICER'S CERTIFICATE - CIT shall have received an executed
Officer's Certificate of the Company, satisfactory in form and substance to CIT,
certifying that (i) the representations and warranties contained herein are true
and correct in all material respects on and as of the Closing Date; (ii) the
Company is in compliance with all of the terms and provisions set forth herein;
and (iii) no Default or Event of Default has occurred

         (G) OPINIONS - Counsel for the Company shall have delivered to CIT
opinions satisfactory to CIT opining, inter alia, that, subject to the (i)
filing, priority and remedies provisions of the Uniform Commercial Code, (ii)
the provisions of the Bankruptcy Code, insolvency statutes or other like laws,
(iii) the equity powers of a court of law and (iv) such other matters as may be
agreed upon with CIT: (x) this Financing Agreement and all other Loan Documents
of the Company are (A) valid, binding and enforceable according to their terms,
(B) are duly authorized, executed and delivered, and (C) do not violate any
terms, provisions, representations or covenants in the charter or by-laws of the
Company or the or, to the best knowledge of such counsel, of any loan agreement,
mortgage, deed of trust, note, security or pledge agreement or indenture.


                                                                              13

<PAGE>   14


         (H) ABSENCE OF DEFAULT - No Default or Event of Default shall have
occurred and no material adverse change shall have occurred in the financial
condition, business, prospects, profits, operations or assets of the Company or
the Company's subsidiaries.

         (I) LEGAL RESTRAINTS/LITIGATION - As of the Closing Date, there shall
be no: (x) litigation, investigation or proceeding (judicial or administrative)
pending or threatened against the Company or its assets, by any agency, division
or department of any county, city, state or federal government arising out of
this Financing Agreement; (y) injunction, writ or restraining order restraining
or prohibiting the consummation of the financing arrangements contemplated under
this Financing Agreement; or (z) suit, action, investigation or proceeding
(judicial or administrative) pending against the Company or its assets, which,
in the opinion of CIT, if adversely determined, could have a material adverse
effect on the business, operation, assets, financial condition or Collateral of
the Company.

         (J) ADDITIONAL DOCUMENTS - The Company shall have executed and
delivered to CIT all Loan Documents necessary to consummate the lending
arrangement contemplated between the Company and CIT.

         (K) DISBURSEMENT AUTHORIZATION - The Company shall have delivered to
CIT all information necessary for CIT to issue wire transfer instructions on
behalf of the Company for the initial and subsequent loans and/or advances to be
made under this Financing Agreement including, but not limited to, disbursement
authorizations in form acceptable to CIT.

         (L) EXAMINATION & VERIFICATION -CIT shall have completed, to CIT's
satisfaction, an examination and verification of the Accounts, Inventory,
financial statements, books and records of the Company which examination shall
indicate that, after giving effect to all Revolving Loans, advances and
extensions of credit to be made at closing, the Company shall have an opening
additional Availability of at least $2,000,000 , as evidenced by a Borrowing
Base certificate delivered by the Company to CIT as of the Closing Date, all as
more fully required by the CIT Commitment Letter. It is understood that such
requirement contemplates that all debts and obligations are current, and that
all payables are being handled in the normal course of the Company's business
and consistent with its past practice.

         (M) DEPOSITORY ACCOUNTS - The Company shall have established a system
of lockbox and bank accounts with respect to the collection of Accounts and the
deposit of proceeds of Collateral as shall be acceptable to CIT in all respects.
Such accounts shall be subject to three party agreements (between the Company,
CIT and the depository bank), which shall be in form and substance satisfactory
to CIT.

         (N) CIT COMMITMENT LETTER - The Company shall have fully complied, to
the reasonable satisfaction of CIT, with all of the terms and conditions of the
CIT Commitment Letter.


                                                                              14

<PAGE>   15


Upon the execution of this Financing Agreement and the initial disbursement of
loans hereunder, all of the above Conditions Precedent shall have been deemed
satisfied except as otherwise set forth hereinabove or as the Company and CIT
shall otherwise agree in writing.

         2.2      CONDITIONS TO EACH SUBSEQUENT EXTENSION OF CREDIT

         Except to the extent expressly set forth in this Financing Agreement,
the agreement of CIT to make any extension of credit requested to be made by it
to the Company on any date (including without limitation, the initial extension
of credit) is subject to the satisfaction of the conditions precedent denoted as
(A), (B) and (C) below:

         (A) REPRESENTATIONS AND WARRANTIES - Each of the representations and
warranties made by the Company in or pursuant to this Financing Agreement shall
be true and correct in all material respects on and as of such date as if made
on and as of such date.

         (B) NO DEFAULT - No Default or Event of Default shall have occurred and
be continuing on such date or after giving effect to the extension of credit
requested to be made on such date.

         (C) BORROWING BASE - Except as may be otherwise agreed to from time to
time by CIT and the Company in writing, after giving effect to the extension of
credit requested to be made by the Company on such date, the aggregate
outstanding balance of the Revolving Loans owing by the Company will not exceed
the lesser of (i) the Revolving Line of Credit or (ii) the Borrowing Base.

         The agreement of CIT to make any extension of credit requested to be
made by it to the Company on and after March 1, 2001 is subject to the
satisfaction of the condition precedent denoted as (D) below:

         (D) CASH BUDGET PROJECTIONS - On or before February 28, 2001, CIT shall
have received a twelve (12) month cash budget projection prepared by the
Company.

Each borrowing by the Company hereunder shall constitute a representation and
warranty by the Company as of the date of such loan or advance that each of the
representations, warranties and covenants contained in the Financing Agreement
have been satisfied and are true and correct, except as the Company and CIT
shall otherwise agree herein or in a separate writing.

SECTION 3. REVOLVING LOANS

         3.1 CIT agrees, subject to the terms and conditions of this Financing
Agreement, from time to time (but subject to CIT's right to make
"Overadvances"), to make loans and advances to the Company on a revolving basis
(i.e. subject to the limitations set forth herein, the Company may borrow, repay
and re-borrow Revolving Loans). Such requests for loans and advances shall be in
amounts not to exceed the lesser of (a) the Availability or (b) the Revolving
Line of Credit. All requests for loans and advances must be received by an
officer of CIT no later than noon, New York



                                                                              15
<PAGE>   16


time, of the Business Day on which any such loans and advances are required;
provided however, that during such time that there exists no Event of Default,
to the extent that Company shall not request a loan or an advance on any day,
Company hereby requests that CIT, only during the period that Availability is in
excess of $500,000, advance to Company's designated bank account an amount equal
to the lesser of (c) the Availability or (d) such amount as shall cause the
aggregate of all Advances outstanding on such date to be not greater than
$3,000,000. Should CIT for any reason honor requests for Overadvances, any such
Overadvances shall be made in CIT's sole discretion and subject to any
additional terms CIT deems necessary.

         3.2 In furtherance of the continuing assignment and security interest
in the Company's Accounts and Inventory, the Company will, in connection with
the creation of Accounts and purchase or acquisition of Inventory, deliver to
CIT in such form and manner as CIT may reasonably require, solely for CIT's
convenience in maintaining records of Collateral, at the expense of the Company
on a daily basis schedules of Accounts created and on or before the third
business day of each week, true and complete weekly schedules of Inventory
created and/or acquired, relating to the prior week on a roll forward perpetual
basis. The company shall also, at its expense deliver to CIT for the prior
month: (a) on or before the tenth (10th) day of each month, true and complete
Inventory reports; (b) on or before the tenth (10th) day of each month, true and
complete monthly agings of its Accounts and accounts payable, (c) on or before
the fifteenth (15th) day of each month, such additional confirmatory schedules
of Accounts and Inventory as CIT may reasonably request, all in form and
substance satisfactory to CIT, and (d) on or before the fifteenth (15th) day of
each month such other appropriate reports designating, identifying and
describing the Accounts and Inventory as CIT may reasonable request. CIT may
request any such information more frequently, from time to time, as it deems
appropriate and necessary, upon its reasonable prior request. In addition, the
Company shall provide CIT with copies of agreements with, or purchase orders
from, the Company's customers, and copies of invoices to customers, proof of
shipment or delivery, access to its computers, electronic media and software
programs associated therewith (including any electronic records, contracts and
signatures) and such other documentation and information relating to said
Accounts and other Collateral as CIT may reasonably require. Failure to provide
CIT with any of the foregoing shall in no way affect, diminish, modify or
otherwise limit the security interests granted herein. The Company hereby
authorizes CIT to regard the Company's printed name or rubber stamp signature on
assignment schedules or invoices as the equivalent of a manual signature by one
of the Company's authorized officers or agents.

         3.3 The Company hereby represents and warrants that: each Trade Account
Receivable is based on an actual and bona fide sale and delivery of Inventory or
rendition of services to customers, made by the Company in the ordinary course
of its business; the Inventory being sold, and the Trade Accounts Receivable
created, are the exclusive property of the Company and are not and shall not be
subject to any lien, consignment arrangement, encumbrance, security interest or
financing statement whatsoever, other than the Permitted Encumbrances; the
invoices evidencing such Trade Accounts Receivable are in the name of the
Company; and the customers of the Company have accepted, or upon delivery will
accept, the Inventory or services, owe and are obligated to pay the full amounts
stated in the invoices according to their terms, without dispute, offset,
defense,


                                                                              16

<PAGE>   17


counterclaim or contra, except for disputes and other matters arising in the
ordinary course of business with respect to which the Company has complied with
the notification requirements of Paragraph 3.5 of this Section 3. The Company
confirms to CIT that any and all Taxes or fees relating to its business, its
sales, the Accounts or Inventory relating thereto, are its sole responsibility
and that same will be paid by the Company when due, subject to Paragraph 7.6 of
Section 7 of this Financing Agreement, and that none of said Taxes or fees
represent a lien on or claim against the Accounts. The Company hereby further
represents and warrants that it shall not acquire any Inventory on a consignment
basis, nor co-mingle its Inventory with any of its customers or any other
person, including pursuant to any bill and hold sale or otherwise, and that its
Inventory is marketable to its customers in the ordinary course of business of
the Company, except as it may otherwise report in writing to CIT pursuant to
Paragraph 3.5 hereof from time to time. The Company also warrants and represents
that it is a duly and validly existing corporation and is qualified in all
states where the failure to so qualify would have an adverse effect on the
business of the Company or the ability of the Company to enforce collection of
Accounts due from customers residing in that state. The Company agrees to
maintain such books and records regarding Accounts and Inventory as CIT may
reasonably require and agrees that the books and records of the Company will
reflect CIT's interest in the Accounts and Inventory. All of the books and
records of the Company will be available to CIT at normal business hours,
including any records handled or maintained for the Company by any other company
or entity.

         3.4 Until CIT has advised the Company to the contrary after the
occurrence of an Event of Default, the Company, at its expense, will enforce,
collect and receive all amounts owing on the Accounts in the ordinary course of
its business and any proceeds it so receives shall be subject to the terms
hereof, and held on behalf of and in trust for CIT. Such privilege shall
terminate at the election of CIT, upon the occurrence of an Event of Default.
Any checks, cash, credit card sales and receipts, notes or other instruments or
property received by the Company with respect to any Collateral, including
Accounts, shall be held by the Company in trust for CIT, separate from the
Company's own property and funds, and promptly turned over to CIT with proper
assignments or endorsements by deposit to the Depository Accounts. The Company
shall: (i) indicate on all of its invoices that funds should be delivered to and
deposited in a Depository Account; (ii) direct all of its account debtors to
deposit any and all proceeds of Collateral into the Depository Accounts; (iii)
irrevocably authorize and direct any banks which maintain the Company's initial
receipt of cash, checks, wire transfers and other items to promptly wire
transfer all available funds to a Depository Account; and (iv) advise all such
banks of CIT's security interest in such funds. The Company shall provide CIT
with prior written notice of any and all deposit accounts opened or to be opened
subsequent to the Closing Date. All amounts received by CIT which are identified
by either the Company or CIT as "other than proceeds of Accounts" will be
remitted to Company upon its request if same can be identified prior to
application to the Obligations. All amounts received and retained by CIT in
payment of Accounts will be credited to the Revolving Loan Account when CIT is
advised by its bank of its receipt of "collected funds" at CIT's bank account in
New York, New York on the Business Day of such advise if advised no later than
1:00 p.m. EST or on the next succeeding Business Day if so advised after 1:00 PM
EST. No checks, drafts or other instrument received by


                                                                              17

<PAGE>   18


CIT shall constitute final payment to CIT unless and until such instruments have
actually been collected.

         3.5 The Company agrees to notify CIT: (a) of any matters affecting the
value, enforceability or collectibility of any Account and of all customer
disputes, offsets, defenses, counterclaims, returns, rejections and all
reclaimed or repossessed merchandise or goods, and of any adverse effect in the
value of its Inventory, in its weekly and monthly Collateral reports (as
applicable) provided to CIT hereunder, in such detail and format as CIT may
reasonably require from time to time; and (b) promptly of any such matters which
(i) are material, as a whole, to the Accounts and/or the Inventory, or (ii)
which adversely affect the value of any Account or Inventory in an amount of
$50,000 or more. The Company agrees to issue credit memoranda promptly (with
duplicates to be immediately forwarded to CIT) upon accepting returns or
granting allowances. Upon the occurrence of an Event of Default (which is not
waived in writing by CIT) and on notice from CIT, the Company agrees that all
returned, reclaimed or repossessed merchandise or goods shall be set aside by
the Company, marked with CIT's name (as secured party) and held by the Company
for CIT's account.

         3.6 CIT shall maintain a Revolving Loan Account on its books in which
the Company will be charged with all loans and advances made by CIT to it or for
its account, and with any other Obligations, including any and all costs,
expenses and reasonable attorney's fees which CIT may incur in connection with
the exercise by or for CIT of any of the rights or powers herein conferred upon
CIT, or in the prosecution or defense of any action or proceeding to enforce or
protect any rights of CIT in connection with this Financing Agreement, the other
Loan Documents or the Collateral assigned hereunder, or any Obligations owing by
the Company. The Company will be credited with all amounts received by CIT from
the Company or from others for the Company's account, including, as above set
forth, all amounts received by CIT in payment of Accounts, and such amounts will
be applied to payment of the Obligations as set forth herein. In no event shall
prior recourse to any Accounts or other security granted to or by the Company be
a prerequisite to CIT's right to demand payment of any Obligation. Further, it
is understood that CIT shall have no obligation whatsoever to perform in any
respect any of the Company's contracts or obligations relating to the Accounts.

         3.7 After the end of each month, CIT shall promptly send the Company a
statement showing the accounting for the charges, loans, advances and other
transactions occurring between CIT and the Company during that month. The
monthly statements shall be deemed correct and binding upon the Company and
shall constitute an account stated between the Company and CIT unless CIT
receives a written statement of the exceptions within thirty (30) days of the
date of the monthly statement.

         3.8 In the event that any requested advance exceeds Availability or the
outstanding balance of Revolving Loans exceeds the lesser of the Borrowing Base
or the Revolving Line of Credit, any such nonconsensual Overadvance shall be due
and payable to CIT immediately upon CIT's demand therefor.


                                                                              18

<PAGE>   19


SECTION 4. INTENTIONALLY OMITTED

SECTION 5. INTENTIONALLY OMITTED

SECTION 6. COLLATERAL

         6.1 As security for the prompt payment in full of all Obligations, the
Company hereby pledges and grants to CIT a continuing general lien upon, and
security interest in, all of its:

         (A)      Accounts;

         (B)      Inventory;

         (C)      General Intangibles; provided however, that the interest
                  granted in General Intangibles by the Company to CIT shall be
                  solely limited to the right to use such items constituting
                  General Intangibles in connection with the liquidation of
                  Inventory after the occurrence of an Event of Default and in
                  connection with the direct collection of Accounts by CIT. The
                  rights granted to CIT shall not include any right or interest
                  to dispose of any indicia of ownership in any item
                  constituting General Intangibles and such right granted to CIT
                  shall be solely to use, as necessary, such items constituting
                  General Intangibles in connection with the aforementioned
                  liquidation of inventory and direct collection of Accounts by
                  CIT. Further, nothing contained in this grant shall limit, in
                  any way, the right or ability of the Company to issue licenses
                  to or sell or transfer any item constituting General
                  Intangibles provided that such licensure, sale or transfer
                  does not impair CIT's right to the use of such items
                  constituting General Intangibles in connection with the
                  aforementioned liquidation of inventory and direct collection
                  of Accounts;

         (D)      Documents of Title;

         (E)      Other Collateral;

         (F)      All royalty payments due to Company from Mylan Pharmaceuticals
                  Inc., provided however, that the right to receive and collect
                  such royalty payments shall not be effective until after an
                  Event of Default; and

         (G)      All proceeds and products, whether tangible or intangible, of
                  all of the foregoing, including proceeds of insurance covering
                  any or all of the foregoing.



                                                                              19


<PAGE>   20


         6.2 The security interests granted hereunder shall extend and attach
to:

         (A) All Collateral which is owned by the Company or in which the
Company has any interest, whether held by the Company or others for its account,
provided however that as to all royalty payments due to Company from Mylan
Pharmaceuticals Inc., the right to receive and collect such royalty payments
shall not be effective until after an Event of Default; and

         (B) All Inventory and any portion thereof which may be returned,
rejected, reclaimed or repossessed by either CIT or the Company from the
Company's customers, as well as to all supplies, goods, incidentals, packaging
materials, labels and any other items which contribute to the finished goods or
products manufactured or processed by the Company, or to the sale, promotion or
shipment thereof.

         6.3 The Company agrees to safeguard, protect and hold all Inventory for
CIT's account and make no disposition thereof except in the ordinary course of
its business of the Company, as herein provided. The Company represents and
warrants that Inventory will be sold and shipped by the Company to its customers
only in the ordinary course of the Company's business, and then only on open
account and on terms currently being extended by the Company to its customers,
provided that, absent the prior written consent of CIT, the Company shall not
sell Inventory on a consignment basis nor retain any lien or security interest
in any sold Inventory. Upon the sale, exchange, or other disposition of
Inventory, as herein provided, the security interest in the Inventory provided
for herein shall, without break in continuity and without further formality or
act, continue in, and attach to, all proceeds, including any instruments for the
payment of money, Trade Accounts Receivable, documents of title, shipping
documents, chattel paper and all other cash and non-cash proceeds of such sale,
exchange or disposition. As to any such sale, exchange or other disposition, CIT
shall have all of the rights of an unpaid seller, including stoppage in transit,
replevin, rescission and reclamation. The Company hereby agrees to immediately
forward any and all proceeds of Collateral to the Depository Account, and to
hold any such proceeds (including any notes and instruments), in trust for CIT
pending delivery to CIT. The Company hereby irrevocably grants CIT a royalty
free license to sell, or otherwise dispose or transfer, in accordance with
Paragraph 10.3 of Section 10 of this Financing Agreement, and the applicable
terms hereof, of any of the Inventory upon the occurrence of an Event of Default
which has not been waived in writing by CIT.

         6.4 The rights and security interests granted to CIT hereunder are to
continue in full force and effect, notwithstanding the termination of this
Financing Agreement or the fact that the Revolving Loan Account may from time to
time be temporarily in a credit position, until the final payment in full to CIT
of all Obligations and the termination of this Financing Agreement. Any delay,
or omission by CIT to exercise any right hereunder shall not be deemed a waiver
thereof, or be deemed a waiver of any other right, unless such waiver shall be
in writing and signed by CIT. A waiver on any one occasion shall not be
construed as a bar to, or waiver of, any right or remedy on any future occasion.


                                                                              20

<PAGE>   21


         6.5 Notwithstanding CIT's security interest in the Collateral and to
the extent that the Obligations are now or hereafter secured by any assets or
property other than the Collateral or by the guarantee, endorsement, assets or
property of any other person, CIT shall have the right in its sole discretion to
determine which rights, liens, security interests or remedies CIT shall at any
time pursue, foreclose upon, relinquish, subordinate, modify or take any other
action with respect to, without in any way modifying or affecting any of them,
or any of CIT's rights hereunder.

         6.6 Any balances to the credit of the Company and any other property or
assets of the Company in the possession or control of CIT may be held by CIT as
security for any Obligations and applied in whole or partial satisfaction of
such Obligations when due. The liens and security interests granted herein, and
any other lien or security interest CIT may have in any other assets of the
Company, shall secure payment and performance of all now existing and future
Obligations. CIT may in its discretion charge any or all of the Obligations to
the Revolving Loan Account when due.

         6.7 The Company possess all General Intangibles and rights thereto
necessary to conduct its business as conducted as of the Closing Date and the
Company shall maintain its rights in, and the value of, the foregoing in the
ordinary course of its business, including, without limitation, by making timely
payment with respect to any applicable licensed rights. The Company shall
deliver to CIT, and/or shall cause the appropriate party to deliver to CIT, from
time to time such pledge or security agreements with respect to General
Intangibles (now or hereafter acquired) of the Company as CIT shall require in
connection with the liquidation of Inventory or collection of Accounts. The
Company hereby irrevocably grants to CIT a royalty-free, non-exclusive license
in the General Intangibles for the sole purpose, upon the occurrence of an Event
of Default, of the right to: (i) advertise for sale and sell or transfer any
Inventory bearing any of the General Intangibles, and (ii) make, assemble,
prepare for sale or complete, or cause others to do so, any applicable raw
materials or Inventory bearing any of the General Intangibles, including use of
the Equipment for the purpose of completing the manufacture of unfinished goods,
raw materials or work-in-process comprising Inventory, and apply the proceeds
thereof to the Obligations hereunder, all as further set forth in this Financing
Agreement.

SECTION 7. REPRESENTATIONS, WARRANTIES AND COVENANTS

         7.1 The Company warrants and represents that: (i) Schedule 1 hereto
correctly and completely sets forth the Company's (A) chief executive office,
(B) Collateral locations, (C) tradenames, and (D) all the other information
listed on said Schedule; (ii) except for the Permitted Encumbrances, after
filing of financing statements in the applicable filing clerks office at the
locations set forth in Schedule 1, this Financing Agreement creates a valid,
perfected and first priority security interest in the Collateral and the
security interests granted herein constitute and shall at all times constitute
the first and only liens on the Collateral; (iii) except for the Permitted
Encumbrances, the Company is, or will be, at the time additional Collateral is
acquired by it, the absolute owner of the Collateral with full right to pledge,
sell, consign, transfer and create a security interest therein, free and clear
of any and all claims or liens in favor of others; (iv) the Company will,



                                                                              21
<PAGE>   22


at its expense, forever warrant and, at CIT's request, defend the same from any
and all claims and demands of any other person other than a holder of a
Permitted Encumbrance; and (v) the Company will not grant, create or permit to
exist, any lien upon, or security interest in, the Collateral, or any proceeds
thereof, in favor of any other person other than the holders of the Permitted
Encumbrances.

         7.2 The Company agrees to maintain books and records pertaining to the
Collateral in accordance with GAAP and in such additional detail, form and scope
as CIT shall reasonably require. The Company agrees that CIT or its agents may
enter upon the Company's premises at any time during normal business hours, and
from time to time in its reasonable business judgement, for the purpose of
inspecting the Collateral and any and all records pertaining thereto. The
Company irrevocably authorizes all accountants and third parties to disclose and
deliver directly to CIT, at the Company's expense, all financial statements and
information, books, records, work papers, management reports and other
information generated by them or in their possession regarding the Company
and/or the Collateral. In the event that CIT requests a meeting with the
Company's accountants, CIT agrees to provide reasonable prior notice to Company
of the meeting and to allow a Company representative to attend such meeting as
an observer. The Company agrees to afford CIT thirty (30) days prior written
notice of any change in the location of any Collateral, other than to locations,
that as of the Closing Date, are known to CIT and at which CIT has filed
financing statements and otherwise fully perfected its liens thereon. The
Company is also to advise CIT promptly, in sufficient detail, of any material
adverse change relating to the type, quantity or quality of the Collateral or on
the security interests granted to CIT therein.

         7.3 The Company agrees to: (a) execute and deliver to CIT, from time to
time, solely for CIT's convenience in maintaining a record of the Collateral,
such written statements, and schedules as CIT may reasonably require,
designating, identifying or describing the Collateral; (b) provide CIT, on
request, with an appraisal of the Inventory which appraisal shall be at the
Company's expense and otherwise acceptable to CIT; provided, however, that prior
to the occurrence of an Event of Default, CIT agrees that not more than two (2)
such inventory appraisals per year shall be at Company's cost; nothing contained
herein shall prevent CIT from performing or causing to have performed additional
inventory appraisals at its expense; and (c) provide CIT, on request, but no
more frequently than annually, an environmental audit report on its leasehold
and fee interests, and its waste disposal practices, which report shall be (i)
at the Company's expense and otherwise acceptable to CIT and (ii) not disclose
or indicate any material liability (real or potential) stemming from the
Company's premises, its operations, its waste disposal practices or waste
disposal sites used by the Company. The Company's failure, however, to promptly
give CIT such statements, or schedules shall not affect, diminish, modify or
otherwise limit CIT's security interests in the Collateral.

         7.4 The Company agrees to comply with the requirements of all state and
federal laws in order to grant to CIT valid and perfected first security
interests in the Collateral, subject only to the Permitted Encumbrances. CIT is
hereby authorized by the Company to file (including pursuant to the applicable
terms of the UCC) from time to time any financing statements, continuations or
amendments covering the Collateral whether or not the Company's signature
appears thereon. The



                                                                              22
<PAGE>   23


Company hereby consents to and ratifies any and all execution and/or filing of
financing statements on or prior to the Closing Date by CIT. The Company agrees
to do whatever CIT may reasonably request, from time to time, by way of: (a)
filing notices of liens, financing statements, amendments, renewals and
continuations thereof; (b) cooperating with CIT's agents and employees; (c)
keeping Collateral records; (d) transferring proceeds of Collateral to CIT's
possession; and (e) performing such further acts as CIT may reasonably require
in order to effect the purposes of this Financing Agreement.

         7.5(a) The Company agrees to maintain insurance on the Inventory under
such policies of insurance, with such insurance companies, in such reasonable
amounts and covering such insurable risks as are at all times reasonably
satisfactory to CIT. All policies covering the Inventory are to be made payable
to CIT, in case of loss, under a standard non-contributory "lender" or "secured
party" clause and are to contain such other provisions as CIT may require to
fully protect CIT's interest in the Inventory and to any payments to be made
under such policies. All original policies or true copies thereof are to be
delivered to CIT, premium prepaid, with the loss payable endorsement in CIT's
favor, and shall provide for not less than thirty (30) days prior written notice
to CIT of the exercise of any right of cancellation. At the Company's request,
or if the Company fails to maintain such insurance, CIT may arrange for such
insurance, but at the Company's expense and without any responsibility on CIT's
part for: (i) obtaining the insurance; (ii) the solvency of the insurance
companies; (iii) the adequacy of the coverage; or (iv) the collection of claims.
Upon the occurrence of an Event of Default which is not waived in writing by
CIT, CIT shall, subject to the rights of any holders of Permitted Encumbrances
holding claims senior to CIT, have the sole right, in the name of CIT or the
Company, to file claims under any insurance policies, to receive, receipt and
give acquittance for any payments that may be payable thereunder, and to execute
any and all endorsements, receipts, releases, assignments, reassignments or
other documents that may be necessary to effect the collection, compromise or
settlement of any claims under any such insurance policies.

         (b) In the event of any loss or damage by fire or other casualty,
insurance proceeds relating to Inventory shall reduce the Company's Revolving
Loans. Upon the occurrence of a Default or Event of Default, such Insurance
Proceeds may be applied to the Obligations in such order as CIT may elect.

         7.6 The Company agrees to pay, when due, all Taxes, including sales
taxes, assessments, claims and other charges lawfully levied or assessed upon
the Company or the Collateral unless such Taxes are being diligently contested
in good faith by the Company by appropriate proceedings and adequate reserves
are established in accordance with GAAP. Notwithstanding the foregoing, if any
lien shall be filed or claimed thereunder (a) for Taxes due the United States of
America, or (b) which in CIT's opinion might create a valid obligation having
priority over the rights granted to CIT herein, such lien shall not be deemed to
be a Permitted Encumbrance hereunder and the Company shall immediately pay such
tax and remove the lien of record. If the Company fails to do so promptly, then
at CIT's election, CIT may (i) create an Availability Reserve in such amount as
it may deem appropriate in its business judgement, or (ii) upon the occurrence
of a Default or Event of Default,


                                                                              23

<PAGE>   24


imminent risk of seizure, filing of any priority lien, forfeiture, or sale of
the Collateral, pay Taxes on the Company's behalf, and the amount thereof shall
be an Obligation secured hereby and due on demand.

         7.7 The Company: (a) agrees to comply with all acts, rules, regulations
and orders of any legislative, administrative or judicial body or official,
which the failure to comply with would have a material and adverse impact on the
Collateral, or any material part thereof, or on the business or operations of
the Company, provided that the Company may contest any acts, rules, regulations,
orders and directions of such bodies or officials in any reasonable manner which
will not, in CIT's reasonable opinion, materially and adversely effect CIT's
rights or priority in the Collateral; (b) agrees to comply with all
environmental statutes, acts, rules, regulations or orders as presently existing
or as adopted or amended in the future, applicable to the Collateral, the
ownership and/or use of its real property and operation of its business, which
the failure to comply with would have a material and adverse impact on the
Collateral, or any material part thereof, or on the operation of the business of
the Company; and (c) shall not be deemed to have breached any provision of this
Paragraph 7.7 if (i) the failure to comply with the requirements of this
Paragraph 7.7 resulted from good faith error or innocent omission, (ii) the
Company promptly commences and diligently pursues a cure of such breach, and
(iii) such failure is cured within (30) days following the Company's receipt of
notice of such failure, or if such cannot in good faith be cured within thirty
(30) days, then such breach is cured within a reasonable time frame based upon
the extent and nature of the breach and the necessary remediation, and in
conformity with any applicable consent order, consensual agreement and
applicable law.

         7.8 Until termination of this Financing Agreement and payment and
satisfaction of all Obligations due hereunder, the Company agrees that, unless
CIT shall have otherwise consented in writing, the Company will furnish to CIT:
(a) within ninety (90) days after the end of each Fiscal Year of the Company, an
audited Consolidated Balance Sheet, with a Consolidating Balance Sheet attached
thereto, as at the close of such year, and statements of profit and loss, cash
flow and reconciliation of surplus of the Company and its consolidated
subsidiaries for such year, audited by independent public accountants selected
by the Company and satisfactory to CIT if such accountants selected by the
Company are not among the five (5) largest accounting firms in the United
States; (b) within sixty (60) days after the end of each Fiscal Quarter a
Consolidated Balance Sheet and Consolidating Balance Sheet as at the end of such
period and statements of profit and loss, cash flow and surplus of the Company
and its consolidated subsidiaries, certified by an authorized financial or
accounting officer of the Company; (c) within thirty (30) days after the end of
each month a Consolidated Balance Sheet as at the end of such period and
statements of profit and loss, cash flow and surplus of the Company and all
subsidiaries for such period, certified by an authorized financial or accounting
officer of the Company; and (d) from time to time, such further information
regarding the business affairs and financial condition of the Company and its
consolidated subsidiaries as CIT may reasonably request, including, without
limitation (i) the accountant's management practice letter and (ii) annual cash
flow projections in form satisfactory to CIT. Each financial statement which the
Company is required to submit hereunder must be accompanied by an officer's
certificate, signed by the President, Vice President, Controller, or Treasurer,
pursuant to which any one such officer


                                                                              24

<PAGE>   25


must certify that: (x) the financial statement(s) fairly and accurately
represent(s) the Company's financial condition at the end of the particular
accounting period, as well as the Company's operating results during such
accounting period, subject to year-end audit adjustments; and (y) during the
particular accounting period: (A) there has been no Default or Event of Default
under this Financing Agreement, provided, however, that if any such officer has
knowledge that any such Default or Event of Default, has occurred during such
period, the existence of and a detailed description of same shall be set forth
in such officer's certificate; (B) the Company has not received any notice of
cancellation with respect to its property insurance policies; (C) the Company
has not received any notice that could result in a material adverse effect on
the value of the Collateral taken as a whole; and (D) the exhibits attached to
such financial statement(s) constitute detailed calculations showing compliance
with all financial covenants contained in this Financing Agreement.

         7.9 Until termination of the Financing Agreement and payment and
satisfaction of all Obligations hereunder, the Company agrees that, without the
prior written consent of CIT, except as otherwise herein provided, the Company
will not:

         (a)      Mortgage, assign, pledge, transfer or otherwise permit any
                  lien, charge, security interest, encumbrance or judgment,
                  (whether as a result of a purchase money or title retention
                  transaction, or other security interest, or otherwise) to
                  exist on any of the Collateral, whether now owned or hereafter
                  acquired, except for the Permitted Encumbrances;

         (b)      Incur or create any Indebtedness other than the Permitted
                  Indebtedness;

         (c)      Sell, lease, assign, transfer or otherwise dispose of (i)
                  Collateral, except as otherwise specifically permitted by this
                  Financing Agreement, or (ii) either all or substantially all
                  of the Company's assets, which do not constitute Collateral;

         (d)      Merge, consolidate or otherwise alter or modify its corporate
                  name, principal place of business, structure, or existence,
                  re-incorporate or re-organize, or enter into or engage in any
                  operation or activity materially different from that presently
                  being conducted by the Company, except that the Company may
                  change its corporate name or address; provided that: (i) the
                  Company shall give CIT thirty (30) days prior written notice
                  thereof, and (ii) the Company shall execute and deliver, prior
                  to or simultaneously with any such action, any and all
                  documents and agreements requested by CIT to confirm the
                  continuation and preservation of all security interests and
                  liens granted to CIT hereunder;

         (e)      Assume, guarantee, endorse, or otherwise become liable upon
                  the obligations of any person, firm, entity or corporation,
                  except by the endorsement of negotiable instruments for
                  deposit or collection or similar transactions in the ordinary
                  course of business;


                                                                              25

<PAGE>   26



         (f)      Declare or pay any dividend or distributions of any kind on,
                  or purchase, acquire, redeem or retire, any of the capital
                  stock or equity interest, of any class whatsoever, whether now
                  or hereafter outstanding, except that the Company may declare
                  and pay dividends or distributions in the ordinary course of
                  its business provided there is then no existing Default or
                  Event of Default, and provided further that after giving
                  effect to any such dividend or distribution the Company has at
                  least $250,000 in Availability for the thirty (30) day period
                  preceding such distribution or dividend;

         (g)      Make any advance or loan to, or any investment in, any firm,
                  entity, person or corporation other than advances to employees
                  for travel expenses; or

         (h)      Pay any management, consulting or other similar fees to any
                  person, corporation or other entity affiliated with the
                  Company other than on normal, fair and reasonable business
                  terms, consistent with similarly situated businesses.

                  7.10 Until termination of the Financing Agreement and payment
         and satisfaction in full of all Obligations hereunder, the Company
         shall maintain at all times during each Fiscal Year ending below a Net
         Worth of not less than the amount set forth below for the applicable
         period:

<TABLE>
<CAPTION>
         FISCAL YEAR                                          NET WORTH
         -----------                                          ---------
         <S>                                                  <C>
         (i )  For the Fiscal Year ending
         December 31, 2001                                    $20,000,000
         (ii)  For the Fiscal Year ending
         December 31, 2002                                    $15,000,000
         (iii) For the Fiscal Year ending
         December 31, 2003                                    $ 7,000,000
</TABLE>

         7.11 The Company agrees to advise CIT in writing of: (a) all
expenditures (actual or anticipated) in excess of $50,000.00 from the budgeted
amount therefor in any Fiscal Year for (i) environmental clean-up, (ii)
environmental compliance or (iii) environmental testing; and (b) any notices the
Company receives from any local, state or federal authority advising the Company
of any environmental liability (real or potential) stemming from the Company's
operations, its premises, its waste disposal practices, or waste disposal sites
used by the Company and to provide CIT with copies of all such notices if so
required.

         7.12 The Company hereby agrees to indemnify and hold harmless CIT and
its officers, directors, employees, attorneys and agents (each an "Indemnified
Party") from, and holds each of them harmless against, any and all losses,
liabilities, obligations, claims, actions, damages, costs and expenses
(including attorney's fees) and any payments made by CIT pursuant to any
indemnity



                                                                              26
<PAGE>   27


provided by CIT with respect to or to which any Indemnified Party could be
subject insofar as such losses, liabilities, obligations, claims, actions,
damages, costs, fees or expenses with respect to the Loan Documents, including
without limitation those which may arise from or relate to: (a) the Depository
Account, the Blocked Accounts, the lockbox and/or any other depository account
and/or the agreements executed in connection therewith; and (b) any and all
claims or expenses asserted against CIT as a result of any environmental
pollution, hazardous material or environmental clean-up; or any claim or expense
which results from the Company's operations (including, but not limited to, the
Company's off-site disposal practices), which CIT may sustain or incur (other
than solely as a result of the physical actions of CIT on the Company's premises
which are determined to constitute gross negligence or willful misconduct by a
court of competent jurisdiction), all whether through the alleged or actual
negligence of such person or otherwise, except and to the extent that the same
results solely and directly from the gross negligence or willful misconduct of
such Indemnified Party as finally determined by a court of competent
jurisdiction. The Company hereby agrees that this indemnity shall survive
termination of this Financing Agreement, as well as payments of Obligations
which may be due hereunder. CIT may, in its sole business judgement, establish
such Availability Reserves with respect thereto as it may deem advisable under
the circumstances and, upon any termination hereof, hold such reserves as cash
reserves for any such contingent liabilities.

         7.13 Without the prior written consent of CIT, the Company agrees that
it will not enter into any transaction, including, without limitation, any
purchase, sale, lease, loan or exchange of property with any affiliate, other
than a subsidiary of the Company, provided that, except as otherwise set forth
in this Financing Agreement, the Company may enter into sale and service
transactions and consulting agreements in the ordinary course of its business
and pursuant to the reasonable requirements of the Company, and upon standard
terms and conditions and fair and reasonable terms, no less favorable to the
Company than the Company could obtain in a comparable arms length transaction
with an unrelated third party, provided further that no Default or Event of
Default exists or will occur hereunder prior to and after giving effect to any
such transaction.

SECTION 8. INTEREST, FEES AND EXPENSES

         8.1 (a) Interest shall be payable monthly as of the end of each month
in an amount equal to the Chase Bank Rate plus one percent (1.0%) per annum on
the greater of (i) $3,000,000.00 or (ii) on the average of the net balances
owing by the Company to CIT in the Revolving Loan Account at the close of each
day during such month. In the event of any change in said Chase Bank Rate, the
rate hereunder shall change, as of the date of such change, so as to remain one
percent (1.0%) above the Chase Bank Rate. The rate hereunder shall be calculated
based on a 360-day year. CIT shall be entitled to charge the Revolving Loan
Account at the rate provided for herein when due until all Obligations have been
paid in full.

         (b) Notwithstanding any provision to the contrary contained in this
section 8, in the event that the outstanding Revolving Loans exceed the lesser
of either (x) the maximum aggregate amount



                                                                              27
<PAGE>   28


available under Section 3 of this Financing Agreement or (y) the Revolving Line
of Credit: (A) as a result of Revolving Loans advanced by CIT at the request of
the Company (herein "Requested Overadvances"), for five (5) or more days in any
month, or (B) for any other reason whatsoever (herein "Other Overadvances") and
such Other Overadvances continue for five (5) or more days in any month , the
average net balance of all Revolving Loans for such month shall bear interest at
the Overadvance Rate.

         (c) Upon and after the occurrence of an Event of Default and the giving
of any required notice by CIT in accordance with the provisions of Section 10,
Paragraph 10.2 hereof, all Obligations shall bear interest at the Default Rate
of Interest.

         8.2 Intentionally Omitted

         8.3 Intentionally Omitted

         8.4 Intentionally Omitted

         8.5 The Company shall reimburse or pay CIT, as the case may be, for:
(a) all Out-of-Pocket Expenses and (b) any applicable Documentation Fee.

         8.6 Upon the last Business Day of each month, commencing on January 31,
2001, the Company shall pay to CIT (i) the Line of Credit Fee, and (ii)
interest. Interest will be computed at the rate, and in the manner, set forth in
Paragraph 8.1 of this Financing Agreement.

         8.7 To induce CIT to enter into this Financing Agreement and to extend
to the Company the Revolving Loan, the Company shall pay to CIT a Loan Facility
Fee in the amount of $90,000.00 on the Closing Date.

         8.8 On the Closing Date and each anniversary of the Closing Date
thereafter, the Company shall pay to CIT the Administrative Management Fee in
the amount of $25,000.00. Upon early termination no rebate or refund of the
annual Administrative Management Fee shall occur.

         8.9 The Company shall pay CIT's standard charges and fees for CIT's
personnel used by CIT for reviewing the books and records of the Company and for
verifying, testing, protecting, safeguarding, preserving or disposing of all or
any part of the Collateral (which fees shall be in addition to the
Administrative Management Fee and any Out-of-Pocket Expenses).

         8.10 The Company hereby authorizes CIT to charge the Revolving Loan
Account with the amount of all payments due hereunder as such payments become
due. The Company confirms that any charges which CIT may so make to the
Revolving Loan Account as herein provided will be made as an accommodation to
the Company and solely at CIT's discretion.



                                                                              28
<PAGE>   29



         8.11 In the event that CIT (or any financial institution which may from
time to time become a lender hereunder) shall have determined in the exercise of
its reasonable business judgement that, subsequent to the Closing Date, any
change in applicable law, rule, regulation or guideline regarding capital
adequacy, or any change in the interpretation or administration thereof, or
compliance by CIT with any new request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on CIT's capital as a consequence of its obligations hereunder to a level below
that which CIT could have achieved but for such adoption, change or compliance
(taking into consideration CIT's policies with respect to capital adequacy) by
an amount reasonably deemed by CIT to be material, then, from time to time, the
Company shall pay no later than five (5) days following demand to CIT such
additional amount or amounts as will compensate CIT for such reduction. In
determining such amount or amounts, CIT may use any reasonable averaging or
attribution methods. The protection of this Paragraph 8.11 shall be available to
CIT regardless of any possible contention of invalidity or inapplicability with
respect to the applicable law, regulation or condition. A certificate of CIT
setting forth such amount or amounts as shall be necessary to compensate CIT
with respect to this Section 8 and the calculation thereof when delivered to the
Company shall be conclusive on the Company absent manifest error.
Notwithstanding anything in this paragraph to the contrary, in the event CIT has
exercised its rights pursuant to this paragraph, and subsequent thereto
determines that the additional amounts paid by the Company in whole or in part
exceed the amount which CIT actually required to be made whole, the excess, if
any, shall be returned to the Company by CIT.

         8.12. In the event that any applicable law, treaty or governmental
regulation, or any change therein or in the interpretation or application
thereof, or compliance by CIT with any request or directive (whether or not
having the force of law) from any central bank or other financial, monetary or
other authority, shall:

         (a) subject CIT to any tax of any kind whatsoever with respect to this
Financing Agreement or change the basis of taxation of payments to CIT of
principal, fees, interest or any other amount payable hereunder or under any
other documents (except for taxes on the income of CIT, changes in the rate of
tax on the overall net income of CIT by the federal government or the
jurisdiction in which it maintains its principal office);

         (b) impose, modify or hold applicable any reserve, special deposit,
assessment or similar requirement against assets held by, or deposits in or for
the account of, advances or loans by, or other credit extended by CIT by reason
of or in respect to this Financing Agreement and the Loan Documents, including
(without limitation) pursuant to Regulation D of the Board of Governors of the
Federal Reserve System; or

         (c) impose on CIT any other condition with respect to this Financing
Agreement or any other document, and the result of any of the foregoing is to
increase the cost to CIT of making, renewing or maintaining its loans hereunder
by an amount that CIT deems to be material in the exercise of its reasonable
business judgement or to reduce the amount of any payment (whether of


                                                                              29

<PAGE>   30


principal, interest or otherwise) in respect of any of the loans by an amount
that CIT deems to be material in the exercise of its reasonable business
judgement, then, in any case the Company shall pay CIT, within five (5) days
following its demand, such additional cost or such reduction, as the case may
be. CIT shall certify the amount of such additional cost or reduced amount to
the Company and the calculation thereof and such certification shall be
conclusive upon the Company absent manifest error. Notwithstanding anything in
this paragraph to the contrary, in the event CIT has exercised its rights
pursuant to this paragraph, and subsequent thereto determine that the additional
amounts paid by the Company in whole or in part exceed the amount which CIT
actually required pursuant hereto, the excess, if any, shall be returned to the
Company by CIT.

SECTION 9. POWERS

         The Company hereby constitutes CIT, or any person or agent CIT may
designate, as its attorney-in-fact, at the Company's cost and expense, to
exercise all of the following powers, which being coupled with an interest,
shall be irrevocable until all Obligations to CIT have been paid in full:

         (a) To receive, take, endorse, sign, assign and deliver, all in the
name of CIT or the Company, any and all checks, notes, drafts, and other
documents or instruments relating to the Collateral;

         (b) To receive, open and dispose of all mail addressed to the Company
and to notify postal authorities to change the address for delivery thereof to
such address as CIT may designate;

         (c) To request from customers indebted on Accounts at any time, in the
name of CIT information concerning the amounts owing on the Accounts;

         (d) To request from customers indebted on Accounts at any time, in the
name of the Company, in the name of certified public accountant designated by
CIT or in the name of CIT's designee, information concerning the amounts owing
on the Accounts;

         (e) To transmit to customers indebted on Accounts notice of CIT's
interest therein and to notify customers indebted on Accounts to make payment
directly to CIT for the Company's account; and

         (f) To take or bring, in the name of CIT or the Company, all steps,
actions, suits or proceedings deemed by CIT necessary or desirable to enforce or
effect collection of the Accounts.

         Notwithstanding anything hereinabove contained to the contrary, the
powers set forth in (b) and (f) above may only be exercised after the occurrence
of an Event of Default and until such time as such Event of Default is waived in
writing by CIT.

SECTION 10. EVENTS OF DEFAULT AND REMEDIES


                                                                              30

<PAGE>   31


         10.1 Notwithstanding anything hereinabove to the contrary, CIT may
terminate this Financing Agreement immediately upon the occurrence of any of the
following Events of Default:

         (a)      cessation of the business of the Company or the calling of a
                  meeting of the creditors of the Company for purposes of
                  compromising the debts and obligations of the Company; or

         (b)      the failure of the Company to generally meet its debts as they
                  mature; or

         (c)      (i) the commencement by the Company of any bankruptcy,
                  insolvency, arrangement, reorganization, receivership or
                  similar proceedings under any federal or state law; (ii) the
                  commencement against the Company of any bankruptcy,
                  insolvency, arrangement, reorganization, receivership or
                  similar proceeding under any federal or state law by creditors
                  of the Company, provided that such Default shall not be deemed
                  an Event of Default if such proceeding is controverted within
                  ten (10) days and dismissed and vacated within thirty (30)
                  days of commencement, except in the event that any of the
                  actions sought in any such proceeding shall occur or the
                  Company shall take action to authorize or effect any of the
                  actions in any such proceeding; or (iii) the commencement (x)
                  by the Company's subsidiaries, or any one of them, of any
                  bankruptcy, insolvency, arrangement, reorganization,
                  receivership or similar proceeding under any applicable state
                  law, or (y) against the Company's subsidiaries, or any one of
                  them, of any involuntary bankruptcy, insolvency, arrangement,
                  reorganization, receivership or similar proceeding under
                  applicable law, provided that such Default shall not be deemed
                  an Event of Default if such proceeding is controverted within
                  ten (10) days and dismissed or vacated within thirty (30) days
                  of commencement, except in the event that any of the actions
                  sought in any such proceeding shall occur or the Company's
                  subsidiaries, or any one of them, shall take action to
                  authorize or effect any of the actions in any such proceeding;
                  or

         (d)      breach by the Company of any warranty, representation or
                  covenant contained herein (other than those referred to in
                  sub-paragraph (e) below) or in any other written agreement
                  between the Company or CIT, provided that such Default by the
                  Company of any of the warranties, representations or covenants
                  referred in this clause (d) shall not be deemed to be an Event
                  of Default unless and until such Default shall remain
                  unremedied to CIT's satisfaction for a period of ten (10) days
                  from the date of such breach; or

         (e)      breach by the Company of any warranty, representation or
                  covenant of Paragraphs 3.3 (other than the fourth sentence of
                  Paragraph 3.3) and 3.4 of Section 3 hereof; Paragraphs 6.3 and
                  6.4 (other than the first sentence of Paragraph 6.4) of
                  Section 6 hereof; Paragraphs 7.1, 7.5, 7.6, and 7.8 through
                  7.13 hereof; or


                                                                              31

<PAGE>   32


         (f)      failure of the Company to pay any of the Obligations on the
                  due date thereof, provided that nothing contained herein shall
                  prohibit CIT from charging such amounts to the Revolving Loan
                  Account on the due date thereof; or

         (g)      the Company shall (i) engage in any "prohibited transaction"
                  as defined in ERISA, (ii) have any "accumulated funding
                  deficiency" as defined in ERISA, (iii) have any "reportable
                  event" as defined in ERISA, (iv) terminate any "plan", as
                  defined in ERISA or (v) be engaged in any proceeding in which
                  the Pension Benefit Guaranty Corporation shall seek
                  appointment, or is appointed, as trustee or administrator of
                  any "plan", as defined in ERISA, and with respect to this
                  sub-paragraph (h) such event or condition (x) remains uncured
                  for a period of thirty (30) days from date of occurrence and
                  (y) could, in the reasonable opinion of CIT, subject the
                  Company to any tax, penalty or other liability material to the
                  business, operations or financial condition of the Company; or

         (h)      the occurrence of any default or event of default (after
                  giving effect to any applicable grace or cure periods) under
                  any instrument or agreement for Indebtedness of the Company
                  having a principal amount in excess of $250,000; or

         (i)      any judgment or judgments aggregating in excess of $100,000.00
                  or any injunction or attachment is obtained or enforced
                  against Company and which remains unstayed for more than ten
                  (10) Business Days; or

         (j)      If Jennifer Good ceases for any reason whatsoever (other than
                  as a result of death or dismissal for fraud, defalcation,
                  embezzlement or the like) to be actively engaged as Vice
                  President-Finance and Chief Financial Officer in the
                  management of the Company and an acceptable replacement is not
                  employed within 180 days of the cessation of employment of
                  Jennifer Good, or if Tod R. Hamachek ceases for any reason
                  whatsoever (other than as a result of death or dismissal for
                  fraud, defalcation, embezzlement or the like) to be actively
                  engaged as Chairman of the Board or Chief Executive Officer in
                  the management of the Company and an acceptable replacement is
                  not employed within 180 days of the cessation of employment of
                  Tod R. Hamachek.

         10.2 Upon the occurrence of a Default and/or an Event of Default, at
the option of CIT, all loans, advances and extensions of credit provided for in
Section 3 of this Financing Agreement shall be thereafter in CIT's sole
discretion and the obligation of CIT to make Revolving Loans shall cease unless
such Default is cured to CIT's satisfaction or Event of Default is waived in
writing by CIT, and at the option of CIT upon the occurrence of an Event of
Default: (a) all Obligations shall become immediately due and payable; (b) CIT
may charge the Company the Default Rate of Interest on all then outstanding or
thereafter incurred Obligations in lieu of the interest provided for in Section
8 of this Financing Agreement, and (c) CIT may immediately terminate this
Financing Agreement upon notice to the Company; provided, however, that upon the
occurrence of an Event of Default

                                                                              32
<PAGE>   33


listed in Paragraph 10.1(c) of this Section 10, this Financing Agreement shall
automatically terminate and all Obligations shall become due and payable,
without any action, declaration, notice or demand by CIT. The exercise of any
option is not exclusive of any other option, which may be exercised at any time
by CIT.

         10.3 Immediately upon the occurrence of any Event of Default, CIT may,
to the extent permitted by law: (a) remove from any premises where same may be
located any and all books and records, computers, electronic media and software
programs associated with any Collateral (including any electronic records,
contracts and signatures pertaining thereto), documents, instruments, files and
records, and any receptacles or cabinets containing same, relating to the
Accounts, or CIT may use, at the Company's expense, such of the Company's
personnel, supplies or space at the Company's places of business or otherwise,
as may be necessary to properly administer and control the Accounts or the
handling of collections and realizations thereon; (b) bring suit, in the name of
the Company or CIT, and generally shall have all other rights respecting said
Accounts, including without limitation the right to: accelerate or extend the
time of payment, settle, compromise, release in whole or in part any amounts
owing on any Accounts and issue credits in the name of the Company or CIT; (c)
sell, assign and deliver the Collateral and any returned, reclaimed or
repossessed Inventory, with or without advertisement, at public or private sale,
for cash, on credit or otherwise, at CIT's sole option and discretion, and CIT
may bid or become a purchaser at any such sale, free from any right of
redemption, which right is hereby expressly waived by the Company; (d) foreclose
the security interests in the Collateral created herein or by the Loan Documents
by any available judicial procedure, or to take possession of any or all of the
Collateral, including any Inventory and/or Other Collateral without judicial
process, and to enter any premises where any Inventory and/or Other Collateral
may be located for the purpose of taking possession of or removing the same; and
(e) exercise any other rights and remedies provided in law, in equity, by
contract or otherwise. CIT shall have the right, without notice or
advertisement, to sell, lease, or otherwise dispose of all or any part of the
Collateral, whether in its then condition or after further preparation or
processing, in the name of the Company or CIT, or in the name of such other
party as CIT may designate, either at public or private sale or at any broker's
board, in lots or in bulk, for cash or for credit, with or without warranties or
representations, and upon such other terms and conditions as CIT in its sole
discretion may deem advisable, and CIT, to the extent provided by law, shall
have the right to purchase at any such sale. If any Inventory shall require
preparation, CIT shall have the right, at its option, to do such of the
preparation as is necessary, for the purpose of putting the Inventory in such
saleable form as CIT shall deem appropriate and any such costs shall be deemed
an Obligation hereunder. The Company agrees, at the request of CIT, to assemble
the Inventory and to make it available to CIT at premises of the Company or
elsewhere and to make available to CIT the premises and facilities of the
Company for the purpose of CIT's taking possession of, removing or putting the
Inventory in saleable form. If notice of intended disposition of any Collateral
is required by law, it is agreed that ten (10) days notice shall constitute
reasonable notification and full compliance with the law. The net cash proceeds
resulting from CIT's exercise of any of the foregoing rights, (after deducting
all charges, costs and expenses, including reasonable attorneys' fees) shall be
applied by CIT to the payment of the Obligations, whether due or to become due,
in such order as CIT may elect, and the Company shall remain liable to CIT for
any


                                                                              33

<PAGE>   34


deficiencies, and CIT in turn agrees to remit to the Company or its successors
or assigns, any surplus resulting therefrom. The enumeration of the foregoing
rights is not intended to be exhaustive and the exercise of any right shall not
preclude the exercise of any other rights, all of which shall be cumulative. The
Company hereby indemnifies CIT and holds CIT harmless from any and all costs,
expenses, claims, liabilities, Out-of-Pocket Expenses or otherwise, incurred or
imposed on CIT by reason of the exercise of any of its rights, remedies and
interests hereunder, including, without limitation, from any sale or transfer of
Collateral, preserving, maintaining or securing the Collateral, defending its
interests in Collateral (including pursuant to any claims brought by the
Company, the Company as debtor-in-possession, any secured or unsecured creditors
of the Company, any trustee or receiver in bankruptcy, or otherwise), and the
Company hereby agrees to so indemnify and hold CIT harmless, absent CIT's gross
negligence or willful misconduct as finally determined by a court of competent
jurisdiction. The foregoing indemnification shall survive termination of this
Financing Agreement until such time as all Obligations (including the foregoing)
have been finally and indefeasibly paid in full. In furtherance thereof CIT, may
establish such reserves for Obligations hereunder (including any contingent
Obligations) as it may deem advisable in its reasonable business judgement.

SECTION 11. TERMINATION

         Except as otherwise permitted herein, CIT may terminate this Financing
Agreement only as of the initial or any subsequent Anniversary Date and then
only by giving the Company at least sixty (60) days prior written notice of
termination. Notwithstanding the foregoing CIT may terminate the Financing
Agreement immediately upon the occurrence of an Event of Default, provided,
however, that if the Event of Default is an event listed in Paragraph 10.1(c) of
Section 10 of this Financing Agreement, this Financing Agreement shall terminate
in accordance with paragraph 10.2 of Section 10. This Financing Agreement,
unless terminated as herein provided, shall automatically continue from
Anniversary Date to Anniversary Date. The Company may terminate this Financing
Agreement at any time upon sixty (60) days' prior written notice to CIT,
provided that the Company pays to CIT immediately on demand an Early Termination
Fee. In the event of a sale of a substantial portion of the assets of Company,
the Company may terminate this Financing Agreement at any time upon thirty (30)
days' prior written notice to CIT, provided that the Company pays to CIT
immediately on demand an Early Termination Fee. All Obligations shall become due
and payable as of any termination hereunder or under Section 10 hereof and,
pending a final accounting, CIT may withhold any balances in the Company's
account (unless supplied with an indemnity satisfactory to CIT) to cover all of
the Obligations, whether absolute or contingent, including, but not limited to,
cash reserves for any contingent Obligations.

SECTION 12. MISCELLANEOUS

         12.1 Except as specifically provided for here, the Company hereby
waives diligence, notice of intent to accelerate, notice of acceleration,
demand, presentment and protest and any notices thereof as well as notice of
nonpayment. No delay or omission of CIT or the Company to exercise any right or
remedy hereunder, whether before or after the happening of any Event of Default,
shall


                                                                              34

<PAGE>   35


impair any such right or shall operate as a waiver thereof or as a waiver of any
such Event of Default. No single or partial exercise by CIT of any right or
remedy precludes any other or further exercise thereof, or precludes any other
right or remedy.

         12.2 This Financing Agreement and the Loan Documents executed and
delivered in connection therewith constitute the entire agreement between the
Company and CIT; supersede any prior agreements; can be changed only by a
writing signed by both the Company and CIT; and shall bind and benefit the
Company and CIT and their respective successors and assigns.

         12.3 In no event shall the Company, upon demand by CIT for payment of
any Indebtedness relating hereto, by acceleration of the maturity thereof, or
otherwise, be obligated to pay interest and fees in excess of the amount
permitted by law. Regardless of any provision herein or in any agreement made in
connection herewith, CIT shall never be entitled to receive, charge or apply, as
interest on any indebtedness relating hereto, any amount in excess of the
maximum amount of interest permissible under applicable law. If CIT ever
receives, collects or applies any such excess, it shall be deemed a partial
repayment of principal and treated as such; and if principal is paid in full,
any remaining excess shall be refunded to the Company. This paragraph shall
control every other provision hereof, the Loan Documents and of any other
agreement made in connection herewith.

         12.4 If any provision hereof or of any other agreement made in
connection herewith is held to be illegal or unenforceable, such provision shall
be fully severable, and the remaining provisions of the applicable agreement
shall remain in full force and effect and shall not be affected by such
provision's severance. Furthermore, in lieu of any such provision, there shall
be added automatically as a part of the applicable agreement a legal and
enforceable provision as similar in terms to the severed provision as may be
possible.

         12.5 THE COMPANY AND CIT EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR PROCEEDING ARISING OUT OF THE LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED THEREUNDER. THE COMPANY HEREBY IRREVOCABLY WAIVES
PERSONAL SERVICE OF PROCESS AND CONSENTS TO SERVICE OF PROCESS BY CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED. IN NO EVENT WILL CIT BE LIABLE FOR
LOST PROFITS OR OTHER SPECIAL OR CONSEQUENTIAL DAMAGES.

         12.6 Except as otherwise herein provided, any notice or other
communication required hereunder shall be in writing (provided that, any
electronic communications from the Company with respect to any request,
transmission, document, electronic signature, electronic mail or facsimile
transmission shall be deemed binding on the Company for purposes of this
Financing Agreement, provided further that any such transmission shall not
relieve the Company from any other obligation hereunder to communicate further
in writing), and shall be deemed to have been validly served, given or delivered
when hand delivered or sent by facsimile, or three days after deposit in the
United State mails, with proper first class postage prepaid and addressed to the
party to be notified or to such other address as any party hereto may designate
for itself by like notice, as follows:



                                                                              35
<PAGE>   36


         (A) if to CIT, at:

                  The CIT Group/Business Credit, Inc.
                  1211 Avenue of the Americas
                  22nd Floor
                  New York, New York 10036
                  Attn:  Regional Credit Manager
                  Fax No.: 212-536-1295

         (B) if to the Company at:

                  Penwest Pharmaceuticals Co.
                  2981 Route 22
                  Patterson, New York 12563-9970
                  Attn: Jennifer L. Good, Vice President-Finance and
                        Chief Financial Officer
                  845-878-3498 (fax)

With a courtesy copy of any material notice to the Company's counsel at:

                  Steven Singer, Esq.
                  Hale and Dorr
                  60 State Street
                  Boston, Massachusetts 02109
                  617-526-5000 (fax)


provided, however, that the failure of CIT to provide the Company's counsel with
a copy of such notice shall not invalidate any notice given to the Company and
shall not give the Company any rights, claims or defenses due to the failure of
CIT to provide such additional notice.

         12.7 THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS FINANCING
AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT ANY OTHER LOAN DOCUMENT INCLUDES AN
EXPRESS ELECTION TO BE GOVERNED BY THE LAWS OF ANOTHER JURISDICTION.

         12.8 a. CONCERNING REVISED ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE.
The parties acknowledge and agree to the following provisions of this Agreement
in anticipation of the possible application, in one or more jurisdiction's to
the transactions contemplated hereby, of the revised Article 9 of the Uniform
Commercial Code in the form or substantially in the form approved by the
American Law Institute and the National Conference of Commissioners on Uniform
State Law and contained in the 1999 Official Text of the Uniform Commercial Code
("Revised Article 9").

         b. ATTACHMENT. In applying the law of any jurisdiction in which Revised
Article 9 is


                                                                              36

<PAGE>   37


in effect, the Collateral of the Debtor, whether or not within the scope of
Revised Article 9. The Collateral shall include, without limitation, the
following categories of assets as defined in Revised Article 9: inventory,
instruments arising from the sale of inventory or the collection of Accounts
(including promissory notes), documents arising from the sale of inventory or
the collection of Accounts, accounts, chattel paper (whether tangible or
electronic), deposit accounts arising from the sale of inventory or the
collection of Accounts, letter-of-credit rights arising from the sale of
inventory or the collection of Accounts (whether or not the letter of credit is
evidenced by a writing), general intangibles arising from the sale of inventory
or the collection of Accounts (including payment intangibles), supporting
obligations and any and all proceeds of any thereof, wherever located, whether
now owned and hereafter acquired.

         c. ADDITIONAL GRANT OF SECURITY INTEREST IN SPECIFIED PROPERTY. Debtor
acknowledges and agrees that in anticipation of the possible application, in one
or more jurisdictions of the revised Article 9 of the Uniform Commercial Code in
the form or substantially in the form approved by the American Law Institute and
the National Conference of Commissioners on Uniform State Law and contained in
the 1999 Official Text of the Uniform Commercial Code ("Revised Article 9") that
the Debtor, in addition to the items previously described as constituting
Collateral hereby gives, grants, bargains, assigns and confirms that it has
granted a security interest in the following now owned or hereafter acquired and
wherever located properties, assets and rights of the Debtor:

         All other rights, arising from the sale or disposition of Inventory or
collection of Accounts, to payment of money, insurance refund claims and other
insurance claims and proceeds, tort claims, electronic chattel paper, securities
and other investment property, rights to proceeds of letters of credit, letter
of credit rights, supporting obligations of every nature.

Debtor acknowledges and agrees that, with respect to any term used herein that
is defined in either (a) Article 9 of the Uniform Commercial Code as in force in
the jurisdiction in which this financing statement was signed by the Debtor at
the time that it was signed or (b) Article 9 as in force at any relevant time in
the jurisdiction in which this financing statement is filed, the meaning to be
ascribed thereto with respect to any particular item of property shall be that
under the more encompassing of the two definitions.

         d. PERFECTION BY FILING. The Secured Party may at any time and from
time to time, pursuant to the provisions of Section 7.4 hereof, file financing
statements, continuation statements and amendments thereto that describe the
Collateral as all assets of the Debtor or words of similar effect and which
contain any other information required by Part 5 of Revised Article 9 for the
sufficiency or filing office acceptance of any financing statement, continuation
statement or amendment, including whether the Debtor is an organization, the
type of organization and any organization identification number issued to the
Debtor. The Debtor agrees to furnish any such information to the Secured Party
promptly upon request. Any such financing statements, continuation statements or
amendment may be signed by the Secured Party on behalf of the Debtor, as
provided in Section 7.4 hereof, and may be filed at any time in any jurisdiction
whether or not Revised Article 9 is then in effect in that jurisdiction.


                                                                              37

<PAGE>   38


         e. OTHER PERFECTION, ETC. The Debtor shall at any time and from time to
time, whether or not Revised Article 9 is in effect in any particular
jurisdiction, take such steps as the Secured Party may reasonably request for
the Secured Party (a) to obtain an acknowledgment, in form and substance
satisfactory to the Secured Party, of any bailee having possession of any of the
Collateral that the bailee holds such Collateral for the Secured Party, (b) to
obtain "control" of any deposit accounts, letter-of-credit rights or electronic
chattel paper (as such terms are defined in Revised Article 9 with corresponding
provisions in Rev. ss.ss. 9-104, 9-105, 9-106 and 9-107 relating to what
constitutes "control" for such items of Collateral) arising from the sale of
inventory or the collection of Accounts, and (c) otherwise to insure the
continued perfection and priority of the Secured Party's security interest in
any of the Collateral and of the preservation of its rights therein, whether in
anticipation and following the effectiveness of Revised Article 9 in any
jurisdiction.

         f. OTHER PROVISIONS. In applying the law of any jurisdiction in which
Revised Article 9 is in effect, the following references to sections of existing
Article 9 of that jurisdiction shall be to the Revised Article 9 Section of that
jurisdiction as indicated below:

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Existing Article 9                    Revised Article 9
--------------------------------------------------------------------------------
<S>                                   <C>
ss.9-103(3)                           Rev.ss.9-102(a)(34)
--------------------------------------------------------------------------------
ss.9-207                              Rev.ss.9-207
--------------------------------------------------------------------------------
ss.ss.8-106 and 9-115 (1994)          Rev.ss.ss.8-106 and 9-106
--------------------------------------------------------------------------------
ss.9-504(1)(c)                        Rev.ss.ss.9-608(a)(1)(C) and 9-615(a)(3)
--------------------------------------------------------------------------------
</TABLE>



                                                                              38

<PAGE>   39



         g. SAVINGS CLAUSE. Nothing contained in this Section shall be construed
to narrow the scope of the Secured Party's security interest in any of the
Collateral or the perfection or priority thereof or to impair or otherwise limit
any of the rights, powers, privileges or remedies of the Secured Party hereunder
except (and then only to the extent) mandated by Revised Article 9 to the extent
then applicable.

         IN WITNESS WHEREOF, the parties hereto have caused this Financing
Agreement to be effective, executed, accepted and delivered at New York, New
York, by their proper and duly authorized officers as of the date set forth
above.

PENWEST PHARMACEUTICALS CO.                THE CIT GROUP/
                                           BUSINESS CREDIT, INC.

By: /s/ Jennifer L. Good                   By: /s/ Eddy L. Milstein-V.P.
   --------------------------------           --------------------------------
Jennifer L. Good
Vice President-Finance and
   Chief Financial Officer


                                                                              39

<PAGE>   40


                       SCHEDULE 1 - COLLATERAL INFORMATION

EXACT COMPANY NAME IN STATE OF ORGANIZATION:

PENWEST PHARMACEUTICALS CO.

STATE OF INCORPORATION OR FORMATION:

WASHINGTON

FEDERAL TAX I.D. NO.

91-1513032

CHIEF EXECUTIVE OFFICE:

2981 Route 22
Patterson, New York 12563-9970

COLLATERAL LOCATIONS:

2981 Route 22, Patterson, New York 12563-9970
801 First Avenue, Cedar Rapids, Iowa 52404
Roe Movers, 7 Tucker Drive, Poughkeepsie, New York 12603-1645
Strugar, 2867 South Vail Avenue, Commerce, California 90040-2613
CRT & S, 3350 10th Street SW, Cedar Rapids, Iowa 52404-3936
CR Transfer, 1201 9th Street SW, Cedar Rapids, Iowa 52404
OT Delivery System, 1 Lawrence Street, Ardsley, New York 10502-2603




                                                                              40